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vil Appeal No. 113 of 1953. Appeal from the Judgment and Decree, dated the 25th day of March, 1952, of the High Court of Judicature at Bombay (Bavdekar and Dixit JJ.) in Appeal No. 554 of 1951, from Original Decree arising out of the Judgment and Decree, dated the 30th day of June, 1951, of the Court of the Joint Civil Judge, Senior Division of Thana, in Special Suit No. 12 of 1949. K. section Krishnaswamy lyengar, (J. B. Dadachanji, V.B. Rege and Ganpat Rai, with him) for the appellants. section B. Jathar, R. B. Kotwal and Naunit Lal for respondent No. 1. 1954. April 12. The Judgment of the Court was delivered by GHULAM HASAN J. This appeal is brought by leave of the High Court of Bombay against the judgment and decree of a Division Bench of that Court (Bavdekar and Dixit JJ.) dated March 25, 1952, modifying the judgment and decree of the Civil Judge, Senior Division of Thana, dated June 30, 1951. The appeal arises out of a partition between 6 brothers of a joint Hindu family. The joint family carried on joint family business of a grocery shop, liquor shops, a ration shop, a motor bus service and also moneylending under the name of "Sontakke Brothers". The family also Possessed immovable and movable property. Balkrishna Sitaram Sontakke is the eldest of the brothers and is the plaintiff respondent in the present appeal. He will be referred to hereafter as the plain tiff. It is common ground that up to 1944 the brothers were living and messing together and the income from 101 the family business used to be kept with the plaintiff. From April 14, 1945, the situation changed and the parties began to appropriate the proceeds of the various businesses carried on by them separately to themselves. The plaintiff was running the liquor shops, defendants Nos. I and 2 who are the appellants, were carrying on the motor bus service business while defendant No. 4 was running the grocery shop. The parties tried to have partition effected between them through arbitrators but the attempt failed. On June 29, 1945, all the five brothers filed a suit for partition against the plaintiff of all joint family properties including the accounts of all the businesses. The suit was numbered 39 of 1945. It was compromised on March 7, 1946. By this compromise it was declared that prior to 1942 all the accounts of the various businesses had been correctly maintained and shown, that the parties had agreed to have arbitrators appointed through Court for examining the accounts from 1942 up to March 31, 1946, and for determining the amount due up to that date. Each of the brothers was to get one sixth share in the cash balance as found on March 31, 1946, upon examination of accounts by the arbitrators. All the movable property of the joint family including the stock in trade of all the family businesses was to be divided equally among all the brothers. The compromise further declared that the plaintiff was to have one sixth share in the motor garage and that defendants 1 and 2 were to pay the price of one sixth share to him. These are the material provisions of the compromise. One of the brothers was a minor and the Court finding the compromise to be for the benefit of the minor accepted it and passed a pre liminary decree in terms of the compromise on July 25, 1947. If nothing else had happened to disturb the natural course of events, the proceedings would have ended in a final decree for partition. The plaintiff, however, commenced a fresh suit on February 23, 1949, confining his relief to his share of the profits and assets Of the motor business carried on by defendants Nos. 1 and 2 after March 31,1946. His case was that the compromise was made in a hurry, that the parties omitted to provide in the compromise about the future conduct 102 of the motor business from April 1, 1946, that the motor business was still a joint family business and that he had a right to ask for accounts of that business subsequent to March 31, 1946. In defence it was pleaded that the compromise was made after due deliberation, that accounts of the motor 'business and grocery shop should actually have been taken up to April 14, 1945, the date of disruption of the joint family status, but the parties agreed by way of compromise that account of all family businesses should be taken up to March 31, 1946. It was also pleaded that the claim was barred by res judicata. Upon the issues framed in the case the Civil Judge found that the suit was not. barred by reason of the decision in the previous suit No. 39 of 1945, that the decision in that suit was not obtained by fraud and misrepresentation and that the compromise in the previous suit was not due to a mistake or misunderstanding. Despite these findings the Civil Judge held that although the motor business carried on after the partition had ceased to be a joint family business yet as it was carried on by some members of a family their position was analogous to that of a partner carrying on partnership after dissolution and applying the principle underlying section 37 of the Partnership Act he held that the two brothers carrying on the motor business were liable to account. Accordingly he passed a preliminary decree directing the accounts of the motor business to be taken from March 31, 1946, up to the date on which a final decree for payment of the amount found to be due would be made. A Commissioner was appointed to take the accounts to ascertain the profits earned by the use of the capital belonging to the shares of brothers other than those who carried on the motor business. In appeal Bavdekar 'J. with whom Dixit J. agreed modified the decree of the trial Court by directing that the accounts were to be taken up to the date when the businesses discontinued and not up to the date of the final decree. The learned Judges held that the cause of action for the present suit was different from the cause. of action in the previous suit and that the suit was not barred 103 by res judicata or by Order II, rule 2, of the Code of Civil Procedure. After delivering themselves of some conflicting observations to which reference will in detail be made hereafter they held that the consent decree did not expressly negative the right for accounts of the motor transport business. Finally the learned Judges recorded the conclusion that regardless of the pleadings in the case the defendants Nos. I and 2 had made use of the joint family property and that they stood in, the position of co owners and as contemplated in section 90 of the Indian Trusts Act were liable to render accounts for the profits which were attributable to the employment of the assets owned by the parties jointly. Learned counsel for the appellants has contested the view of the High Court upon all the points decided, ,against them. He has contended that the cause of action in a suit for partition is the desire and intention of the family to separate, that the cause of action in the two suits is identically the same and not separate and distinct and. that the suit was, therefore, barred both by the principle of res judicata and by Order II, rule 2, of the Civil Procedure Code. Learned counsel also challenged the view of the High Court about the applicability of section 90 of the Indian Trusts Act It seems to us that upon a fair reading of the compromise arrived at between the parties in the circumstances then existing, the only legitimate conclusion possible is that the parties had agreed to confine the taking of all accounts upto March 31,1946, and had closed the door to reopening them beyond that date. If the compromise was arrived at after full consideration by the parties and was not vitiated by fraud, misrepresentation, mistake or misunderstanding as held by the trial Court a finding which was not interfered with by the High Court it follows that a matter once concluded between the parties who were dealing with each other at arms length cannot now be reopened. What led the parties to confine the period of account to March 31, 1946, and stop further accounting which would have normally extended to the passing of the final decree will appear from the following circumstances. The plaintiff knew that the licence for the liquor shops 104 carried on by him was expiring on the 1st April, 1946, and he was anxious to run the liquor business exclusively and not jointly or in partnership with his brothers after the expiry of the licence. He gave a notice to his brothers through pleader on December 12, 1945, stating inter alia the following : "The period of (licence for) the liquor shops at the said places expires by end of March, 1946. Hence after the expiry of the said period, my client having no desire to conduct liquor shop business jointly or in partnership with any of you again, he intends to run and will run as from the date 1st April, 1946, one or more liquor shops as he pleases belonging to him alone independently. The moneys that will be required for (purchase in) auction of the shops will be paid by my client by borrowing the same from third parties on his own responsibility and my client will not allow the said moneys to have the least connection with the businesses, properties and cash which are at present in dispute in Court and with the profits and income from the said businesses or properties. My client expressly informs you by this notice of the fact, viz., that the liquor shops thus purchased by him will solely belong to him and will be run by him independently of any of you. None of you will have any legal right to meddle with or interfere in the liquor shops which will be thus purchased by my client in the Government auction for the new year beginning from 1st April, 1946, and if any of you make an attempt with malicious intention to cause even the slightest interference in the said business of my client, then my client will hold you fully responsible for any harm suffered by him and for other damages and expenses incurred by him and will take a severe legal action against you therefor. " This notice furnishes a true guide as to the intention of the plaintiff which was none other than that he should run the liquor shops exclusively for himself and appropriate the profits thereof without making himself accountable to his brothers. Although the plaintiff says that he intended to pay for the auction of liquor shops by borrowing he was really in a position of vantage for he admittedly had Rs. 13,000 cash in hand as 105 against the Rs. 3,000 his brothers had. The notice explains the significance of the provision in the compromise that accounts are to be taken only up to March 31, 1946. Since the plaintiff did not want his brothers to interfere with his exclusive running of the liquor business after March 31, 1946, he perforce had to agree that he should sever his connection with other businesses run by his brothers. This arrangement was apparently acceptable to all the brothers as being fair and reasonable and as not giving undue advantage to any party over the other. This being our construction of the compromise, it follows that the plaintiff 's conduct in going back upon that arrangement by filing a fresh suit in regard to the motor business only is anything but honest. The plaint filed in the previous suit leaves no manner of doubt that the plaintiffs in that suit ,sought a complete division of all the family property both movable and immovable and a final determination of all the accounts in respect of the family businesses. It is also significant that after the compromise the plaintiff (Balkrishna) filed an application before the Civil Judge in which he alleged that when he agreed in the compromise that the accounts of the various businesses should be up to the 31st March, 1946, he was under a misapprehension regarding his legal right inasmuch as he thought that when the accounts were to be taken up to a certain date, 'the joint family property after that date would not be allowed to be utilized by some members only of the family for making profits for themselves to the exclusion of the plaintiff. He goes on to say that he laboured under the impression that the joint family business would be either altogether stopped after the 31st March, 1946, or would be run either by the arbitrators or the Commissioners and the profits accruing therefrom would be deposited in Court for distribution among the parties according to their shares. The application was made on November 22, 1947. His pleader, however, stated on April 6, 1948: " The application is abandoned by the applicant as he wishes to pursue his remedy by way of an independent suit for the grievance in the application," and the Court passed the order, "The application is disposed of as 14 106 it is not pressed." The learned Judges of the High Court in referring to this application observe thus: " It is obvious therefrom that really speaking the idea of the profits of several businesses after the 1st of April, 1946, was present to the minds of the parties; but the parties did not care to ask that accounts of the other businesses will be taken up after the 1st of April, 1946. One of the businesses was a liquor business, which admittedly was to come to an end on the 31st of March, 1946; but there was also another business; that Was a kirana shop, which was not a very big business. But all the same it was there, and there is force, therefore, in the contention which has been advanced on behalf of the appellants that it was not as if there has been an oversight on the part of the parties, but the parties knew that the businesses might go on afterwards; but if they were carried on, they did not particularly care for providing by the compromise decree for accounts of those businesses being taken after the 1st of April, 1946. " Having said all this they record the conclusion that the compromise did not expressly negative the right of the plaintiff to an account of motor business. We are unable to accept this conclusion. The observations quoted above negative the plaintiff 's case about mistake or misunderstanding in regard to the true effect of the compromise and show that the plaintiff abandoned the right to Account after the crucial date and the status of the parties thereafter changed into one of tenants in common. If the plaintiff really intended that accounts of the motor business or indeed of all other businesses were to be taken up to the date of the 'final decree, there was no point in mentioning the 31st March, 1946. The normal course, after the preliminary decree was passed by the Court, was to divide all the property by metes and bounds and to award monies as found on examination of the accounts right up to the date of the final decree. But for the compromise which limited the period of the account the plaintiff would have obtained the relief he is now seeking, in the partition suit as accounts would have been taken of all the businesses up to the date of the final decree. The plaintiff has himself to thank for preventing the natural 107 course of events and for forbidding the accounts to be taken after the 31st March, 1946. The plaintiff on the other hand has no real grievance in the matter, for although the defendants Nos. 1 and 2, who continued to run the motor business, may have made some money with the help of the two old motor buses, the plaintiff whose keenness to run the liquor business is apparent from the notice referred to above was not precluded from reaping the fruits of that business. It is hard to conceive that the plaintiff would have agreed to share his burden of the loss if the motor business had sustained any. We hold, therefore, that the compromise closed once for all the controversy about taking any account of the joint family businesses including the motor business after the 31st March ', 1946, and the plaintiff is bound by the terms of the compromise and the consent decree following upon it. The obvious effect of this finding is that the plaintiff is barred by the principle of res judicata from reaitating the question in the present suit. It is well settled that a consent decree is as binding upon the parties thereto as a decree passed by invitum. The compromise having been found not to be vitiated by fraud, misrepresentation, misunderstanding or mistake, the decree passed thereon has the binding force of res judicata. We are also of opinion that the plaintiff 's claim is barred by the provisions of Order II, rule 2(3), of the Code of Civil Procedure. The plaintiff by confining his claim to account up to March 3, 1946, only, implicitly of not explicitly, relinquished his claim to the account for the subsequent period. Sub rule 3 clearly lays down that if a person Omits, except with the leave of the Court, to sue for all reliefs to which he is entitled, he shall not afterwards sue for any relief so omitted. We do not agree with the High Court that the cause of action in the subsequent suit was different from the cause of action in the first suit. The cause of action in the first suit was the desire of the plaintiff to separate from his brothers and to divide the joint family property. That suit embraced the entire property without any reservation and was compromised, the plaintiff having abandoned his claim to account in respect of 108 the motor business subsequent to March 31, 1946. His subsequent suit to enforce a part of the claim is founded on the same cause of action which he deliberately relinquished. We are clear, therefore, that the cause of action in the two suits being the same, the suit is barred under Order II, rule 2(3), of the Civil Procedure Code. As the. suit is barred both by res judicata and Order II, rule 2(3), of the Civil Procedure Code, no further question as to the applicability of section 90 of the Indian Trusts Act can possibly arise under the circumstances. The result is that we allow the appeal and dismiss the suit with costs throughout. Appeal allowed.
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It’s a well-known legal rule that a consent decree (an agreement approved by a court) is just as binding as a court order made after a trial. If a settlement isn't based on fraud, lies, misunderstanding, or error, then the court's decision based on that settlement is final and prevents the same issue from being brought up again in court. This is called "res judicata." If a plaintiff (the person suing) limits their claim to a specific time, they are giving up any claim for later times, even if they don't say it directly. This is because a legal rule says that if someone doesn't ask for all the relief they could get in a lawsuit, they can't sue for that missing relief later, unless they got permission from the court first.
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The State of West Bengal & Ors.
1. Learned senior advocate for the State Mr. Kar
has raised the point of maintainability and
has submitted that the maintainability point
be kept open and to be decided later.
2. However, I find that there cannot be any
doubt about the maintainability of this writ
application and I am satisfied from Annexure
P-7 of the writ application that the writ
application is not delayed. Annexure P-7 is an
order passed by the appellate authority under
the Right to Information Act, 2005. From that
Annexure P-7 it appears that the Right to
Information application was made in 2018.
The first appeal in respect of the said RTI
application was filed on 23.10.2018. The
second appeal was filed before the
Commission on 10.12.2018 and the date of
hearing was 13.04.2021. Therefore, the
question of delay on the part of the petitioner
cannot come in the way of maintainability of
the writ application. The petitioner appeared
in Teachers Eligibility Test 2014.
3. Mr. Gupta, learned senior advocate for the
West Bengal Board of Primary Education, has
submitted that the petitioner's allegation in
respect of the persons named in pages 74 and
75 of the writ application is baseless as they
got one mark for one wrong question in
Teacher Eligibility Test-2014 and after getting
that one mark all of them have been qualified
in the TET and, therefore, they have been
recruited along with other candidates totalling
to 269. He further submits that this was done
as per the resolution dated 30.11.2017
communicated to the Chairperson of Hooghly,
District Primary School Council dated
04.12.2017. In respect of other set of
candidates, as appears in page 78 of the writ
application, against whom the allegation is,
they have been given appointment though
some of them were not qualified, Mr. Gupta
has submitted that he has to take instruction
in this regard.
4. Mr. Gupta has also submitted that he will file
a report before this court within a short time.
I direct the West Bengal Board of Primary
Education to file the said report in the form of
an affidavit on 15th June, 2022.
5. In this matter annexing one facebook page of
one Mr. Upendra Nath Biswas, who was the
Additional Director of CBI and also a minister
in the first five years of the present
Government, the petitioner has alleged that
he has named one “Ranjan”, who is in the
business of selling job of primary school
teachers. The petitioner has pleaded that the
actual name of this ‘Ranjan’ is Chandan
Mondal of Bagda, North 24 Parganas. It has
also been alleged that he has special tie up
with the Minister Level, Education
Department of Government of West Bengal.
6. I direct the petitioner to add said Mr. Upendra
Nath Biswas and said Chandan Mondal, who
has been termed as ‘Ranjan’ as party
respondents in course of the day.
7. Serious allegation by one responsible person,
who was none other than the Ex-Additional
Director of CBI and a Cabinet Minister of the
State Government in the first five years of the
Government, has come before this court
which is serious corrupt practice. I hold this
aspect is to be thoroughly investigated by the
CBI and such investigation is required to be
started forthwith. The Police of this State is
otherwise very efficient but controlled by
some persons in power and cannot act freely
which is common knowledge and without
showing any disrespect to the Police authority
I hold that CBI is the appropriate authority to
investigate the matter.
8. CBI shall have every power to call and
interrogate the said Chandan Mondal and it is
expected that the erstwhile Additional
Director, Mr. Upendra Nath Biswas will fully
cooperate with the CBI to expose the scam of
selling jobs as has been alleged. The CBI shall
register a case in this regard and start
investigation. CBI shall have every power to
take into custody the said Chandan Mondal
for interrogation if he does not cooperate with
9. Learned counsel for CBI, Mr. Billwadal
Bhattacharya, is present and I direct Mr.
Bhattacharya as well as learned advocate for
the petitioner, Mr. Firdous Samim, to
communicate this order immediately to CBI.
It is expected that CBI will start its action
immediately.
10. This matter will appear on 15th June, 2022
when the report of the West Bengal Board of
Primary Education will be filed in the form of
an affidavit and a status report of CBI will
also be filed before this court in a sealed
cover.
List the matter accordingly.
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On Wednesday, the Calcutta High Court ordered the Central Bureau of Investigation (CBI) to look into a case about hiring primary school teachers. The court also told the CBI to give its report in a sealed envelope by June 15.
The person who filed the case told Justice Abhijit Gangopadhyay that a former state minister and police officer, Upendra Nath Biswas, had accused Chandan Mondal. Mondal, from Bagda in North 24 Parganas, was allegedly giving primary school teacher jobs in exchange for money. It's important to know that Upendra Nath Biswas himself used to be an additional director of the CBI. The court also heard claims that Mondal was working secretly with ministers from West Bengal's Education Department.
When the court ordered the CBI investigation, it emphasized:
"A very serious accusation has come before this court. It was made by a trustworthy person, who was a former Additional Director of the CBI and a state Cabinet Minister. This accusation points to serious corruption. I believe the CBI must fully investigate this matter, and the investigation needs to start right away. While the state police are usually very good at their job, everyone knows they are controlled by some powerful people and cannot act freely. So, without disrespecting the police, I believe the CBI is the right agency to investigate this case."
The court also stated that the CBI has full power to call in and question Chandan Mondal, who is accused in the case. Former state minister Upendra Nath Biswas was also told to work completely with the CBI to help reveal this alleged scam of selling jobs.
Therefore, the CBI was told to give an update report in a sealed envelope by the next court hearing, which is scheduled for June 15.
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, right in holding that Respondent No. From the Judgment and order dated 17.10. 1986 of the Rajasthan High Court in D.B. Civil Special (Writ) Appeals Nos. 27,28 of 1983 and 224 of 1982. Tapas Ray, S.K. Jain, Mrs. P.Jain and section Atreya for the Respondents. The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J. The appeals are disposed of by the judgment herein. 1 Shri Kishan Bhageria was working under the appellant company as an Internal Auditor on a monthly salary of Rs.1186.60 per month. The appellant alleged that the respondent started absenting himself from 28.1.78 and as such was not entitled to any salary for any period beyond 28.1.78 The said respondent was thereafter placed under suspension on 30th of March, 1978. The respondent on 4th of May, 1978 filed an application under section 33C(2) of the (hereinafter called 'the Act ') claiming the total sum of Rs.4,746.40 on account of salary from Ist of January, 1978 to 30th of April, 1978 at the rate of Rs.11,86.60 per month. The appellant company objected. The main ground of objections was that the respondent was not a workman. On or about 9th of November, 1978 there was an order dismissing the respondent from service. The respondent thereafter on 2nd of January, 1979 filed an application under section 28A of the Rajasthan Shops & Establishments Act, 1958 (hereinafter called 'the Rajasthan Act '). The said application was dismissed on 31st of July 1979 on the ground of limitation. The Labour Court on 2nd of August, 1979 held that the respondent was doing clerical duties and as such was a workman under the Act and he was entitled to Rs.2,060 as salary from 1.1.78 to 9.3.78. The appellant filed Writ Petition No. 765 of 1979 in the Rajasthan High Court against the order of the Labour Court allowing the said salary. The respondent also filed another writ petition being writ petition No. 1091 of 1979 for declaration that he was entitled to receive Rs.2,066.98 as salary from 9.3.78 to 30.4.78. There was thereafter a reference under section 10 of the Act on 8.8.80 arising out of the dismissal of the respondent. The appellant filed another writ petition being Writ Petition No. 1623 of 1980 challenging the order of reference. All these aforesaid writ petitions were disposed of by the learned Single Judge of the Rajasthan High Court on 16.3.82 holding that the respondent was not a workman. The other contentions urged before the leaned Single Judge were not considered by the Division Bench in the view it took later on. On 17th of October, 1986 the Division Bench reversed the judgment of the learned Single Judge and held that the respondent was a workman. Two writ petitions of the appellant were dismissed and the writ petition of the respondent was allowed. Aggrieved by the aforesaid orders the appellant has come up in these appeals before this Court. The main question which requires consideration in these appeals is whether the respondent was a workman or not. For the determination of this question it is necessary to refer to section 2(s) of the Act which defines "workman" and states that it means any person emp 990 loyed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms of employment be express or implied, and includes any such person who has been dismissed discharged or retrenched in connection with or as a consequence of any dispute. But sub clause (iii) does not include any person who is employed mainly in a managerial or administrative capacity and sub clause (iv) does not include any person who being employed in a supervisory capacity draws wages exceeding one thousand six hundred rupees per month or duties attached to the office or by reason of the powers vested in him, discharges functions mainly of a managerial nature. In view of the said definition, we are concerned here with the question whether the respondent was a workman as not being employed in any supervisory capacity. There is no controversy that the said respondent is not employed in any managerial or administrative capacity. In this case before we deal with the facts and the relevant authorities of this Court it may be appropriate to refer to a decision of P.B. Mukharji, J. Of the Calcutta High Court as the learned Chief Justice then was in Mcleod and Co. vs Sixth Industrial Tribunal, West Bengal and others, A.I.R. 1958 Calcutta 273. There the learned Judge observed that whether a person was a workman within the definition of the was the very foundation of the jurisdiction of the Industrial Tribunal. The Court further observed that in order to determine the categories of service indicated by the use of different words like "supervisory", "managerial", "administrative", it was necessary not to import the notions of one into the interpretation of the other. It has to be broadly interpreted from a common sense point of view where tests will be simple both in theory and in their application. The learned Judge further observed that a supervisor need not be a manager or an administrator and a supervisor can be a workman so long as he did not exceed the monetary limitation indicated in the section and a supervisor irrespective of his salary is not a workman who has to discharge functions mainly of managerial nature by reasons of the duties attached to his office or of the powers vested in him. In that case the learned Judge further held that a person in charge of a Department could not ordinarily be a clerk even though he may not have power to take disciplinary action or even though he may have another superior 991 officer above him. It was further observed that distribution of work may easily be the work of a manager or an administrator but "checking" the work so distributed or "keeping an eye" over it is certainly supervision. It is reiterated that a manager or administrator 's work may easily include supervision but that does not mean that supervision is the only function of a manager or an administrator. Bearing in mind the aforesaid indication, it would be necessary to discuss some decisions of this Court. In All India Reserve Bank Employees Association vs Reserve Bank of India, ; , this Court dealing with certain types of employees observed "These employees distribute work, detect faults, report for penalty, make arrangements for filling vacancies, to mention only a few of the duties which are supervisory and not merely clerical." At page 46 of the report Hidayatullah, J. as the learned Chief Justice then was observed that the work in a Bank involved layer upon layer of checkers and checking is hardly supervision but where there is a power of assigning duties and distribution of work there is supervision, (emphasis supplied). There the Court referred to a previous decision in Llyods Bank Ltd. vs Pannalal Gupta, , where the finding of the Labour Appellate Tribunal was reversed because the legal inference from proved facts was wrongly drawn and it was reiterated that before a clerk could claim a special allowance payable to a supervisor, he must prove that he supervises the work of some others who are in a sense below him. It was pointed out by Hidayatullah, J. that mere checking of the work of others is not enough because this checking was a part of accounting and not of supervision and the work done in the audit department of a bank was not supervision. (emphasis supplied). vs Burmah Shell Management Staff Association & Ors., ; , this Court observed that a workman must be held to be employed to do that work which is the main work he is required to do, even though he may be incidentally doing other types of work. Therefore, in determining which of the employees in the various categories are covered by the definition of 'workman ' one has to see what is the main or substantial work which he is employed to do. In The Punjab Co operative Bank Ltd. vs R.S. That did not make the respondent employed in a managerial or administrative capacity. The workman was, therefore, in that context rightly held as a clerk. 992 In P. Maheshwari vs Delhi Administration & Ors., ; the question whether a person was performing supervisory or managerial work was the question of fact to be decided bearing in mind the correct principle. The principle therefore is, one must look into the main work and that must be found out from the main duties. A supervisor was one who could bind the company to take some kind of decision on behalf of the company. One who was reporting merely as to the affairs of the company and making assessment for the purpose of reporting was not a supervisor. At page 1290, "Supervisor" has been described, inter alia, as follows: "In a broad sense, one having authority over others, to superintend and direct. The term 'supervisor ' means any individual having authority, in the interest of the employer, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibility to direct them, or to adjust their grievances, or effectively to recommend such action, if in connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment. " Reference may be made to the observations of this Court in Ved Prakash Gupta vs M/s. Delton Cable India (P) Ltd., ; There on facts a Security Inspector was held to be a workman. At page 575 of the report this Court referred to the decision in Llyods Bank Ltd. vs Panna Lal Gupta, (supra) and also the observations of this Court in Hind Construction and Engineering Company Ltd. vs Their Workmen, In that case the nature of the duties performed by the appellant showed that the substantial part of the work of the appellant consisted of looking after the security of the factory and its property by deputing the watchmen working under him to work at the factory gate or sending them to watch towers or around the factory or to accompany visitors to the factory and making entries in the visitors ' register as regards the visitors and in the concerned registers as regards materials entering into or going out of the premises of the factory. There it was found that he had no power to appoint. In the instant case the evidence have been summarised by the Division Bench. Reference may be made to pages 65, 73, 80, 84 to 94, 993 95, 96 and 97 of the Paper Book which indicate the nature of duties performed by the respondent No. His duties were mainly, reporting and checking up on behalf of the management. A reporter or a checking clerk is not a supervisor. The respondent herein does not appear to us doing any kind of supervisory work. He was undoubtedly checking up on behalf of the employer but he had no independent right or authority to take decision and his decision did not bind the company. In that view of the matter keeping the correct principle of law in mind the Division Bench has come to the conclusion taking into consideration the evidence recorded before the Labour Court that the respondent is a workman and not a supervisor. That conclusion arrived at in the manner indicated above cannot, in our opinion, be interfered with under Article 136 of the Constitution. It is not necessary for our present purpose to set out in extenso the evidence on record as discussed by the Division Bench. Our attention was, however, drawn by the counsel for the respondent to certain correspondence, for instance the letter at page 65 of the paper book bearing the date 14th of May, 1976 where the respondent reported that certain materials were lying in stores deptt. in absence of any decision. It was further reiterated that on inspection of the pieces that those pieces were found cracked. We are of the opinion that the Division Bench was right that these letters only indicated that the report was being made of the checking done by the respondent. A checker on behalf of the management or employer is not a supervisor. In the aforesaid view of the matter the conclusion of the Division Bench that respondent No. 1 is a workman has to be sustained. We do so accordingly. The next question that arises in this case is whether Act would apply or the Rajasthan Act would apply. In this connection section 28A of the Rajasthan Act is material. It enjoins that no employer shall dismiss or discharge from his employment any employee who has been in such employment continuously for a period of not less than 6 months except for a reasonable cause and after giving such employee at least one month 's prior notice or on paying him one month 's wages in lieu of such notice. Sub section (2) of section 28A gives every employee, so dismissed or discharged, right to make a complaint in writing in the prescribed manner to a prescribed authority within 30 days of the receipt of the order of dismissal or discharge. Section 37 of the Rajasthan Act reads as follows: "37. Saving of certain rights and privileges. Nothing in this Act shall affect any rights or privileges which an employee in any establishment is entitled to on the date this Act comes into force under any other law, contract, custom or usage applicable to such establishment or any award, settlement or agreement binding on the employer and the employee in such establishment, if such rights or privileges are more favourable to him than those to which he would be entitled under this Act. " It has to be borne in mind that section 2A of the Act was amended to permit individual workman to ask for a reference in the case of individual dispute. The Rajasthan Act received the assent of the President on 14th of July, 1958. On 8th March, 1972 Chapter 6A including section 28A was inserted in the Rajasthan Act. Therefore the material provision of the Rajasthan Act is the subsequent law. Under Article 254(2) of the Constitution if there was any law by the State which had been reserved for the assent of the President and has received the assent of the President, the State law would prevail in that State even if there is an earlier law by the Parliament on a subject in the Concurrent List. It appears that both of these Acts tread the same field and if there was any conflict with each other, then section 28A of Rajasthan Act would apply being a later law. We find, however, that there is no conflict. The learned Single Judge of the Rajasthan High Court in Poonam Talkies, Dausa vs The Presiding Officer, Labour Court, Jaipur, (S.B. Civil Writ Petition No. That decision has been upheld by the Division Bench of the Rajasthan High Court in Writ Appeal No. The Division Bench of the High Court in the instant appeal relying on the said decision held that there was no scope for any repugnancy. It appears to us that it cannot be said that these two Acts do not tread the same field. Both these Acts deal with the rights of the workman or employee to get redressal and damages in case of dismissal or discharge, but there is no repugnancy because there is no conflict between these two Acts, in pith and substance. There is no inconsistency between these two acts. These two Acts, in our opinion, are supplemental to each other. Though there may be no direct conflict, a State law may be inoperative because the Commonwealth Code is intended to be a complete exhaustive code; and 3. Even in the absence of intention, a conflict may arise when both State and Commonwealth seek to exercise their powers over the same subject matter. " Quoting the aforesaid observations, this Court in M/s. Hoechst Pharmaceuticals Ltd. and others vs State of Bihar and others; , at page 87 where A.P. Sen, J. exhaustively dealt with the principles of repugnancy and observed that one of the occasions where inconsistency or repugnancy arose was when on the same subject matter, one law would be repugnant to the other. Therefore, in order to raise a question of repugnancy two conditions must be fulfilled. The State law and the Union law must operate on the same field and one must be repugnant or inconsistent with the other. These are two conditions which are required to be fulfilled. These are cumulative conditions. Therefore, these laws must tread on the same field and these must be repugnant or inconsistent with each other. In our opinion, in this case there is a good deal of justification to hold that these laws, the and the Rajasthan Act tread on the same field and both laws deal with the rights of dismissed workman or employee. But these two laws are not inconsistent or repugnant to each other. That is not the position in this case. Learned counsel on behalf of the appellant, however, contended that in this case, there had been an application as indicated above under section 28A of the Rajasthan Act and which was dismissed on ground of limitation. Sree Shankar Ghosh tried to submit that there would be inconsistency or repugnancy between the two decisions, one given on limitation and the other if any 996 relief is given under the Act. We are unable to accept this position, because the application under Section 28A of the Rajasthan Act was dismissed not on merit but on limitation. There is a period of limitation provided under the Rajasthan Act of six months and it may be extended for reasonable cause. But there is no period of limitation provided under the . Therefore, that will be curtailment of the rights of the workmen or employees under the . In the situation section 37 declares that law should not be construed to curtail any of the rights of the workmen. It will be a well settled principle of interpretation to proceed on that assumption and section 37 of the Rajasthan Act must be so construed. Therefore in no way the Rajasthan Act could be construed to curtail the rights of the workman to seek any relief or to go in for an adjudication in case of the termination of the employment. If that is the position in view of the provisions 6 months ' time in section 28A of the Rajasthan Act has to be ignored and that cannot have any binding effect inasmuch as it curtails the rights of the workman under the and that Act must prevail. In the premises, there is no conflict between the two Acts and there is no question of repugnancy. The High Court was, therefore, right in holding that the respondent was workman and in granting relief on that basis. Before we conclude we note that our attention was drawn to certain observations of this Court that interference by the High Court in these matters at the initial stage protracts adjudication and defeats justice. Reference was made to certain observations in P. Maheshwari vs Delhi Admn. & Ors., (supra). But as mentioned hereinbefore in this case, the interference was made by the High Court not at the initial stage. In the premises, we are of the opinion that the High Court was right in the view it took. These appeals, therefore, fail and are accordingly dismissed. There will, however, be no order as to costs. Appeals dismissed.
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The first person involved worked for the company as an Internal Auditor and earned about Rs. 1186 per month. The company said that the person stopped coming to work on January 28, 1978. Because of this, they shouldn't get paid for any time after that date, according to the company. The person was then suspended from work on March 30, 1978. On May 4, 1978, the person asked for Rs. They used a specific section of the law to make this request. The company disagreed, saying the person wasn't a "workman" (someone protected by labor laws). On November 9, 1978, the company fired the person. On January 2, 1979, the person made another request under a different law, the Rajasthan Shops and Commercial Establishments Act, 1958. This request was turned down on July 31, 1979, because it was filed too late. On August 2, 1979, the Labour Court (a special court for workers) said the person did office work and was therefore a "workman." They were entitled to about Rs. 2060 as salary from March 9, 1978, to April 30, 1978. A judge from the High Court (a state-level court) dealt with all these issues on March 16, 1982, and decided the person wasn't a "workman." The company's legal papers were dismissed, while the person's legal paper was accepted. The company disagreed with these orders and appealed to a higher court. The questions were: (1) Was the person a "workman" under the definition of a specific section of the law? (2) Which law applied in this case: the main labor law or the Rajasthan Shops and Commercial Establishments Act, 1958? (a) Whether someone is doing supervisory or managerial work is a matter of fact. Someone who just reports on the company's affairs and makes assessments for reporting purposes is not a supervisor. [992A B] (b) In this case, it's clear that the person wasn't in a managerial or administrative position. Giving out work can be a manager's job, but "checking" the work or "keeping an eye" on it is supervision. A manager's job might include supervision, but supervision isn't the *only* thing a manager does. Supervision involves the power to assign duties and distribute work. (c) A checker for the management isn't a supervisor. [993E] In this case, the person's job mainly involved reporting and checking for the management. A reporter or checking clerk isn't a supervisor. The person didn't seem to be doing any supervisory work. They were checking for the company, but they didn't have the independent power to make decisions, and their decisions didn't bind the company. The court decided the person was a "workman" based on the evidence presented to the Labour Court, which showed they were a worker, not a supervisor. (a) To argue that two laws are in conflict, two things must be true: the state law and the national law must cover the same topic, and one must contradict the other. [995E] Two previous court cases were referenced. (b) In this case, it's reasonable to say that the laws—the main labor law and the Rajasthan Shops and Commercial Establishments Act, 1985—cover the same area. Both laws deal with the rights of a fired worker or employee. But these two laws don't contradict each other. The main test for contradiction is whether one law would prevent the other from being followed. That's not the situation here. [995F G] (c) The request under the Rajasthan Act was turned down because it was filed too late, not because it was wrong. The Rajasthan Act has a deadline for filing requests, which can be extended for a good reason. But the main labor law doesn't have a specific deadline. So, enforcing the deadline in the Rajasthan Act would limit the rights of workers or employees under the main labor law. Section 37 of the main labor law says that the law shouldn't be interpreted to limit workers' rights. We should assume this when interpreting laws, and Section 37 of the Rajasthan Act should be understood in this way. The Rajasthan Act shouldn't be interpreted to limit a worker's right to seek help or take legal action if they are fired. [996C] (e) So, there's no conflict between the main labor law and the Rajasthan Shops and Commercial Establishments Act, 1985, and there's no question of contradiction. The two laws support each other. [994G H; 996D]
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Criminal Appeal No. 46, of 1969. Appeal under Article 134(1)(c) of the Constitution of India from the judgment and order dated December 10, 1968, of the Patna High Court in Criminal Appeal No. 116 of 1966. section M. Mishra and section section Jauhar, for the appellant. B. P. Jha, for the respondent. The Judgment of the Court was delivered by Khanna, J. The short question which arises for determination in this appeal on certificate granted by Patna High Court is whether the appellant who was less than 21 years of age on the date of his conviction for an offence under section 326 read with section 149 Indian Penal Code, can claim the, benefit of section 6, of the (Act No. 20 of 1958). , 876 The appellant and five others, who belong to village Mandil in District Gaya, were tried in the court of Additional Sessions Judge Gaya for offences under sections 147, 148, 307, 323 and 307 read with section 149 Indian Penal Code and section 25 of the Arms Act. Jugal Kishore appellant was convicted under section 326 read with section 149 and section 148 Indian Penal Code and was sentenced to undergo rigorous imprisonment for a period of five years on the first count and rigorous imprisonment for a, period of two years on the second count. The sentences awarded to the appellant were ordered to run concurrently. The other five accused were also convicted for various offences and were sentenced on those counts. On appeal the Patna High Court as per judgment dated January 22, 1968 acquitted two of the accused. The conviction of the appellant for offences under section 326 read with section 149 and 148 Indian Penal Code was maintained. The sentence of the appellant for the offence under section 326 read with section 149 Indian Penal Code was reduced from five years to three years. The sentence for the offence under section 148 Indian Penal Code was, however, maintained. The conviction of the other three accused was maintained for some of the offences, and they were awarded sentences of imprisonment on that count. After the pro nouncement of the judgment by the High Court, an application was made on behalf of the appellant that his case be deal; with under the on the ground that he wag below 21 years of age at the time of his conviction by the trial court. This application was rejected by the High Court as per ,order dated December 12, 1968 on the ground that the offence for which the appellant had been convicted was punishable with imprisonment for life, and as such, the provisions of could no be invoked in his case. On prayer made by the appellant, the High Court certified the case to be fit for appeal to the Supreme Court as it involved the question relating to the applicability of the . The appellant and his companions were tried on the allegation that on October 14, 1964 at about 10 a.m., while Madho Saran was getting his field bearing No. 1678 ploughed by his ploughman Rakshya Mahto, the appellant and Raghu accused went there and questioned Madho Saran for cutting the ridge between field No. 1678 and 1719. Field No. 1719 belonged to the appellant. Madho Saran went to his house and narrated the incident to his brother Sadho Saran. Madho Saran and Sadho Saran along with others then came out of their house and while they were near a barrage, they met the accused who were accompanied by about 30 person of their village. One of the accused, namely, Hira Lal, who was armed with a gun, fired a shot as a result of which Sadho 'Saran was hit on his head. Sadho Saran fell down, whereafter 87 7 the other accused, including the appellant who was armed with a garasa, caused further injuries to Sadho Saran and his companions with sharp edged and blunt weapons. The injured were thereafter taken to Jehanabad Hospital. On receipt of intimation from the doctor incharge of the hospital, a police Sub Inspector went to the hospital and recorded the statement of Madho Saran, Nand Kishore, one of the accused, also lodged a report at the police station. The question with which we are concerned in this appeal, as mentioned earlier, is whether the appellant can claim the benefit of the . The appellant gave. his age to be 19 years in his statement under Section 342 of the Code of Criminal Procedure, and the case has been argued before us on the assumption that the appellant was less than 21 years of age at the time of his conviction by the Additional Sessions Judge. The main offence for which the appellant has been convicted is section 326 read with section 149 Indian Penal Code. Section 326 deals with the offence of voluntarily causing grievous hurt by dangerous weapons or means and the punishment prescribed for the offence is imprisonment for life, or imprisonment of either description for a term which may extend to ten years. The convicted person shall also be liable to pay fine. According to section 149 of the Code, if an offence is committed by any member of an unlawful assembly in prosecution of the common object of that assembly, or such as the members of that assembly knew to be likely to be committed in prosecution of that object, every person who, at the time of the committing of that offence, is a member of the same assembly, is guilty of that offence. It is. , therefore, manifest that the appellant on being convicted for the offence under section 326 read with section 149 Indian Penal Code was liable to be punished for imprisonment for life or with imprisonment of either description for a term which may extend to ten years and was also liable to pay fine. The was enacted in 1958 with a view to provide for the release of offenders of certain categories on probation or after due admonition and for matters connected therewith. The object of the Act is to prevent the conversion of youthful offenders into obdurate criminals as a result of their association with hardened criminals of mature age in case the youthful offenders are sentenced to undergo imprisonment in jail. The above object is in consonance with the present trend in the field of penology, according to which effort should be made to bring about correction and reformation of the individual offenders and not to resort to retributive justice. Modern criminal jurisprudence recognises that no one is a born criminal and that good many crimes are the product of socioeconomic milieu. Although net much can be done for hardened criminals, considerable stress has 878 been laid on bringing about reform of young offenders not guilty of very serious offences and of preventing their association with hardened criminals. The Act gives statutory recognition to the above objective. It is, therefore provided that youthful offenders should not be sent to jail, except in certain circumstances. Before, however, the benefit of the Act can be invoked, it has to be shown that the convicted person even though less than 21 years of age, is not guilty of an offence punishable with imprisonment for life. This is clear from the language of section 6 of the Act. Sub section (1) of that section reads as under "When any person under twenty one years of age. is found guilty of having committed an offence punishable with imprisonment (but not with imprisonment for life), the Court by which the per son is found guilty shall not sentence him to imprisonment unless it is satisfied that, having regard to the circumstances of the case including the nature of the offence and the character of the offender, it would not be desirable to deal with him under section 3 or section 4, and if the Court passes any sentence of imprisonment on the offender, it shall record its reasons for doing so. " Mr. Misra on behalf of the appellant has urged that as the offence under section 326 read with section 149 Indian Penal Code is punishable not only with imprisonment for life but also with imprisonment which may extend up to ten years, the benefit of section 6 of the Act can be invoked by the appellant. This contention, in our opinion, is not well founded. Plain reading of section 6 makes it manifest that it deals with persons under twenty one years of age who are found guilty of having committed an offence punishable with imprisonment but not with imprisonment for life. As imprisonment for life can also be awarded for the offence under section 326 read with section 149 Indian Penal Code, a person found guilty of such an offence would not be entitled to claim the benefit of section 6. To hold otherwise. would have the effect of ignoring the words "but not with imprisonment for life" and treating them to be otiose. Such a construction is plainly not permissible. We also cannot subscribe to the view that the offences excluded from the purview of the section are only those offences wherein punishment prescribed is imprisonment for life and not for a lesser term, for the language used in the section does not warrant such a view. On the contrary, the ,Plain meaning of the section is that the section cannot be invoked by a person who is convicted for an offence punishable with imprisonment for life. The fact that imprisonment for a lesser term can also be awarded for the offence would not take it out of the category of offences punishable with imprisonment for life. The policy underlying the Act appears to be that it is only in 879 cases of not very serious nature, viz., offences not punishable with imprisonment for life that the convicted person should have the benefit of provisions of the Act. Where, however, the offence for which a person has been convicted is of a serious nature punishable with imprisonment for life, the benefit of the Act would not be permissible in his case. Likewise, there are certain offences like those under the Prevention of Corruption Act wherein the convicted person cannot claim the protection of the Act. Section 18 of the Act expresser excludes such offences from the purview of the Act. In the case of Som Nath Puri vs State of Rajasthan (1) the appellant had been convicted for an offence under section 409 Indian Penal Code. Punishment for the offence under section 409 Indian Penal Code is the same as for the offence under section 326, namely, imprisonment for life, or imprisonment of either description for a term which may extend to ten years and the liability to pay fine. It was held by this Court that in such a case the provisions of section 4 of the cannot be invoked. It may be mentioned that section 4 of the, Pro bation of Offenders Act also excludes from its operation persons convicted of offences punishable with imprisonment for life. In that connection, the Court observed : "As the offence of criminal breach of trust under section 409, I.P.C. is punishable with imprisonment for life, the High Court, in our view, was right because the provisions of section 4 are only applicable to a case of a person found guilty of having comm itted an offence not punishable with death or imprisonment for life. " We, therefore, hold that the appellant cannot invoke the benefit of section 6 of the . The appeal fails and is dismissed. Appellant to surrender to the bail bond. Appeal dismissed.
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The person appealing the case was under 21. He was found guilty of a crime under a specific law (section 326, along with 6. 140 of the Indian Penal Code, or I.P.C.). He was sentenced to 3 years in jail. The question was whether he could get help from another law (section 6 of a certain Act). The court said: (1) This other law was created to release some offenders on probation (a chance to stay out of jail if they behave) or after a warning. The goal was to keep young offenders (under 21) from becoming serious criminals by being around older, hardened criminals in jail. But, if the crime someone was convicted of is very serious and can be punished with life in prison, or if it's one of the crimes listed in section 18 of the Act, then this help wouldn't be available. (2) The person appealing was found guilty under section 326 along with section 149 of the I.P.C. This meant he could be punished with life in prison. So, he can't get help from section 6 of the other law. To say otherwise would be ignoring part of the law, which you can't do. (3) Just because a shorter jail sentence could also be given for the crime doesn't mean it's no longer a crime that *could* be punished with life in prison. A previous case (Som Nath Puri vs State of Rajasthan) was used as a guide.
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Civil Appeal No. 2031 of 1977. Appeal by special Leave from the judgment and order dated the 30th June, 1977 of the Andhra Pradesh High Court in Writ Petition No. 905 of 1975. WITH Civil Appeal Nos. 136 & 137 of 1978. From the judgment and order dated the 30th June, 1977 of the Andhra Pradesh High Court in Writ Petition Nos. 796 & 922 of 1975 respectively. Ramachandra Reddy, Advocate General and B. Parthasarthi for the Appellants P. Rama Reddy and A.V.V. Nair for Respondent No. 2 in CA. 2031, R. 3 in 136 & R. 2 in 137. A. Subba Rao for RR I & 2 in CA. 136/78. A.K. Sen, e. Rajendra Choudhury, G.R. Subbaryan, I. Koti Reddy and Mahabir Singh for Respondent No. 1 in CA. 137/78. B. Ranta Rao for Respondent No. 1 in CA. 2031/77. The Judgment of the Court was delivered by CHANDRACHUD, C.J. these three appeals arise out of a common judgment dated June 30. 1977 of a Division Bench of the High Court of Andhra Pradesh, setting aside the judgment of a learned single Judge dated November 18, 1975 in Writ Petitions Nos. 1539 of 1974 and 798 of 1975. Civil Appeal No. 2031 (NCM) of 1977 is by special leave while the other two appeals are by certi 503 ficate granted by the High Court The question which these appeals involve is whether the appellant, the Government of Andhra Pradesh, has the power to evict the respondents summarily in exercise of the power conferred by the Andhra Pradesh Land Encroachment Act, 1905. This question arises on the following facts: We are concerned in these appeals with three groups of lands situated in Habsiguda, Hyderabad East Taluk, Andhra Pradesh. Those lands are: R.S. No 10/1, which corresponds to plot No. 94 admeasuring 10 acres and 2 guntas, R.S. No. 10/2 which corresponds to plot No. 104 admeasuring 9 acres and 33 guntas; and R.S. Nos. 7, 8 and 9 which correspond to plot No. 111 admeasuring 26 acres and 14 guntas. These lands belonged originally to Nawab Zainuddin and after his death, they devolved on Nawab Habibuddin. Sometime between the years 1932 and 1937, certain lands were acquired by the Government of the Nizam of Hyderabad under the Hyderabad Land Acquisition Act of 1309 Fasli, the provisions of which are in material respects similar to those of the Land Acquisition Act, 1894. The lands were acquired for the benefit of the osmania University which was then administered as a Department of the Government of Hyderabad. The University acquired an independent legal status of its own under the osmania University Revised Charter, 1947, which was promulgated by the Nizam. E The question whether the aforesaid three plots of land were included in the acquisition notified by the Government of Nizam became a bone of contention between the parties, the osmania University contending that they were so included and that they were acquired for its benefit and the owner, Nawab Habibuddin, contending that the three plots were not acquired. On February 13, 1956 the osmania University filed a suit (O.S. No. 1 of 1956) against Nawab Habibuddin, in the City Civil Court, Hyderabad, claiming that the three lands were acquired by the Government for its benefit and asking for his eviction from those lands. That suit was dismissed in 1959 on the ground that plot No. 111 was not acquired by the Government and that though plots Nos. 94 and 104 were acquired, the University failed to prove its possession thereof within twelve years before the filing of the suit. In regard to plots Nos. 94 & 104, it was found by the trial court that Habibuddio had encroached thereupon in the year 1942, which was more than twelve years before the filing of the suit. Civil Appeal No. 61 of 1959 filed by 504 the University against that judgment was dismissed on January 24, 1964 by the High Court which affirmed the findings of the trial court. The State Government was not impleaded as a party to those proceedings. On May 8, 1964 the osmania University wrote a letter to the Government of Andhra Pradesh, requesting it to take steps for the summary eviction of persons who were allegedly in unauthorised occupation of the 3 plots. On December 8, 1964, the Tahsildar, Government of Andhra Pradesh, acting under section 7 of the Land Encroachment Act, 1905, issued a notice to Nawab Habibuddin to vacate the lands and on December 15, 1964 the Tahsildar passed an order evicting him iron the lands. The appeal filed by Habibuddin to the Collector was dismissed in 1965 and the appeal against the decision of the Collector was dismissed by the Revenue Board in 1968 During the pendency of the appeal before the Revenue Board, the respondents purchased the plots from Habibuddin for valuable consideration and on the death of Habibuddin, they were impleaded to the proceedings before the Revenue Board. They preferred an appeal from the decision of the Revenue Board to the Government but that appeal was dismissed on November 26, 1973. On March 19, 1974, the respondents filed Writ Petitions in the High Court of Andhra Pradesh challenging the order by which they were evicted from the plots summarily under the provisions of the Act of 1905. The learned single Judge dismissed those Writ Petitions observing: "The question whether the lands with which we are concerned in the writ petition were acquired by the Government or not and the question whether the Government had transferred its title to the University or not are questions which cannot properly be decided by me in an application under article 226 of the Constitution. The appropriate remedy of the petitioners is to file a suit to establish their title. " The learned Judge held that: "Though the title of the Government is not admitted by the alleged encroacher, there is a finding by the Civil 505 Court that there was encroachment by the alleged encroacher. That is sufficient to entitle the Government to initiate action under the provisions of the Land Encroachment Act. " Three appeals were preferred to The Division Bench against the judgment of the learned single Judge, two of them being by the petitioners in one writ petition and the third by the petitioner in the other writ petition. The Division Bench, while setting aside the judgment of the learned single Judge, held: "The question whether the lands. belong to osmania University or not will have to be decided as and when the Government comes forward with a suit for the purpose. Even if we assume for the purpose of our judgment, as we are not pronouncing any conclusion as to whether the land vested in the Government or University, that the Government is the owner, the dispute going back from 1942 cannot be dealt with in summary proceeding under section 7 of the Land Encroachment Act. " The summary remedy provided by section 7, according to the Division Bench, cannot be resorted to "unless there is an attempted encroachment or encroachment of a very recent origin" and further, that it cannot be availed of in cases where complicated questions of title arise for decision. We are in respectful agreement with the view taken by the Division Bench, subject however to the observations made herein below. The Andhra Pradesh Land Encroachment Act, 1905, was passed in order "to provide measures for checking unauthorised occupation of lands which are the property of Government. " The preamble to the Act says that it had been the practice to check unauthorised occupation of lands which are the property of the Government "by the imposition of penal or prohibitory assessment or charge" and since doubts had arisen whether such practice was authorised by law, it had become necessary to make statutory provisions for checking unauthorised occupations. Section 2 (1) of the Act provides that all public roads, streets, lands, paths, bridges, etc. shall be deemed to be the property belonging to Government, unless it falls under clauses (a) to (e) of that section. Section 2 (2) provides that all public roads and streets 506 vested in any public authority shall be deemed to be the property of the Government by section 3 (1), any person who is in unauthorised occupation of any land which is the property of Government, is liable to pay assessment as provided in clauses (i) and (ii) of that section. Section S provides that any person liable to pay assessment under section 3 shall also be liable, at the discretion of the Collector, to pay an additional sum by way of penalty. Sections 6 (1) and 7, which are relevant for our purpose, read thus: "Sec. 6 (1) Any person unauthorisedly occupying any land for which he is liable to pay assessment under section 3 may be summarily evicted by the Collector, Tahsildar or Deputy Tahsildar and any crop or other product raised on the land shall be liable to forfeiture and any building or other construction erected or anything deposited thereon shall also, if not removed by him after such written notice as the Collection Tahsildar. or Deputy Tahsildar may deem reasonable, be liable to forfeiture. Forfeitures under this section shall be adjudged by the Collector, Tahsildar or Deputy Tahsildar and any property so forfeited shall be disposed of as the Collector, Tahsildar or Deputy Tahsildar may direct." "Sec. 7. Before taking proceedings under section 5 or section 6, the Collector or Tahsildar or Deputy Tahsildar as the case may be shall cause to be served on the person reputed to be in unauthorised occupation of land being the property of Government, a notice specifying the land so occupied and calling on him to show cause before a certain date why he should not be proceeded against under section S or section 6. " It seems to us clear from these provisions that the summary remedy for eviction which is provided for by section 6 of the Act can be resorted to by the Government only against persons who are in 507 unauthorized occupation of any land which is "the property of Government". In regard to properly described in sub sections (I) and (2) of section 2, there can be no doubt, difficulty or dispute as to the title of the Government and, therefore, in respect of such property, the Government would be free to take recourse to the summary remedy of eviction provided for in section 6. A person who occupies a part of a public road, street, bridge, the bed of the sea and the like, is in unauthorised occupation of property which is declared by section 2 to be the property of the Government and, therefore, it is in public interest to evict him expeditiously which can only be done by resorting to the summary remedy provided by the Act. But section 6 (1) which confers the power of summary eviction on the Government limits that power to cases in which a person is in unauthorised occupation of a land "for which he is liable to pay assessment under section 3 ' '. Section 3, in turn, refers to unauthorised occupation of any land "which is the property of Government" If there is a bond dispute regarding the title of the Government to any property the Government cannot take a unilateral decision in its own favour that the property belongs to it, and on the basis of such decision take recourse to the summary remedy provided by section 6 for evicting the person who is in possession of the property under a bona fide claim or title. In the instant case, there is unquestionably a genuine dispute between The State Government and the respondents as to whether The three plots of land were the subject matter of acquisition proceedings taken by the then Government of Hyderabad and whether the osmania University. for whose benefit the plots are alleged to have been acquired, had lost title to the property by operation of the law of limitation. The suit filed by the University was dismissed on the ground of limitation, inter alia, since Nawab Habibuddin was found to have encroached on the properly more than twelve years before the date of the suit and the University was not in possession of the property at any time within that period. Having tailed in the suit, the University activated the Government to evict the Nawab and his transferees summarily, which seems to us impermissible. The respondents have a bona fide claim to litigate and they cannot be evicted save by the due process of law. The summary remedy prescribed by section 6 is not the kind of legal process which is suited to an adjudication of complicated questions of title. That procedure is, therefore, not the due process of law for evicting the respondents. 508 The view of the Division Bench that the summary remedy provided for by section 6 cannot be resorted to unless the alleged encroachment is of "a very recent origin", cannot be stretched too far That was also the view taken by the learned single Judge him self in another case which is reported in Meherunnissa Begum vs State of A.P. which was affirmed by a Division Bench.(2) It is not the duration, short or long, of encroachment that is conclusive of the question whether the summary remedy prescribed by the Act can be put into operation for evicting a person. What is relevant for the decision of that question is more the nature of the property on which the encroachment is alleged to have been committed and the consideration whether the claim of the occupant is bona fide. Facts " which raise a bond fide dispute of title between the Government and the occupant must be adjudicated upon by the Ordinary courts of law. The Government cannot decide such questions unilaterally in its own favour and evict any person summarily on the basis of such decision. But duration of occupation is relevant in the sense that a person who is hl occupation of a property openly for an appreciable length of time can be taken, prima facie, to have a bonafide claim to the property requiring an impartial adjudication according to the established procedure of law. The conspectus of facts in the instant case justifies the view that the question as to the title to the three plots cannot appropriately be decided in a summary inquiry contemplated by sections 6 and 7 of the Act. The long possession of the respondents and their predecessors in title of these plots raises a genuine dispute between them and the Government on the question of title, remembering especially that the property, admittedly, belonged originally to the family of Nawab Habibuddio from whom the respondents claim to have purchased it. The question as to whether the title to the property came to be vested in the Government as a result of acquisition and the further question whether the Nawab encroached upon that property thereafter and perfected his title by adverse possession must be decided in a properly constituted suit. May be, that the Government may succeed in establishing its title to the property but, until that is done, the respondents cannot be evicted summarily. For these reasons, we uphold the judgment of the Division Bench of the High Court and dismiss these appeals with costs. 509 We do not propose to pass any orders on Civil Misc. Petitions A Nos. 18974, 18975, 18976, 18497, 18498 and 18499 of 1981 which have been filed for adding certain parties as respondents to these appeals. Those petitions involve the question of a Will alleged to have been made by Nawab Habibuddin in favour of Entashamuddin alias Anwar Siddiqui and his elder brother. We cannot go into the validity of that Will and other incidental questions in these ap peals. H.L.C. Appeals dismissed.
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The Andhra Pradesh Land Encroachment Act, passed in 1905, was created to stop people from illegally taking over government land. If someone is illegally occupying land that belongs to the government, they must pay a fee as explained in section 3 of the law. According to section 6(1), officials like the Collector (district officer), Tahsildar (revenue officer), or Deputy Tahsildar can quickly remove anyone illegally living on land if they have to pay the fee under section 3. Before doing so, they must give a "show cause notice," as described in section 7, which is a chance for the person to explain why they shouldn't be evicted. This lawsuit was rejected in 1959 because the court said one of the pieces of land wasn't taken over by the government. For the other two pieces, the university couldn't prove they had control of the land within 12 years before filing the lawsuit. The trial court (original court) found that the person who inherited the land from the original owner had illegally moved onto those two pieces of land in 1942. The High Court (higher court) agreed with the trial court's decision in 1964. The State Government was not involved in these court cases. The University then asked the State Government to quickly evict the heir of the original owner from the three pieces of land. The Tahsildar started the process and ordered the eviction under section 6(1) of the Act on December 15, 1964. Appeals (requests to change the decision) against this order were rejected by the Collector in 1965 and by the Revenue Board (another government body) in 1968. The people who bought the land while the appeal was with the Revenue Board were added as parties to the case after the original owner's heir died. Their appeal from the Revenue Board's decision was rejected by the Government in 1973. A single judge of the High Court dismissed this petition, saying that the High Court could not decide who owned the land under Article 226. However, the judge said that the Civil Court had already found that there was illegal occupation, which was enough for the Government to start action under the Land Encroachment Act. The people's appeal was allowed by a group of judges (Division Bench), who said that a dispute from as far back as 1942 couldn't be handled in a quick eviction process under the Land Encroachment Act. The quick eviction process should only be used if someone is currently trying to illegally occupy land or if the illegal occupation is very recent. It also shouldn't be used if there are complicated questions about who owns the land. Dismissing the appeals, the court HELD: (I) The government can only use the quick eviction process in section 6 of the Act against people who are illegally occupying government land. If there's a real disagreement about whether the government owns the land, the government can't simply decide that it owns the property and then use the quick eviction process. In this case, there was a clear disagreement between the State Government and the people about whether the three pieces of land had been taken over by the government of Hyderabad and whether the University had lost its claim to the land because of the law of limitation (a law about how long you have to make a claim). The people had a real reason to fight for their claim, and they couldn't be evicted without a proper legal process. The quick eviction process in section 6 wasn't suitable for deciding complicated questions about who owns the land. So, that process wasn't the right way to evict the people. The view of the judges that the quick eviction process in section 6 should only be used if the illegal occupation is "very recent" shouldn't be taken too literally. It's not just about how long the illegal occupation has been going on. What matters more is the type of property and whether the person's claim to the land is legitimate. If there are facts that create a real disagreement about who owns the land between the government and the person living there, it must be decided by the regular courts. How long someone has been occupying the land matters because someone who has been openly living on a property for a long time can be seen as having a legitimate claim to the property. In this case, the long period of possession by the people and their family created a real dispute between them and the Government about who owned the land. Whether the government had become the owner of the property because of the takeover, and whether the original owner's heir had illegally moved onto the property and gained ownership through adverse possession (claiming ownership by openly living on the land for a long time), had to be decided in a proper lawsuit.
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1. By this petition, the petitioner seeks transfer of investigation in case
FIR No. 243/2021 under Sections 302/34 IPC registered at P.S.Hari Nagar
from respondent No.3 to CBI, directions to preserve CCTV footages of the
relevant time and compensation to the petitioner/mother of the deceased.
2. According to the petitioner, her son was taken into custody in FIR
Nos. 178/2019, 179/2019 and 180/2019 on 13th June 2019 and since then, he
was in judicial custody. On 14th May 2021, son of the petitioner died on
being taken to the hospital and in this regard, FIR No. 243/2021 was
registered at P.S.Hari Nagar under Sections 302/34 IPC. According to the
petitioner, on looking at the photos and videos of the deceased body, deep
cut wounds on his thighs and hands were found which could not be caused
due to the simple cricket bats, as alleged and such wounds would have been
inflicted only by a sharp object. Daughter of the petitioner i.e. sister of the
deceased had received a call from the deceased one day prior to the date of
incident wherein, she claims that her brother told that he would be murdered
by the jail officers. Further, at the time of incident itself, a PCR call was
received from the jail which was not from the officers of the jail wherein,
the caller stated that ‘my brother has been got murdered by R.N.Meena; I am
in jail and R.N.Meena is also in jail, who is D.S. in jail and has assaulted
me yesterday and also assaulted my brother with sticks; my brother has
been moved to DDU Hospital name Shreekant Rama Swami; my brother has
been murdered’. When Shrikant was admitted in hospital, after some
treatment, he was declared dead. In view of the fact that the deceased died
in custody, judicial enquiry is in process.
3. According to the learned Standing Counsel for the State, report of
Magisterial enquiry has not been received, however, FIR No. 243/2021
under Sections 302/34 IPC was registered on the same day. The
investigation of the FIR is being conducted by the investigating officer from
P.S.Hari Nagar and based on the investigation conducted, a status report has
been filed which is reproduced here-in-under:-
“Most respectfully it is submitted that on 14/5/21 a PCR call
was received in P.S Hari Nagar vide DD No – 41-A that, “ Tihar Jail
No-2, “Caller is stating that, “My brother has been got murdered by
R.N Meena . I am in the Jail and R. N Meena also in Jail, who is D.S
in jail and has assaulted me yesterday and also assaulted my brother
with sticks. My brother has been moved to DDU hospital Name
Shreekant Rama Swami, My brother has been murdered”. On receipt
of information SI Kavish was informed to take necessary action. In
the meanwhile information was received from Safdarjung hospital
that Srikant @ Appu was admitted in hospital where he was declared
dead during treatment. As per direction of senior officer Insp.
Praveen and SHO sir also reached at the spot and in the meanwhile
SI Kavish also reached there. In Jail No-2 Tihar jail eyewitnesses of
the incident Warder Lalit was enquired and his statement was
recorded. He stated that on 14/5/21 he alongwith warder Praveen
was present on duty on ward No-2 of jail No -2. As per routine the
barracks of inmates were opened at about 6 PM and after opening the
barracks he alongwith warder Praveen were present in the guard
room near main gate of the ward. Suddenly at about 7 AM they heard
hue and cry from side of barrack No-4. On hearing the rush towards
the barrack where inside the barrack inmates Arun @ Mandwa,
Ganpat, Kishan and Akash were found assaulted inmate Srikant @
Appu with cricket bats. Both the warders controlled the assaulters
with help of other inmates. During this, all the assaulters committed
crossing (a common term used for mutual giving injuries to each
other just to create defense) with each other. During this assaulter
Arun also received injuries on his head and started bleeding profusely.
They locked the other assaulters in another barrack and tried to take
both the injured inmates namely Srikant @ Appu & Arun @ Mandwa
for treatment, but Srikant refused for the same and warder Lalit took
injured inmate Arun to jail dispensary for treatment and warder
Praveen remained in ward for duty. Senior jail officials were also
informed by the warders. When after treatment of Arun Jail warders
and other officials were taken round of the ward. Inmate Srikant
complained of pain and he was rushed to jail dispensary, from where
he was referred to Safdarjung hospital, where he was declared dead.
Information in this regard was also conveyed to concerned duty M.M.
Ld. Ms. Anjani Mahajan. The scene of crime was inspected and some
blood stains were noticed on the floor and a bedsheet with blood
stains was also recovered. The jail officials also provided two cricket
bats having blood stainds which were snatched from the accused
persons and wearing blood stained clothes of inmate Arun. On
statement of warder Lalit present FIR was registered and
investigation was started. In the meanwhile PCR calls were also
received from unknown numbers that inmate Srikant has been
assaulted by Jail official R.N.Meena. During investigation of the case
other eyewitnesses were enquired Eye witness Warder Praveen was
also enquired and his statement was recorded in which he
corroborated the statement of Warder Lalit. Other inmates were also
enquired and they also supported the version of complainant and
stated that the deceased used to bully other inmates and also demand
money from them. It was also revealed that just a day prior to this
incident i.e. 13/5/21 the deceased has again harassed accused Arun
@ Mandwa & another inmates Vikas Jain and Arun has also made a
written complaint to Jail authorities in this regard and Arun and
Vikas have requested for change of their barracks and after this they
were shifted to barrack No. 6 from Barrack No. 4. Notice was given to
jail authorities to provide CCTV footage of incident. But they stated
that the CCTVs in Ward No. 2 are not in working condition. The
number from which PCR call with regard to death of Srikant was
made is not reachable since then. Even no brother of deceased
Srikant was found to be lodged in Tihar Jail as alleged in the PCR
call. Post mortem of the deceased was got conducted in Safdarjung
hospital on 15/5/21 and as per post-mortem report cause of death is
given as “Death is due to shock as a result of multiple injuries to head,
both upper limbs and both the lower limbs consequent to blunt force
impact”. After this all the four accused persons were arrested in the
present case after permission of Hon’ble Couret. During
interrogation they stated that deceased Srikant used to harass and
bully all other inmates and even demand money from them. Arun
stated that he was a new inmate in barrack No. 4 of Jail No. 2 and
Srikant used to harass and bully him and used to demand money from
him. Due to this constant torture he has also made a complaint to jail
authorities and has requested to change his barrack and due to this
reason on 13/5/21 he was shifted to barrack No. 6 from No. 4. He has
discussed all this with other accused persons, who all were also
having grudge against Srikant due to his constant torture and they all
hatched a conspiracy to kill Srikant. On the day of incident after
opening of barracks, all accused persons entered in barrack of
decease and assaulted him with cricket bats which subsequently
caused his death. Blood sample of all the accused persons have been
obtained and have been sent to FSL alongwith other seized exhibits
for opinion. The registered owner of mobile phone No. 9311898547
(from which PCR call with regard to involvement of Deputy
Superintendent Sh.R.N.Meena in murder of deceased was made) Ms.
Mukundpur Delhi was also enquired and she stated that she has lot
her mobile phone having above sim and due to ignorance she has not
lodged any complaint in this regard and she does not know Srikant
and none of her acquaintance is lodged in Tihar jail.
Sh. R.N.Meena Deputy Superintendent was also enquired and
he stated that deceased Srikant used to bully other inmates and his
conduct in jail was very bad which is evident from the list of several
punishment tickets issued to him in jail and at the time of incident he
was not even on duty and his name is dragged into this offence just
because he is trying to maintain discipline in the jail.
The investigation of the case is in final stage and from the
investigation conducted so far sufficient evidence has come on record
to prove involvement of above mentioned four accused namely Arun,
Ganpat, Kishan & Akash in the present case.
Report may kindly be submitted please”.
4. No post-mortem report of the deceased has been placed on record
before this Court. When this petition came up before this Court on 8th July
2021, this Court while issuing notice directed the State to submit a status
report, whereafter, the petitioner’s plea for transfer of investigation to CBI
was to be considered.
5. A report had been received from the Superintendant, Central Jail No.2
indicating that on the day of incident, Sh.Lalit, Warder and Sh.Parveen,
Warder were deployed on duty as Head Warder and Warder respectively in
Ward No. 2 in morning shift. At about 7:00 hours, they heard some hue and
cry in Barrack No. 4 of Ward No. 2. They rushed towards Barrack No. 4 of
Ward No. 2 where four UTPs/inmates namely Arun @ Mandva, Akash @
Hunny, Ganpat @ Niranjan and Kishan s/o Tejman were giving beatings to
inmate Shrikant @ R.Srikant @ Appu with cricket bat. Inmate Arun was
also injured and blood was oozing out of his head when the officials
intervened and separated the UTPs. Immediately, inmate Arun @ Mandav
was taken to jail dispensary where he was given stitches and UTP Shrikant
was asked to come to the jail dispensary however, he refused to go to the jail
dispensary. Thereafter, a team comprising of Assistant Superintendent
visited Ward No. 2 again where they found that UTP Shrikant was taking
bath. When the team enquired from Shrikant, he complained of trepidation
and pain in the body. The team also noted the injury in his body and took
him to jail dispensary from where he was referred to Safdarjung Hospital.
The search team also found one mobile phone and one iron patti from UTP
Shrikant. As claimed in the status report, at around 12.20 pm, a message
was received about the death of Shrikant @ Appu at about 11.50 am.
6. Vide order dated 8th July 2021, this Court directed the Director
General (Prisons) to file a detailed report indicating as to where and how
many CCTVs are installed in and around Barrack No. 4 of Ward No. 2. It
was also directed that the affidavit would be accompanied by a complete site
plan giving the locations of the said CCTVs and the place of incident and in
case, CCTVs are installed, explanation was also directed to be rendered that
why, immediately on receiving the information of the incident at the said
place, CCTV footages of the entire area were not preserved at that time.
7. A reply has been filed by the Director General (Prisons) along with
the site plan. As per the reply, most of the old CCTVs installed in Tihar Jail
have become non-functional and thus, a mega plan of installation of the
CCTVs is underway and at most of the places, they have been installed.
Director General (Prisons) who appears in person through video
conferencing states that the project of installation of CCTVs got delayed due
to Covid-19, however, efforts are being made to ensure that the newly
installed CCTVs become functional expedituously. He states that out of
6967 CCTVs to be installed, more than half of the CCTVs installed are
functional and rest would be functional by 15th August 2021.
8. It is thus evident that no CCTV footage of the incident is available.
However, the prime issue which now concerns this Court besides the
manner in which the death of the inmate has been caused, is, why no proper
investigation could be carried out despite the fact that a PCR call was made
from a phone number from the jail and the said phone number is duly
recorded in the PCR Call.
9. As noted above, in the status report, it is stated that the registered
owner of the mobile number 9311898547 from which PCR call was made is
one Ms. Hina, wife of Md. Irfan from whom enquiry was made and she
stated that she has lost her mobile phone having the said SIM and due to
ignorance, she had not lodged any complaint in this regard. She stated that
she does not know deceased Srikant and none of her acquaintance was
lodged in Tihar Jail. From the status report, it is apparent that the
investigation based on the mobile phone number as noted in the PCR still
appears to be incomplete. Claim of the sister of the deceased was that she
received a phone call from the deceased himself a day prior to the incident
from the jail, informing her that he would be murdered, however, there is no
investigation on the said point nor has the mobile of the sister been taken
nor have the call records been analysed which would have revealed
something nor has any investigation been carried out from the call records of
the mobile number 9311898547 from which PCR call was made. It has
been two months since the FIR in question has been registered.
10. Considering the fact that as per status report filed by the
Superintendent Jail, there was no apparent injury on the deceased, however,
the case of the petitioner is that there were deep injury marks on the
deceased and an indepth investigation is required to be conducted to find out
the circumstances under which the deceased made a phone call to his sister
expressing his apprehension of death and his subsequent death in the judicial
custody, this Court finds it fit to transfer the investigation of the case FIR in
question to CBI.
11. Status report will be filed by the concerned S.P., CBI after
investigation into the FIR in question well before the next date of hearing.
12. List on 29th September 2021.
13. Order be uploaded on the website of this Court.
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The Delhi High Court recently handed over the investigation into the supposed killing of a prisoner to the CBI. This happened after the court decided that a full and thorough investigation was needed. The prisoner was waiting for his trial inside Tihar Jail when he died.
Judge Mukta Gupta noticed that no one had looked into the dead man's sister's claim. She said her brother called her a day before he died, saying he was afraid he would be killed.
The Court ordered, "A report from the prison superintendent said there were no clear injuries on the dead man. However, the mother, who filed this case, claims there were deep wounds. A full investigation is needed to find out why the dead man called his sister, fearing for his life, and then died while in prison. For these reasons, this Court believes it is right to give this police case (FIR) to the CBI to investigate."
The dead man's mother started the legal process. She asked for the CBI to investigate and also for the security camera videos from around the time of his death to be saved.
The man who died had been in prison, waiting for his trial, since June 13, 2019, at Tihar Jail. He was announced dead on May 14, 2021, after being taken to Safdarjung Hospital. A police case (FIR) was then filed under sections for murder and common intention in Indian law.
According to a report from the prison superintendent, four other prisoners (also waiting for trial) were beating the dead man with a cricket bat. As a result, one of the other prisoners and the dead man got hurt. The dead man was then taken to the prison clinic and sent to Safdarjung Hospital for treatment, where he was pronounced dead.
The mother argued that pictures and videos of the dead body showed deep cuts on his legs and hands. She said these injuries could not have come from a cricket bat and must have been made by something sharp.
About the security camera videos, the Director General of Prisons said the old cameras in Tihar Jail weren't working. He added that a big project to install new cameras was happening, and most areas now had them.
They also said that out of nearly 7000 cameras planned, more than half of the installed cameras were working. The others would work by August 15, 2021.
The Court observed, "It's clear that there are no security camera videos of what happened. However, the main problem for this Court now, apart from how the prisoner died, is why a good investigation wasn't done. This is especially puzzling since someone made a police emergency call (PCR call) from a phone in the prison, and that phone number was officially noted in the police call record."
When the Court ordered the CBI to take over the investigation, it also asked for an update report to be handed in before the next court date.
The case will be discussed again on September 29.
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Appeal No. 383 of 1961. Appeal from the judgment and order dated July 21 1959, of the Special Bench of the Calcutta High Court in Matter No. 76 of 1952. D. R. Prem and R. L. Dhebar, for the appellant and respondents NOS. 2 and 3. section P. Desai and B. P. Maheshwari, for respondent No. 1 565 1962. April 30. The brief facts necessary for present purposes are these. The respondent had imported 2,000 drums of mineral oil. Out of this quantity, the appellant, the Collector of Customs, Calcutta, confiscated 50 drums by order dated September 20, 1950. He also imposed a personal penalty of Rs.61,000/on the respondent under the , No. 8 of 1878, (hereinafter referred to as the Act). The respondent appealed to the Central Board of Revenue under section 188 of the Act, and this appeal was dismissed in April 1952. Thereupon the respondent filed a petition under article 226 of the Constitution in the High Court. We are in the present appeal not concerned with the merits of the case put forward by the respondent, for the matter has not yet been heard on the merits. When the petition came up before a learned Single Judge a question was raised as to the jurisdiction of the High Court to hear the petition in view of the decision of this Court in Election Commission India vs Saka Venkata Subba Rao.(1) As the learned Single Judge considered the point important, he referred the matter to a larger bench; and eventually the question was considered by a Full Bench if the High Court. The Full Bench addressed itself two questions in that connection, namely, (i) whether any writ could issue against the Central Board of Revenue which was a party to the writ petition and which was permanently located outside the jurisdiction of the High Court, and (ii) whether if no writ could issue, against the Central Board of Revenue any writ could be issued against the appellant, which was the original authority to pass the order under challenge, when the appellate (1) ; , 566 authority (namely, the Central Board of Revenue) had merely dismissed the appeal. The Full Bench held on the first question. that the High Court, had no jurisdiction to issue a writ against the Central Board of Revenue in view of the Precision in the case of Sake Venkata Subba Rao.(1). On the second question, it held that as the Central Board of Revenue had merely dis missed the appeal against the order of the Collector of Customs Calcutta, the really operative order was the order of the appellant, which was located within the jurisdiction of the High Court, and therefore it had jurisdiction to pass an order against the Collector of Customs in spite of the fact that order had been taken in appeal (which was dismissed) to the Central Board of Revenue to which no writ, could be issued. The Full Bench further directed that the petition would be placed before the learned Single Judge for disposal in the light of its decision or, the question of jurisdiction. Thereupon there was an application for a certificate to appeal to this Court, which was granted; and that in how the matter has come up before us. The only question which 1ells for decision before us in the second question debated in the ' High Court,. namely, whatever the High Court would have jurisdiction to issue a writ against the Collector of Customs Calcutta in spite of the fact that his order was taken in appeal to the Central Board of Revenue against which the High Court could not issue a writ and the appeal had been dismissed. There seems to have been a difference of opinion amongst the High Courts in this matter. The Rajasthan High Courts in Barkatali vs Custodian General of Evacuee Property (1) held that where the A.I.R. (1904) Raj. 567 original authority passing the order was within the jurisdiction of the High Court but the appellate authority was not within such jurisdiction, the High Court would still have jurisdiction to issue a writ to the original authority, where the appellate authority had merely dismissed the appeal and the order of the original authority stood confirmed without any modification whatsoever. On the other hand, the PEPSU High Court in Joginder Singh Waryam Singh vs Director, Rural Rehabilitation. Pepsu Patiala, the Nagpur High Court in Burhanpur, National Textile Workers Union, vs Labour Appellate Tribunal of India at Bombay ( 2) and the Allahabad High Court in Azmat Ullah, vs Custodian, Evacuee Property (3 ) held otherwise, taking the view that even Where the appeal was merely dismissed, the order of the original authority merged in the order of the appellate authority, and if the appellate authority was beyond the territorial jurisdiction of the High Court, no writ could issue even to the original authority. It may be mentioned that the Rajasthan High Court had occasion to reconsider the matter after the decision of this Court in A. Thangal Kunju Mudaliar vs M. Venkita chalam Potti ( 4 ) and held that in view of that decision, itsearlier decision in Barkatali 's case (5) was no longer good law. The High Court has however not noticed this later decision of the Rajasthan High Court to which the learned Chief Justice who was party to the earlier Rajasthan case was also a party. The main reason which impelled the High Courts, which held otherwise, was that the order of the original authority got merged in the order of the Appellate authority when the appeal was disposed of and therefore if the High Court had no territorial jurisdiction to issue a writ against the appellate authority it could not issue a writ (1) A.I.R. (1955) Pepsu 91 (3) A. I. R. (1955) All 435. (2) A. I. R. (4) ; (5) A.I.R. (1954) Raj. 568 against the original authority, even though the appellate authority had merely dismissed the appeal without any modification of the order passed by the original authority. The question therefore turns on whether the order of the original authority becomes merged in the order of the appellate authority even where the appellate authority merely dismisses the appeal without any modification of the order of the original authority. It is obvious that when an appeal is made, the appellate authority can do one of three things, namely, (i) it may reverse the order under appeal, (ii) it may modify that order, and (iii) it may merely dismiss the appeal and thus confirm the order without any modification. It is not disputed that in the first two cases where the order of the original authority is either reversed or modified it is the order of the appellate authority which is the operative order and if the High Court has no jurisdiction to issue a writ to the appellate authority it cannot issue a writ to the original authority. The question therefore is whether there is any difference between these two cases and the third case where the appellate authority dismisses the appeal and thus confirms the order of the original authority. It seems to us that on principle it is difficult to draw a distinction between the first tori kinds of orders passed by the appellate authority and the third kind of order passed by it. In all these three cases after the appellate authority has disposed of the appeal, the operative order is the order of the appellate authority whether it has reversed the original order or modified it or confirmed it. In law, the appellate order of confirmation is quite as efficacious as an operative order as an appellate order of reversal or modification. Therefore, if the appellate authority is beyond the territorial jurisdiction of the High Court it seems difficult to bold even in a case where the appellate 569 authority has confirmed the order of the original authority that the High Court can issue a writ to the original authority which may even have the effect of setting aside the order of the original authority when it cannot issue a writ to the appellate authority which has confirmed the order of the original authority. In effect, by issuing a writ to the original authority setting aside its order, the High Court would be interfering with the order of the appellate authority which had confirmed the order or the original authority even though it has DO territorial jurisdiction to issue any writ to the appellate authority. We therefore feel that on principle when once an order of an original authority is taken in appeal to the appellate authority which is located beyond the territorial jurisdiction of the High Court, it is the order after the appeal is disposed of; and as the High Court cannot issue a writ against the appellate authority for want of territorial jurisdiction it would not be open to it at issue a writ to the original authority which may be within its territorial jurisdiction once the appeal is disposed of, though it may be that the appellate authority has merely confirmed the order of the original authority and dismissed the appeal. It is this principle, viz., that the appellate order is the operative order after the appeal is disposed of, which is in our opinion the basis of the rule that the decree of the lower court merges in the decree of the appellate court, and on the same principle it would not be incorrect to say that the order of the original authority is merged in the order of the appellate authority whatsoever its decision whether of reversal or modification or mere confirmation. This matter has been considered by this Court on a number of occasions after the decision in Saka Venkata Subba Rao 's case.(1) (1) ; 570 In A. Thangal Kunju Mudaliar 's case (1), though the point was not directly in issue in that case, the Court had occasion to consider the matter (see p. 1213) and it approved of the decisions of the PEPSU, Nagpur and Allahabad High Courts, (referred to above). Then in Commissioner of Income tax vs Messrs. Amritlal Bhogilal and Company (2), a similar question arose as to the merging of an order of the income tax officer into the order of the Appellate Assistant Commissioner passed in appeal in connection with the powers of the Commissioner of Income tax in revision. Though in that case the order of registration by the Income tax officer was held not to have merged in the order of the Assistant Commissioner on appeal in view of the special provisions of the Income tax Act, this Court observed as follows in that connection at p. 720 : ",There can be no doubt that, if an appeal is provided against an order passed by a tribunal, the decision of the appellate authority is the operative decision in law. If the appellate authority modifies or reverses the decision of the tribunal, it is obvious that it is the appellate decision that is effective and can be enforced. In law the position would be just the same even if the appellate decision merely confirms the decision of the tribunal. As a result of the confirmation or affirmable of the decision of the tribunal by the appellate authority the original decision merges in the appellate decision and it is the appellate decision alone which subsists and is operative and capable of enforcement. The matter was considered again by this Court, in Madan Gopal Rungta vs Secretary to the Government of Orissa (3) in connection with an order of the (1) (1955)2 S.C.R.1196. 12) (1959) S.C.R. 713, (3) (1962) (Supp.) 3 S.C.R. 966. 571 Central Government in revision under the Mineral Concession Rules, 1949, framed under the Mines and Minerals (Regulation and Development) Act, (No. 53 of 1948) and it was held that when the Central Government rejected the review. petition against the order of the State Government under the Mineral Concession Rules it was in effect rejecting the application of the appellant of that case for grant of the mining lease to him. The question of the original order with the appellate order was also considered in that case though it was pointed out in view of r.60 of the Mineral Concession Rules that it is the Central Government 's order in review which is the effective and final order. Learned counsel for the respondent sought to distinguish Madan Gopal Rungla 's case (1) on the ground that it was based mainly on an interpretation of r. 60 of the Mineral Concession Rules 1949, though he did not pursue this further when section 188 of the was pointed out to him. The main reliance however of the respondent both in the High Court and before us is on the decision in the State of Uttar Pradesh vs Mohmmed Nooh (2). That was a case where a public servant was dismissed on April 20, 1948 before the Constitu tion had come into force. His appeal from the order of dismissal was dismissed in May 1949 which was also before the Constitution came into force. His revision against the order in the appeal was dismissed on April 22, 1950, when the Constitution had come into force, and the question that arose in that case was whether the dismissed public servant could take advantage of the provisions of the Constitution because the revisional order had been passed after the Constitution came into force. In that case, this Court certainly held that the order of dismissal passed on April 20, 1948 could not be said to have merged in the orders in appeal and in revision. It (1) (1962) (Supp.) 3 S.C.R. 906. (2) ; 572 was pointed out that the order of dismissal was operative of its own strength as from April 20, 1948 and the public servant stood dismissed as from that date and therefore it was a case of dismissal before the Constitution came into force and the. public servant could not take advantage of the provisions of the Constitution in view of the fact that his dismissal had taken place before the Constitution had come into force. As was pointed out in Madan Gopal Rungta 's, case(1) Mohammad Nooh 's case (2) was a special case, which stands on its own facts. The question there was whether a writ under article 226 could be issued in respect of a dismissal which was effective from 1948. The relief that was being sought was against an order of dismissal which came into existence before the Constitution came into force and remained effective all along even after the dismissal of the appeal and the revision from that order. It was in those special circumstances that this Court held that the dismissal had taken place in 1948 and it could not be the subject matter of consideration under Art.226 of the constitution, for that would be giving retrospective effect to the Article. The argument based on the principle of merger was repelled by this Court in that case on two grounds, namely, (i) that the principle of merger applicable to decrees of courts would not be applicable to departmental tribunals, and (ii) that the original order would be operative on its own strength and did not gain greater efficacy by the subsequent order of dismissal of the appeal or revision. in effect, this means that even if the principle of merger were applicable to an order of dismissed like the one in Mohammad Nooh 's case, (2) the fact would still remain that the dismissal was before the Constitution came into force and therefore the person dismiss could not take advantage of the provisions of the Constitution, so (1) (1962)(Supp.)3 S.C.R.906. (2) ; 573 far as that dismissal was concerned. That case was not concerned with the territorial jurisdiction of the High Court where the original authority is within such territorial jurisdiction while the appellate authority is not and must therefore be confined to the special facts with which it was dealing. We have therefore no hesitation in holding consistently with the view taken by this Court in Mudaliar 's case (1) as well as in Messrs. Amritlal Bhogilat 's (2) that the order of the origin%] authority must be held to have merged in the order of the appellate authority in a case like the present and it is only the order of the appellate authority which is operative after the appeal is disposed of. Therefore, if the appellate authority is beyond the territorial jurisdiction of the High Court it would not be open to it to issue a writ to the original autbority which is within its jurisdiction so long as it can not issue a writ to the appellate authority. It is not in dispute in this case that no writ could be issued to the appellate authority and in the circumstances the High Court could issue no writ even to the original authority. We therefore allow the appeal, set aside the order of the High Court and dismiss the writ petition with costs. Appeal allowed. (1) ; (2) (1959) S.C.R. 713.
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Someone brought in 2,000 containers of mineral oil. The government took 50 containers and fined that person. The Central Board of Revenue (a tax court) said no to the person's appeal. The person then asked the Calcutta High Court for help, using a part of the Constitution (article 226). The High Court said it couldn't tell the Central Board of Revenue what to do, based on a past court case (Saka Venkata Subbha Rao). But, since the Central Board of Revenue only said no to the appeal of the government’s order, the High Court said it *could* tell the government what to do. The government then went to a higher court (this Court) after getting permission. This Court said that the government's actions were now part of what the Central Board of Revenue decided. So, the High Court couldn't tell the government what to do. Once an appeal is decided, only the decision from the appeal matters. It doesn't matter if the appeal changes the original order, fixes it, or agrees with it. The decision from the appeal is just as important as if it had changed the original order. Since the Central Board of Revenue was outside the High Court's area, the High Court couldn't tell the government what to do, even though the government was in its area. Election Commission, India vs Saka Vankata Subba Rao, , A. Thangal Kunju Mudatiar vs M. Venkitachalam Poiti, ; , Commissioner of Income tax vs M/s. Amritlal Bhogilal & Co. [1959] section C. R. 713 and Madan Gopal Rungta vs Secretary to the Government of Orissa, (1962) (Supp.) 3 S.C.R. were followed. Barkatali vs Custodian General of Evacuee Property, A. 1. R. , was overruled. Joginder Singh Waryam Singh vs Director, Rural Rehabilitation, Pepsu, Patiala, A. 1. R. 1955 Pepsu 91, Burhanpur National Textile Workers Union vs Labour Appellate Tribunal of India at Bombay, A. I. R. , and Azmat Ullah vs Custodian, Evacuee Property, A.I.R. 1955 All 435, were approved. State of U. P. vs Mohammed Nooh, ; , was distinguished.
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Each of these appeals is by special leave and is directed against the Award made in different disputes by the Labour Court. The common justification for ignoring the High Court and approaching this Court directly by way of special leave, according to Mr. Jitendra Sharma for each of the appellants, is that there are a couple of Full Bench decisions of the Punjab and Haryana High Court holding that the Irrigation Department of the State Government of Punjab is not an 'industry ' and no useful purpose would have been served by routing the matters through the High Court as the Full Bench decision would have been followed. The appellant in the remaining appeal was an operator in the Mechanical Division, Rohtak under the Irrigation Department of Haryana State. In each of these cases challenge was advanced by the governmental authority to the maintainability of the application before the Labour Court on the ground that the employer was not an 'industry ' and the did not apply. The common question in these appeals, therefore, is as to whether the Irrigation Department of either Government is an 'industry '. The amended definition of "industry" is as follows: "Industry means any systematic activity carried on by co operation between an employer and his workmen (whether such workmen are employed by such employer directly or by or through any agency, including a contractor) for the production, supply or distribution of goods or services with a view to satisfy human wants or wishes (not being wants or wishes which are merely spiritual or religious in nature), whether or not, (i) any capital has been invested for the purpose of carrying on such activity; or (ii) such activity is carried on with a motive to make any gain or profit, and includes (a) any activity of the Dock Labour Board established under Section 5A of the ; (b) any activity relating to the promotion of sales or business or both carried on by an establishment, but does not include (1) any agricultural operation except where such agricultural operation is carried on in an integrated manner with any other activity (being any such activity as is referred to in the foregoing provisions of this clause) and such other activity is the predominant one, Explanation: For the purposes of this sub clause, 'agricultural operation ' does not include any activity carried on in a 621 plantation as defined in clause (f) of Section 2 of the ; or (2) hospitals or dispensaries; or (3) educational, scientific, research or training institutions; or (4) institutions owned or managed by organisation wholly or substantially engaged in any charitable, social or philanthropic service; or (5) khadi or village industries; or (6) any activity of the Government relatable to the sovereign functions of the Government including all the activities carried on by the departments of the Central Government dealing with defence research, atomic energy and space; or (7) any domestic service; or (8) any activity, being a profession practised by an individual or body of individuals, if the number of persons employed by the individual or body of individuals in relation to such profession is less than ten; or (9) any activity, being an activity carried on by a cooperative society or a club or any other like body of individuals, if the number of persons employed by the cooperative society, club or other like body of individuals in relation to such activity is less than ten;" Since the amended statutory definition is not yet in force, the parent definition and judicial pronouncements have to be referred to for finding the law. In case the Irrigation Department is accepted to be "industry", there is no dispute that each of the appellants would be a "workman" and each of the claims would constitute an "industrial dispute" as defined in Section 2(s) and (k) respectively. Mukherjee & Ors., 622 ; considered the scope of the definition of industry. Chandrashekhara Aiyer, J. speaking for the Court stated: "It is therefore incumbent on us to ascertain what the statute means by industry and industrial dispute, leaving aside the original meaning attributed to the words in a simpler state of society, when we had only one employer perhaps, doing a particular trade or carrying on a particular business with the help of his own tools, material and skill and employing a few workmen in the process of production or manufacture, and when such disputes that occurred did not go behind individual levels into acute fights between rival organisations of workmen and employers; and when large scale strikes and lock outs throwing society into chaos and confusion were practically unknown. We can assume therefore that it was to meet such a situation that the was enacted, and it is consequently necessary to give the terms employed in the referring to such disputes as wide an import as reasonably possible. Though the word undertaking in the definition of industry is wedged in between business and trade on the one hand and manufacture on the other, and though therefore it might mean only a business or trade undertaking, still it must be remembered that if that were so, there was no need to use the word separately from business or trade. Undertaking in the first part of the definition and industrial occupation or avocation in the second part obviously mean much more than what is ordinarily understood by trade or business. The ratio in Mukherjee 's case was relied upon by a three Judge Bench in State of Bombay & Ors. "Besides, it would be relevant to point out that too much reliance cannot be placed on what are described as the essential attributes or features of trade or business as conventionally understood. Industrial adjudication has necessarily to be aware of the current of socio economic thought around; it must recognise that in the modern welfare State healthy industrial relations are a matter of paramount importance and its essential function is to assist the State by helping a solution of industrial disputes which constitute a distinct and persistent phenomenon of modern industrialised States in attempting to solve industrial disputes, industrial adjudication does not and should not adopt a doctrinaire approach. Negatively stated the activities of the Government which can be properly described as regal or sovereign activities are outside the scope of section 2(j). An attempt is, however, made by the appellant to suggest that in view of the Directive Principles enunciated in of the Constitution and in view of the ideal of a welfare state which has been placed before the country, Governments, both at the level of States as well as at the Centre undertake several welfare activities; and the argument is that the field of governmental or regal activities which are excluded from the operation of section 2(j) should be extended to cover other activities undertaken by the Governments in pursuit of their welfare policies. The activities which do not fall within section 2(j) and which are described as governmental or regal or sovereign have been pithily described by Lord Watson as 'the primary and inalienable functions of a constitutional Government '; and it is only these activities that are outside the scope of section 2(j). Within a couple of weeks from the Hospital Mazdoor Sabha 's case (supra), the same Bench in the case of Corporation of the City of Nagpur vs Its Employees, ; , this time Subba Rao, J., as he then was, speaking for the Court examined the self same question. Before the Court were available two precedents Mukherjee 's case 625 (supra) and Hospital Mazdoor Sabha 's case (supra) and it was stated: "Before considering the positive aspects of the definition, what is not an industry may be considered. However wide the definition of industry may be, it cannot include the regal or soveriegn functions of State. While the learned counsel for the Corporation would like to enlarge the scope of these functions so as to comprehend all the welfare activities of a modern State, the learned counsel for the respondents would seek to confine them to what are aptly termed the primary and inalienable functions of a constitutional Government " The Court analysed the activities of the various departments of the Corporation and observed: "We can also visualize different situations. A particular activity of a municipality may be covered by the definition of industry. But there may be cases where the said two departments may not only be in charge of a particular activity or service covered by the definition of industry but also in charge of other activity or activities falling outside the definition of industry. If an activity falls under either part of the definition it will be an industry within the meaning of the . (4) If a service rendered by an individual or a private person would be an industry, it would equally be an industry in the hands of a corporation. (6) If a department of a municipality discharges many functions some pertaining to industry as defined in the and the other non industrial activities, the predominant functions of the department shall be the criterion for the purposes of the . " Applying these tests, this Court examined as to whether the various departments of the Corporation came within the definition or not. Then came the decision of a Constitution Bench in the case of Management of Safdarjung Hospital vs Kuldip Singh Sethi; , where Chief Justice Hidayatullah spoke for the Court. the learned Chief Justice observed: "This definition is in two parts. The first part says that it means any business, trade, undertaking, manufacture or calling of employers and then goes on to say that includes any calling, service, employment, handicraft or industrial occupation or avocation of workmen . "Therefore, an industry is to be found when the employers are carrying on any business, trade, undertaking, manufacture or calling of employers. If they are not, there is no industry as such. The normal cases are those in which the production or distribution is of material goods or wealth and they will fall within the expressions trade, business or manufacture. ' Then came the case of Bangalore Water Supply and Sewerage Board vs A. Rajappa & Ors ; This time the same point was before a seven Judge Bench of this Court. 628 "Industry as defined in section 2(j) and explained in Banerjee (supra) has a wide import. the employer employee basis, bears resemblance to what we find in trade or business. The dominant nature test: (a) Where a complex of activities, some of which qualify for exemption others not, involves employees on the total undertaking, some of whom are not workmen as in 630 the University of Delhi vs Ram Nath; , or A some departments are not productive of goods and services if isolated, even then, the predominant nature of the services and the integrated nature of the departments as explained in the Corporation of Nagpur, will be the true test. In paragraph 149 of the judgment, the learned Chief Justice observed: "In his heroic efforts, my learned brother Krishna Iyer, if I may say so with great respect, has not discarded the tests of industry formulated in the past. Banerjee 's case, and, after that, in Corporation of the City of Nagpur vs Its Employees, and State of Bombay vs The Hospital Mazdoor Sabha to their pristine glory. " For objectivity, we have to look first to the words 631 used in the statutory provision defining industry in an attempt to find the meaning. It raises doubts as to what could be meant by the calling of employers even if business, trade, undertaking or manufacture could be found capable of being more clearly delineated. In paragraph 165 of the judgment, the learned Chief Justice added: G "I have contended myself with a very brief and hurried outline of my line of thinking partly because I am in agreement with the conclusions of my learned brother Krishna Iyer and I also endorse his reasoning almost wholly, but even more because the opinion I have dictated 632 just now must be given today if I have to deliver it at all. Therefore, I have really no time to discuss the large number of cases cited before us, including those what are known as sovereign functions. " added a note by saying: "We are in respectful agreement with the view expressed by Krishna Iyer, J. that the appeal should be dismissed. The learned Chief Justice (because by then he had assumed that office) referred to several authorities and tests and in paragraph 181 of the judgment stated: ". The remaining two learned Judges added their separate opinion and in the concluding part stated: "In view of the difficulty experienced by all of us in defining the true denotation of the term industry and divergence of opinion in regard thereto as has been the case with this Bench also we think, it is high time that the Legislature steps in with a comprehensive bill to clear up the fog and remove the doubts and set at rest once for all the controversy which crops up from time to time in relation to the meaning of the aforesaid term rendering it necessary for larger Benches of this Court to be constituted which are driven to the necessity of evolving a working formula to cover particular cases. " Bare Acts and Commentaries on the have, however, brought in the new definition by deleting the old one with a note that the new provision has yet to come into force. We may extract a part of the Report: "The irrigation department which was set up more than 100 years ago is mainly responsible to provide water supplies for the substance and development of agriculture in the 30.36 hectare cultivable area of the State covered by canal command. This requires harnessing of the surface and grounds water resources of the State and their equitable distribution to the beneficiaries, within Canal Command area. This task involves construction of multipurposes, major, medium and minor irrigation projects, maintenance of net work of channels, regulation of canal supplies, enforcement of water laws etc. Besides the irrigation the department also provides water for drinking purposes to villages and towns in the State. The canal water supplies are also being made available for the industrial development in areas where no other source for water supplies exists". This work is also done by the Department." "Having shared with the neighbouring States almost entire water resources of the rivers flowing through the Punjab water has now become a constraint to keep the tempo of the development of irrigated agriculture in the State. There is a full Bench judgment of the Punjab and Haryana High Court in the case of Om Prakash vs M/s Executive Engineers, SYL, Kurukshetra & Ors. 349 where the question that came up for consideration before the full Bench was thus stated; whether the irrigation department of the State (of Punjab) comes within the ambit of industry in section 2(j) of the Industrial disputes Act, 1947? The Court took into account the judgment of another full Bench decision of the same Court in the case of State of Punjab vs Kuldip Singh & Anr., where the question for consideration was whether the Public Works Department of the State Government was an industry. It also took into account the position of the Irrigation Department in Punjab keeping in the background the provisions of the of 1873 and stated: "The irrigation department is a branch of the public works department. All these projects have been carried out by the state at the state expense. It is understandable that such projects could not at all be undertaken by private enterpreneurs or could be left in their hands for execution. Thus it would be evident that the water has at all times been a State subject and the State can exercise full executive powers in all matters connected with the water. The State supplies water to the farmers through the network of canals. In other words, the State does not sell water to the farmers. Merely this fact that water is supplied by charging certain rates cannot warrant a finding that the state is indulging in trade or business activity or an activity which is analogous to trade, business or economic venture. From what has been stated above, there can be gainsaying that the functions of the irrigation department cannot at all be left to private enterprise. The facts which weighed in holding that the construction and maintenance of national and state highways by the State does not come within the ambit of industry in Kuldip Singh 's case (supra) are present so far as the irrigation department is concerned . In this view of the matter, I hold that the functions of the irrigation departments are essentially government functions and that these functions neither partake of the nature of trade and business nor are even remotely analogous thereto and that this department does not come within the ambit of industry as defined in section 2(j) of the Act." Mr. Shalma for the appellants placed before us some cases of different High Courts in support of his stand that the Irrigation Department should be considered as industry. On the facts found therein, the High Court came to the conclusion that it came within the definition under section 2(j) of the Act. In State of Rajasthan vs The Industrial Tribunal, Rajasthan, the question for consideration before the Rajasthan High Court was whether the Survey and Investigation Division of Irrigation Department was an industry. In paragraph 26, the learned Judge came to the conclusion by saying: "In view of the aforesaid decisions of the Supreme Court, I find it difficult to hold that the activities of the 639 State Government by organising its Survey and Investigation. Division in the Irrigation Department through which the State Government rendered services in the matter of supplying water by constructing canals and dams does not fall within the ambit of the sovereign or regal functions of the State. If in the opinion of the learned Judge, it was difficult to hold that the activities did not fall within the ambit of the sovereign or regal functions, then the conclusion should have been different. vs State of Bihar & Ors. 207, a Division Bench of the Patna High Court was considering if the Public Health Engineering Department of the State of Bihar was an industry. In paragraph 8 of the judgment, reliance was placed on the Bangalore Water Supply case (supra) and the Nagpur Corporation case (supra) and it was held that the said department of the State Government of Bihar was an industry. In Chief Engineer, Irrigation, Orissa vs Harihar Patra & Anr., a Division Bench of the orissa High Court was considering whether the Salandi Irrigation Project in that State was an industry. The High Court relied upon the earlier full Bench decision of its own Court and some of the decisions of this Court which we have referred to above, and came to hold that the irrigation project was an industry. On the tests, as already laid down in the judgments, we do not think these facts found in this case can take out the Irrigation Department outside the purview of the definition of 'industry '. We have not been able to gather as to why even six years after the amendment has been brought to the definition of industry in section 2(j) of the Act the same has not been brought into force. This Court on more than one occasion has indicated that the position should be clarified by an appropriate amendment and when keeping in view the opinion of this Court, the law was sought to be amended, it is 640 appropriate that the same should be brought into force as such or with such further alterations as may be considered necessary, and the legislative view of the matter is made known and the confusion in the field is cleared up. We make it clear that in the event of the definition of industry being changed either by enforcement of the new definition of industry or by any other legislative change, it would always be open to the aggrieved Irrigation Department to raise the issue again and the present decision would not stand in the way of such an attempt in view of the altered situation.
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These appeals were made to challenge the Labour Court's decisions. The first appellant, a foreman for the Irrigation Department, asked the Labour Court to help him get back pay for annual raises. The second appellant was a worker in the P.W.D. Drainage Division. He was fired without following the proper legal steps, so he took his case to the Labour Court. The last appellant was an operator for the Irrigation Department in Haryana State. He was also fired, and he challenged his firing in the Labour Court. In each case, the government argued that the Labour Court didn't have the authority to hear the case because the employer wasn't an "industry," and the relevant labor laws didn't apply. The Labour Court agreed and denied the workers' requests. The higher court allowed the appeals, making these points: The main question was whether the Irrigation Department counted as an "industry." The law defines "industry" in Section 2(j) of the Act. This definition was changed by an amendment, but that change hasn't taken effect yet. Because the new definition isn't in use, the old definition and past court rulings must be used to understand the law. Previous court cases already address this issue, so it's not necessary to look beyond those precedents. If the Irrigation Department is an "industry," then each worker would be considered a "workman," and their complaints would be "industrial disputes," as defined in the law. The court noted that Haryana and Punjab used to be one state, and Haryana became separate in 1966. The Irrigation Department of the old Punjab State was fulfilling the state's duties under the law. The Irrigation Department's report from 1981-82 was presented to the Court. The workers' lawyer presented cases from other High Courts to support the argument that the Irrigation Department should be considered an industry. Based on previous court rulings, the Court didn't believe the details of this case removed the Irrigation Department from the definition of "Industry." The Irrigation Department's main jobs, when tested using the "Dominant Nature" test from a previous case, clearly fit within the meaning of industry. Perhaps keeping the earlier judges' thoughts in mind, the definition of "industry" was changed in the law. However, the Court couldn't understand why, even six years after the change to the definition of "industry," it still hadn't been put into effect. The court had previously suggested that this issue should be clarified with an amendment. When the law was being amended, based on the Court's advice, it should have been put into effect, either as it was or with any necessary changes, to make the legal view clear and remove confusion. Law books now include the new definition but note that it hasn't taken effect, which adds to the confusion. The appeals were successful. The Court clarified that if the definition of "industry" is changed in the future, either by putting the new definition into effect or by another legal change, the Irrigation Department can raise the issue again. This decision won't prevent them from doing so if the situation changes.
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iminal Appeal No. 60 of 1962. Appeal by special Leave from the judgment and order dated October 25, 1961, of the Punjab High Court in Criminal Appeal No. 890 of 1961 of Murder Reference No. 74 of 1961. Jai Gopal Sethi, C. L. Sareen and R. L. Kohli, for appellant. Gopal Singh, D. Gupta, P. D. Menon, for respondent. April 27. The Judgment of the Court was delivered by DAS GUPTA, J. The Appellant was convicted by the Sessions Judge, Patiala, of an offence under s.302 of the Indian Penal Code for the murder of Gurdev Singh and sentenced to death. The Punjab High Court dismissed his appeal and confined the sentence of death. The present appeal is on the strength of special granted by this Court. The prosecution case is that at about 2.30 p.m. on November 18, 1960 when Gurdev Singh was passing the tea stall of Cbaran Singh, not far from the courts at Barnala on a motor cycle, the appellant Sewa Singh, who was at that time in that shop with a double barrel gun stood up and fired a shot at him. Gurdev Singh was hit on the right side of his chest and died instantaneously. The appellant and one Gogar Singh, who was with him, ran away. The accused pleaded not guilty. It was not disputed that Gurdev Singh had died of a gun shot 547 injury at the time and place as alleged. It was satr entiously contended, however, that he was not the culprit. According to the prosecution this occurrence was witnessed by Charan Singh, the owner of the shop and Mukhtiar Singh, a Student, and Bakhtawar Singh, the two persons who were having tea in the shop. At the trial Charan Singh denied any knowledge as to who had fired the shot and was declared hostile by the prosecution. The other two witnesses gave evidence that they saw the present appellant, who was known to them from before, firing the shot from a double barrel gun. Their evidence was believed by the Trial Judge and also by the High Court. In support of the appeal it is contended by Mr. Sethi that we should look at the evidence ourselves as the High Court does not appear to have taken into consideration, in appreciating the evidence, the Characteristics of the injuries caused by the shot. He has drawn our attention to a decision of this Court in Zora Singh vs The State of Punjab (Criminal Appeal No. 81 of 1957: Judgment delivered on 10.5 1957). According to the learned Counsel these features of the injury as they appear from the Doctor 's evidence clearly show that when the gun was fired it was held in close contact with the body of the victim or within two or three inches of it. This, argues the learned Counsel, shows that the witnesses who have claimed to have been the occurrence did not actually see the occurrence as they give a totally different version as regards the distance of the gun from the body of the victim. It has to be mentioned that the judgment of the High Court contains no discussion on this point and it does not appear that the attention of the learned Judges was 548 drawn to the features of the injury on which we are now asked to hold that the shot which killed Gurudev Singh was fired from a very close range, not exceeding a few inches. Even so, we have thought it proper to hear the Counsel on this question, ,.is in our view these features ought ordinarily to be taken into consideration in assessing the value of the evidence of the eye witnesses. The doctor 's evidence shows: (1) that the wound caused was a roundish, wound 1 1/2"x 1 1/4" communicating with the right chest cavity; (2) that the wound was plugged with a cork wadding and card board disc of 12 bore cartridge; (3) that the right fourth and fifth ribs were blown off under the wound and also the right lung was punctured over an area 2 1/2"x 2" about in its middle lobe about its interior margin in the middle which was blown off, (4) that the woollen coat, which was on the body of the deceased, was bloodstained with a corresponding rent blackened charred; the shirt was also blood stained with a corresponding rent blackened. The doctor gave the opinion that the distance from which the shot was fired might be three to four feet. There was some cross examination of the doctor in the Committing Court but the correctness of this opinion was not challenged. The doctor did not appear to give evidence before the Sessions Court. His deposition as recorded by the Committing Court was treated as evidence in the Sessions Court under the provisions of s.509 of the Code of Criminal Procedure. Turning first to the size of the wound it appears to us that far from supporting the theory of death having been caused by a contact shot it indicates that the shot was fired from about a yard away. Speaking of ordinary shot guns, Sir Sidney Smith in his Forensic Medicine, 9th Edition; page 182 says : "At about a yard the charge of shot will enter as one mass,. making a whole with irregular 549 edges about an inch in diameter." Major Sir Gerald Burrard in his Identification of firearms and Forenisic Ballistics says at P.73 : "It may be assumed for all practical purposes that if the diameter of the wound is an inch, or less, than the distance of the shot was 18 inches or under, irrespective of the gauge of the shotgun or the degree of choke. Up to 2 feet there is very little difference in the spread between guns of various and different obokes, the hole at this distance being slightly over an inch in diameter. At 3 feet the hole is nearly 1 1/2 inches in diameter, and the difference between the two extremes of boring, true cylinder and full choke, begins to be evident. ' In Lyon 's Medical Jurisprudence, 10th Edition, we find stated at p. 279 thus: "At a distance of 3 feet the shot mass begins to spread, the wound is an inch or slightly more in diameter. " In Taylor 's Principles and practice of Medical Jurisprudence, 11th Edition, 'the matter is described thus at page 334: In the case of shot guns the distance from which the weapon was fired may be deduce d from the amount of scattering of the charge. Up to about a yard the whole of the charge enters in a mass, producing a round hole about the size of the bore of the weapon. . . In view of these authorities, it is reasonable to hold even without knowing whether the gun had an unchoked or a choked barrel that a roundish wound of 1 1 /2" x 1 1/4" would be caused if the gun is fired at a distance of about a yard. We are unable to agree that the burning of the clothes as described by the doctor is any indication that the shot was fired from within a few inches. Mr. Sethi has drawn our attention to the statement made in the several text books that whet the gun is fired from a distance of only a few inched; the wound would be surrounded by a zone of black ening and burning. in the Present case no mark 550 of blackening or burning were noticed by the doctor on the skin round the wound or in the depths of the wound; but the rent in the woollen coat was found blackened and charged and the rent in the shirt blackened. On this question it is important to mention the opinion as given in the Taylor 's Principle and Practice of Medical Jurisprudence, 10th Edition at p. 441 thus: "The amount or degree to which the clothes and body of a person may be burnt by the near discharge of firearms has given rise to a medico legal inquiry. The facts in any given case can be determined only by experiments with the actual weapon used, and loaded as nearly as possible in the same manner as it was when used for the purpose which are being investigated. It is impossible to state rules as to the precise distance from which it is possible to produce marks of burning, for this depends on the quantity and nature of the powder, the method of charging, and the nature of the weapon. It is unusual, however, to get marks of burning beyond a yard or a yard and a half with a shot gun, or at more than half a yard with a revolver." According to this view therefore marks of burning may be found in the clothes or body of a person if the shot was fired at a distance of a yard or a yard and a half with a shot gun. Even though this opinion is not reiterated in Taylor 's 11th Edition, it seems clear, in view of this opinion that the presence of the burning marks in the clothes cannot from a reasonable basis for holding that the gun was fired in this case from the close range of a few inches only. It is necessary next to consider the fact that the cork was found lodged in the body. Glaister 551 in Medical Jurisprudence and Texicology, 9th Edition at p. 265 says, while speaking of a shot fired close to the body surface up to a few inches that "the wad may be forced in the wound. " It appeas to be clear that in a contact wound the wad is likely to enter the body. But the authorities are not so clear to the maximum distance at which the wad may enter the body. The nearest statement appears to be given by Sir Sidney Smith in his Forensic Medicine, 9th Edition at p. 182 thus : " 'the wads enter with the projectile in near discharges. " Reading this statement in the light of the discussion in the previous paragraphs, it appears to us that a discharge up to yard has been considered by the learned author as a near discharge. The fact that the wad was lodged in the wound appears therefore to be quite consistent with the shot having been fired from about a yard. It remains to consider what the doctors has described as the "blowing off" of the ribs and a part of the right lung. This description, if correctly given, indicates the entry of gas into the wound and that, it is true, ordinarily takes place only if the shot is fired within a few inches of the body, As we have already noticed however, the dimension of the wound itself is a clear indication that shot was fired at a distance of about a yard. There is thus some apparent inconsistency between what is indicated by the size of the wound and what the doctors has described as "the blowing off" of the ribs and a par of the right lung. As there is less likelihood of any mistake being made in the measurement of the wound than about the doctor 's view about the "blowing off" of the ribs. , we are of opinion that what the doctor has described as "blowing off" is not a good reason for thinking that the shot was fired only a few inches off from the body. 552 On a consideration of all the features of the wound as described by the doctors together, we have come to the conclusion that the doctor 's opinion as given in his examination in chief, which was not challenged in cross examination before the Committing Magistrate, that the shot may have been fired about three to four feet away should be accepted as correct. We find no reason therefore interfere with the assessment of evidence as made by the High Court and also with the order, of conviction and sentence passed by it. The appeal is accordingly dismissed. Appeal dismissed.
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Someone was found guilty of murder and was sentenced to death. Two people who saw the crime said that he shot and killed the person who died from a store. The person who died was riding a motorcycle. The doctor who looked at the body after death said the shot could have been fired from three or four feet away. No one asked the doctor questions to challenge this information in court. The person who was found guilty appealed to the High Court, but the court agreed with the first decision. The case was then brought to the Supreme Court for review. The main argument for the person found guilty was that the High Court didn't consider important details about the wound. These details could have shown the person was shot from only a few inches away, not the distance the witnesses claimed. It was argued that if the High Court had looked at these details, they might not have believed the witnesses. The court decided that the details of the deadly wound should be considered when deciding how much weight to give to what the witnesses said. After looking at all the details of the wound that the doctor described, the court agreed with the doctor's opinion. Since no one questioned the doctor's opinion that the shot was fired from three to four feet away, the court believed it was correct.
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IN THE HIGH COURT OF MADHYA PRADESH
AT INDORE
hri Abhinav Dhanodkar - Advocate for the petitioner (WP
1408/2016).
Shri L.C.Patne - Advocate for the petitioner (WP No. 5052/2016).
Shri Himanshu Joshi - Dy. Solicitor General for the respondent/UoI
hri Bhuwan Deshmukh - Government Advocate for the respondent/State.
Shri Piyush Dubey - Advocate for the respondent/intervener.
Heard on I.A.Nos. 3612/2024 and 3613/2024 applications for intervention.
These applications have been filed by the Doctors who have completed their six months training nominated for "Fundamental Abdomino- Pelvic Ultrasonography : Level 1 and aspiring to appear in the Competency - Based Evaluation test (CBE). On account of the interim orders passed in this petition, they are unable to appear in the examination in order to register themselves for performing sonography.
Keeping in view the reasons mentioned in the application and the fact that there is no reply filed by the petitioner or respondents the intervention applications, the same is allowed. The interveners are permitted to intervene in the present writ petition.
I.A.Nos. 3612/2024 and 3613/2024 are allowed and disposed of.
2 WP-1408-2016 Vide order dated 06.11.2023 application for vacating stay was disposed of with a direction to list the case for final hearing in the month of January, 2024. Even after lapse of about a year, the petitions could not be heard finally. Vide order dated 13.07.2016, this Court stayed the operation of Annexure P/4 dated 26.02.2015 and notification dated 23.06.2016. Thereafter, vide order dated 19.10.2023 fresh notification for conducting the CBE test in the month of November, 2023 was also stayed.
Learned counsel for the respondents and interveners submit that due to the interim orders passed by this Court, they are unable to appear in the CBE test under the Pre-Conception and Pre-Natal Diagnostic Techniques (Prohibition of Sex Selection) Rules, 1996 and Pre-Conception and Pre-Natal Diagnostic Techniques (Prohibition of Sex Selection) (Six Months Training) Rules, 2014 to register themselves as Sonologist.
Shri Abhinav Dhanodkar, learned counsel for petitioners submits that the members of petitioner No.1/society are qualified for registration under the Rules of 1996 as Sonologists as each one of them was registered medical practitioner and had six months training or one year experience in sonography. Hence, this vested right accrued to them cannot be taken away by compelling them to undertake six months training as provided in the Rules of 2014. In this case, the notification was issued for conducting examination in the year 2016 and thereafter in the year 2023. But due to interim order passed by this Court, no examination could be conducted and the medical practitioners are unable to practice as sonologist. At the most, the interest of members of petitioner No.1 society can be protected by 3 WP-1408-2016 observing that the impugned Rule 3(3)(b) of Rules of 1996 and Rules 6 & 9 of the Rules of 2014 shall not come in the their way during the pendency of the petitions and simultaneously respondents may be directed to conduct the examination Competency Based Evaluation test (CBE) in confirmation with the Pre-Conception and Pre-Natal Diagnostic Techniques (Prohibition of Sex Selection) (Six Months Training) Rules, 2014.
Considering the aforesaid, respondents are directed to complete the examination process initiated vide notification dated 12.10.2023. It is made clear that this examination will not come in the way of the members of petitioner No.1/society working as Sonologists.
List for final hearing in due course as similar issue is pending consideration before the Apex Court.
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The Madhya Pradesh High Court heard a case involving doctors who had finished six months of training. These doctors asked to join the case so they could take a special exam called the Competency-Based Evaluation (CBE) test. Two judges, Vivek Rusia and Binod Kumar Dwivedi, allowed these doctors to join the case. In this matter, these doctors had applied to join because they completed their training and wanted to take the CBE test. However, the Court had issued temporary orders that stopped these CBE tests. This prevented the doctors from becoming officially registered as Sonologists, who are doctors trained in using ultrasound. The Court had put a hold on a document from 2015 and an official announcement from 2016. Later, in October 2023, the Court issued another temporary stop, blocking the CBE test planned for November 2023. Requests to remove these stops were handled in November 2023, and the Court decided the main case would be heard in January 2024. Despite this, the core issue was still not settled.
The group that first brought the case, called the petitioner society, argued that its members were already qualified to register as Sonologists. They said this was according to the 1996 Rules, which aim to prevent doctors from telling parents the sex of their baby before birth. To qualify under these rules, doctors needed six months of training or one year of experience in using ultrasound. The society argued that new rules from 2014, which require an *additional* six months of training, should not take away the legal rights their members already had.
The Court realized that its temporary orders were stopping doctors from working and trainees from taking important exams. This meant the situation needed to be fixed. The Court carefully considered the existing legal rights of the original group's members. It also considered the need for the doctors who joined the case to complete their registration process. After weighing these points, the Court allowed the new doctors to join the case. The Court then ordered the opposing side to hold the CBE test, following the official announcement from October 2023 and the 2014 Rules. The Court also explained that this exam would not stop members of the original group who were already working as Sonologists. This was to make sure their established legal rights remained protected while the case was still being decided.
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399 of 1952. Petition under article 32 of the Constitution of India for a writ in the nature of habeas corpus, Godavari Parutekar, the petitioner, in person. M. C. Setalvad, Attorney General for India, (G.N. Joshi and P. A. Mehta, with him) for the respondent. December 5. The Judgment of the Court was delivered by BosE J. This is a habeas corpus petition under article 32 of the Constitution. The petitioner was detained the, 16th of October, 1951, under the of 1950 as amended in 1951. Her detention was actually longer than this but the earlier detentions were under a different set of orders which are not relevant to the present matter. The present detention is based an order of the District Magistrate, Thana, and merely says that the petitioner be detained, without specifying any period. The order of confirmation was passed the 4th of January, 1952, and there again no period was specified. The petitioner 's case is that as no period was specified in the order her period of detention expired the 31st of March, 1952, because of the amending Act of 1951 ; or at the outside the 30th of September, 1952, because of Act XXXIV of 1952 which effected a further amendment. The reply behalf of the State of Bombay is that the of 1950 was again amended by Act LXI of 1952 and that the effect of this amendment was to carry the petitioner 's detention to the 31st of March, 1953, because of section 11 A which was added to the original Act of 1950. The petitioner counters by saying that the new Act does not apply to cases in which the order of detention is not silent about its duration and so section 11 A does not serve to extend the period of her detention. She relies the following portion of section II A (2) ". every detention order which has been confirmed under section 11 before the commencement of the Preventive Detention (Second Amendment) Act 1952, shall, unless a shorter priod is specified in the order, continue to remain in force until the Ist day of April, 1953. " The petitioner concedes that no shorter period is specified in her order of detention but contends that as her detention would have expired either the 31st of March, 1952, or the 30th of September, 1952, one of those two dates must now be read into the order and when that is done we have an order which specifies as shorter period, therefore section 11 A (2) does not serve to extend her detention. We are unable to accept this contention. The section is clear and unless a shorter period is specified in the order, section I 1 A(2) applies. We cannot add the words "or must be deemed to have been specified by reason of the expiry of the earlier Act" into the section. We hold therefore that section 11 A(2) validly extended the period of detention till the Ist of April, 1953. 1 The petitioner 's next point is based articles 14 and 22(i)(b) of the Constitution. ' It arises in this way. Section 3 (1) (a) of the of 1950 classifies grounds of permissible detention into three categories. Article 22 (7) (b) empowers Parliament to prescribe the maximum period for which any person may "in any class or classes of cases" be detained. The petitioner argues that this permits only one maximum for each class and that if different maxima are provided for "equals" within a class it offends not only article 22 (7) (b) but also article 14 as interpreted by the decisions of this Court, She next argues that section 11 A, now introduced by the second amending Act of 1952 (Act LXI of 1952), does just that and so is ultra vires. Her point is put as follows. Sub section (1) of section 11 A states that the maximum period for which any person may be detained in pursuance of any detention order which has been confirmed under section 1 1 shall be twelve months from the date of detention. But sub section (2) qualifies this by dividing detentions into two classes; 213 (a) those in which the detention order was confirmed before 30th of September, 1952, and (b) those in which the confirmation was after that date, and it provides that. in the former case, unless a shorter period is specified in the order, the detention shall continue either till the 1st of April, 1953, or for twelve months from the date of detention, whichever expires later. This, she says, introduces a fresh classification which divides detentions into those before the Act and those after. That, she says, is ultra vires, first, because it introduces a discriminatory classification in the class to which she belongs under section 3 of the Act and, second, because it entails discrimination even in the fresh class into which she has been thrown by the new sub division, made by the second amending Act of 1952. As regards the first point, the ratio decidendi in Shamrao V. Parulekar vs The District Magistrate, Thana, and Others(1) applies here. In that case, detentions were divided into those which had already been considered by an Advisory Board and those which had not. This was upheld. The dividing line here is different, namely a certain date, but the principle is the same and its reasonableness is apparent from a consideration of the various amendments which have been made from time to time. The life of the Act of 1950, which was the principal Act, was extended till the 1st of October, 1952, by section 2 of the amending Act (Act XXXIV of 1952), and the effect of section 3 was to prolong the ' life of all detentions in force on 14th of March 1952, (provided they had been confirmed before that date) for so long as the principal Act was in force. At that date this meant till the 1st of October, 1952. But the second amending Act of 1952 extended the life of the principal Act till the 31st of December,1954. Therefore, in the absence of section 11 A all those detentions would have been extended till that date. But section 11 A modified that and put 1st of April,1953, as the latest date for these old detentions, (1) ; at 691 and 693. 214 It therefore conferred a benefit and cannot be deemed unreasonable. Sub section (3) of 'section 11 A shows that that was the object. But the petitioner attacked the provisions on the ground of discrimination. She said that even assuming the new classification of detentions into those before and after the 30th of September, 1952, to be good, section 11 A is nevertheless discriminatory because it discriminates amongst those in her class,, namely those whose detentions were made and confirmed before the 30th of September. She put it in this way. Taking the case of her own detention, she pointed, out that if section II A is good, it will continue till the 1st of April, 1953, that is to say, her detention will have been for a period of 17 1/2 months from the 16th of October, 1951, till the 1st of April, 1953. 'On the other hand, a person detained after her on, say, the last of September, 1952, would also be due for release on the 1st of April, 1953, and so would have had only six months ' detention. This, in our opinion, is not discrimination within the meaning of article 14. A maximum can be fixed, either by specifying a particular period, such as twelve months, or by setting an outside limit, land it is inevitable in such a case that the length of detention will vary in each individual case. Those taken into detention at a later date are bound to be detained for a shorter time. Government is not bound to detain everybody for the same length of time. , It has a discretion. Moreover, the appropriate Government has boon left power to revoke or modify the detention order at any earlier time. This point was considered in Shamrao V. Parulekar vs The District Magistrate, Thana, & Others (1) and was decided against the detenu. The petitioner endeavoured to have her application reopened on the merits contending again that the grounds of detention are vague. She relies on Shamrao V. Parulekar vs The State, of Bombay (2) where (1) ; at 691 at 693. (2) Petition No. 86 of 1952. 215 another detenu was released by another Bench of this Court in circumstances which., according to her, are very similar. We are unable to allow this as her petition has already been rejected on the merits. She was only allowed to appear on constitutional points. We understand that in the other petition this fact was not brought to the notice of the Court. The application is dismissed. Application dismissed.
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Section 11A was added to a law from 1950 by an update in 1952. It said that the longest time someone could be held under a detention order (an order to keep someone in custody) that was approved under section 11, was 12 months from when they were first detained. But subsection (2) made this rule more specific. It split detentions into two groups: (a) those approved before September 30, 1952, and (b) those approved after that date. For the first group, unless the detention order said a shorter time, the detention would last until either April 1, 1953, or 12 months from when they were detained, whichever was later. It was decided that this section did not go against article 14 or article 22 (7) (b) of the Constitution just because it created a new way to group detentions (before and after the law). This grouping was seen as fair. The section didn't unfairly treat people whose detentions were approved before September 30, 1952. This is because, as a result of the section, some people might be held for longer, and others for shorter periods. This follows the decision in the case of Shamrao Parulekar vs The District Magistrate, Thana and Others. Also, a detention order made on October 16, 1951, that didn't say how long the detention would last, was not a case where "a shorter period was specified in the order" according to section 11A (2). This is true even if the detention would have ended on either March 31, 1952, or September 30, 1952, if the law had not been changed.
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Appeal No.122 of 1956. Appeal from the judgment and order dated March 5, 1954, of the Bombay High Court in Appeal from its Original Jurisdiction Misc. 1 of 1954. H. N. Sanyal, Addl. Solicitor General, G. N. Joshi and R. H. Dhebar, for the appellants. N. A. Palkhivala, section N. Andley, J. B. Dadachanji, P. L. Vohra and Rameshwar Nath, for the respondent. The Judgment of the Court was delivered by GAJENDRAGADKAR J. This is an appeal by the Income tax Officer, Companies Circle I (1), Bombay and the Union of India and it raises a short question about the construction of section 35 of the Income tax Act read with section 1, sub section (2) and section 13 of the Indian Income tax (Amendment) Act, 1953 (XXV of 1953). The Income tax Officer, by his assessment order made on October 9, 1952, for the assessment year 1952 53, assessed the respondent, the Bombay Dyeing and Manufacturing Co. Ltd., under the Act. In the said assessment order the respondent, was given credit for Rs. 50,603 15 0 as representing interest at 2% on tax paid in advance under section 18A of the Act. This credit was given to the respondent in pursuance of the provisions contained in section 18A, sub section (5) of the Act as it then stood. Section 1, sub section (2) of the Amendment Act provides that " subject to any special provision made in this behalf in the Amendment Act, it shall be deemed to have come into 705 force on the first day of April, 1952 ". By section 13 of the Amendment Act, a proviso was added to section 18A (5) of the Act. The effect of the amendment made by the insertion of the said proviso to section 18A (5) was that the. assessee was entitled to get interest at 2% not on the whole of the advance amount of tax paid by him as before but only on the difference between the payment made and the amount at which the assessee was assessed to tax under the regular assessment under section 23 of the Act. After the Amendment Act was passed, the first appellant exercised his power under section 35 of the Act and purported to rectify the mistake apparent from the record in regard to the credit for Rs. The first appellant held that the assessee was really entitled to a credit of only Rs. 21,157 6 0 by way of interest on tax paid in advance as a result of the retrospective operation of the amendment made in section 18A (5) by the Amendment Act. In accordance with this order a notice of demand under section 29 of the Act was issued against the assessee for the sum of Rs. 29,446 9 0 on the ground that the assessee had been given credit for this excess amount through mistake. Aggrieved by this notice of demand, the respondent filed a petition in the High Court of Bombay on January 4, 1954, under article 226 of the Constitution praying for a writ against the appellants inter alia prohibiting them from, enforcing the said rectified order and the said notice of demand. It appears that this petition was admitted by Tendolkar J. on January 6, 1954, and a rule issued on it. Accordingly on March 5, 1954, the petition was heard by Chagla C. J. and Tendolkar J. and a writ was issued against the appellants. The High Court held that section 35 of the Act had no application to the facts of the case because the mistake apparent from the record contemplated by the said section is not a mistake which is the result of the amendment of the law even though the amending law may be retrospective in operation. In other words, in the opinion of the High Court, the 706 mistake mentioned by section 35 had to be apparent on the face of the order and it can only be judged in the light of the law as it stood on the day ,When the order was passed. The appellants then applied for and obtained a certificate from the High Court on October 8, 1954; on their behalf it is urged ' that the High Court of Bombay has erred in law in taking the view that the appellant No. I was not entitled to rectify the mistake in question under section 35 of the Act. Thus the short question which arises before us in the present appeal is whether an order which was proper and valid when it was made can be said to disclose a mistake apparent from the record if the said order would be erroneous in view of a subsequent amendment made by the Amendment Act when the Amendment Act is intended to operate retrospectively ? It is unnecessary to refer to the provisions of section 18A (5) as well as the provision of the proviso which was subsequently added by section 13 of the Amendment Act. It is common ground that, in the absence of the subsequently inserted proviso, the assessee would be entitled to obtain a credit for Rs. It is also common ground that, if the subsequently inserted proviso covered the assessee 's case, he would be entitled to a credit only of Rs. It is thus obvious that the order giving the relevant credit to the assessee was valid when it was made and that it would be erroneous under the subsequent amendment. In deciding this question it would be necessary to determine the true legal effect of the retrospective operation of the Amendment Act. Section 1, sub section (2) of the Amendment Act expressly provides that subject to the special provisions made in the said Act it shall be deemed to have come into force on the first day of April 1952. The result of this provision is that the amendment made in the Act by s, 13 of the Amendment Act must, by legal fiction, be deemed to have been included in the principal Act as from the first of 707 April, 1952, and this inevitably means that, at the time when the Income tax Officer passed his original order on October 9, 1952, allowing to the respondent credit for Rs. 50,603 15 0, the proviso added by section 13 of the Amendment Act must be deemed to have been inserted in the Act. As observed by Lord Asquith of Bishopstone in East End Dwellings Co. Ltd. vs Finsbury Borough Council (1), " if you are bidden to treat an imaginary state of affairs as real, you must surely, unless prohibited from doing so, also imagine as real the consequences and incidents which, if the putative state of affairs had in fact existed, must inevitably have flowed from or accompanied it. One of those in this case is emancipation from the 1939 level of rents. The statute says that you must imagine a certain state of affairs; it does not say that having done so, you must cause or permit your imagination to boggle when it comes to the inevitable corollaries of that state of affairs ". Thus, there can be no doubt that the effect of the retrospective operation of the Amendment Act is that the proviso inserted by the said section in section 18A (5) of the Act would, for all legal purposes, have to be deemed to have been included in the Act as from April 1, 1952. But it is urged for the respondent that the retrospective operation of the relevant provision is not intended to affect completed assessments. It is conceded that, if any assessment proceedings in respect of the assessee 's income for a period subsequent to the first of April 1952 were pending at the time when the Amendment Act was passed, the proviso inserted by section 13 would govern the decision in such assessment proceedings; but where an assessment proceeding has been completed and an assessment order has been passed by the Income tax Officer against the assessee, such a completed assessment would not be affected and cannot be reopened under section 35 by virtue of the retrospective operation of the Amendment Act. In support of this contention, reliance is placed on the observations of the Privy Council in Delhi Cloth and (1) , 132. 90 708 General Mills Co. Ltd. vs Income tax Commissioner, Delhi and Anr. Lord Blanesburg who delivered the judgment of the Board referred to the Board 's earlier decision in the Colonial Sugar Refining Company vs Irving (2) where it was in effect laid down that, while provisions of a statute dealing merely with matters of procedure may properly, unless that construction be textually inadmissible, have retrospective effect attributed to them, provisions which touch a right in existence at the passing of the statute are not to be applied retrospectively in the absence of express enactment or necessary intendment. The learned Judge then added that " Their Lordships have no doubt that the provisions which, if applied retrospectively, would deprive of their existing finality orders which, when that statute came into force, were final, are provisions which touch existing rights. " The argument for the respondent is that the assessee has obtained a right under the order passed by the Income tax Officer to claim credit for the specified amount under section 18A(5) and the said right cannot be taken away by the retrospective operation of section 13 of the Amendment Act. The same argument is put in another form by contending that the finality of the order passed by the Incometax Officer cannot be impaired by the retrospective operation of the relevant provision. In our opinion, this argument does not really help the respondent 's case because the order passed by the Income tax Officer under section 18A(5) cannot be said to be final in the literal sense of the word. This order was and continued to be liable to be modified under section 35 of the Act. What the Income tax Officer has purported to do in the present case is not to revise his order in the light of the retrospective amendment made by section 13 of the Amendment Act alone, but to exercise his power under section 35 of the Act; and so the question which falls to be considered in the present appeal. The respondent then urged that the Amendment Act should not be given greater retrospective operation than its language and its general scheme render necessary. This convention is based on the provisions of section 3, sub section (2), section 7, sub section (2) and section 30, sub section (2) of the Amendment Act. Since section 13 does not specifically authorise the reopening of concluded assessments it should be held that its retrospective operation is not intended to cover such concluded assessments. That in brief is the argument. We are, however, not satisfied that this argument is wellfounded. Section 3, sub section (1) of the Amendment Act makes several additions and modifications in section 4 of the principal Act. Section 3, sub section (2) then provides that, the amendments made by sub cl. (b) of sub section (1) shall be deemed to be operative in relation to all assessments for any year whether such assessments have or have not been concluded before the com mencement of the Amendment Act of 1953. It would be noticed that the main object of this sub section is to extend the retrospective operation of the relevant provisions of the Amendment Act beyond the first of April 1952 mentioned by section 1, sub section (2) of the Amendment Act. Since it was intended to provide for such further retrospective operation of the relevant provision the legislature thought it advisable to clarify the position by saying that the said extended retrospective operation would cover all assessments whether they had been completed or not before the commencement of the Amendment Act. Section 7, sub section (1) adds two provisos to section 9 of the principal Act by cls. (a) and (b). Sub section (2) of section 7 then lays down that the amendments made in cl. (a) of sub section (1) shall be deemed to be operative for any assessment for the year ending the 31st day of March, 1952, whether made before or after the commencement of this Act and, where any such 710 assessment has been made before such commencement, he Income tax Officer concerned shall revise it whenever necessary to give effect to this amendment. The position under section 30, sub section (2) of the Amendment Act is substantially similar. By sub section (1) of this section certain additions and amendments are made in the schedule to the principal Act by cls. (a), (b), (c) and (d). sub section (2) then provides for the retrospective operation of the amendment made by sub section (1) in terms similar to those used in section 7, sub section It is clear that the Provisions in sections 7 and 30 are intended for the benefit of the assessees and so the legislature may have thought it necessary to confer on the Income tax Officer specific and express power to revise his orders in respect of the relevant assessments wherever necessary to give effect to the amendments in question. The effect of this provision is to make it obligatory on he Income tax Officer to revise his original orders in he light of the amendments and also to confer on the assessee right to claim such revision. It may be con ceded that in respect of the other retrospective provisions of the Amendment Act such a power to revise the earlier orders cannot be claimed or exercised by the Income tax Officer. In other words, a distinction can be drawn between there two provisions of the Amendment Act and the rest in respect of the power which the Income tax Officer can purport to exercise to give effect to the amendments made by the Amendment Act. Whereas, in respect of the amendments made by section 7 and section 30 of the Amendment Act, the Income tax Officer can and must revise his earlier orders covered by section 7, sub section (2) and section 30, sub section (2), such a power of revision has not been conferred on him in the matter of giving effect to the other amendments made in the Amendment Act. Even so, we do not think it would be legitimate or reasonable to hold that the provisions of section 7(2) and section 30(2) lead to the infference that the retrospective operation of the other provisions of the Amendment Act is not intended to affect concluded assessments in any manner whatever. In this connection, it would be pertinent to remember that the power to revise which has been conferred on 711 the Income tax Officer by section 7(2) and section 30(2) of the Amendment Act is distinct and independent of the power to rectify mistakes which the Income tax Officer can exercise under section 35 of the Act. It is in the light of this position that the extent of the Income tax Officer 's power under section 35 to rectify: mistakes apparent from the record must be determined; and in doing so, the scope and effect of the expression " mistake apparent from the record " has to be ascertained. At the time when the Income tax Officer applied his mind to the question of rectifying the alleged mistake, there can be no doubt that he had to read the principal Act as containing the inserted proviso as from April 1, 1952. If that be the true position then the order which he made giving credit to the respondent for Rs. 50,603 15 0 is plainly and obviously inconsistent with a specific and clear provision of the statute and that must inevitably be treated as a mistake of law apparent from the record. If a mistake of fact apparent from the record of the assessment order can be rectified under section 35, we see no reason why a mistake of law which is glaring and obvious cannot be similarly rectified. If, as a result of the said fiction we must read the subsequently inserted proviso as forming part of section 18A(5) of the principal Act as from April 1, 1952, the conclusion is inescapable that the order in question is inconsistent with the provisions of the said proviso and must be deemed to suffer from a mistake apparent from the record. That is why we think that the Income tax Officer was justified in the present case in exercising his power under section 35 and rectifying the said mistakes. (1)(1957) 712 In this connection it would be useful to refer to the decision of the Privy Council in the Commissioner of [Income Tax, Bombay Presidency and Aden vs Khemchand Ramdas (1). In Khemchand 's case, the assessees were registered as a firm and they were assessed under section 23(4) on an income of Rs. Being a registered firm no super tax was levied. A notice of demand was also made before March 1927. On February 13, 1928, the Commissioner, in exercise of his powers under section 33, cancelled the order registering the assessee as a firm and directed the Income tax Officer to take necessary action. The Income tax Officer accordingly assessed the firm to super tax on May 4, 1929. The Privy Council held that the assessment made on January 17, 1927, was final both in respect of the income tax and super tax. The fresh action taken by the Income tax Officer on May 4, 1929, was out of time though it had been taken in pursuance of the directions of the Commissioner and that the order of May 4, 1929, was one which the Income tax Officer had no power to make. One of the points raised before the Privy Council was whether, under the relevant circumstances the Income tax Officer had power to make the impugned order in view of the provisions of sections 34 and 35 of the Act. The Privy Council dealt with this question on the footing that the Commissioner 's order cancelling the registration had been properly made. On this basis their Lordships thought that it was unnecessary to consider whether the. case would attract the provisions of section 34 " inasmuch as in Their Lordships ' opinion the case clearly would have fallen within the provisions of section 35 had the Income tax Officer exercised his powers under the section within one year from the date on which the earlier demand was served upon the respondents ". The judgment shows that Their Lordships took the view that looking at the record of the assessments made upon the respondents as it stood after the cancellation of the respondents ' registration and the order effecting the cancellation would have formed part of the record it would be apparent that a mistake (1)(1938) L.R. 713 had been made in stating that no super tax was leviable. This decision clearly shows that the subsequent cancellation of the assessees ' registration was held by Their Lordships of the Privy Council to form part of the record retrospectively in the light of the said subsequent event, and the order was deemed to suffer from a mistake apparent from the record so as to justify the exercise of the rectification powers under section 35 of the Act. It is because Their Lordships thought that section 35 would have been clearly applicable that they did not decide the question as to whether section 34 could also have been invoked. This decision lends considerable support to the view which we are disposed to take about the true meaning and scope of the expression " the mistake apparent from the record " occurring in section 35. We must accordingly hold that the High Court of Bombay was in error in coming to the conclusion that the notice issued by the Income tax Officer calling upon the respondent to pay 9the sum of Rs. The result is the order passed by the High Court issuing a writ against the appellant is set aside and the appeal is allowed with costs throughout. Appeal allowed.
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The Income Tax Officer made an order on October 9, 1952. This order said the person had to pay taxes for the year 1952-53. The order also gave the person credit for about 50,603 rupees. This was for interest on taxes paid early, as allowed by a rule in the Income Tax Act. On May 24, 1953, a change to the Income Tax Act became law. This change added a condition to the rule about interest on early tax payments. The new condition said the person would get interest only on the difference between what they paid early and the final amount they owed. They wouldn't get interest on the whole early payment. The changed law said it was to be considered in effect from April 1, 1952. The Income Tax Officer used another rule in the Act to correct the original order. He said the person should only get about 21,157 rupees in interest because of the change to the early tax payment rule. This change was applied to the past. The officer then sent a notice to the person demanding about 29,446 rupees, which was the difference. The person filed a request with the High Court of Bombay. They asked the court to stop the tax authorities from enforcing the corrected order and demand for payment. They used a part of the Constitution to make this request. The High Court agreed with the person and issued an order stopping the tax authorities. They said the rule used to correct the order did not apply in this case. The court said the mistake had to be clear just by looking at the original order. The court also said the order had to be judged based on the laws at the time it was made. However, it was decided that the Income Tax Officer was right to correct the mistake using the rule. Because of the way the changed law was written to apply to the past, the new condition must be seen as part of the original early tax payment rule from April 1, 1952. This means the Income Tax Officer's first order, from October 9, 1952, did not follow the new condition. It had a mistake that was clear from the record. Two previous cases were mentioned as relevant examples. The order made by the Income Tax Officer about early tax payments was not truly final. It could be changed later under the rule about correcting mistakes. It is also not right to say that the change to the early tax payment rule was not supposed to affect past situations that were already settled.
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IN THE HIGH COURT OF DELHI AT NEW DELHI Lovee Narula v. ED 1. The instant bail application has been filed on behalf of the applicant under Section 483 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (hereinafter "BNSS") and/or Section 439 of the Code of Criminal Procedure, 1973 (hereinafter "CrPC") read with Section 45 of the Prevention of Money Laundering Act, 2002 (hereinafter "PMLA") seeking grant of regular bail in ECIR/DLZO-II/03/2024 dated 22nd April, 2024 registered under Sections 3 and 4 of the PMLA, arising out of FIR No. 59/2024 dated 12 th March, 2024, registered at Police Station - Crime Branch, Delhi for offences punishable under Sections 274, 275, 276, 420, 468, 471 read with 120B and 34 of the Indian Penal Code, 1860 (hereinafter "IPC"). 2. The brief facts that led to the filing of the instant application are that on 12th March, 2024, FIR No. 59/2024 was registered at Police Station - Crime Branch, Delhi under Sections 274, 275, 276, 420, 468, 471 read with 120B of the IPC, based on a complaint by SI Gulab Singh. The complaint alleged the involvement of several accused persons in the procurement, manufacturing and sale of spurious anti-cancer medicines. 3. In the said FIR, it has been alleged that the primary accused, namely Viphil Jain and Suraj Shat, in collusion with their several associates, were engaged in the illegal procurement of empty vials and raw materials of anti- cancer drugs such as Keytruda and Opdyta. These counterfeit drugs were allegedly manufactured and distributed in the market to unsuspecting cancer patients. 4. Pursuant to the information received, the police formed six teams to conduct simultaneous raids across Delhi-NCR on 11th March, 2024. During the raid at Flat No. 1101, Block-2, Eleventh Floor, CSP Units, DLF Capital Greens, Moti Nagar, New Delhi, the accused persons were allegedly caught in the act of filling empty vials with unauthorized substances and packaging them using specialized machinery. The police seized a substantial quantity of raw materials, counterfeit vials, packaging equipment etc.
5. It is stated that the applicant herein was allegedly in contact with the primary accused since the year 2020 and is accused of purchasing spurious anti-cancer injections from the co-accused Neeraj Chauhan without proper billing and documentation. It is further alleged that the applicant knowingly facilitated the sale of these counterfeit drugs, generating proceeds of crime amounting to Rs. 7,45,000/- which were allegedly deposited in various bank accounts. 6. Based on the FIR, the Directorate of Enforcement (hereinafter "ED") initiated ECIR/DLZO-II/03/2024 dated 16th March, 2024 under Sections 3 and 4 of the PMLA. The applicant was initially included as a witness in the investigation, however, following further investigation, he was named as accused No. 9 in the first supplementary prosecution complaint dated 20th July, 2024 filed before the learned Special Judge under the allegations of money laundering. 7. Thereafter, the applicant was arrested by the ED on 22nd May, 2024 and remanded to custody. In the meanwhile, the applicant applied for interim bail before the learned Special Judge citing the ailing health of his father, however, the said interim bail application was rejected. Subsequently, the applicant applied for interim bail before this Court which was granted on 12th September, 2024. Following the same, the learned Special Judge took cognizance of the aforementioned ECIR vide order dated 21 st September, 2024. 8. Pursuant to the above, the applicant filed a regular bail application before the learned Special Judge which was dismissed vide order dated 15th October, 2024. Hence, the present bail application.
9. Mr. Siddharth Aggarwal, learned senior counsel appearing on behalf of the applicant submitted that the applicant herein is entitled to be released on regular bail as the quantum of proceeds of crime attributed to him is Rs. 7,45,000/- which is significantly below the threshold limit of Rs. 1 Crore as prescribed under the proviso to Section 45 of the PMLA. Consequently, the rigors of the twin conditions under the main provision of Section 45 of the PMLA are not applicable and the applicant is entitled to bail under the relaxed conditions laid down in the proviso. He has placed his reliance on judgements titled Amit Katyal v. Union of India, 2024 SCC OnLine Del 1909, Rajeev Sharma v. Enforcement Directorate, (2022) 1 HCC (Del) 66 and Sidhique Kappan v. Directorate of Enforcement, 2022 SCC OnLine All 898. 10. It is submitted that the applicant had no knowledge or intent to commit the alleged offence and is nowhere implicated in the commission of the scheduled offence under FIR No. 59/2024. The applicant was initially named as a prosecution witness, and his name appears at Serial No. 4 in the list of witnesses in the charge sheet. This clearly indicates that he was not considered an accused in the scheduled offence and had no direct role in its commission. It is further submitted that the Hon‟ble Supreme Court in Vijay Madanlal Choudhary v. Union of India, (2023) 12 SCC 1 has held that at the stage of bail under PMLA, the primary consideration is whether the accused possessed the requisite mens rea, and the Court is not required to record a positive finding of guilt. 11. It is submitted that the prosecution‟s case against the applicant is entirely based on the statements of the co-accused persons recorded under Section 50 of the PMLA post their arrest. These statements are inadmissible in evidence, being obtained under coercive custody and hit by Article 20(2) of the Constitution of India, as affirmed by the Hon‟ble Supreme Court in Pavana Dibbur v. Directorate of Enforcement, 2023 SCC OnLine SC 1586. Further, there exists no independent evidence to corroborate these statements, and as such, the prosecution cannot rely solely on these statements to indicate the applicant‟s alleged role in the offence.
12. It is submitted that any purchase of anti-cancer drugs, if made, was under a bonafide belief that they were genuine and procured through legitimate banking channels. The applicant paid Rs. 1.20 Lakhs per vial, which is indicative of a legitimate business transaction. The prosecution has failed to establish that the applicant knowingly purchased spurious drugs or intended to benefit from illegal transactions. The Karnataka High Court in Razorpay Software Pvt. Ltd. v. Union of India, 2024 SCC OnLine Kar 23 has held that negligence without knowledge of the predicate offence does not constitute an offence under Section 3 of the PMLA. 13. It is submitted that the applicant‟s arrest was made in gross violation of Section 19 of the PMLA, which mandates that the arresting officer must have "reason to believe" that the person is guilty based on the material in his possession. In the present case, the applicant was arrested solely for his alleged failure to produce certain documents, which is not a ground for arrest under the PMLA. It is pertinent to mention that the applicant fully cooperated with the investigation and his statement under Section 50 of the PMLA was recorded before his arrest on 5th April, 2024, and later during custody on multiple occasions. The Hon‟ble Supreme Court in Pankaj Bansal v. Union of India, 2023 SCC OnLine SC 1244, held that arrest in the absence of substantive evidence to support guilt under PMLA vitiates the proceedings. 14. It is submitted that the prosecution complaint was filed on 6th June, 2024, and subsequent proceedings have been delayed, with the matter currently at the stage of compliance under Section 207 of the Cr.P.C. There is no likelihood of an early conclusion of the trial and therefore, the applicant is entitled for bail. The Hon‟ble Supreme Court in Javed Gulam Nabi Shaikh v. State of Maharashtra and Another, 2024 SCC OnLine SC 1693, has reiterated that prolonged incarceration during pending trials violates the fundamental right to a speedy trial under Article 21 of the Constitution.
15. It is submitted that the applicant satisfies the triple test for bail as he has roots in society and is not a flight risk, has no propensity to tamper with evidence considering that the entire evidence is documentary and in the custody of the investigating agency and the applicant is willing to abide by any conditions imposed by this Court. 16. It is submitted that the alleged violations/offence primarily fall under the Drugs and Cosmetics Act, 1940, which does not fall under the scheduled offences of the PMLA. The alleged sale of medicines without invoices is governed by Section 27 of the Drugs and Cosmetics Act, 1940 which prescribes specific penalties for such violations. Reliance in this regard has been placed on the judgment of the Hon‟ble Supreme Court in Union of India v. Ashok Kumar Sharma, (2021) 12 SCC 674, wherein, it was held that regulatory infractions should be dealt with under specialized statutes only, rather than general penal provisions. 17. It is submitted that the applicant‟s father is suffering from Grade IV carcinogenic brain tumor, and the applicant has been previously granted interim bail to attend to his ailing father. His grandfather, aged 94, is also suffering from severe medical conditions. The Hon‟ble Supreme Court has consistently held that humanitarian considerations should be taken into account while considering bail, as reiterated in Manish Sisodia v. Enforcement Directorate, 2024 SCC OnLine SC 2274. 18. In light of the above submissions, it is prayed that the instant application may be allowed and the reliefs be granted as prayed for. 19. Per Contra, learned counsel appearing on behalf of respondent-ED vehemently opposed the instant application submitting to the effect that the same is liable to be dismissed being devoid of any merit. 20. It is submitted that the applicant is a close associate of the principal accused namely Viphil Jain and was actively engaged in the distribution and sale of spurious anti-cancer drugs through his family-owned businesses, M/s Narula Associates and M/s Imperial Healthcare Pvt. Ltd.
21. It is submitted that the investigation has revealed financial transactions amounting to Rs. 42 Lakhs between the applicant and co- accused Viphil Jain which establishes the applicant's role in facilitating the supply of counterfeit medicines to unsuspecting cancer patients. The respondent contends that the applicant misused his position and reputation in the medical business to act as a conduit for the proceeds of crime generated from the illicit sale of counterfeit drugs. 22. It is emphasized that under Section 45 of the PMLA, the accused must satisfy the mandatory twin conditions to be eligible for bail, which are, that the prosecution must be given proper opportunity to oppose the bail application and when opposed, the Court has to be satisfied that there are reasonable grounds to believe that the accused is not guilty of the offence, and that the accused is not likely to commit any offence while on bail. 23. It is submitted that given the gravity of the allegations and the applicant‟s involvement in the systematic collaboration with the co-accused, the applicant fails to satisfy these conditions and is not entitled to the discretionary relief of bail. 24. It is submitted that the applicant had full knowledge of the illicit nature of the transactions and was actively involved in the purchase and sale of spurious drugs without proper authorization or invoices. The applicant collaborated with co-accused Viphil Jain, Neeraj Chauhan, and Tushar Chauhan in the organized network of counterfeit drug distribution, as evidenced by bank transactions, statements, and seized records. The applicant's transactions were deliberately structured to conceal the source of illicit funds, making him complicit in the offence of money laundering. ―10. Role of accused in the offence of money laundering A. Evidences of offence of money laundering against Smt Saumya Chaurasia--
Mrs Saumya Chaurasia is an officer of the Chhattisgarh State Civil Services who was posted as the Deputy Secretary in the Office of Chief Minister of Chhattisgarh and was working as an OSD to CM. Despite being relatively very junior in the bureaucratic hierarchy, she enjoyed unprecedented power and control because of her direct access to higher political powers. Information shared by the Income Tax Department and analysis of documents and digital devices seized during the searches conducted under Section 17 PMLA, 2002 revealed that Smt Saumya Chaurasia, Deputy Secretary working in the Chief Minister's Office, is one of the key persons in creation of the syndicate headed by Shri Suryakant Tiwari. An extortion racket of this magnitude and nature was possible only when multiple State agencies fell in place and everyone supported the illegal acts of Suryakant Tiwari. This was made possible by Saumya Chaurasia so that pliant officers were posted in the coal mining districts who would listen to Suryakant Tiwari. Also, it was an unwritten rule that instructions of Suryakant Tiwari meant the voice of Saumya Chaurasia and the powers to be. The fact that Suryakant Tiwari had personal and close official dealings with her and was carrying her instructions to the officers, made it possible for Suryakant Tiwari to also command senior district level officers. This illegal authority was essential for him to run his empire of illegal extortion from coal & iron pellet transportation. Without his concurrence, no NOC was issued by the district machinery. All this was made possible by the fact that he was in the good books of Mrs Saumya Chaurasia. Therefore, she has directly indulged in the offence of money laundering as defined under Section 3 PMLA, 2002 being actually involved in the process of money laundering by way of possession, concealment, use, acquisition and projecting the proceeds of crime as untainted property.
As per the findings of the investigation, it can be inferred that Saumya Chaurasia has directly acquired ―proceeds of crime‖ as defined under Section 2(l)(u) PMLA, 2002 to an extent of more than Rs 30 crores. ED's investigation makes it evident that although all the money of extortion on coal & iron pellet transportation was collected by the syndicate of Suryakant Tiwari, he was not the final beneficiary of this scam. He did utilise large amounts of money for purchasing benami assets, but big chunks of the money were transferred to Saumya Chaurasia, spent on political funding and transferred as per the instructions of higher powers. Mr Manish Upadhyay, a relative of Mr Suryakant Tiwari, is a close associate of both Mrs Saumya Chaurasia & Mr Suryakant Tiwari. ED investigation has established that Mr Manish Upadhyay was inserted in as an extra layer of protection for cash dealings between Mr Suryakant Tiwari and Mrs Saumya Chaurasia. He used to transport cash from Mr Suryakant Tiwari to Mrs Saumya Chaurasia. ED investigation has established that Mrs Saumya Chaurasia and her family went on a spree of acquiring immovable assets during the period which coincided with the coal levy scam. These assets of which she is the real beneficial owner were identified and attached by issuance of provisional attachment orders(s) as detailed in succeeding paragraphs.‖ 20. The evidence relating to strong relations between the appellant and Mr Suryakant Tiwari, between the appellant and Mr Manish Upadhyay, and between the appellant and Mr Anurag Chaurasia; the evidences of movement of funds acquired out of extortion syndicate run by Mr Suryakant Tiwari to Manish Upadhyay, proxy of the appellant; the utilisation of proceeds of crime and acquisition of properties by the appellant in the name of her mother Shanti Devi and cousin Mr Anurag Chaurasia along with the details of the said properties, etc. have been detailed in the said prosecution complaint, which leave no doubt in the mind of the Court that prima facie the appellant has been found involved in the commission of the offence of money laundering as defined in Section 3 of the said Act.
21. The next question that falls for consideration before the Court is whether the appellant being a woman should be granted the benefit of the first proviso to Section 45 PMLA, which reads as under: ―45. Offences to be cognizable and non-bailable.--(1) * * * Provided that a person who is under the age of sixteen years or is a woman or is sick or infirm [or is accused either on his own or along with other co-accused of money-laundering a sum of less than one crore rupees], may be released on bail, if the Special Court so directs:...‖ 103. Moreover, it is pertinent to mention here that the word used in the proviso to Section 45 of the PMLA is „may‟ which indicates that it is the discretion of the Court concerned and it is not a mandate. As observed by the Hon‟ble Supreme Court in a catena of judgments, it is the discretion of the Court and all the other relevant factors are needed to be weighed in while adjudicating the bail application. The relevant factors include the gravity of the offence, likelihood of reoccurrence, criminal antecedents etc. 104. In view of the foregoing judgment, this Court holds that the applicant cannot claim the benefit of the monetary threshold exemption under the proviso to Section 45 of the PMLA even if the proceeds of crime alleged against the applicant is merely Rs. 7,45,000/-. 105. The entire scheme of laundering illicit funds, as uncovered by the investigation, extends far beyond the threshold of one crore rupees, and the applicant's role must be assessed in the broader context of the criminal conspiracy in which he actively participated. 106. It is evident that an entire syndicate with established network and properly defined roles exist and operates at different levels, which, when taken into consideration in entirety, clearly indicate that the proceeds of crime are more than Rs. 1 Crore, and thus, the proviso is not applicable in the present case. 107. Now this Court shall decide as to whether the applicant satisfies the twin conditions of bail under Section 45 of the PMLA.
108. It is well settled, as reiterated by the Hon‟ble Supreme Court in Vijay Madanlal Choudhary (Supra) and Manish Sisodia (Supra), that while the stringent twin conditions under Section 45 of the PMLA restrict the right to bail, they do not impose an absolute bar. The discretion of the Court in granting bail remains judicial and must be exercised in accordance with the settled legal principles. The governing principle that "bail is the rule, and jail is the exception" must be harmonized with the legislative mandate that requires satisfaction of the conditions laid down under Section 45 of the PMLA before bail can be granted. 109. In the present case, the respondent has placed on record material indicating the applicant‟s active involvement in the procurement and sale of spurious anti-cancer medicines, the proceeds of which were funneled through various channels, including formal banking and hawala transactions. The grounds of arrest, along with financial records and electronic evidence, establish a prima facie case of money laundering. The applicant‟s role in the laundering of illicit proceeds stands corroborated by the investigative findings, including statements under Section 50 of the PMLA and independent documentary evidence. 110. The applicant has failed to discharge the burden placed upon him under Section 45(1)(ii) of the PMLA which requires him to that there are reasonable grounds for believing that he is not guilty of the offence. The material produced by the respondent, including financial transactions linked to the proceeds of crime and the applicant‟s own admissions, points to his direct and active involvement in the offence. Mere assertions that the applicant was a passive investor and was unaware of the illegality of the transactions do not satisfy the threshold required to overcome the presumption under the PMLA. 111. Further, the second limb of Section 45(1)(ii) of the PMLA, which mandates that the applicant must satisfy the Court that he is not likely to commit any offence while on bail, is also not met. 112. The nature of the offence in the instant case, involving a sophisticated network for the distribution of counterfeit medicines targeting vulnerable patients, demonstrates a potential for re-offending if bail is granted. The involvement of multiple entities and associates in the fraudulent scheme raises a genuine apprehension that the applicant, if released, may influence witnesses and tamper with evidence, thereby, jeopardizing the ongoing investigation.
113. In view of the facts and circumstances, this Court finds that the twin conditions prescribed under Section 45 of the PMLA have not been satisfied. The evidence on record, the ongoing nature of the investigation, and the applicant‟s alleged role in the broader financial and selling of spurious medicines syndicate indicate that the rigors of Section 45 of the PMLA continue to apply. 114. The present bail application has also been filed under Section 439 of the CrPC, therefore, this Court, while considering the plea for bail, deems it necessary to evaluate the applicant‟s case through well-established principles governing the grant of bail under the said provision. Notwithstanding the rigors of Section 45 of the PMLA, the courts have consistently applied the „triple test‟ as a guiding framework while considering bail applications under special statutes, including the PMLA. 115. The triple test, derived from Section 439 of the CrPC, consists of the various parameters. First, whether the accused is likely to abscond or evade the process of law if released on bail. Given the nature of offences under the PMLA, which often involve complex financial transactions and cross-border elements, the potential for absconding is a significant concern. Second, whether the accused, if released, is likely to influence witnesses or tamper with evidence. In money laundering cases, where the trail of proceeds of crime is intricate and dependent on multiple records and statements, the possibility of interference with ongoing investigations remains high, and third, whether there is a reasonable apprehension that the accused may indulge in similar offences if granted bail, thereby prejudicing the ongoing investigation and endangering public interest. 116. In Satender Kumar Antil v. CBI, (2022) 10 SCC 51, the Hon‟ble Supreme Court has held that while granting bail, the gravity of the allegations must be taken into account. 117. Applying the aforementioned principle to the present case, this Court finds that the gravity of the allegations against the applicant is of a serious nature, involving the alleged laundering of proceeds derived from the sale of spurious anti-cancer medicines. The offence not only entails significant financial implications but also poses a grave risk to public health and safety.
118. As observed in the foregoing paragraphs, but not being repeated for the sake of brevity, the applicant in the present case is alleged to have played an active role in the procurement, distribution, and financial management of the illicit business. 119. The evidence on record, including financial transactions and digital communications, suggests a well-orchestrated operation which demands a higher threshold of investigation before granting bail. The investigating agency has highlighted the potential risk of the applicant tampering with the evidence and influencing witnesses, thereby, affecting the integrity of the ongoing investigation. 120. In the present case, the applicant has failed to demonstrate that his release would not pose a risk to the investigative process. The applicant‟s financial dealings, the intricate network of the accused persons, and the continuing investigation reinforce the respondent‟s concerns regarding the potential for obstruction of justice. 121. Thus, in addition to failing to fall under the proviso to Section 45 of the PMLA and satisfy the twin conditions under Section 45(1) of the PMLA; the applicant also fails to meet the general considerations under the triple test for the grant of bail. Consequently, the applicant‟s custody is warranted to ensure the integrity of the investigation and prevent any potential misuse of the judicial process. 122. At this stage, it is also pertinent to mention that during the course of arguments, it has been contended by the learned senior counsel for the applicant that several co-accused persons, who play a major role in the predicate offence, have been enlarged on bail in the predicate offence and thus, the instant applicant‟s bail plea may also be considered in light of the same. 123. However, this Court is unable to accept the contention put forth by the learned senior counsel for the applicant as it is a settled position of law that the in order to grant bail to an accused under the PMLA, only the rigors of twin conditions of Section 45 of the PMLA are to be looked into primarily and only after satisfaction of the same, the Court may proceed to the other factors depending upon the type of crime committed.
124. In the present case, the applicant has not been charged for some minor offence that has simple economic ramifications, rather he has been charged for supplying and selling of spurious life saving anti-cancer medicines and that he is part of an established crime syndicate. This factual position does not satisfy the consciousness of this Court and there are considerable reasons to believe that there is likelihood that the applicant might commit offence while on bail as the applicant does not have clean criminal antecedents. Thus, the said argument stands rejected. 125. Having dealt with all the issues, this Court is of the view that considering the filing of the first supplementary prosecution complaint and the ongoing nature of the investigation, it is not satisfied that the applicant has fulfilled the twin conditions under Section 45 of the PMLA. The respondent has presented sufficient material to warrant further investigation, including financial records, electronic evidence, and statements of co- accused implicating the applicant. These materials suggest an active involvement in laundering proceeds of crime and a pattern of financial transactions that need further investigation. 126. The ongoing investigation is an extensive and meticulous effort by the investigating agency to unearth a broader nexus of financial misconduct and uncover deeper layers of the offence alleged herein. As new evidence continues to emerge, it may further solidify the allegations against the applicant. The complexity of the financial trail and its potential societal and national ramifications require continued custodial interrogation and thus, this Court does not find any merit in the instant bail application. 127. In light of the above discussions on facts and law, it is held that the applicant has been unable to put forth any propositions before this Court that are sufficient for grant of bail and thus, the same are rejected. In view of the same, this Court is not inclined to release the applicant on bail and the instant application, is, hereby, dismissed along with the pending applications, if any. 128. The applicant, if on interim bail, is directed to surrender before the Court concerned within a period of seven days from today and the sureties/bail bond, if any shall stand discharged. If the applicant fails to surrender as directed, the investigating agency shall take appropriate steps to take the applicant in custody to secure his presence.
129. It is made clear that any observations made herein are only for the purpose of deciding the present petition and shall not be construed as an expression on the merits of the case. The learned Trial Court shall proceed with the matter uninfluenced by any observations made by this Court and shall decide the case strictly in accordance with law. 130. The order will be uploaded on the website forthwith.
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A person asked the Delhi High Court to let them out on 'bail,' which means being temporarily released from jail while a case is ongoing. This request was made under various laws, including the Prevention of Money Laundering Act (PMLA) and the Criminal Procedure Code (CrPC). The person was accused of money laundering and other crimes like fraud and forgery, which started from a police complaint (FIR). Judge Chandra Dhari Singh refused to release the person on bail. The judge said the money trail was very complex, and the crime could have serious effects on society and the country. Because of this, the person needed to stay in custody for more questioning. A police report (called an FIR) was filed. It stated that several people were involved in getting, making, and selling fake anti-cancer medicines. The main people accused worked with others to illegally get empty medicine bottles and basic ingredients for cancer drugs like Keytruda and Opdyta. They then supposedly made fake versions of these drugs and sold them to cancer patients who had no idea they were not real. After getting this information, the police carried out raids at the same time. They reportedly caught the accused people actively putting unapproved substances into empty bottles and packaging them with special machines. The police took a large amount of raw materials, fake medicine bottles, and packaging equipment. The person asking for bail (the applicant) was supposedly in contact with the main accused since 2020. This applicant is accused of buying fake anti-cancer injections from others involved in the crime, without proper receipts or records. It is also claimed that the applicant knowingly helped sell these fake drugs. This made about Rs. 7,45,000 in 'proceeds of crime' (money gained from illegal activity), which was then supposedly put into different bank accounts.
Because of the police report (FIR), a government agency called the Directorate of Enforcement (ED), which deals with financial crimes, started its own investigation (called an ECIR). The ED then arrested the applicant and sent them to jail. While in jail, the applicant asked a lower court judge for temporary bail, saying their father was sick. This request was turned down. Later, the applicant asked this High Court for temporary bail, and it was granted on September 12, 2024. After that, the lower court judge formally recognized the ED's case. The applicant then applied for regular bail with that same lower court judge, but this request was rejected on October 15, 2024. That is why the applicant made the current request for bail to the High Court. The applicant argued that their arrest was not done according to the law. They pointed to Section 19 of the PMLA, which says that an officer must have a strong 'reason to believe' (meaning good evidence) before arresting someone for money laundering. The Court looked at the applicant's role in the crime. It found clear signs that money made from the crime was supposedly moved to the bank accounts of others involved and their families, and that the applicant played a big part in this. This showed that the applicant was involved in money laundering and distributing illegal profits. So, it appeared that a money laundering crime had indeed been committed. Financial records showed large transfers of money between the applicant, others accused in the case, and other known people involved in the fake medicine operation. These money transfers, along with the applicant's control over the business, proved the claim that they were involved in money laundering. Therefore, the investigating police followed the correct procedures and had solid evidence, not just guesses, to support the arrest. The Court ruled that the applicant's claim that the arrest was illegal had no basis, and they would not get any help on this specific argument.
The applicant also argued that their arrest was based only on statements given by others involved in the crime ('co-accused') under Section 50 of the PMLA. They questioned if these statements could be used as proof to justify their arrest and continued jail time. The Court said that statements taken under Section 50 of the PMLA *can* be used as evidence and relied upon to show guilt in money laundering cases. The applicant also claimed that the amount of illegal money they personally got was less than Rs. 1 crore. They said this should free them from the strict rules of Section 45 of the PMLA. However, the Court explained that the entire money laundering plan must be considered. Since the fraud was well-organized and the applicant played an active role, the Court found them responsible under the PMLA, no matter how much money was directly linked to them. The Court decided that the accused person did not meet the specific exceptions or the two main conditions required for bail under Section 45 of the PMLA. They also failed to pass the general 'triple test' that courts use to decide if someone should get bail. Therefore, keeping the applicant in jail is necessary to protect the investigation and prevent them from interfering with the legal process. The Court refused the request for bail because the prosecution (the other side in the case) showed enough evidence that more investigation is needed. This evidence included bank records, digital information, and statements from others involved in the crime that directly point to the applicant.
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The matter comes up on an application preferred by Shri
Sunil Bhandari representing the respondents seeking dismissal of
the writ petition on the ground of it having been filed without
proper authorization.
The instant writ petition has been filed in representative
capacity on behalf of a Union posed as Income Tax Contingent
Employees Union. The affidavit in support of the writ petition has
been sworn by one Kamal Pal claiming to be a Member and an
authorized person of the Union.
Shri Sunil Bhandari Advocate representing the respondents
has filed an application (I.A.No.1/2021) seeking dismissal of the
writ petition on the ground that none of the Members of the so-
called union whose cause is sought to be agitated in this writ
petition are identifiable. No list of the casual labour who are
alleged to be Members of the Union, has been annexed with the
writ petition. Furthermore, no proper authorization/resolution
passed by the so-called Union for the purpose of filing the Original
Application before the Central Administrative Tribunal or the writ
petition before this Court has been placed on record.
Reliance has been placed by counsel for the respondents on
the order dated 17.11.2011 passed in D.B. Civil Writ
Union & Anr. Vs. A.N. Jha & Anr.” and the order dated
9.7.2019 passed in D.B. Civil Writ Petition No.3798/2019
“Income Tax Contingent Employees Union Vs. Union of
India & Ors.” whereby, this Court has held that such writ
petitions are not maintainable for lack of proper authorization.
Shri Gupta learned counsel representing the petitioners
vehemently relied upon the document Annex.7 claiming that in the
meeting dated 20.3.2015, the Union authorized him (Shri Gupta)
to file the cases on behalf of the Union. He further urged that in
the meeting dated 11.4.2018, Shri Kamal Pal had been authorized
to plead the matters on behalf of the Union. Shri Gupta thus
submits that the writ petition has been presented and is being
pursued under proper authorization.
We have given our thoughtful consideration to the arguments
advanced at the bar and have gone through the material placed
on record.
Suffice it to say that the minutes of the meeting dated
20.3.2015, which have been referred to by Shri Gupta during the
course of his arguments, do not bear signatures of any of the
Members of the Union. Furthermore, no list of the Members of the
Union has been annexed with the writ petition. Shri Jagdish
Solanki claiming to be President of the Union, has authorized Shri
Kamal Pal to file the matters on behalf of the Union in the courts.
However, no resolution of the Union has been filed on record on
the strength whereof, Shri Jagdish Solanki has been authorized to
further authorize Shri Kamal Pal to file the Original Application
before the Central Administrative Tribunal or the instant writ
petition. In similar circumstances, Writ Petition No.2893/2019
filed by the petitioner Union through its so-called President
Jagdish Solanki was dismissed by this Court by order dated
respondent has raised a preliminary objection
pertaining to incorporation of petitioner No. 1 and
authorization/resolution passed by the members of
the Union and authorization given to the Advocate.
The respondent counsel has also brought to the
knowledge of the Court judgment passed by the Co-
ordinate Bench of this Court in DBCWP No.3798/2019
passed on 09.7.2019 wherein relying upon the Rule 7
of the Central Administrative Tribunal Rules of
Practice, 1993 (hereinafter referred to as the Rules of
1993) and after hearing the arguments, this Court has
held that there was non compliance of Rule 7 and in
absence of proper and adequate authorization the
petition was dismissed.”
Hence, we are of the firm view that the writ petition has
been filed without proper authorization/resolution and hence, the
same is not maintainable.
Accordingly, the I.A.No.1/2021 is allowed.
The writ petition is dismissed as not maintainable in absence
of proper authorization.
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The Rajasthan High Court ruled that a lawsuit (called a writ petition) filed for a group, without their official permission or a formal decision, cannot be accepted by the court.
Two judges, Justice Sandeep Mehta and Justice Vinod Kumar Bharwani, part of a special court group, clearly stated, "We firmly believe this lawsuit was filed without the correct permission or a formal group decision, so it cannot be accepted."
Because of this, the court rejected the lawsuit, which was supposedly filed for a group called the Income Tax Contingent Employees Union. It was rejected because it lacked the necessary official permission.
The court based its decision on a similar case the High Court had handled before. In that case, titled Income Tax Contingent Employees Union v. A.n. Jha, Finance Secretary, a lawsuit filed by the same Union through someone claiming to be its President was also rejected.
In this current case, a lawsuit was filed on behalf of a group that presented itself as the Income Tax Contingent Employees Union. A sworn statement (called an affidavit) supporting this lawsuit was signed by Kamal Pal, who said he was a member and an authorized person for this Union.
After that, the lawyer for the other side, Sunil Bhandari (representing the "respondents"), filed a request asking the court to throw out the lawsuit. His reason was that it had been filed without the correct official permission.
The court discovered that the notes from the meeting, which the people who filed the lawsuit mentioned, did not have the signatures of any Union members. The court also noticed that no list of the Union's members was attached to the lawsuit.
The court also stated that Jagdish Solanki, who claimed to be the Union's President, had given Kamal Pal permission to file cases for the Union in court. However, there was no official decision (resolution) from the Union itself. This decision would have shown that Jagdish Solanki had the power to then allow Kamal Pal to file the first complaint (Original Application) with the Central Administrative Tribunal or this particular lawsuit (writ petition).
Lawyer Sunil Bhandari, representing the other side, argued that no list of the temporary workers, who were supposedly members of the Union, was attached to the lawsuit. He also argued that no proper permission or formal decision from the "Union" had been officially recorded to allow them to file the first complaint with the Central Administrative Tribunal or the lawsuit in this Court.
He pointed out that this Court had previously ruled that such lawsuits cannot be accepted if they lack the correct permission. To support his argument, he referred to decisions made on November 17, 2011, in a case called "Income Tax Contingent Employees Union & Anr. Vs. A.N. Jha & Anr.," and on July 9, 2019, in another case called "Income Tax Contingent Employees Union Vs. Union of India & Ors."
The lawyer for the people who filed the lawsuit (the "petitioners"), T.C. Gupta, strongly argued using a document. He claimed that during a meeting on March 20, 2015, the Union gave him permission to file cases for them. He also insisted that in a meeting on April 11, 2018, Kamal Pal was given permission to argue cases for the Union. Finally, he stated that the lawsuit was properly filed and is being continued with the correct authorization.
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Civil Appeal No. 1415 of 1981. Appeal by special leave from the judgment and order dated the 7th January 1981 of the Allahabad High Court in Civil Misc. Application No. 113 of 1981 in Second Appeal No. 1484 of 1973. O.P. Rana, M. Qamaruddin and Mrs. M. Qamaruddin for the Appellants. 510 A.K. Sanghi for Respondent No. 1. The Judgment of the Court was delivered by DESAI, J. Special leave granted. We have heard Mr. O. P. Rana, learned counsel for the appellant, and Mr. A.K. Sanghi, learned counsel for the respondent. The High Court disposed of the appeal preferred by the present appellant in the absence of the learned counsel for the appellant. When the appellant became aware of the fact that his appeal had been disposed of in the absence of his advocate, he moved an application in the High Court to recall the order dismissing his appeal and permit him to participate in the hearing of the appeal. This application was rejected by the High Court on the ground that though the application was prepared and drafted and an affidavit was sworn on 29th October, 1980, the same was not presented to the court till November 12, 1980 and that there is no satisfactory explanation for this slackness on the part of the learned advocate who was requested to file the application. The disturbing feature of the case is that under our present adversary legal system where the parties generally appear through their advocates, the obligation of the parties is to select his advocate, brief him, pay the fees demanded by him and then trust the learned advocate to do the rest of the things. The party may be a villager or may belong to a rural area and may have no knowledge of the court 's procedure. After engaging a lawyer, the party may remain supremely confident that the lawyer will look after his interest. At the time of the hearing of the appeal, the personal appearance of the party is not only not required but hardly useful. Therefore, the party having done everything in his power to effectively participate in the proceedings can rest assured that he has neither to go to the High Court to inquire as to what is happening in the High Court with regard to his appeal nor is he to act as a watchdog of the advocate that the latter appears in the matter when it is listed. It is no part of his job. Mr. A.K. Sanghi stated that a practice has grown up in the High Court of Allahabad amongst the lawyers that they remain absent when they do not like a particular Bench. Maybe he is better informed on this matter. Ignorance in this behalf is our bliss. Even if we do not put our seal of imprimatur on the alleged practice by dismissing this matter which may discourage such a tendency, would it not bring justice delivery system into disrepute. What is the fault of the party who having done everything in his 511 power and expected of him would suffer because of the default of his advocate. If we reject this appeal, as Mr. A.K. Sanghi invited us to do, the only one who would suffer would not be the lawyer who did not appear but the party whose interest he represented. The problem that agitates us is whether it is proper that the party should suffer for the inaction, deliberate omission, or misdemeanour of his agent. The answer obviously is in the negative. Maybe that the learned advocate absented himself deliberately or intentionally. We have no material for ascertaining that aspect of the matter. We say nothing more on that aspect of the matter. However, we cannot be a party to an innocent party suffering injustice merely because his chosen advocate defaulted. Therefore, we allow this appeal, set aside the order of the High Court both dismissing the appeal and refusing to recall that order. We direct that the appeal be restored to its original number in the High Court and be disposed of according to law. If there is a stay of dispossession it will continue till the disposal of the matter by the High Court. There remains the question as to who shall pay the costs of the respondent here. As we feel that the party is not responsible because he has done whatever was possible and was in his power to do, the costs amounting to Rs.200/ should be recovered from the advocate who absented himself. The right to execute that order is reserved with the party represented by Mr. A.K.Sanghi. Appeal allowed to the extent indicated with costs in the manner indicated. P.B.R. Appeal allowed.
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The person appealing a case found out the High Court threw out his appeal because his lawyer wasn't there when the case was discussed. So, he asked the court to undo the dismissal and let him be part of the appeal hearing. The High Court said no. They said the lawyer didn't give a good enough reason for waiting almost two weeks to file a sworn statement after writing it. The question is: Does the person appealing deserve to have his case heard again by the High Court? The court decided: It's not right for someone who did everything they could to be involved in their case by hiring a lawyer to suffer because the lawyer messed up or didn't do their job. No matter why the lawyer wasn't in court, the person appealing shouldn't be treated unfairly because of their lawyer's mistake. The person who won the first case should get their legal fees paid for by the lawyer who didn't show up to court. The court ordered the appeal to be put back on the High Court's schedule and heard.
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Case :- CRIMINAL MISC. WRIT PETITION No. - 3511 of 2022
Counsel for Petitioner :- Anurag Kumar Singh,Akhilendra Singh
Counsel for Respondent :- G.A.
Heard Sri Anurag Kumar Singh, learned Counsel for the petitioners, Shri
Dhananjay Kumar Singh, learned Additional Government Advocate for the
State/respondents and perused the material brought on record.
The debit of the bank account of the petitioners has been freezed on the
instructions of the Investigating Officer dated 24.03.2022 by the Axis
Bank, City Centre, XXV/1130 Round West, Thrishur, Kerala as a sequel to
the F.I.R. lodged by the Chief Manager of the Management of Manuments,
Museum, Parks, Garden etc. registered as Case Crime No. 0716 of 2021 at
Lucknow) on 16th September, 2021 for offence punishable under Sections
Feeling aggrieved by the debit freeze of the petitioners' account on the
instructions of the Investigating Officer, the instant writ petition has been
filed by the petitioners.
The contention of the learned Counsel for the petitioners is that as per
Section 102 (3) of the Code of Criminal Procedure, 1973, seizure of bank
account shall forthwith be reported to the Magistrate concerned having
jurisdiction and the same is mandatory in nature as prescribed under
Section 102 (3) Cr.P.C. but in the instant case, the Investigating Officer
has not reported the seizure/debit freezing of the petitioners' account to the
Magistrate concerned having jurisdiction, hence the impugned action to
freeze the debit account of the petitioners is contrary to the provisions of
Section 102 (3) Cr.P.C., hence the entire proceeding initiated against the
petitioners is liable to be quashed.
Per contra, learned Additional Government Advocate argued that the
question as to whether Section 102 (3) Cr.P.C. is mandatory or directory,
has already been decided by a Co-ordinate Bench of this Court at
Allahabad in Criminal Misc. Writ Petition No. 11201 of 2021 : Amit Singh
Vs. State of U.P. and others, decided on 18.04.2022, wherein while
observing that Section 102 (3) Cr.P.C. is not mandatory but it is directory,
the Co-ordinate Bench of this Court dismissed the writ petition. It was also
observed that non-reporting of the seizure forthwith, as provided under
Section 102 (3) Cr.P.C., shall not ipso facto render the seizure illegal
particularly as no period is specified and it's consequences have not been
provided. Thus the instant writ petition is also liable to be dismissed.
For convenience, the relevant part of the order dated 18.04.2022 (Supra) is
"(14) In view of submissions of learned counsel for the parties the
main issue which falls for our consideration is as to whether
Section 102(3) Cr.P.C. is mandatory or directory in nature? It is well
settled that non-observance of a mandatory condition is fatal to the
validity of the action. However, non-observance would not matter if
the condition is found to be merely directory. In other words, it is not
that every omission or defect entails the drastic penalty of invalidity.
Whether the provision is mandatory or directory can be ascertained
by looking at the entire scheme and purpose of the provision and
by weighing the importance of the condition, the prejudice to private
rights and the claims of the public interest, therefore, it will depend
upon the provisions of the statute and mere use of word ''shall'
would itself not make the provision mandatory. The Hon'ble
Supreme Court in the case of State of Haryana Versus Raghuveer
Dayal (Supra) has held that the use of word 'shall' is ordinarily
mandatory but it is sometimes not so interpreted if the scope of the
enactment, on consequences to flow from such construction would
not so demand.
(15) The Hon'ble Supreme Court, in the case of Nasiruddin and
has held that it is well settled that the real intention of the legislation
must be gathered from the language used. It may be true that the
use of the expression ''shall or may' is not decisive for arriving at a
finding as to whether statute is directory or mandatory. But the
intention of the legislature must be found out from the scheme of
the Act. It is also equally well settled that when negative words are
used the courts will presume that the intention of the legislature
was that the provisions are mandatory in character. It has further
been held that if an act is required to be performed by a private
person within a specified time, the same would ordinarily be
mandatory but when a public functionary is required to perform a
public function within a time frame, the same will be held to be
directory unless the consequences therefor are specified. The
relevant paragraphs 38 and 39 are extracted below:-
"38. The court's jurisdiction to interpret a statute can be invoked
when the same is ambiguous. It is well known that in a given case
the court can iron out the fabric but it cannot change the texture of
the fabric. It cannot enlarge the scope of legislation or intention
when the language of the provision is plain and unambiguous. It
cannot add or subtract words to a statute or read something into it
which is not there. It cannot re-write or recast legislation. It is also
necessary to determine that there exists a presumption that the
legislature has not used any superfluous words. It is well settled
that the real intention of the legislation must be gathered from the
language used. It may be true that use of the expression "shall or
may" is not decisive for arriving at a finding as to whether the
statute is directory or mandatory. But the intention of the legislature
must be found out from the scheme of the Act. It is also equally well
settled that when negative words are used the courts will presume
that the intention of the legislature was that the provisions are
mandatory in character.
39. Yet there is another aspect of the matter which cannot be lost
sight of. It is a well-settled principle that if an act is required to be
performed by a private person within a specified time, the same
would ordinarily be mandatory but when a public functionary is
required to perform a public function within a time-frame, the same
will be held to be directory unless the consequences therefor are
at p. 107 it is pointed out that a statutory direction to private
individuals should generally be considered as mandatory and that
the rule is just the opposite to that which obtains with respect to
public officers. Again, at p. 109, it is pointed out that often the
question as to whether a mandatory or directory construction
should be given to a statutory provision may be determined by an
expression in the statute itself of the result that shall follow non-
compliance with the provision.
"As a corollary of the rule outlined above, the fact that no
consequences of non-compliance are stated in the statute, has
been considered as a factor tending towards a directory
construction. But this is only an element to be considered, and is by
(16) The consequences of non reporting about the seized property
have not been provided under the section. In addition, the
requirement of reporting in the manner, as stated, is on the part of a
public functionary and in view of the law laid down by the Hon'ble
Supreme Court, as noticed above, the same is required to be held
to be directory unless the consequences thereof are specified.
Since the consequences have not been specified, it would be
safe to hold that requirement of Section 102(3) Cr.P.C. cannot
be termed as mandatory but would be directory in nature.
(17) The Scheme for disposal of property under the Code is
provided under Chapter XXXIV of the Cr.P.C. Section 451 provides
that when any property is produced before any Criminal Court
during any inquiry or trial, the Court may make such order as it
thinks fit for the proper custody of such property pending the
conclusion of the inquiry or trial. Section 452 provides the order for
disposal of property at conclusion of trial. Section 457 (1) provides
that whenever the seizure of property by any police officer is
reported to a Magistrate under the provisions of this Code, and
such property is not produced before a Criminal Court during an
inquiry or trial, the Magistrate may make such order as he thinks fit
respecting the disposal of such property or the delivery of such
property to the person entitled to the possession thereof, or if such
person cannot be ascertained, respecting the custody and
production of such property. Sub-section (2) provides that if the
person so entitled is known, the Magistrate may order the property
to be delivered to him on such conditions (if any) as the Magistrate
thinks fit and if such person is unknown, the Magistrate may detain
it and shall, in such case, issue a proclamation specifying the
articles of which such property consists, and requiring any person
who may have a claim thereto, to appear before him and establish
his claim within six months from the date of such proclamation.
(18) In view of above scheme of the Code the purpose of
information given to the Magistrate regarding seizure of property by
the Police Officer is merely to facilitate its disposal in accordance
with law during pendency of trial or subsequent thereto. Therefore
non reporting of the seizure forthwith, as provided under Section
102(3) Cr.P.C., shall not ipsofacto render the seizure illegal
particularly as no period is specified and it's consequences have
not been provided. Therefore when on an application moved by the
petitioner, the same has been informed, the petitioner may move
the concerned Magistrate for the custody of the property i.e.
unfreezing of the account of the petitioner, which may be dealt with
in accordance with law and on it's own merit.
(19) The Delhi High Court, in the case of Ms.Swaran Sabharwal
Versus Commissioner of Police (Supra), quashed the prohibitory
order on the ground that the moneys in the bank does not
constitute "case property". In the case of Dr. Shashikant D. Karnik
Versus The State of Maharashtra (Supra), the Bombay High Court
allowed the petition on the ground that all the three requirements of
Section 102 Cr.P.C. have not been complied. It appears that in this
case a direction was issued not to permit operation of the bank
accounts of petitioner therein and his family without seizure
therefore the court was of the view that there can not be an interim
order and thereafter it's continuation. The authorities had also failed
to ascertain, by the time it was decided, as to whether there was
any connection of it with the alleged crime. The court has only
mentioned that sub-section (3) of Section 102 lays down a mandate
without any finding as to whether it is mandatory or directory. The
Court without any provision has also observed that there is a fourth
requirement of law that notice is required to be given before
stopping the operation of the account. In the absence of any
specific stipulation in the statute or necessary consequence flowing
from the scheme contained in the Act, we are not inclined to
subscribe to such a view.
(20) In the present case we have considered the issue in detail and
are of the view that sub-Section (3) of Section 102 Cr.P.C. is
directory in nature and once the court has been informed of
freezing of bank account on an application moved by the petitioner,
the requirement of statute stands fulfilled. Deprivation of property
(freezing of bank account) otherwise being as per law, the
argument that Article 300-A of Constitution is violated cannot be
accepted. Contrary view taken by learned Single Judges of the
High Courts of Delhi, Madras and Telangana in the judgments in
Ms Swaran Sabharwal Versus Commissioner of Police, 1990 (68)
Comp Cas 652 Delhi (DB); Muktaben M.Mashru Vs. State of N.C.T.
of Delhi and Another; Crl M.C. 4206 of 2018, decided on
29.11.2019; Tmt.T. Subbulakshmi Vs. The Commissioner of Police;
Crl. O.P. No.13103 of 2013 decided on 30.08.2013; Uma
Maheshwari Vs. The State Rep. By Inspector of Police, Central
Crime Branch, Egmore, Channai; Criminal O.P. No.15467 of 2013
decided on 20.12.2013; The Meridian Educational Society Vs. The
State of Telangana; Writ Petition No.21106 of 2021 decided on
04.10.2021 without considering and dealing with the provisions and
scheme of the Code cannot be relied upon. Therefore these
judgments can not be of any help to the petitioner. The Judgment,
in the case of Chief Information Commissioner and another Versus
State of Manipur and another (Supra), relied by learned counsel for
the petitioner, is also not applicable in the facts and circumstances
of the present case.
(21) In view of the discussions made above this court is of the
considered opinion that there is no infringement of Constitutional
right of property of the petitioner under Article 300-A of the
Constitution of India. Article 300-A of the Constitution of India only
provides that no person shall be deprived of his property save by
authority of law. The alleged deprivation of property (freezing of
bank account) since is found to be in accordance with applicable
law i.e. Code of Criminal Procedure, the action complained of is
clearly in consonance with Article 300-A of the Constitution of India.
Petitioner's plea of violation of Article 300-A of Constitution of India
cannot be pressed to impeach the act of freezing of bank account
after such act is held to be as per applicable law i.e. the Code of
(22) The bank account of the petitioner has been got freezed in
exercise of powers given under Section 102 Cr.P.C. and the Code
of Criminal Procedure restricts the release of such bank account
only to an order passed by the Magistrate, which is not the case
here. The provisions of the Code thus cannot be by-passed on the
plea that Article 300-A of Constitution of India is violated. Merely
because the freezing of bank account is not reported forthwith and
reported only on an application moved by the petitioner, it cannot
be said that there is infringement of right of property given under
Article 300-A of the Constitution of India. The plea of the petitioner
in this regard is misconceived and not sustainable. The writ petition
consequently lacks merit and is dismissed. No order is passed as
Keeping in mind the aforesaid judgment and order dated 18.04.2022
(supra) and also considering the facts and circumstances of the case, this
Court is in full agreement with the view expressed by the Co-ordinate
Bench of this Court at Allahabad vide judgment and order dated
18.04.2022 passed in Criminal Writ Petition No. 11201 of 2021 : Amit
Singh Vs. State of U.P. and others.
The writ petition lacks merit and is, accordingly, dismissed in terms of the
judgment and order dated 18.04.2022 (supra).
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The Allahabad High Court has decided something important. They said that when police freeze a bank account using a rule called Section 102 of the CrPC, they are supposed to tell a judge right away. But if they don't report it immediately, that doesn't automatically make the freezing illegal.
The two judges, Justice Ramesh Sinha and Justice Saroj Yadav, came to this decision. They agreed with an earlier ruling by the Allahabad High Court in a case known as Amit Singh v. State Of U.P. And 3 Others.
About the rules involved in the matter
It's important to know that Section 102 of the CrPC laws gives police officers the power to take control of certain property. According to part (1) of this Section 102 rule, a police officer can take control of any property that is believed or suspected to be stolen. They can also seize property found in a way that suggests a crime might have happened.
Also, part (3) of Section 102 CrPC states that any police officer who takes property under part (1) must immediately tell the judge who has authority over that area.
This rule shows that police can take control of any property if they suspect it was used in a crime or is related to one. The Supreme Court has previously decided in several cases that "property" here includes bank accounts. This means a police officer can freeze a bank account during an investigation.
So, the question the Court had to answer was this: Do police need to immediately tell the judge about taking control of any property, including a bank account, under Section 102?
Court's observations
The two judges, Justice Sinha and Justice Yadav, agreed with the earlier High Court decision in the Amit Singh case. They said that not reporting the freezing right away, as part (3) of Section 102 CrPC mentions, does not automatically make the freezing illegal. This is especially true because the rule doesn't say exactly how quickly they must report it, and it doesn't say what happens if they don't.
About the case in brief
The Court was looking at a formal request, called a writ petition. This was filed by a company named M/S SJS Gold Pvt. Ltd., through its Director Sunil Jaihind Salunkhe. The company argued that after a police report (called an FIR) was filed, Axis Bank froze their bank account. This happened on the orders of the police officer investigating the case.
Because they were upset about their account being frozen due to the investigating officer's orders, the company filed this writ petition.
The company's lawyer argued that, according to part (3) of Section 102 of the Code of Criminal Procedure, 1973, when a bank account is frozen, it must be reported immediately to the judge in charge. They claimed this rule is a must, as stated in Section 102 (3) Cr.P.C.
Because of this, they argued that in their case, the investigating officer had not told the judge in charge about freezing their account. Therefore, they said that freezing their account went against the rules of Section 102 (3) Cr.P.C.
But the Court did not agree with their arguments and rejected their request.
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Appeal No. 1631 of 1967. Appeal by special leave from the order dated May 11, 1967 of the Allahabad High Court in Civil Misc. Writ Petition No. 1647 of 1967. S.V. Gupte 'and D.N. Mukherjee, for the appellant. M.K. Ramamurthi, Shayamala Pappu and Vineet Kumar for respondent No. 2. The Judgment of the Court was delivered by Vaidialingam, J. In this appeal, by special leave, the appellant challenges the order of the Allahabad High Court dated May 676 11, 1967 dismissing Civil Miscellaneous Writ Petition No. 1647 of 1967. The facts leading up to the filing of the said writ petition by the appellant under article 226 of the Constitution, may be briefly stated. The appellant is an existing company under the and has its registered office at Calcutta. The company was and is being managed by Martin Burn Ltd., Secretaries and Treasurers. The company carries on the business of generation, distribution and supply of electricity within its licensed area in the city of Agra and its environs in the State of Uttar Pradesh On a reference made by the Government of Uttar Pradesh regarding a dispute that had arisen between the electricity undertakings managed by Martin Burn Ltd., of which the appellant was one, and their workmen about the demand of the workmen for supply of uniforms, free of charge, the Chairman, Martin Electricity Supply Company Adjudication Board made an award on February 20, 1947 in and by which certain types of workmen were directed to be supplied with uniforms. The said award remained operative till April 15, 1950 on which date it was terminated. Though the award had been terminated, the appellant continued the practice of supplying uniforms to its workmen. Subsequently, again, a dispute was raised by the employees of the electricity undertakings managed by Martin Burn Ltd., regarding the supply of uniforms to some categories of workers. The said dispute was referred by the Government of Uttar Pradesh, by order dated March 15, 1951, for adjudication to the State Industrial Tribunal, Uttar Pradesh, Allahabad. The said Industrial Tribunal passed an award dated November 29, 1952 holding that the same categories of workmen to whom uniforms had to be supplied as per the award dated February 20, 1947 were entitled to be supplied with uniforms. Though this award remained in operation only for a period of one year, the appellant continued to supply uniforms till 1953 after which year the supply of uniforms was discontinued. Nevertheless, the appellant again resumed supplying uniforms from May 1961. On December 31, 1961 twenty three employees of the appellant, including the second respondent herein, filed a joint petition before the Labour Court, Meerut,. under section 6 1 1(2) of the Uttar Pradesh (hereinafter referred to as the Act) claiming that they were entitled to recover the money equivalent to the cost of uniforms which had not been supplied to them during the period 1954 to 1960. The said petition was numbered as Case No. 1 of 1962. According to these employees, the employer had failed to supply them uniforms which they were entitled to get and in consequence of such failure the workmen had been put to expense by purchase of clothes to be used while rendering service in the company. They claimed that the benefits 677 which they were entitled to get should be computed in terms of money to enable them to recover the cost of uniforms from the appellant. The appellant filed a written statement on January 27, 1962 disputing the claim of the workmen and denying its ii, ability to either supply uniforms or pay the money value of the On February 22, 1964 the application filed by the workmen was taken up by the Labour Court for heating, but as none appeared on behalf of the workmen who were the applicants when the case was called on for hearing the Labour Court Meerut dismissed the application for non prosecution. The actual order passed by the Labour Court was as follows: "Case called on for hearing. No one is present on behalf of the applicant, nor 'any request for adjournment has been received. The application is dismissed as not having been prosecuted. No order as to costs. " On or about January 1, 1965 seven employees of the appellant, including the second respondent herein, filed seven separate applications before the Labour Court, Meerut, again under section 6 H(2) of the Act. The seven applications had been numbered as Case Nos. 217 to 223 of 1965. The application filed by the second respondent was Case No. 217 of 1965. The second respontdent, in particular claimed that he was a mains coyly from April 13, 1950 to September 15, 1959 'and that he was entitled to be supplied uniform by the appellant. As the uniform had not been so supplied he pleaded that he was entitled to recover a sum of Rs. 390/ as cost of the uniforms which the management should have supplied during those years. All the applicants, including the second respondent, had also stated in their respective applications that they had moved before the Labour Court a similar application, under section 6 H(2) of the Act, but, unfortunately that had been dismissed for default on February 21, 1964 and hence the fresh applications were being filed. The appellant flied on or about April 7, 1965 separate objections denying the claim made by the applicants. We are not, at this stage, concerned with the various pleas taken either by the employees, in support of their claim, or by the appellant, in denial thereof. It is only necessary to state that the appellant pleaded that the fresh applications, filed by the workmen, were not maintainable in view of the fact that identical applications, claiming the same reliefs, had been dismissed on February 21, 1964 by the Labour Court. If the workmen were aggrieved by that said order, the proper remedy that should have been adopted by them was by taking action under r. 16(2) of the Uttar Pradesh Industrial Disputes Rules, 1957 (hereinafter referred to as the rules). Not 678 having adopted the procedure indicated therein, the management pleaded that it was no longer open to the workmen to file a second application and the Labour Court had no jurisdiction to entertain the same. The Labour Court had, by its order dated August 27, 1965 consolidated all the seven applications. On the basis of the objection raised by the appellant to the maintainability of the applications filed, issue No. 5 was framed in the following terms: "Whether the present applications of the workmen under section 6 H(2) are not maintainable for the reasons given in para 5 of the written statement of the employers ?" and this issue was treated as a preliminary issue 'and arguments heard on the same By order dated February 10, 1967 the Labour Court held that the applications filed by the seven workmen, including the second respondent were maintainable. The Labour Court has expressed the view that the order passed on February 21, 1964 was one dismissing the applications, filed by the workmen, for default and such an order was not contemplated by sub r. (1 ) of r. 16 of the rules, and hence the workmen were not bound to take 'action under sub r. (2) of r. 16. In consequence the Labour Court held that the applications filed by the workmen were competent and directed the applications to be posted for further hearing. Though the order had been passed in Case No. 217 of 1965, the Labour Court directed that the finding given on issue No. 5 would govern Cases Nos. 218 to 223 of 1965 also. The 'appellant challenged this finding of the Labour Court before the High Court of Allahabad in Civil Writ No. 1647 of 1967. A Division Bench of the High Court, by its order dated May 11, 1967 summarily dismissed the writ petition. Mr. Gupte, learned counsel for the appellant and Mr. Ramamurthy, learned counsel for the second respondent, urged the same contentions that were urged on behalf of their clients before the Labour Court. Therefore the question that arises for consideration is whether the view of the Labour Court that the second application filed by the second respondent herein is maintainable, is correct. Section 6 H of the Act deals with recovery of money due from an employer. Section 6 H more or less corresponds to section 33 C of the . Sub section (2) of section 6 H, with which we are concerned, is as ,follows: "(2) Where any workman is entitled to receive from the employer any benefit which is capable of being computed in terms of money, the amount at which such benefit should be computed may, subject to any rules 679 that may be made under this Act, be determined by such Labour Court as may be specified in this behalf by the State Government, and the amount so determined may be recovered as provided for in sub section (1 ). " As we have already mentioned, the second respondent, along with certain others, had filed an application on December 31, 1961 claiming identical relief that is now claimed in Case No. 217 of 1965. That application was dismissed as not having been prosecuted, on February 22, 1964. The second application was filed on January 1, 1965. We shall now refer to the relevant rules. Rule 9 empowers a Tribunal or Labour Court to accept, admit or call for evidence at any stage of the proceedings before it and in such manner as it may think fit Rule 10 relates to the issue of summons for production of any books, papers or other documents as the Labour Court, Tribunal or Arbitrator feels necessary for the purpose of investigation or adjudication. Rule 12 relates to procedure at the first hearing. It states that 'at the first sitting of a Labour Court or Tribunal, the Presiding Officer shall call upon the parties in such order as he may think fit to state their case. Rule 16 provides for the Labour Court or Tribunal or Arbitrator proceeding ex parte, as follows: "( 1 ) If, on the date fixed or on ,any other date to which the hearing may be adjourned, any party to the proceedings before the Labour Court or Tribunal or an Arbitrator is absent, though duly served with summons or having the notice of the date of hearing, the Labour Court or Tribunal or the Arbitrator, as the case may be, may proceed with the case in his absence and such order as it may deem fit and proper. (2) The Labour Court, Tribunal or an Arbitrator may set aside the order passed against the party in his absence, if within ten days of such order, the party applies in writing for setting aside such order and shows sufficient cause for his absence. The Labour Court, Tribunal or an Arbitrator may require the party to file an affidavit, stating the cause of his absence. As many copies of the application and affidavit, if any, shall be filed by the party concerned as there are persons on the opposite side. Notice of the application shall be given to the opposite parties before setting aside the order. " Sub rule (1 ) deals with the absence of a party on the date fixed, or on any other date to which the hearing may be adjourned, though he has been served with summons or he has notice of the date of hearing. Under the circumstances it provides that the 680 Labour Court, Tribunal or Arbitrator, as the case may be "may proceed with the case in his absence and pass such order as it may deem fit and proper". It is to the setting aside of such an order that may have been passed under sub r. (1 ), that the procedure is indicated in sub r. According to Mr. Gupte, learned counsel for the appellant, the order passed on February 22, 1964, by the Labour Court is one contemplated by sub r. (1) of r. 16, in which case the provisions of sub r. (2) are attracted and the second respondent, if he felt aggrieved by that order, should have filed an application under sub r. (2), within time, to set aside that order. We are not inclined to 'accept this contention of Mr. Gupte. As pointed out earlier by us, the order passed on February 22, 1964, is one dismissing the application as not having been prosecuted, for default of appearance of the second respondent. We will presently show that the order of February 22, 1964 cannot be considered to be one contemplated to have been passed under sub r. ( 1 ) of r. 16. Sub r. ( 1 ) refers to a party being absent on the date fixed, or on any other date to which the hearing has been adjourned, and such party having been duly served or having notice of the date of hearing. The said sub r. (1 ) indicates as to what is to be done .under such circumstances. We have referred to r. 12 which provides for what the Labour Court or Tribunal should do at the first hearing. Neither the Act nor the rules empower a Tribunal or Labour Court to dismiss an application for default of appearance of a party. Rule 16 (1 ) is the only provision for what is to be done when a party is absent. That provision, which clearly enjoins the Labour Court or Tribunal in the circumstances mentioned therein "to proceed with the case in his absence" either on the date fixed or on any other date to which the hearing may be adjourned, coupled with the further direction "and pass such order as it may deem fit and proper", clearly indicates that the Tribunal or Labour Court should take up the case and decide it on merits 'and not dismiss it for default. Without attempting to be exhaustive, we shall just give an example. Where a workman, after leading some evidence in support of his claim, absents himself on the next adjourned date with the result that he does not lead further evidence, the Tribunal is bound to proceed with the case on such evidence as has been placed before it. It cannot dismiss the application on the ground of default of appearance of the workman. This will be an instance of "proceeding with the case in the absence of a party" and giving a decision on merits. If such an order is passed by the Tribunal in the absence of one or other of the parties before it, a right is given to such party to apply under sub r. (2) for setting aside the order that has been passed in his absence in the case in terms of sub r. The application must be filed within the period mentioned in 681 sub r. (2) and the party will have also to satisfy the Tribunal or Labour Court that he had sufficient cause for his absence. The necessity for filing an application for setting aside an order passed in the case in the absence of 'a party, as contemplated under sub r. (2) of r. 16 will only arise when an order on merits affecting the case has been passed in the absence of a party, under sub r. (1 ) of r. 16. An order dismissing a case for default or non prosecution, does not come under sub r. ( 1 ) of r. 16 and to such an order sub r. (2) has no 'application. We have already indicated that the order passed on February 22, 1964 by the Labour Court cannot be considered to be an order contemplated under sub r. (1 ) of r. 16. If that is so, the second respondent was not bound to file an application within the time mentioned in sub r. (2) for setting 'aside the order dated February 22, 1964. Therefore the fact that a previous application, filed by the second respondent, was dismissed for non prosecution on February 22, 1964 is no bar under r. 16(2) to the filing of the present application, Case No. 217 of 1965. It follows that the objections raised by the appellant to the maintainability of the application filed by the second respondent have been rightly rejected by the Labour Court and the High Court. The appeal fails and is dismissed. The appellant will pay the costs of the second respondent.
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The second party first asked the court for certain help against their employer (the company appealing the case). The Labor Court threw out the request because the second party didn't show up to court, so the case wasn't pursued. The second party then made a second request, asking for the same help. The company argued that this second request shouldn't be allowed. They said that if the workers were unhappy with the first decision, they should have taken action under rule 16(2) of the Uttar Pradesh Industrial Disputes Rules from 1957. The Labor Court disagreed with the company, and the company challenged this decision by asking the High Court to review it. This is called a writ petition. The High Court dismissed the company's request. HELD: An order that dismisses a case because someone didn't show up or didn't pursue it doesn't fall under rule 16, part 1. Therefore, rule 16, part 2, doesn't apply to such an order. The law and its rules don't give a Tribunal or Labor Court the power to dismiss a request just because a party doesn't appear. Rule 16(1) is the only rule that says what to do when a party is missing. This rule tells the Labor Court or Tribunal that if someone is absent, they should "proceed with the case" and "pass such order as it may deem fit." This means the court should hear the case and decide it based on the facts, not dismiss it because someone didn't show up. You only need to ask the court to overturn a decision made when a party was absent (as described in rule 16, part 2) if a decision was made about the case's merits under rule 16, part 1, while a party was absent.
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The present writ petition was filed by petitioner no.
1- who is suffering from cerebral palsy along with
petitioner no. 2 (Abled, Differently Abled, All People
Together, formerly known as the Spastics Society of India).
The grievance was in respect of the treatment mooted out to
the first petitioner by the crew of Spice Jet.
2. On 24th March, 2015, this Court recorded that a
representation had been filed, inter alia, to seek
directions for the respondents to follow the Civil Aviation
Requirements (CAR) guidelines dated 1st May, 2008 with regard
to the carrying/lifting of differently abled persons.
Subsequently this Court awarded a compensation to the
petitioner no. 1 on 12.5.2016.
3. Subsequently, on 14.02.2017, this Court was apprised
of the revised CAR guidelines and that suitable amendments
are required to be made for effective care of differently
abled people. The Director General of Civil Aviation (DGCA)
was directed to look into the suggestions submitted by the
petitioners and to incorporate amendments in the CAR
guidelines as may be necessary after considering the
directions of this Court as well as the remarks/comments of
the petitioners.
4. It appears that the guidelines were revised on 2 nd
July, 2021. Now the draft guidelines regarding ‘Carriage by
Air of Persons with Disability and/or Persons with Reduced
Mobility’ have been put in public domain in the year 2021.
5. Mr. Gonsalves, learned senior counsel appearing for
the petitioners has raised multiple objections to the draft
guidelines. We leave it open to the petitioners to submit
objections/suggestions to the draft guidelines with a hope
that the DGCA shall consider such suggestions even if the
time limit for submission of the suggestions has come to an
end. Such suggestions may be submitted within 30 days from
6. Before parting, two aspects need to be mentioned.
First is that no differently abled person should be manually
lifted without his consent. We find that the suggestion is
worth considering, as lifting of a person manually is
inhumane. How, the differently abled person should be
treated with dignity is left to the DGCA.
7. Another aspect we want to mention is about some of the
differently abled person use prosthetic limbs/calipers. Some
time, they are directed to remove their prosthetic
limbs/calipers as a part of the security check. In the draft
guidelines circulated, it has been mentioned that scanning
of prosthetic limbs/calipers though full body scanner but to
what extent differently abled persons with prosthetic
limbs/calipers are required to be checked for the purpose of
security should be in a manner where, no such person is
asked to remove prosthetic limbs/calipers to maintain human
dignity while ensuring the requirement of security checks.
8. With such direction and liberty, we dispose of the
present petition with the hope that the Director General of
Civil Aviation will take into consideration the suggestions,
if any, submitted by the petitioner.
9. All pending applications stand disposed of.
Date : 01-12-2021 This petition was called on for hearing today.
UPON hearing the counsel the Court made the following
The Writ Petition is disposed of in terms of the
All pending applications stand disposed of.
[Signed Order is placed on the file]
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India's highest court looked at a request about plane travel for people with disabilities. The Court said people with artificial limbs or braces should not remove them at airport security. This helps keep their human dignity. The Court also said that lifting a person with a disability during a flight or security check is wrong. It should never happen without their permission.
Two judges heard an old case from 2012. Jeeja Ghosh, a disability activist, filed it. She was forced off a Spicejet plane for her disability. In 2016, the Supreme Court told Spicejet to pay her 10 lakh rupees. This payment was for not treating her with dignity. The Court also told the DGCA to change its rules. The DGCA is the government group that makes flying rules. These new rules must protect the dignity of people with disabilities on flights.
As a next step, the Court looked at new rules the DGCA had made. In February 2017, the Court said these updated rules, called 'CAR guidelines,' needed more changes. These changes were to better help disabled people. The head of the DGCA was told to review the ideas from the petitioner. He also had to make more changes to the CAR guidelines. He needed to think about the court's orders and the petitioner's comments.
On July 2, 2021, the DGCA released new draft rules. These rules focused on how to carry people with disabilities or those who have trouble moving on planes. Dr. Colin Gonsalves, a senior lawyer for the petitioner, found many problems with these new rules. The judges then allowed the petitioner to send their ideas and complaints to the Ministry of Civil Aviation. This was for the new draft CAR guidelines. These rules help people with disabilities and those who have trouble moving.
The judges let the petitioner send their complaints and ideas about the draft rules. They hoped the Ministry of Civil Aviation would still look at these ideas. This was true even if the deadline to send them had passed. The judges asked the petitioner to send their ideas within 30 days.
When ending the case, the judges made two main points:
1. No disabled person should be lifted by hand without their say-so. Lifting someone by hand is wrong. The judges liked the petitioner's idea about this.
2. Airport security checks must be done so disabled people do not have to remove their fake limbs or braces.
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One Bachan Singh and Anr., the two promotees to the post of 'AEE ' in the years 1958 and 1959 respectively, filed a writ petition in the High Court of Delhi challenging the appointment of several direct recruits to 'MES ' on the ground that their appointment was contrary to and in violation of the rules of recruitment and they were not validly appointed and, therefore; could not become members of the service. The writ petition was dismissed by the High Court of Delhi and the 944 matter was carried in appeal in this Court. The decision rendered A by a Constitution Bench of this Court in Bachan Singh & Anr vs Union of India & ors(l) was interpreted by the first respondent to mean that the direct recruitment, not by competitive examination but by interview and viva voce test, was valid and such appointments being in consonance with the rules, the confirmation of said direct recruits was within the quota of direct recruits in permanent vacancies and was hence valid. The first respondent understood the decision to mean that there was a quota for recruitment in the cadre of 'AEE ' in 'MES ' Class I of 9 direct recruits to 1 promotee (9:1) since 1951 and the quota must lead to rota for confirmation and proceeded to redraw the seniority list in 1974 with the startling result in respect of the appellant and several persons similarly situated as hereinabove set out. (c) From 1.2.1969, the date on which the rules became statutory, the seniority of excess departmental promotees (Approx 'B ') of the list is to be regulated as under: (i) The seniority of departmental promotees who are brought into cadre from 1969 onwards will count along with direct recruits of the year in 945 which the promotees are brought into the cadre and any service for further promotion to higher posts. By notification dated September 17, 1949, the Ministry of 1 Defence published Rules styled as Military Engineer Services, Class I (Recruitment, Promotion and Seniority) Rules (1949 Rules for short). The recruitment was to be from two sources: (i) direct recruitment by competitive examination; and (ii) by promotion in accordance with Part III of the Rules. One submission of Mr. P. R. Mridul, learned counsel for direct recruits was that the proviso is the proviso to sub rule (ii) of Rule 3 and it fixes the quota of 9 to 1 between direct recruits and promotees. Sub para (iii) of para 3 is relevant and may be extracted: "(iii) A roster shall be maintained indicating the order in which appointments are to be made by recruitment and promotion in accordance with the percentages fixed for each method of recruitment in the recruitment rules. The relative seniority of promotees and direct recruits shall be determined by the dates on which the vacancies reserved for the direct recruits and the promotees occur. " I of the year 1962 and by the impugned seniority list of June 14, 1974, he does not find his place in the seniority list and is still in the surplus list to be accommodated at a future date and Mr. Sanghi learned counsel for the appellant asserted with some vehemence that he cannot come into the service till 1989 when it may be time for him to retire from the service. But, having done that we do propose to examine and expose an extremely undesirable, unjust and inequitable situation emerging in service jurisprudence from the precedents namely, that a person already rendering service as a promotee has to go down below a person who comes into service decades after the promotee enters the service and who may be a schoolian, if not in embryo, when the promotee on being promoted on account of the exigencies of service as required by the Government started rendering service. ; (ii) In making recruitment in the manner it was done till '1949 Rules ' acquired statutory character, was there a violation of quota rule assuming that there was quota prescribed in Rule 4 of '1949 rules ' ?, (iii) If Rule 4 of '1949 Rules ' prescribed a quota of 9:1 between direct recruits and promotees, had the Government the power to relax the quota rule when necessary or under certain circumstances ? ; (vi) If prior to '1949 Rules ' acquiring statutory character in 1969 promotions were made in excess of the quota, which principle 951 governed determination of inter se seniority of later direct recruits with earlier promotees ?, (vii) If 1963 Seniority List when drawn up was according to the Rules then in force, could it be rendered ineffective by a revised rule for determining inter se seniority devised in 1974 and given retrospective effect. To steer clear of a possible unintended transgression of this binding decision, it is necessary to set out in some details the ratio of the decision of the Constitution Bench in that case ? were promoted in the years 1958 and 1959 respectively to AEE in MES (Class I Some of the respondents in that case were appointed by direct recruitment after they had appeared in the competitive examination, but all the respondents were appointed to the service in the years 1962, 1963 and 1964. The first contention raised on behalf of the promotee appellants was that the recruitment of some respondents as direct recruits not as the result of competitive examination as provided in the Rules but by mere interview by the Union Public Service Commission was contrary to and in violation of the relevant Rules and thus the recruitment being invalid they did not become members of the service. The second contention was that such of the respondents who were recruited by interview and as a result of the competitive examination after the appellants had been promoted to the service, are not entitled to be confirmed in permanent posts before the appellants. The Court then referred to rules 3 and 4 of ' 1949 Rules ' when they came into force in 1951 and noticed that the recruitment to MES Class I could be made from two sources only, namely, by competitive examination held in India in accordance with Part II of the Rules and by promotion in accordance with Part III of the Rules. Repelling this contention, the Constitution Bench held as under: "The appointments to Class I Service by interview were made by the Government in consultation with the Union Public Service Commission. The Union Government relaxed the Rules both in regard to recruitment by interview and in regard to the quotas fixed by the Rules for direct recruitment and recruitment by promotion to Class I Service. Keeping in view the contention raised on behalf of the appellants before us that Rule 4 does not prescribe a quota to be invariably followed, but merely a ceiling and the contention of Mr. P. R. Mridul for some of the direct recruits that rule 4 prescribes an invariable quota any violation of which would render the appointees in excess of quota invalid, we would proceed as held in Bachan Singh 's case that rule 4 prescribes the quota. However, as it has been held in a binding decision that Rule 4 did prescribe a quota rule of 9: 1 between direct recruits and promotees, we would proceed on that basis. The Court then noticed that in 1962, there was a state of emergency. The Court then proceeded to notice the vacancies that occurred between 1951 and 1971 and concluded that it is because of the conditions of emergency that the quota for filling the temporary posts was ignored both for departmental promotees and direct recruitment. After taking this view, the Court proceeded to answer the contention whether the recruitment of some of the respondents in that case by a method not permitted by rules was legal and valid which necessitated the Court considering and answering the question as to whether the Government had the power to make recruitment in relaxation of the Rules ? The Court then upheld the appointment of those direct recruits who were appointed after interview by the Union Public Service Commission by holding that was done in relaxation of the rules both as to competitive examination and the promotions were given after relaxing the quota rule. Rule 3 of '1949 Rules ' permitted recruitment only from two sources i.e. by competitive examination and by promotion. a quota, Rule 4 which was introduced in 1967 conferred power on the Union Government for the reasons to be recorded in writing and after consultation with the Union Public Service Commission to relax all or any of the rules with respect to class or category of persons/ posts. The Government was in need of large number of Engineers and therefore, had to make recruitment by a method not prescribed by the rules in relaxation of the rules, and large number of persons had to be given departmental promotion with the same end in view which would amount to relaxation of the quota rule. Even apart from this, in the statement of case filed in this case on behalf of the Union of India, it is conceded that in view of the exigencies of service relaxation was made in the matter of promotion to the cadre of Assistant Executive Engineers between 1951 and 1963. If rule 3 provided methods of recruitment indicating the sources from which recruitment could be made and if rule confers discretion on Government to make recruitment from either source because Rule 4 opens with a limitation, namely, that it is subject to Rule 3, now if as held in Bachan Singh 's case 1949 Rules ' while prescribing the quota conferred power on the Union Government to make recruitment in relaxation of the rules, it is implicit in this power to G make recruitment in relaxation of the quota rules and it is admitted that because of the emergency and because of the exigencies of service, recruitment was made in relaxation of the rules. Now, where the rule provides for recruitment from two sources and simultaneously prescribes quota, unless there is power to relax the rule as has been held in a catena decisions, any recruitment in excess of the quota from either of the sources would be illegal and the excess recruits unless they find their place by adjustment in subsequent 956 years in the quota, would not be members of the service. "We are accordingly of the opinion that promotees from Class II, Grade III, to class I Grade II Service in excess of the prescribed quotas for each of the years 1951 to 1956 and onwards have been illegally promoted and the appellant is entitled to a writ in the nature of mandamus commanding respondents 1 to 3 to adjust the seniority of the appellant and other officers similarly placed like him and to prepare a fresh seniority list in accordance with law after adjusting the recruitment for the period 1951 to 1956 and onwards in accordance with the quota rule prescribed . ' Where rules thus confer a discretion on the Government to relax the rules to meet with the exigencies of service, any recruitment made in relaxation of the rules would not be invalid. "The contention was that the Resolution prescribed a quota and the Government had no discretion to make recruitment in relaxation of the quota and therefore, any recruitment made in excess of the quota in view of the decision in Jaisinghani 's case and 2 B.S. It thus becomes crystal clear that when recruitment is from two independent sources, subject to prescribed quota, but the power is conferred on the Government to make recruitment in relaxation of the rules, any recruitment made contrary to quota rule would not be invalid unless it is shown that the power of relaxation was exercised mala fide. In Bachan Singh 's case the Court has extensively referred to the emergency situation in the market of recruitment of engineers between 1959 and 1969 and that fact situation not only was not controverted but conceded before us. Now if recruitment contrary to Rule 3, namely, by interview by the Union Public Service Commission, which is not the recognised mode of recruitment, is held valid in Bachan Singh 's case on the ground that it was done in relaxation of the rules, it must follow as a corollary that the same emergency compelled the Government to recruit by promotion engineers to the post of AEE Class I in excess of the quota by exercising the power of relaxation and such recruitment ipso facto would be valid. Appellant and those similarly situated were recruited by promotion as provided in Rule 3(ii) and it must be conceded that the recruitment by promotion during these years was in excess of the quota as provided in Rule 4. One such contention was that Union of India In its statement of case had conceded that as direct recruits were not available during that period, even though the qualification of competitive examination for direct recruits was completely relaxed and a mere interview by the Union Public Service Commission was considered sufficient, large number of persons from subordinate ranks had to be given promotion but this aspect was not examined by the Court. Repelling this submission, the High Court observed that the learned counsel was not able to point out any express admission to that effect in the statement of objections filed on behalf of the Union Government and the averment in Exhibit 'F ' that there has been a relaxation from time to time in the observance of the said rules by the Government in consultation with Union Public Service Commission to meet the emergent requirements of the Service, was not sufficient to permit an inference sought to be drawn as desired by the learned counsel. In fact, before the High Court rendered its decision, the Judgment of the Constitution Bench in Bachan Singh 's case was reported and as pointed out by us, this Court specifically held that the recruitment from both the services was made in relaxation of the rules And in the statement of case filed in this Court, there is a specific admission to that effect. We are therefore of the view that the High Court was in error in rejecting this contention The next question is, on what principle then in force inter se seniority of promotees and direct recruits recruited to service in relaxation of 1949 Rules including the quota rule was to be determined and how they were to be integrated in the cadre of AEE for further promotion to the cadre of Executive Engineers. Then came the decision of the Constitution Bench in Bachan Singh 's case whereupon 960 the Union Government set aside the two aforementioned seniority A list and drew up a fresh list on the criteria drawn from the decision in Bachan Singh 's `case as set out in the earlier portion of this Judgment. The contention of the Union Government is that the earlier seniority lists of 1963 and 1967/68 were not drawn up according to any particular principle. However, as we would presently point out we need not fall back upon this general principle for determining inter se seniority because in our view there is a specific rule governing inter se seniority between direct recruits and promotees in MES Class I Service, and it was in force till 1974 when the impugned seniority list was drawn up. In para 3(iii) of Appendix V of '1949 Rules ' it was provided that a roster shall be maintained indicating, the order in which appointments are to be made by direct recruitment and promotion in accordance with the percentages fixed for each method of recruitment in the recruitment rules. If quota prescribed by rule 4 was adhered to or was inviolable, the rule of seniority enunciated in para 3(iii) of Appendix V will have to be given full play and the seniority list has to be drawn in accordance with it. An identical situation was noticed by this Court in First B. section Gupta 's case wherein this Court while rejecting the contention of the promotees that the quota rule and the seniority rule deserved to be independent of each other held that with the upgrading of the large number of posts and the appointments to them of promotees, the quota rule collapsed and with that the seniority rule also. Therefore, once the quota rule was wholly relaxed between 1959 and 1969 to suit the requirements of service and the recruitment made in relaxation of the quota rule and the minimum qualification rule for direct recruits is held to be valid, no effect can be given to the seniority rule enunciated in para (iii), which was wholly inter linked with the quota rule and cannot 962 exist apart from it on its own strength. because both those seniority lists were drawn up in accordance with the rule of seniority enunciated in Annexure 'A ' to Army Instruction No. The principle of seniority therein enunciated is that the rule for determining inter se seniority in the cadre of Assistants should generally been taken as the model in framing the rules of seniority for other services and in respect of persons employed in any particular grade seniority should as a general rule, be determined on the basis of the length of service in that grade as well as service in an equivalent grade irrespective of whether the latter was under the Central or Provincial Government in India or Pakistan. This is recognised by the Ministry of Defence when while enacting '1953 Rules ', a provision was made in para 3 of Appendix v that the principles for determining seniority are under consideration. And it may be recalled that 964 both the 1963 and 1967 seniority lists were drawn up in accordance A with that principle. It is therefore necessary to proceed further and determine on what basis the seniority list of AEE was to be drawn up upto 1969, when the '1949 Rules ' became statutory according to the decision in Bachan Singh 's case. Between 1959 and 1969 and especially during the years 1962, 1963 and 1964 and some subsequent years, the Government consistent with its requirements and exigencies of service made recruitment including recruitment by promotion in relaxation of the '1949 & subsequent rules ' which the Government undoubtedly had the power to do. The next question is whether 1963 seniority list and 1967 seniority list were valid when drawn up. Therefore till the 1949 Rules acquired statutory character in 1969, the seniority lists of 1963 and 1967 in respect of AEE were quite legal and valid and were drawn up on the basis of the principle which satisfies the test of Article 16. It is open to the Government to prescribe principles for determining inter se seniority of persons belonging to the same service or cadre except that any such principle must meet the test of article 16. This relief must follow as a necessary corollary because once 1974 seniority list is quashed and consequently a declaration is being made that 1963 and 1967 seniority lists were valid and cannot be set at naught by principles of seniority determined in 1974, any panel drawn up on the basis of the invalid seniority must fall and must be quashed. 968 Pursuant to an integrated reading of Judgment in Bachan Singh 's case and this case a fresh panel for promotion will have to be drawn up consistent with the seniority list of 1963 & 1967 because it was not disputed that promotion from the cadre of AEE to Executive Engineer is on the principle of seniority cum merit. But in order to protect the interest of the appellant and those similarly situated, it was made abundantly clear that any promotion given subsequent to the date of the filing of the petition in the High Court must be temporary and must abide by the decision in this appeal. It is therefore, time to clearly initiate a proposition that a direct recruit who comes into service after the promotee was already unconditionally and without reservation promoted and whose promotion is not shown to be invalid or illegal according to relevant statutory or non statutory rules should not be permitted by any principle of seniority to score a march over a promotee because that itself being arbitrary would be violative of articles 14 and 16. All the promotions given subsequent to the filing of the petition in the High Court are subject to this decision and must be readjusted by drawing up a fresh panel for promotion keeping in view the 1963 and 1967/68 seniority list of AEE in the light of the observations contained in this judgment.
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In a list from 1967, he was number 234. But after a court case called Bachan Singh's case, the government changed the lists from 1963 and 1967/68. They made a new list based on the rules from the Bachan Singh case. In this new list, the Appellant's name was not on it. This is based on the rules of the Military Engineers Services Rules from 1949, which have been changed over time. The government thought the Bachan Singh case meant that there had to be a 9:1 quota for hiring Assistant Executive Engineers in the Military Engineering Service since 1951. He wanted the court to cancel the list and a promotion list that was based on it. They can only be changed for people who joined the service after 1969. 2.1 The new seniority list and the promotion list based on it are wrong. 2.2 There was no reason to redraw the seniority list in 1974 for people hired or promoted before 1969, when the rules became official laws. It ignored how people were hired between 1959 and 1969. In the Bachan Singh case, the Supreme Court looked at the history of the Military Engineering Service rules from 1949 to 1969 and said: (i) The rules from 1949 became official laws in 1969 because of a change made that year. (ii) Under the 1949 rules, people could only be hired to the Military Engineering Service in two ways: by passing a test or by being promoted. The government changed the rules about hiring and the quota system for direct hires and promotions. (v) Because of the emergency, the quota rule was ignored for filling job openings between 1951 and 1971, for both promotions and direct hires. Since the 1949 rules weren't official laws until 1969, the government could hire people from both sources by changing the rules. 4.1 The Military Engineering Service rules said how people could be hired. In the Bachan Singh case, the court said the government could change the rules about hiring. This means they could also change the quota rule. Because of the emergency, they hired people in ways that didn't follow the quota rule. 4.2 If a rule says people should be hired from two sources and sets a quota, then hiring too many people from one source is illegal, unless there's a way to change the rule. 4.3 But, if the government can change the rules about hiring, then hiring people in ways that don't follow the quota rules is okay, unless it's done unfairly. 4.4 Hiring people through interviews, which wasn't the normal way to hire, was found to be okay in the Bachan Singh case because of the emergency. The people who were promoted became official members of the service because the quota rule was changed. If there's no other rule for deciding seniority, then the rule of continuous service since the person started working is valid and fair. There's also a specific rule for deciding seniority between direct hires and promotions in the Military Engineering Service. It was in place until 1974, when the new list was made. In this case, the quota rule was ignored between 1959 and 1969 to meet the needs of the service. So, the seniority rule can't be used because it was based on the quota rule. The government seemed to agree with this because the seniority lists from 1963 and 1967/68 were made based on a different rule, not the one that was connected to the quota rule. 5.4 The other rule said that seniority should be based on how long someone has worked in that position, no matter if it was for the central or state government. This rule would apply if there wasn't a specific rule for the Military Engineering Service. Even if the rule connected to the quota was considered a special rule for the Military Engineering Service, it wouldn't matter because (1) it was ignored when the quota rule was ignored, and (2) later rules said that the "principles for deciding seniority are under consideration." The first was that there was a strict quota rule and that hiring too many people from one source was illegal. The second was that the quota rule couldn't be changed. The argument is that the way the government made the seniority list was illegal. So, even if the direct hires weren't officially part of the case, the challenge shouldn't fail. Even when there's a quota for hiring people from different sources, the government often hires more people from promotions because it's easier than hiring from outside. In one case, promotions from 1962 had to give way to direct hires from 1966. A new rule should be made that says a direct hire who joins the service after someone has already been promoted shouldn't be allowed to have seniority over the promotion, unless the promotion was invalid or illegal.
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For the respondent: Mr. Nand Lal Thakur Addl. Advocate General, Mr. Ram Lal Thakur Assistant Advocate General, and Mr. Rajat Damtal, Distt. Kangra, H.P. 21 & 22 of NDPS Act A pregnant woman, apprehending her arrest on the allegations of conspiring with her husband in substance trade, from whose house the Police had recovered 259 grams of diacetylmorphine (heroin) and 713 grams of tablets containing tramadol, the quantities of both drugs falling in the commercial category, attracting the rigors of S. 37 of NDPS Act, came up before this Court under Section 438 CrPC, seeking anticipatory bail. Whether reporters or papers may be allowed to see the judgment? -Yes 2. Earlier, the petitioner had filed a bail petition before Ld. Special Judge, Distt Kangra. However, vide order dated 19-01-2021, passed in Bail Application No. 30- D/XXII/2021, the application was dismissed. In Para 10 of the bail application, the petitioner declares having no criminal history. The status report also does not mention any criminal past of the accused. Briefly, the allegations against the petitioner are that on the midnight of Nov 29, 2020, the DySP, who was also officiating as SHO of the Police station Damtal, received a secret information that Dharminder alias Govinda (husband of the petitioner) had received a large quantity of psychotropic substances, which he had concealed in his residential house. The informant also disclosed that Dharminder would disburse the same during the night. Upon this, the DySP informed ASP, his superior officer, who further conveyed to him that he would join him soon. After that, the Investigator and other police officials, along with the drug detection kit, etc., reached the concerned place. In the meanwhile, they also associated independent witnesses. At 1:40 a.m., they reached in the village Channi at the house of Dharminder, alias Govinda. When they knocked on the door, a lady came out of the
house and revealed her name as Raj Kumari (mother-in-law of petitioner). The Investigator informed her about their intention to search the house and informed Raj Kumari about her legal rights under S. 50 of the NDPS Act. When the Investigator inquired about Dharminder, she said that he and his wife were sleeping on the upper floor. On this, the Police officials went to the upper floor and knocked on the door, but no body opened it. After that, they made a forced entry, but no one was inside the room. They further noticed that the back door was open. Subsequently, while searching the house, they noticed a secret cabin on the wall below the plyboard of the H LCD panel. On removing its door, the Investigator recovered a considerable quantity of cash, jewelry, a white-colored plastic packet, and brown colored packet, which had some powder. On opening the same, it contained brown colored substance resembling heroin, and on testing, it gave a positive result for diacetylmorphine (heroin). The substance, when weighed on an electronic scale, measured 259 grams. The Police also recovered 1091 capsules of Ridley tramadol, gross weight 713 grams. The Police also recovered cash amounting to Rs.14,50,000/-, besides gold, silver, etc. After that, the Investigator completed the procedural requirements under the NDPS Act and the CrPC and arrested Raj Kumari. She revealed during her interrogation that Dharminder and Monika, petitioner herein, had absconded from the backside. Subsequently, the Investigator also arrested Dharminder alias Govinda. Based on these allegations, the Police registered the FIR mentioned above. 5. Ld. Counsel for the bail petitioner, based on the pleadings in paragraphs 3 & 4 of the petition, submitted that from August 2020, the petitioner, along with her two minor children, had been residing at her paternal home at Phillaur, in Punjab, because her husband had married another girl. The petition further reads that she came to know about the case after the arrest of her mother-in-law. Mr. Nand Lal Thakur, Ld. Additional Advocate General opposed the bail and
contended that the accused has yet not discharged the presumption under S. 35 of the NDPS Act. Further, the quantity involved is commercial, and restrictions of S. 37 of the NDPS Act do not entitle the accused to bail. The arguments on behalf of the State are that the Police have collected sufficient evidence of a conspiracy between the bail petitioner and her husband, Dharminder, a trader of illicit drugs, which prima facie points out towards her involvement. While opposing the bail, the alternative contention on behalf of the State is that if this Court is inclined to grant bail, such a bond must be subject to very stringent conditions. Mr. Bharat Barowalia, Ld. Amicus Curiae submitted that by opposing the bail petition of the pregnant women, the welfare State would cause ill-being to those residents, who under their instinct of motherhood are also carrying forward the human genes by bearing a long gestation period and almost lifelong responsibilities. Mr. Barowalia further asserted that the Courts should be generous in granting bails to the pregnant. 8. On 02.02.2021, this Court issued notice to the State to file status report. Vide order dated 23.02.2021, this Court granted interim bail to the petitioner, which is continuing till date. In the meantime, the petitioner has filed a medical record about H her pregnancy. One such document dated 9th Mar 2021 is in the following terms: On trans-Abdominal sonography- Gravid uterus shows single g sac with viable fetus CRL=6.6 cms=12W06d; Liquor is adequate; Cardiac & Somatic activity is seen; EDOD++15/09/2021; Nasal bone seen. N T measure 1.4 mm; Internal os is closed; Ovary show normal scan. Opinion=ongoing pregnancy of 12w06d Showing normal cardiac activity.” 9. Thus, as on 9th Mar 2021, the petitioner was carrying pregnancy of 90 days, i.e., three months. Mr. Rajiv Sharma, Ld. Counsel for the petitioner, submitted that she is in the seventh month of her pregnancy and has some medical complications.
The State did not refute the contentions. 10. In Gurbaksh Singh Sibbia v State of Punjab, 1980 (2) SCC 565, (Para 30), a Constitutional Bench of Hon’ble Supreme Court held that the bail decision must enter the cumulative effect of the variety of circumstances justifying the grant or refusal of bail. Per Kalyan Chandra Sarkar v Rajesh Ranjan @ Pappu Yadav, 2005 (2) SCC 42, (Para 18) a three-member Bench of Supreme Court held that the persons accused of non-bailable offences are entitled to bail if the Court concerned concludes that the prosecution has failed to establish a prima facie case against him, or despite the existence of a prima facie case, the Court records reasons for its satisfaction for the need to release such person on bail, in the given fact situations. The rejection of bail does not preclude filing a subsequent application, and the Courts can release on bail, provided the circumstances then prevailing requires, and a change in the fact situation. In State of Rajasthan v Balchand, AIR 1977 SC 2447, (Para 2 & 3), Supreme Court noticeably illustrated that the basic rule might perhaps be tersely put as bail, not jail, except where there are circumstances suggestive of fleeing from justice or thwarting the course of justice or creating other troubles in the shape of repeating offences or intimidating witnesses and the like by the petitioner who seeks enlargement on bail from the Court. It is true that the gravity of the offence involved is likely to induce the petitioner to avoid the course of justice and must weigh when considering the question of jail, and also the heinousness of the crime. In Gudikanti Narasimhulu v Public Prosecutor, (1978) 1 SCC 240, (Para 16), Supreme Court held that the delicate light of the law favors release unless countered by the negative criteria necessitating that course. In Prahlad Singh Bhati H v NCT, Delhi, (2001) 4 SCC 280, Supreme Court highlighted one of the factors for bail to be the public or the State's immense interest and similar other considerations.
In Dataram Singh v State of Uttar Pradesh, (2018) 3 SCC 22, (Para 6), Supreme Court held that the grant or refusal of bail is entirely within the discretion of the judge hearing the matter and though that discretion is unfettered, it must be exercised judiciously, compassionately, and in a humane manner. Also, conditions for the grant of bail ought not to be so strict as to be incapable of compliance, thereby making the grant of bail illusory. 11. The proviso to S. 437 of CrPC, creates a special right of bail in favour of a person who is under the age of sixteen years or is a woman or is sick or infirm. S. 437. When bail may be taken in case of non- bailable offence. (1) When any person accused of, or suspected of, the commission of any non- bailable offence is arrested or detained without warrant by an officer in charge of a police station or appears or is brought before a Court other than the High Court or Court of Session, he (i) such person shall not be so released if there appear reasonable grounds for believing that he has been guilty of an offence punishable with death or imprisonment for life; (ii) such person shall not be so released if such offence is a cognizable offence and he had been previously convicted of an offence punishable with death, imprisonment for life or imprisonment for seven years or more, or he had been previously convicted on two or more occasions of a non- Provided that the Court may direct that a person referred to in clause (i) or clause (ii) be released on bail if such person is under the age of sixteen years or is a woman or is sick or infirm: Provided further that the Court may also direct that a person referred to in clause (ii) be released on bail if it is satisfied that it is just and proper so to do for any other special reason. Art. 51(c) of the Constitution of India is a provision which acts as a beacon for international coordination towards similarities of laws around the globe. It enjoins the state ‘to foster respect for international law.’ It provides that,
(c) foster respect for international law and treaty obligations in the dealings of organized peoples with one another,” 13. Therefore, it is imperative to consider Rule 64 of the United Nations Rules for H the Treatment of Women Prisoners and Non-custodial Measures for Women Offenders (the Bangkok Rules)2, adopted by the General Assembly on 21 December 2010, according to which, “Non-custodial sentences for pregnant women and women with dependent children shall be preferred where possible and appropriate, with custodial sentences being considered when the offence is serious or violent or the woman represents a continuing danger, and after taking into account the best interests of the child or children, while ensuring that appropriate provision has been made for the care of such children.” https://www.ohchr.org/EN/ProfessionalInterest/Pages/BangkokRules.aspx 14. Article 12 of the Convention on the Elimination of All Forms of Discrimination against Women New York, 18 December 1979,3 reads as follows, 1. States Parties shall take all appropriate measures to eliminate discrimination against women in the field of health care in order to ensure, on a basis of equality of men and women, access to health care services, including those related to family planning. 2. Notwithstanding the provisions of paragraph I of this article, States Parties shall ensure to women appropriate services in connection with pregnancy, confinement and the post-natal period, granting free services where necessary, as well as adequate nutrition during pregnancy and lactation. The National Health Portal of Government of India depicts that, “The environment is everything around us wherever we are at home, at work, or outdoors; Although you don't need to worry about every little thing you breathe in or eat, it's smart to avoid exposure to substances that might put your pregnancy or unborn 16. Per the report of Ministry of Women and Child Development Government of India, on Women in Prisons, launched by the Ministry of Women and Child Development, 25-06-2018,5 “As per most recent data available from the end of 2015,
there are 4,19,623 persons in jail in India, of which, 17,834 (about 4.3%) are women. Of these, 11,916 (66.8%) are undertrial prisoners. In India, an analysis of prison statistics at five-year intervals reveals an increasing trend in the number of women prisoners – from 3.3% of all prisoners in 2000 to 4.3% in 2015. A majority of female inmates are in the age group of 30-50 years (50.5%), followed by 18-30 years (31.3%). Of the total 1,401 prisons in India, only 18 are exclusive for women, housing 2,985 female prisoners. Thus, a majority of women inmates are housed in H women’s enclosures of general prisons.” 17. According to Mayo Clinic, even if you eat a healthy diet, you can miss out on key nutrients. Taking a daily prenatal vitamin — ideally starting at least three months before conception — can help fill any gaps.6 Apart from these, pregnant women need https://www.ohchr.org/en/professionalinterest/pages/cedaw.aspx https://www.nhp.gov.in/healthlyliving/pregnancy https://pib.gov.in/Pressreleaseshare.aspx?PRID=1536513 https://www.mayoclinic.org/healthy-lifestyle/pregnancy-week-by-week/in-depth/pregnancy- nutrient level of food and access to basic nutrition and health services, and need sanitation and hygiene education, including menstrual hygiene.7 18. According to WHO’s Kyiv Declaration on Women’s Health in Prison, 8 Correcting gender inequity in prison health Offender Health, 2009, “Pregnant prisoners should be provided with the same level of health care as that provided to women outside prison, including access to obstetricians, gynaecologists, midwives and birthing practitioners appropriate to their culture. Pregnant prisoners should have access to female practitioners if requested. Women may also decide not to proceed
with their pregnancy in prison, especially if they were previously unaware that they were pregnant. Treatment options equivalent to those available in the community should be guaranteed (WHO Regional Office for Europe, 2007).” 19. According to Somayeh Alirezaei and Robab Latifnejad Roudsari, in Promoting Health Care for Pregnant Women in Prison: A Review of International Guidelines 9, published in Iranian Journal of Nursing and Midwifery Research, (2020), “Despite the efforts made in international maternity guidelines to address the issues of care for pregnant women, there are currently deficiencies in many health aspects of pregnant prisoners and the special needs, such as prenatal care and assessment fetal health, MHC, ethical issues, problems related to the prison environment and forced labor, communication with the environment and people inside and outside the prison.” 20. According to Danielle Dallaire and Rebecca Shlafer, in Shackling Pregnant Women Poses Risks to Mother and Fetus,10 (2015), based on a research in US prisons, stated, “Although there is a dearth of research data on these women, we do know that, when compared to women in the general population, pregnant prisoners are more likely to have risk factors associated with poor perinatal outcomes, H including preterm and small-for-gestational-age infants. These outcomes are likely a result of exposure to a combination of risk factors, including lack of access to or failure to attend prenatal care, substance use, toxic stress, domestic violence, poor nutrition, and sexually transmitted infections.” 21. According to CDC (Centers for Disease Control and Prevention), “Violence can lead to injury and death among women in any stage of life, including during https://data.unicef.org/topic/maternal-health/antenatal-care/ https://www.unodc.org/documents/hiv- aids/WHO_EURO_UNODC_2009_Womens_health_in_prison_correcting_gender_inequity-EN.pdf https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7055189/
https://psychologybenefits.org/2015/12/29/shackling-pregnant-women-poses-risks-to-mother-and- pregnancy.”11 Bleeding and clotting disorders can cause serious problems during pregnancy, including miscarriage.12 Some workplace hazards can affect the health of 22. According to Lauren Kuhlik and Carolyn Sufrin, in Pregnancy, Systematic Disregard and Degradation, and Carceral Institutions,14 Harvard Law & Policy Review, [Vol. 14 2020], P 417, “An incarcerated pregnant person must, by default, rely on custody officers to triage any pregnancy related symptoms requiring medical attention, including possible labor symptoms. A pregnant person in custody does not have the freedom to call their health care provider or an ambulance or to go to a hospital, but must instead notify a custody officer who serves, functionally, as the gatekeeper to a pregnant person accessing medical personnel. The response of a custody officer, who is not a medical professional and typically has had no training from the institution on proper pregnancy care or warning signs, should always be to contact medical staff. This need is particularly salient in pregnancy because concerning signs in pregnancy or labor symptoms may often be subtle, such as light bleeding, cramping, or even a headache. In reality, however, custody officers may make their own, unqualified assessments as to whether a pregnant person’s symptoms warrant medical attention, or whether they are “really” in labor—leading to delays and neglect in care. Custody officers’ gatekeeping position allows them not only to exercise their lack of clinical judgment, but also to exercise potential punitive, moral judgments about pregnant incarcerated people. Institutions of incarceration are rarely held accountable for failing to provide prenatal care except when that failure results in an adverse pregnancy outcome.” 23. According to Zohreh Shahhosseini, Mehdi Pourasghar, Alireza Khalilian, and Fariba Salehi in A Review of the Effects of Anxiety During Pregnancy on Children’s Health15, stated “Although pregnancy is often portrayed as a time of great joy, that’s not the reality for all women. The adverse, long-term, stable, and
sometimes, irreparable effects of anxiety during pregnancy can change pregnancy into an agonizing and unpleasant event of women’s life span.” The authors further https://www.cdc.gov/ViolencePrevention/index.html https://www.cdc.gov/ncbddd/blooddisorders/index.html https://www.cdc.gov/niosh/topics/repro/pregnancy.html https://harvardlpr.com/wp-content/uploads/sites/20/2020/11/Kuhlik-Sufrin.pdf https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4499279/#ref22 stated, “Also it can be concluded that adverse effects resulting from high levels of maternal anxiety in children is a serious and thought-provoking in which the necessity of identifying and screening of anxiety disorders in periodic care during influencing factors on anxiety during pregnancy is essential.” pregnancy seems to be urgent. In this regard, the identification of contexts and 24. According to Michael T. Kinsella, and Catherine Monk, Impact of Maternal . Stress, Depression & Anxiety on Fetal Neurobehavioral Development 16, “Studies discussed here, all of which are ongoing, indicate that pregnant women’s psychological health may have consequences for fetal neurobehavioral development, and consequently, child outcomes. These findings underscore the importance of considering the effects of women’s mental health on child development during the prenatal, as well the postnatal, periods.” 25. According to Susan Hatters Friedman, Aimee Kaempf and Sarah Kauffman in their paper, The Realities of Pregnancy and Mothering While Incarcerated,17 the Journal of the American Academy of Psychiatry and the Law Online (2020), stated as follows, “Thus, pregnancies among women in prison, in addition to being complicated by the aforementioned risk factors, are more likely to be complicated by mental illness, substance-use disorders, and personality disorders.” 26. According to Francesca Halstead, in Pregnancy and childbirth in prison,18
(2020), “Nonetheless, the difference between pregnant prisoners and the general prison population (and pregnant women in mainstream society) was the wish for some to conceal their pregnancies. The wish to blend in to avoid being singled out for attention or, worse, threats of violence, intensified their stress. The intensity of masking concerned women about the effect of stress on their unborn baby.” 27. According to Kiran R. Naik, in Women in Prisons India, International Journal H of Research and Analytical Reviews,19 IJRAR (2019), Vol. 6, Issue 2, “As far as possible, except in the case of high-risk prisoners, arrangements for temporary release are to be made to enable delivery of children in a hospital outside the prison. Suspension of sentence may also be considered in the case of casual offenders. Further, the birth certificate of the child should not mention the prison as place of https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3710585/ https://www.sociologylens.net/topics/gender/pregnancy-and-childbirth-in-prison/27982 http://www.ijrar.org/papers/IJRAR1AXP008.pdf birth to protect them against social stigma. “Spending their formative years in prison can have a severe negative impact on the entire lives of children” 28. In Tin Sei Minthang Touthang v. Officer-in-Charge, Moirang Police Station, Manipur, 2021 CriLJ 19, Manipur High Court granted bail to a pregnant woman carrying seven months pregnancy, despite accusations of involvement in a huge quantity of opium, but had no bad antecedents. . 29. In Rekha v. State of Karnataka, Cr. Pet No. 200107 of 2021, decided on 29.01.2021, in a case for causing the death of five persons, the Karnataka High Court granted bail to a woman because there were no allegations against her of overt acts, and also because she was pregnant.
30. In State of Gujarat v. Jadav, Cr. A No. 652 of 2008, decided on 01.02.2016, a Division Bench of Gujrat High Court, while convicting in an appeal, imposed the sentence on the convicts for seven years imprisonment for dowry death, simultaneously suspended sentence for around ten months of a pregnant convict. 31. In Joginder Kumar versus State of U.P., 1994 4 SCC 260, a three-Judge [9]. A realistic approach should be made in this direction. The law of arrest is one of balancing individual rights, liberties and privileges, on the one hand, and individual duties, obligations and responsibilities on the other; of weighing and balancing the rights, liberties and privileges of the single individual and those of individuals collectively; of simply deciding what is wanted and where to put the weight and the emphasis; of deciding which comes first - the criminal or society, the law violator or ig h the law abider; of meeting the challenge which Mr. Justice Cardozo so forthrightly met when he wrestled with a similar task of balancing individual rights against society's rights and wisely held that the exclusion rule was bad law, that society came first, and that the criminal should not go free because the constable blundered. 32. Taking birth in jail could possibly be such a trauma to the child that social H hatred might follow, potentially creating an everlasting impact on the mind whenever questioned about birth. It is high time to take a contrarian call to the maxim Partus sequitur ventrem. 33. Good and nutritious food in prisons may give good physical health but cannot substitute good mental health. Restrains and confined spaces might cause mental stress to a pregnant woman. Giving birth in jail might cause her tremendous trauma. What difference will it make to the State and society by not postponing incarceration? What is so urgent to execute the sentence? Heavens will not fall if incarceration is postponed. There should be no restraints throughout pregnancy, no restraints during labor and delivery, and no restraints at least for a year after giving birth. Every expecting female deserves dignity during motherhood.
34. Pregnant women need bail, not jail! Courts must restore the due and sacrosanct freedom of women in motherhood pro tanto. Even when the offenses are highly grave and accusations very severe, they still deserve temporary bail or suspension of sentence, extending to a year after delivery. Further, those who stand convicted and their appeals closed also deserve similar relief, in whatever camouflage it may come. 35. The next question is since the allegations against the petitioner are for committing a heinous offense, attracting rigors of S. 37 of NDPS Act, is she entitled to a limited period bail, or the entire trial period? 36. To answer this question, the gravity of allegations and the nature of offense assumes significance. The accusations against the petitioner involve commercial quantities of psychotropic substances. Given this, the pre-conditions of S. 37 of the NDPS Act might impede the judicial discretion of whether she is entitled to limited 37. The decision of this Court in Satinder Kumar v. State of H.P., 2020 SCC Online HP 3276, covers the proposition of law involved in this case, wherein this Court observed, “Satisfying the fetters of S. 37 of the NDPS Act is candling the infertile eggs.” The ratio of the said decision is that to get the bail in commercial quantity of substance, the accused must meet the twin conditions of S. 37 of NDPS 38. The prosecution's case is that DySP had received secret information about illicit procurement of a vast quantity of contraband by Dharminder, the petitioner's husband. The petitioner explicitly declares that she has no criminal history, and even the State does not refute it. On the contrary, the investigation revealed that many H cases are registered against co-accused Dharminder alias Govinda under NDPS Act, 1) FIR No. 9/13 Registered under Section 21 of NDPS Act in PS Division 2) FIR No.19/15, registered under Sections 18 and 21 of NDPS Act in PS 3) FIR No.215/16, registered under Section 21 of NDPS Act in PS Indora.
4) FIR No.33/19 registered under Sections 21 and 29 of NDPS Act in PS 5) FIR No.50/19 registered under Sections 21 and 29 of NDPS Act in PS 6) FIR No.53/19 registered under Sections 21 and 29 of NDPS Act in PS 7) FIR No.74/19 registered under Sections 21, 22, 27, 29 of NDPS Act in 8) FIR No.185/20 registered under Sections 21 and 25 of NDPS Act in PS The petitioner was married to the accused around a decade ago and has no criminal background. However, her husband has a checkered criminal history. Thus, being a wife, she might be aware of her husband's illegal activities. But that is not enough! What was her role? How much say she had in the home? Whether she could have intervened and persuaded him to stop illegal activities? Whether her intervention would have helped? The answers to all these factors will depend upon the quality of evidence adduced during the trial and the firmness of cross- examination at her end. The fact is that she has no criminal history of her own. 40. The confessional statement of mother-in-law, who is a co-accused is legally insufficient to deny bail to the other accused in the absence of any other incriminating evidence or allegations. 41. The difference between a bail order and the final judgment is similar to that of a sketch and a painting. However, some sketches would be detailed, and some paintings with a few strokes. 42. Any detailed discussions about the evidence may prejudice the case of the prosecution or the accused. Suffice it to say that due to the reasons mentioned above, and keeping in view the nature of allegations, the petitioner has made out a case for grant of bail. 43. The mandate of S. 37 of the NDPS Act implies that the accused should satisfy its twin conditions and come out clean. The evidence collected by the Investigator is legally insufficient to deny bail to the other accused in the absence of any other incriminating evidence or allegations, further mellowed down by the criminal history H of her husband. Thus, the petitioner has satisfied the first condition. To meet the
second condition, stringent conditions would suffice. Thus, on this ground alone, instead of limited period bail, she has satisfied the rigors of Section 37 of the NDPS Act. Thus, the petitioner makes a case for release on bail during the trial in the facts and circumstances peculiar to this case. 44. The possibility of the accused influencing the investigation, tampering with evidence, intimidating witnesses, and the likelihood of fleeing justice, can be taken care of by imposing elaborative and stringent conditions. In Sushila Aggarwal, (2020) 5 SCC 1, Para 92, the Constitutional Bench held that unusually, subject to the evidence produced, the Courts can impose restrictive conditions. 45. Given the above reasoning, the Court is granting bail to the petitioner, subject to strict terms and conditions, which shall be over and above and irrespective of the contents of the form of bail bonds in chapter XXXIII of CrPC, 1973. 46. In Manish Lal Shrivastava v State of Himachal Pradesh, CrMPM No. 1734 of 2020, after analyzing judicial precedents, this Court observed that any Court granting bail with sureties should give a choice to the accused to either furnish surety bonds or give a fixed deposit, with a further option to switch over to another. 47. The petitioner shall be released on bail in the FIR mentioned above, subject to her furnishing a personal bond of Rs. Ten thousand (INR 10,000/-), and shall furnish one surety of Rs. Twenty-five thousand (INR 25,000/-), to the satisfaction of the Investigator. Before accepting the sureties, the Attesting Officer must satisfy that in case the accused fails to appear in Court, then such sureties are capable to produce the accused before the Court, keeping in mind the Jurisprudence behind the sureties, which is to secure the presence of the accused. 48. In the alternative, the petitioner may furnish a personal bond of Rs. Ten thousand (INR 10,000/-), and fixed deposit(s) for Rs. Ten thousand only (INR
10,000/-), made in favour of Chief Judicial Magistrate of the concerned district. a) The arresting Officer shall give a time of ten working days to enable the accused to prepare the fixed deposit. Such Fixed deposit may be made from any of the banks where the stake ig h of the State is more than 50%, or any of the stable private banks, e.g., HDFC Bank, ICICI Bank, Kotak Mahindra Bank, etc., with the clause of automatic renewal of principal, and liberty of the interest reverting to the linked account. c) The said fixed deposit need not necessarily be made from the account of H the petitioner and need not be a single fixed deposit. d) If the fixed deposit is made in physical form, i.e., on paper, then the original receipt shall be handed over to the concerned Court. e) If made online, then its printout, attested by any Advocate, and if possible, countersigned by the accused, shall be filed, and the depositor shall get the online liquidation disabled. f) The petitioner or her Advocate shall inform at the earliest to the concerned branch of the bank, that it has been tendered as surety. Such information be sent either by e-mail or by post/courier, about the fixed deposit, whether made on paper or in any other mode, along with its number as well as FIR number. g) After that, the petitioner shall hand over such proof along with endorsement to the concerned Court. It shall be total discretion of the petitioner to choose between surety bonds and fixed deposits. It shall also be open for the petitioner to apply for substitution of fixed deposit with surety bonds and vice-versa. Subject to the proceedings under S. 446 CrPC, if any, the entire amount of fixed deposit along with interest credited, if any, shall be endorsed/returned to the depositor(s). Such Court shall have a lien over the deposits up to the by substitution as the case may be. expiry of the period mentioned under S. 437-A CrPC, 1973, or until discharged
The furnishing of the personal bonds shall be deemed acceptance of the following and all other stipulations, terms, and conditions of this bail order: The petitioner to execute a bond for attendance to the concerned Court(s). Once the trial begins, the petitioner shall not, in any manner, try to delay the proceedings, and undertakes to appear before the concerned Court and to attend the trial on each date, unless exempted. In case of an appeal, on this very bond, the petitioner also promises to appear before the higher Court in terms of Section 437-A CrPC. ig h b) The attesting officer shall, on the reverse page of personal bonds, mention the permanent address of the petitioner along with the phone number(s), WhatsApp number (if any), e-mail (if any), and details of personal bank account(s) (if available), and in case of any change, the petitioner shall H immediately and not later than 30 days from such modification, intimate about the change of residential address and change of phone numbers, WhatsApp number, e-mail accounts, to the Police Station of this FIR to the concerned c) The petitioner shall not influence, browbeat, pressurize, make any inducement, threat, or promise, directly or indirectly, to the witnesses, the Police officials, or any other person acquainted with the facts of the case, to dissuade them from disclosing such facts to the Police, or the Court, or to tamper with the evidence. 48. The petitioner shall, within thirty days of release from prison, procure a smartphone, and inform its IMEI number and other details to the SHO/I.O. of the Police station mentioned before. The petitioner shall keep the phone location/GPS always on the “ON” mode. Whenever the Investigating officer asks to share the location, then the petitioner shall immediately do so. The petitioner shall neither clear the location history, WhatsApp chats, calls nor format the phone without permission of the concerned SHO/I.O.
During the trial's pendency, if the petitioner repeats or commits any offence where the sentence prescribed is more than seven years or violates any condition as stipulated in this order, it shall always be permissible to the respondent to apply for cancellation of this bail after three months of her delivering the baby. It shall further be open for any investigating agency to bring it to the notice of the Court seized of the subsequent application that the accused was earlier cautioned not to indulge in criminal activities. Otherwise, the bail bonds shall continue to remain in force throughout the trial and after that in terms of Section 437-A of the CrPC. In case the petitioner finds the bail condition(s) as violating fundamental, human, or other rights, or causing difficulty due to any situation, then for modification of such term(s), the petitioner may file a reasoned application before this Court, and after taking cognizance, even to the Court taking cognizance or the trial Court, as the case may be, and such Court shall also be competent to modify or delete any condition. 51. Any Advocate for the petitioner and the Officer in whose presence the petitioner puts signatures on personal bonds shall explain all conditions of this bail order, in vernacular and if not feasible, in Hindi or Punjabi. H 52. This order does not, in any manner, limit or restrict the rights of the Police or the investigating agency from further investigation as per law. 53. Any observation made hereinabove is neither an expression of opinion on the merits of the case, nor shall the trial Court advert to these comments. 54. In return for the protection from incarceration, the Court believes that the accused shall also reciprocate through desirable behavior. 55. There would be no need for a certified copy of this order for furnishing bonds. Any Advocate for the petitioner can download this order along with the case status from the official web page of this Court and attest it to be a true copy. In case the attesting officer or the Court wants to verify the authenticity, such official can also verify its authenticity and may download and use the downloaded copy for attesting bonds.
In the facts and circumstances peculiar to this case, the petition is allowed in the terms mentioned above.
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The Himachal Pradesh High Court recently stated that delaying a jail sentence for a pregnant woman would not cause any major problems. The court decided that every pregnant woman should be treated with respect during motherhood. Because of this, it ruled that a pregnant woman deserves bail instead of being kept in jail.
A single judge, Justice Anoop Chitkara, gave a pregnant woman special permission to avoid arrest, known as "anticipatory bail." She was accused of crimes under the NDPS Act, which deals with drug offenses. The judge noted that a woman should not be held back or kept in small, closed areas during pregnancy, as this could cause her a lot of mental stress.
The Court stated, "Why is it so urgent to put someone in jail? Nothing bad will happen if we delay putting her in prison. Pregnant women should not be held back during pregnancy, during childbirth, or for at least a year after having their baby. Every woman who is going to be a mother deserves to be treated with respect."
The Court also said:
"Pregnant women need bail, not jail! Courts need to give back the important freedom that women should have during motherhood. Even if the crimes are very serious and the accusations are harsh, they still should get temporary bail or have their sentence put on hold for up to a year after giving birth. Also, even those women who have been found guilty and have no more chances to appeal their case should get similar help, no matter how it's offered."
"Being born in jail could be such a harmful experience for the child that they might face social dislike later in life. This could leave a lasting negative effect on their mind whenever they are asked about their birth. It's time to challenge the old legal saying that a child's status depends on their mother's status at birth."
The Court was looking at a request for anticipatory bail from a pregnant woman. She was worried about being arrested in a drug case (NDPS case) where her husband and mother-in-law had already been taken into custody. The claims against her were that she planned with her husband to sell drugs after a large amount of drugs was found at her husband's home.
The woman said she was not involved and denied the claims. She stated that she had been living in Punjab with her two young children since August of the previous year.
After looking at the details of the case, the Court stated:
"The woman requesting bail married the accused person about ten years ago and has no past criminal record. However, her husband has a long history of criminal activity. So, as his wife, she might have known about his illegal actions. But that alone isn't enough! What was her part in all this? How much power did she have in the home? Could she have stepped in and convinced him to stop his illegal activities? Would her trying to stop him have made a difference? The answers to all these questions will depend on how good the evidence is during the trial and how strong her defense lawyers are during questioning. The important thing is that she herself has no criminal past."
The Court looked at international guidelines, like the United Nations rules for how women prisoners should be treated (known as the Bangkok Rules) and an agreement called the Convention on the Elimination of All Forms of Discrimination against Women. Using these, the Court studied the health risks and needs, both physical and mental, of a pregnant woman.
The Court also considered a report from the Indian government's Ministry of Women and Child Development about women in prisons. This report showed that by the end of 2015, out of 419,623 people in Indian jails, 17,834 (about 4.3%) were women. A large number of these women, 11,916 (66.8%), were awaiting trial and had not yet been found guilty.
The Court first noted, "While prisons might offer good and healthy food, that doesn't make up for good mental health. Being held back and kept in small, closed areas can cause a lot of mental stress for a pregnant woman. And giving birth in jail could cause her extreme emotional harm."
Because of all these reasons, the Court allowed the woman's request for anticipatory bail.
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2. The present appeals challenge the common judgment and
order dated 8th February, 2017, passed by the Division Bench of
the High Court of Madhya Pradesh, Gwalior Bench, in Writ
Appeal No. 386 of 2016 along with companion matters, thereby
allowing the appeals filed by the State of Madhya Pradesh as
well as the Jan Bhagidari Samiti and setting aside the common
judgment and order dated 29th September, 2016 passed by the
learned single judge of the High Court of Madhya Pradesh,
Gwalior Bench in Writ Petition (Civil) Nos. 4716 of 2016, 5326
of 2016 and 5145 of 2016.
3. The facts in the present case are taken from Writ Petition
(Civil) No.4716 of 2016.
4. The State Government of Madhya Pradesh, vide
Notification dated 30th September, 1996, started a Scheme
known as “Jan Bhagidari Scheme” (hereinafter referred to as
“the said Scheme”). As per the said Scheme, the Government
had decided that the local management of the Government
Colleges was to be handed over to a Committee so as to ensure
public participation in the Government Colleges. Under the
said Scheme, the said Committees were to be constituted
having members from various fields. The Chairman of the said
Committee was to be appointed by the State Government from
the members of the concerned Civic Body, District Panchayat,
Member of Legislative Assembly (MLA) or Member of Parliament
(MP). The District Collectors or their representative were to be
the exofficio Deputy Chairman of the General Council of the
said Committee. The representatives of the donors, farmers,
and the representative of benefitting schools were to be the
members of the said Committee. The said Committee was
known as Jan Bhagidari Samiti.
5. Vide the Government Circular/Order dated 5 th October,
2001, the State Government decided to start some courses on a
selffinancing basis. For the said courses, the appointments
were to be made on contractual/tenure basis and the
honorarium of the teachers and other staff was to be decided by
the said Committee.
6. In pursuance to the said Scheme, an advertisement came
to be issued in the year 2014 for appointment of teachers as
guest faculty for the Academic Year 20142015 in different
Colleges. The writ petitioners in Writ Petition (Civil) No.4716 of
2016, having requisite qualifications, applied to the advertised
positions in pursuance to the said advertisement. Upon their
selection by the duly constituted Committee, they were
appointed. After the end of the Academic year, the writ
petitioners were discontinued from service. Fresh
advertisements were issued for the next Academic Year 2015
2016. Being aggrieved thereby, the writ petitioners approached
the High Court by way of Writ Petition (Civil) No. 4716 of 2016.
The said writ petition was allowed by the learned single judge of
the High Court vide judgment and order dated 29 th September,
2016, thereby directing that the writ petitioners therein would
continue to work on their respective posts till regular selections
were made. It was also directed that the writ petitioners
therein were entitled to get the salary in accordance with the
UGC circular issued in February, 2010.
7. Being aggrieved thereby, the State Government as well as
the Presidents of the Jan Bhagidari Samitis preferred appeals
before the Division Bench of the High Court. The Division
Bench of the High Court by the impugned judgment and order
dated 8th February, 2017, allowed the writ appeals and set
aside the judgment and order passed by the learned single
judge of the High Court. Being aggrieved thereby, the present
appeals by way of special leave.
8. We have heard the Shri Rana Mukherjee, learned Senior
Counsel appearing on behalf of the appellants and Shri K.M.
Nataraj, learned Additional Solicitor General (“ASG” for short)
appearing on behalf of the respondents.
9. Shri Rana Mukherjee, learned Senior Counsel, would
submit that the Division Bench of the High Court has erred in
interfering with the judgment and order passed by the learned
single judge. He submits that, as a matter of fact, the
appellants were duly qualified and were selected in accordance
with due selection process and were required to undergo the
selection process in every Academic Year. He submits that the
modus operandi of the Government Colleges was to engage the
services of the appellants at the beginning of the Academic
Session and to discontinue them at the end of the Academic
Session; and again to issue fresh advertisements for the next
Academic Session. In response to the same, the candidates
were again required to follow the selection process to get
appointed. It is therefore submitted that though there was
sufficient workload for regular posts, the appellants were
deprived of regular employment. It is submitted that, in any
case, the appellants had not sought for regularization. The
relief claimed was only for continuation of their services till duly
selected candidates were appointed. He therefore submits that
the impugned judgment and order delivered by the Division
Bench of the High Court deserves to be set aside.
10. Shri K.M. Nataraj, learned ASG, on the contrary, would
submit that the appellants were appointed in accordance with
the said Scheme. It is submitted that under the said Scheme,
the Government Colleges were required to run various courses
on a selffinancing basis. The expenditure for the same was to
be meted out from the tuition fees, received from the students.
He submits that the appointments of appellants were neither
ad hoc nor temporary. It is submitted that their services were
as guest lecturers and were on contractual basis for 11 months.
11. Shri Nataraj further submits that the requirement of the
guest lecturers was from year to year on the basis of the
number of students available for particular course(s). He
further submits that the said Scheme itself provided for
appointment of lecturers on a guest faculty basis and as such,
since the appellants had chosen not to challenge the said
Scheme, the Division Bench had rightly allowed the writ
appeals and dismissed the writ petitions.
12. A perusal of the advertisement dated 24 th June, 2016
issued by the Principal, Government Kamla Raja Girls Post
Graduate Autonomous College, Gwalior, which is at Annexure
P2 of the Appeal Paper Book and the advertisement dated 2 nd
July, 2016 issued by the Principal, SMS Government Model
Science College, Gwalior, M.P., which is at Annexure P3 of the
Appeal Paper Book, would show that the appointments were to
be made after the candidates had gone through due selection
procedure. Though Shri Nataraj, learned ASG has strenuously
urged that the appointments of the appellants were as guest
lecturers and not as ad hoc employees, from the nature of the
advertisements, it could clearly be seen that the appellants
were appointed on ad hoc basis. It is a settled principle of law
that an ad hoc employee cannot be replaced by another ad hoc
employee and he can be replaced only by another candidate
who is regularly appointed by following a regular procedure
prescribed. Reliance in this respect can be placed on the
judgment of this Court in the case of Rattan Lal and others
vs. State of Haryana and others1 and on the order of this
Court in the case of Hargurpratap Singh vs. State of Punjab
and others2.
13. In that view of the matter, we do not find that an error was
committed by the learned single judge of the High Court by
directing the writ petitioners to continue to work on their
respective posts till regular selections are made. We, however,
find that the direction issued by the learned single judge of the
High Court that the writ petitioners would be entitled to get the
salary in accordance with the UGC circular is not sustainable.
The advertisements themselves clearly provided that the
selected candidates would be paid the honorarium to be
determined by the said Committee.
14. We are informed at the Bar that the appellants are being
paid on a per hour basis, i.e., at the rate of Rs.1,000/ per hour
and they are continuing to work in pursuance of the order of
status quo passed by this Court on 28 th April, 2017. We also
find substance with the submission made on behalf of the
respondent – State that continuation of the appellants would
depend on the number of students offering themselves for the
concerned courses.
15. In that view of the matter, we are inclined to partly allow
the present appeals.
16. Accordingly, we pass the following order:
A. The appeals are partly allowed.
B. The impugned judgment and order dated 8 th February,
2017 passed by the Division Bench of the High Court of
Madhya Pradesh, Gwalior Bench in Writ Appeal No.386
of 2016 along with companion matters is quashed and
C. The judgment and order dated 29 th September, 2016
passed by learned single judge of the High Court is
(i) The writ petitioners appellants herein would be
entitled to continue on their respective posts till
they are replaced by regularly selected candidates;
(ii) The writ petitioners appellants herein would be
continued on their respective posts provided that a
sufficient number of students are available for the
particular course(s) for which the writ petitioners –
appellants herein are appointed.
(iii) The writ petitioners – appellants herein would be
entitled to honorarium at the rate of Rs.1,000/
per hour as is being paid to them presently.
17. Pending application(s), if any, shall stand disposed of.
There shall be no order as to costs.
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The Supreme Court has confirmed a rule: a temporary employee cannot be replaced by another temporary employee. Instead, they can only be replaced by someone hired permanently through a proper process.
The Court noted this is a firm legal principle: a temporary worker cannot be replaced by another temporary worker. They must be replaced by someone officially hired by following all the standard steps.
To support this, the Court referred to earlier decisions. These included a Supreme Court case from 1985 called Rattan Lal and others vs. State of Haryana, and another ruling from 2007, Hargurpratap Singh vs. State of Punjab and others.
Two judges, Justices L Nageswara Rao and BR Gavai, made this statement. They were reviewing appeals about hiring teachers for colleges in Madhya Pradesh.
The people who took this case to court (known as the appellants) were hired as guest teachers. They worked under a contract for a program in Madhya Pradesh. After the academic year ended, their jobs were terminated, and new job announcements were made. Feeling wronged, the teachers went to the High Court. A single judge agreed with them, ordering that they could continue working until permanent teachers were selected. However, the state government appealed this decision. A larger panel of judges then overturned the single judge's order. This led the teachers to approach the Supreme Court.
The state government strongly argued that these teachers were guest lecturers, not temporary employees. But the Supreme Court looked at the job advertisements. It clearly saw that the teachers were, in fact, hired on a temporary basis.
Because of this, the Court found no mistake in the single judge's order. That order said the teachers (who filed the lawsuit) should continue in their jobs until permanent staff were chosen.
However, the Supreme Court judges decided one part of the single judge's order was wrong. The single judge had said the teachers should get paid according to rules from the UGC (University Grants Commission). But the Supreme Court said this was not valid. The original job ads clearly stated that selected candidates would receive a fixed payment. This payment (an honorarium) would be decided by the Jan Bhagidari Committee.
The Court has ruled that the teachers can stay in their jobs. They can work until a permanently hired person replaces them.
Also, they will be paid 1,000 rupees for each hour they work. This is the amount they are currently receiving.
Case Name: Manish Gupta and another vs. Jan Bhagidari Samiti and others.
Lawyers involved: Senior Advocate Rana Mukherjee for the teachers (appellants); Additional Solicitor General KM Nataraj for the opposing side (respondents).
**About Employment Law:** It's an established legal rule: a temporary employee cannot be replaced by another temporary employee. They can only be replaced by someone hired permanently by following the correct official steps. This is mentioned in paragraph 12 of the court's decision.
The Court referred to these previous cases: Rattan Lal and others vs. State of Haryana (1985); Hargurpratap Singh vs. State of Punjab and others (2007).
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Appeals Nos. 137 to 141 of 1958. Appeals by special leave from the judgment and order dated April 26, 1956 of the Patna High Court in Misc. Judicial Cases Nos. 362 to 366 of 1955. A. V. Viswanatha Sastri, section K. Majumdar and I. N. Shroff, for the appellants Nos. 2 to 4 (In all the appeals). Hardayal Hardy and D. Gupta, for the respondent (In all the appeals). December 15. The Judgment of the Court was delivered by KAPUR, J. The assessee who is the appellant has brought these five appeals against the judgment and order of the High Court of Patna by which it answered the two questions stated under section 66(2) of the Indian Income tax Act against the appellant and in favour of the Commissioner of Income tax. The appellant is the son of the late Maharajadhiraja of Darbhanga and the brother of the present Maharaja. The father died in 1929 and the appellant was given by way of maintenance the Estate of Rajnagar. He was also given a yearly allowance of Rs. 30,000 which was later raised to Rs. 48,000. From 1929, the appellant invested his cash surplus in shares and securities, the account of which was entered in what is called Account Book No. 1. From the year 1930 onwards up to the year 1941 42 the appellant purchased a large number of shares and securities which by the accounting year 1941 42 were of the value of Rs. 14.91 lacs. During this period the appellant sold shares and securities in the accounting years 1936 37 and 1939 40 of the value of 1.48 lacs and 1.69 lacs respectively. He made certain amount of profits on these sales but under orders of the Commissioner of Income tax in the former case and of the Income tax Tribunal in the latter case, these sums were not assessed to income tax. In the 290 accounting years 1942 43 to 1946 47 the appellant purchased and sold some shares and securities. The entries in Account No. 1 stood as follows: Total value of Total cost of Total cost of shares shares & securities shares and and securities sold cost at the securities pur during the year. beginning of the chased during the year. 1350 Fs. Rs. 14.66 lacs Nil Rs. 4.68 lacs 942 43 (13 items) 1351 Fs. Rs. 9.98 lacs Rs. 2.37 lacs. Rs. 416 lacs 1943 44 (4 items) (12 items) Rs. 3 05 lacs. Rs. 069 lacs 1352 FS. Rs. 8.20 lacs (2 items) and (3 items) 1944 45 other call money. 1353 Fs. Rs. 10.52 lacs Nil Rs. 1.03 lacs 1945 46 (3 items) 1354 Fs. Rs. 9.50 lacs Rs. 15 83 lacs. Rs. 3.39 lacs 1946 47 ( 9items) (2 items) and in all these years the appellant made profits which varied from Rs. 2,56,959 in the accounting year 194243 to Rs. 33,174 in the accounting year 1946 47. On July 16, 1940, the appellant arranged an overdraft with the Mercantile Bank of India and actually withdrew Rs. 10,000 for the purchase of shares. But his brother the Maharaja advanced to him without interest Rs. 10 lacs and thus the overdraft was paid off. A new Account was opened in the books of the appellant named No. 2 Investment Account which contained all entries in regard to shares purchased and sold from out of the money borrowed from the Maharajadhiraj. In this account entries of the different years were as follows: 292 was held not to. be taxable. Thus in the second period the assessee was held not to be carrying on any trade. In the third period, i.e., the assessment years 1944 45 to 1948 49 the profits made by the appellant from purchase and sale of shares were as follows: 1944 45. Rs.2,62,000 and odd 1945 46. Rs.3,95,000 and odd 1946 47. Rs.1,57,000 and odd 1947 48. Rs.1,33,000 and odd 1948 49. 76,000 and odd The Income Tax Officer held these to be liable to income tax as business profits. On appeal the Appellate Assistant Commissioner excluded the profits for the years 1944 45 and 1945 46 but for the years 1946 47 to 1948 49 the assessments were upheld. Both parties appealed to the Appellate Tribunal. It held on the evidence that the appellant was to be regarded as a dealer in shares and securities and therefore the profits were assessable to income tax. The appellant applied for a case to be stated under section 66(1) of the Income tax Act. This application was dismissed but the High Court made an order under section 66(2) of the Income tax Act to state a case on two questions of law. The questions were as follows: (1). Whether in the circumstances of the case, there is material to support the finding of the Appellate Tribunal that the assessee was a dealer in shares and securities with respect to each of the accounts and, therefore, liable to be taxed? (2). Whether, having regard to the findings of the Appellate Tribunal in respect of 1941/42 assessment, it was open to the Appellate Tribunal in the present case to hold that the profits and the transactions of sale and purchase of shares and securities amounted to profits of business and so liable to be taxed ? The High Court held that the facts and circumstances which the Tribunal took into consideration in arriving at the finding were the material before the Tribunal to support the finding and the first question 293 was answered in the affirmative and therefore against the appellant. In regard to the second question the answer was again in the affirmative and against ', the appellant who has come to this Court by special leave. It was argued on behalf of the appellant that he was not carrying on the business of buying and selling shares but his purchases and sales were in the nature of investments of his surplus monies and therefore the excess amounts received by sales were capital receipts being merely surplus and not profits. It was also submitted that the appellant being a zamindar the buying and selling of shares was not his normal activity; that he had a large income and it was his surplus income which he was investing in buying the shares and whenever he found it profitable he converted his holdings and securities and for a number of years from 1931 32 he had been buying shares but he did not sell them; that the very nature of investments was such that they had to be constantly changed so that the monies invested may be used to the best advantage of the investor; and that the sales were really for the purpose of reemploying the monies that he had invested to his best advantage. Counsel for the appellant relied upon certain cases in support of his submission that the first question raised was of a wider amplitude and that it had been erroneously restricted by the High Court and that its true import was the same as of the questions which were raised in the following cases decided by this Court. He relied on G. Venkataswami Naidu & Co. vs The Commissioner of Income tax (1), Oriental Investment Co., Ltd. vs The Commissioner of Income tax, Bombay (2). In the former case the assessee purchased four plots of land adjacent to the mills of which he was the Managing Agent. On various dates and about five years later sold them to the mills in which he realized about Rs. 43,000 in excess of his purchase price. This was treated by the Income tax authorities as purchase with a view to sell at a profit. The question referred was whether there was material for the (1) [1959] Supp. 1 S.C.R. 646. (2) ; 294 assessment of that amount as income arising from an adventure in the nature of trade. The High Court held that that was the nature of the transaction. On appeal this Court held that before the Tribunal could come to the conclusion that it was an adventure in the 'nature of trade, it had to take into consideration the legal requirements associated with the concept of the trade or business and that such a question was a mixed question of law and fact. It was also held that where a person invests money in land intending to hold it and then sells it at a profit it is a case of capital accretion and not profit derived from an adventure in the nature of trade but if a purchase is made solely and exclusively with the intention to resell it at profit and the purchaser never had any intention to hold the property for himself there would be a strong presumption that the transaction is in the nature of trade but that was also a rebuttable presumption. The purchase in the absence of any rebutting evidence was held to fall in the latter category, i.e., adventure in the nature of trade. In the Oriental Investment case(1) the assessee was an investment company. It had purchased certain shares and sold them and qua those shares it claimed to be treated as an investor and not a dealer on the ground that it did not carry on any business in the purchase and sale of shares. The assessee 's applications for reference to the High Court were rejected on the ground that no question of law arose out of the order of the Tribunal. It was held that the question whether the assessee 's business amounted to dealing in shares and in properties or was merely an investment was a mixed question of law and fact and the legal effect of the facts found was a question of law and this Court ordered the case to be stated on two questions that it framed. One of the questions was similar to the first question in the present case but the second question was a wider one, i.e., whether the profits and losses arising from the sale of shares etc. could be taxed as business profits. The question which the High Court had to answer (1) ; 295 in the present case was a narrow one and the answer to that on the material before the Court was rightly given in the affirmative. But even if the question is taken to be wider in amplitude, on the materials produced and on the facts proved the appellant must be held to have been rightly assessed. Counsel for the appellant argued that the amounts received by him in the accounting years were in the nature of capital accretions and therefore not, assessable. In support, Counsel for the appellant relied on the following cases: Raja Bahadur Kamakshya Narain Singh vs The Commissioner of Income Tax, Bihar & Orissa (1) where Lord Wright observed that profits realised by the sale of shares may be capital if the seller is an ordinary investor changing his securities but in some instances it may be income if the seller of the shares is an investment company or an insurance company. The other cases relied upon were Californian Copper Syndicate Limited vs Harris (2); Cooper vs Stubbs (3); Leeming vs Jones (4) and Edwards vs Bairstow & Harrison (5). It is not necessary to discuss these cases because. the principle applicable to such transactions is that. when an owner of an ordinary investment chooses to realise it and obtains a higher price for it than he originally acquired it at, the enhanced price is not a profit assessable to income tax but where as in the present case what is done is not merely a realisation or a change of investment but an act done in what is truly the carrying on of a business the amount recovered as appreciation will be assessable. In July 1948 the appellant had borrowed, though without interest, a large sum of money to the extent of about Rs. 10,00,000, no doubt from his brother. He started a new account calling it No. 2 Investment Account. For the assessment years under appeal shares purchased and sold were of a large magnitude ranging from Rs. 4.68 lacs to Rs. 69 thousands in what is called the first account and from Rs. 9,64,000 or even if Port Trust Debentures are excluded (1) [1943] L.R.70 I.A. 180,194. (2) (3) , 57. (4) (5). [1955] ; 296 Rs. 3,60,000 to Rs. 30,000. The magnitude and the frequency and the ratio of sales to purchases and total holdings was evidence from which the Income tax Appellate Tribunal could come to the conclusion as to the true nature of the activities of the appellant. The principle which is applicable to the present case is what we have said above and on the evidence which was before the Tribunal, i.e., the substantial nature of the transactions, the manner in which the books had been maintained, the magnitude of the shares purchased and sold and the ratio between the purchases and sales and the holdings, if on this material the Tribunal came to the conclusion that there was material to support the finding that the appellant was dealing in shares as a business, it could not be interfered with by the High Court and in our opinion it rightly answered the question against the appellant in the affirmative. The second question is wholly unsubstantial. There is no such thing as res judicata in income tax matters. The Appellate Tribunal has placed in a tabulated form the activities of the appellant showing the buying and selling and the magnitude of holdings and it cannot be said therefore that it was not open to the Appellate Tribunal to give the finding that it did. In our opinion the High Court rightly held against the appellant. The appeals are therefore dismissed with costs. One hearing fee in this Court. Appeals dismissed.
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The person appealing this case used to put extra money into stocks and bonds. He kept track of these investments in a notebook called Book No. 1. From 1930 to 1942, he bought a lot of stocks and bonds. By 1942, they were worth a lot of money. He sold some of these stocks and bonds for a profit. In 1940, he borrowed money from his brother, who was a Maharaja (like a king). He started a new account, called account No. 2. This account tracked all the stocks he bought and sold using the Maharaja's money. From 1944 to 1949, he made a lot of money buying and selling stocks. The Income Tax Officer (a government official) said this money should be taxed as business profits. The person in charge of appeals agreed, but said the profits from 1944 should not be included. Both sides appealed. The Appellate Tribunal (a special court) looked at the evidence and decided that the person was acting like a stock dealer. This meant the profits could be taxed. The High Court (another court) asked two questions about the Income Tax Act. They answered "yes" to both: "(1) Did the Appellate Tribunal have enough evidence to say the person was a stock dealer and should be taxed? (2) Since the Tribunal had already decided this in 1942, could they now say the profits from buying and selling stocks were business profits that should be taxed?" The person appealed again. He said that he was a Zamindar (landowner), so buying and selling stocks wasn't his main job. He said he wasn't running a business, just investing extra money. He claimed the extra money he made from selling stocks was not taxable profit. The court decided that based on the evidence, the person was correctly taxed. The rule is that if you sell an investment for more than you bought it, the extra money is not usually taxed as profit. But, if you are actively buying and selling stocks like a business, then the extra money is considered taxable profit. The court looked at past cases to help make their decision. The court said the amount of buying and selling, how the books were kept, and the size of the stock deals all showed the person was running a stock business. The High Court was right to agree with this decision. Also, just because something was decided in a previous tax case, it doesn't mean it can't be decided differently now. The Appellate Tribunal was allowed to make its own decision.
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Appeal No. 156 of 1971. From the Judgment and Order dated 19 10 1970 of the Gujarat High Court in Special Civil Appln. No. 1177/70. B.R.L. Iyengar, S.K. Dholakia and R.C. Bhatia, for the appellant. B.B.Ahuja, for respondent No. 1. The Judgment of the Court was delivered by UNTWALIA, J. The appellant 's writ petition filed in the High Court of Gujarat was dismissed in limine by a Bench of the High Court on October 19, 1970. The Commissioner of Income tax, Gujarat II, respondent No. 1 was the authority against whom several reliefs had been claimed in the writ petition. Subsequently were added the other members of the family of the appellant as respondents to the writ petition. The appellant obtained a certified from the High Court for appeal to this Court under sub clause (b) of clause (1) of Article 133 of the Constitution of India as it stood before the 30th Constitution Amendment Act. Hence tills appeal to this Court. Having heard Mr. B.R.L. Iyengar, Senior Advocate for the appellant at some length we found that the appellant was ill advised to file the writ petition and to. pursue the matter upto this Court. The appeal being devoid of any substance must fail. We proceed to state the facts and discuss the points urged before us very briefly. One BapalaI Purshottamdas Modi was the head of a Hindu Undivided family. The joint family possessed many immovable properties and carried on business of various types such as money lending etc. Bapalal had five sons namely Vadilal, Ramanlal, Jayantilal, Gulabchand and Kantilal. Ramanlal died long ago in or about the year 1933. Jayantilal died in 1956. The appellant is one of the sons of Jayantilal. The appellant 's case in the writ petition was that Bapalal was the karta of the Hindu Undivided family. He executed a general power of attorney on October 5, 1948 in favour of his third son Gulabchand to manage his (Bapalal 's) separate property. On October 22, 1954 Bapalal relinquished his right, title and interest in the joint family properties on taking a sum of Rs. 75,000/ leaving the corpus and management of the joint family properties to his four sur viving sons and Rajnikant, son of late Ramanlal. These five members also executed a memo of partition on October 24, 1954 disrupting the erstwhile Hindu Undivided family and partitioning the properties. In course of the proceedings for assessment of the income tax for the assessment year 1955 56 against the Hindu Undi vided family of Bapalal Purshottamlal Modi, an application under Section 25A of the Income tax Act, 1922 was made claiming partition w.e.f. October 24, 1954. Notices of the enquiry under section 25A were served on all the members of the family. At the enquiry the statements of various persons including the appellant were recorded by the Income tax Officer. He, by his order, dated January 28, 1960 disallowed the 114 claim under section 25A of the Income tax Act, 1922. It is asserted that in the year 1961 a suit for partition had also been filed and the City Civil Court Ahmedabad passed a decree for partition on June 30, 1965. In an appeal filed before the Appellate Assistant Commissioner from the order of the Income tax Officer dated January 28, 1960 reliance was placed on the Civil Court partition decree also. The Appellate Assistant Commissioner, however, dismissed the appeal by his order dated September 30, 1965. A second appeal to the Income tax Appellate Tribunal was dismissed on March 28, 1969. InCometax assessment was made against the Hindu Undivided family for the year 1955 56. Assessments were also made against the Hindu Undivided family, sometimes treating it as Association of Persons or Unregistered Part nership Firm as per returns filed from time to time, for the subsequent years upto the assessment year 1965 66. Copies of all the assessment orders were enclosed with the writ petition aS Annexure 'I ' collectively. Appeals taken to the Tribunal from some of the assessment orders were also dismissed. Notices were being issued and served under sections 22 and 23 of the Income tax Act, 1922 for the assessment years which were governed by the said Act. In respect of the assessment years 196.2 63 onwards notices were. issued and served under sections 142 and 143 of the Income tax Act, 1961. A large sum of tax and penalty became due as the demands from time to time were partly paid. The Income tax authorities took steps for realization of the income tax dues against the appellant 's family and got attached various properties. In Civil Suit No. 806 of 1961 in which the preliminary partition decree was passed on June 30, 1965, respondent Kantilal had been appointed as a re ceiver Later on one Mr. Bhatt was appointed Receiver. A Savings Bank Account No. 412002 was being operated by the Receiver. The Income tax Officer attached the entire amount of Rs. 56,294.43 in the said account by his orders dated May 12, 1970. Thereupon, the appellant filed the writ petition challenging the various orders passed in the pro ceeding under section 25A of the Income tax Act, 1922; the assessments made for the years 1955 56 to 1965 66 and the attachment orders on various grounds. In a single writ petition rambling allegations were made challenging the multifarious proceedings and the orders on various ground 's and the following prayers were made: "(a) declaring void and illegal and quashing the proceedings of the income tax authorities making assessments on Hindu Undivided Family, Association of persons and unregistered partnership firm afore said for the years beginning from the assessment year 1955 56 and also the proceedings for the recovery of the taxes so assessed, and (b) quashing the orders of the income tax Au thorities refusing to record partition and direct ing the Respondent and his Subordinates to record under Section 25A of the Act that the erstwhile joint family property has been divided or parti tioned in definite portions, each member getting an equal share, on October, 1954; 115 (c) directing the respondent and his subordi nates to cancel o.r withdraw the impugned orders and all steps taken for the recovery of the amounts so. assessed; (d) directing the respondent and hi.s subordi nates not to take any further steps for the recov ery of the tax so assessed; (e) quashing all the penalty orders and such other orders passed in pursuance of the assessment proceedings aforesaid; (f) quashing all the orders of attachment or in the nature attachment passed by the Income tax Authorities in these proceedings for the assessment year 1955 56 onwards, and (g) to pass such other and further orders as your Lordships deem just and expedient in the circurm stances of the case. " It seems to us that the High Court rightly dismissed the appellant 's petition in limine. Since the valuation under Article 133(1)(b) was beyond Rs. 20,000/ , the appellant was granted a certificate as a matter of course. It was pointed out to. the appellant 's counsel that so many proceedings and orders could not be challenged in one writ petition and he was asked to make his submissions in the appeal confining the writ petition to one matter only. Counsel chose to confine it to the attack on the attachment order of the Income tax Officer in respect of the money lying in the Savings Bank Account. While doing so, he traversed the entire allegations in the petition by adopting an ingenious method. Counsel submitted that the attachment had been made for realization of the income tax dues based upon various orders which were void and ultra vires. All those orders could be attacked collaterally while attacking the attachment order. Mr. Iyengar urged the following points in,support of the appeal. (1 ) That the orders of the various authorities rejecting the claim of the partition under section 25A of the Income tax Act, 1922 were without jurisdiction and on their face suffered from many infirmities of law. (2) That after Bapalal relinquished his inter est in the joint family properties and ceased to be the karta, there was no karta of the family. Gulabchand a junior member of the family could not act as a karta. Other members of the family did not accept him to be the karta. (3) That even after the death of Bapalal in the year 1958 various notices under the Income tax Act were issued and served in the name of Bapalal Purshottamdas Modi a dead person and hence the entire proceedings and assessment orders were nullities. 116 (4) That the appellant had no opportunity of taking any part in the income tax proceedings and his property cannot be made liable for realization of the dues determined in such proceedings. None of the points urged on behalf of the appellant merits any detailed discussion. We were taken through the power of attorney executed by Bapalal in favour of Gulabchand, the deed of relin quishment executed by him on October 22, 1954 and the alleged memorandum of partition of October 24, 1954; the orders of the Income tax officer, the Appellate Commissioner and the Tribunal in the proceedings under section 25A of the Income tax Act, 1922. In our opinion. the orders do not suffer from any infirmity of law or any such defect which will make them void. Notice of the enquiry had been given to all the members as admitted by the appellant himself. He had been examined in the proceedings. Sub section (3) of Section 25A pro vides. that where an order accepting partition had not been passed in respect of a Hindu family as sessed as undivided such family shall be deemed for the purposes of the Act to continue to be Hindu undivide family. A partition preliminary decree came much later. The income tax authorities had their own view to take. They were not bound by the decree. No reference was taken under the income tax Act challenging the order of the Tribunal dismiss ing the appeal. It was clear from some of the assessment orders that Gulabchand was acting as a karta even during the life time of Bapalal as he had retired to live in Brindaban. At the relevant time no body disput ed his authority to act as karta. His eldest brother Vadilal was an old man of about 70 years of age. His eider brother Jayantilal father of the appellant died in the year 1956. In these circum stances he appears to have acted as the karta with consent of all the other members. A junior member of the family could do so. See Mulla 's Hindu Law 296, fourteenth edn. Where occurs the following passage: "So long as the members of a family remain undivided, the senior member of the family is entitled to manage the family properties," includ ing even charitable properties (q); and is presumed to be the manager until the contrary is shown(r). But the senior member may give up his right of management, and a junior member may be appointed manager(s) . " Notices were being issued in the name of the family which was carrying on the business in the assumed name of Bapalal Purshottamdas Modi. They were neither issued to nor served on Bapajal the dead person. In response to the notices returns were being filed by the managing member of the family. At no stage before the income tax authorities a contention was raised that the notice was served on a dead person. There is no substance in the third point. Coming to the fourth and the last point urged on behalf of the appellant we find that the appellant is bound by the assess ment made in respect of the income of his family which continued in the eye of law to be joint. The share 117 of the appellant 's properties received by him from the joint family or the income thereof is liable for the income tax dues in question. The appellant, as we have said above, was ill advised to file a misconceived petition on wholly un tenable grounds. In the result the appeal fails and is dismissed with costs to respondent No. 1. S.R. Appeal dismissed.
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Bapalal Purshottamdas Modi was the leader of a Hindu Undivided Family. This family owned land and ran different businesses, including lending money. Bapalal had five sons: Vadilal, Ramanlal, Jayantilal, Gulabehand, and Kantilal. Ramanlal and Jayantilal died before Bapalal, in 1933 and 1956. The person making the appeal in this case was one of Jayantilal's sons. Gulabchand, the third son, acted as the leader of the family and filed tax returns. He did this because Bapalal gave him the power to do so in a legal document called a power of attorney from 1948. The other family members didn't object to this. In 1954, Bapalal gave up his rights to the family property. This left the property to his four living sons and Rajnikant, who was Ramanlal's son. In 1954, they all signed a paper that divided the Hindu Undivided Family and its properties. Later, during a tax review for the year 1955-56, someone made a request under section 25A of the Income Tax Act of 1922. They claimed the family had been divided. The tax officer denied this claim in 1960. While the appeal was ongoing, a lawsuit was filed in 1961 to officially divide the property. A court order for the division was obtained in 1965. The appeal to the Assistant Commissioner was turned down in 1965. A second appeal to the Income Tax Tribunal was also turned down in 1969. The people making the appeal didn't ask the High Court to review the case, as allowed by the law. Instead, they kept filing tax returns for the following years. In 1970, the tax officer took money from a savings account to pay for taxes owed. After this, the person making the appeal filed a legal challenge. They challenged the orders made under section 25A for the tax years 1955-66 to 1965-66, as well as the orders to take the money. The High Court quickly dismissed the legal challenge, but gave permission to appeal to a higher court under article 133(1)(b) of the Constitution. The Court dismissed the appeal, stating: (1) Section 25A(3) says that if a Hindu Undivided Family has been taxed as one unit and no order accepting a division has been made, then the family will still be considered a Hindu Undivided Family for tax purposes. The tax officers could make their own decisions and were not required to follow the court order. In this case, the initial court order for division came much later, and the Tribunal's order was not challenged under the Income Tax Act. (2) A younger member of a family can act as the leader if all other members agree, and if the older member gives up their right to lead.
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The instant Writ Petition has been filed by a mother seeking for compensation from the respondents for the physical pain and mental agony underwent by her for a period of nearly nine months after delivering a child in the 3rd respondent hospital, due to the alleged negligence on the part of the respondents. 2.The case of the petitioner is that she was admitted in the 3rd respondent hospital on 4.11.2005 and she delivered a baby boy on the same day at about 12.30 PM. The 4th respondent doctor performed the delivery and she had to use the forceps, since there was a last minute complication and it required stitches. From 5.11.2005 onwards, puss was oozing from the surgical scars and the petitioner was experiencing difficulty in urinating and defecating. On 9.11.2005, the stitches were undone by the 4th respondent and she redid the stitches on the same day. 3.The situation did not improve for the petitioner and on 10.11.2005, Dr. Ilanchezian examined the petitioner and he used catheter to remove the puss and it was informed that the said doctor will perform the second surgery. The further case of the petitioner is that the situation was not improving for the petitioner and the puss was oozing and dribbling down the legs and she was undergoing extreme pain and hardship. Since there was no progress till 15.11.2005, the husband of the petitioner decided to get the petitioner discharged from the 3rd respondent hospital. The 4th respondent informed that the petitioner has to wait for the second surgery to be performed by Dr. Ilanchezian and since he was not readily available, the petitioner was asked to wait. However, the husband of the petitioner was not able to take it anymore and he insisted for the discharge of the petitioner and the petitioner was discharged on 16.11.2005. 4.The petitioner was thereafter rushed to a private hospital and at which point of time, the petitioner was informed that her rectum had been injured due to the use of forceps and since it has not been stitched and treated properly, it got infected. Immediately, steps were
taken to perform a surgery. The private doctor informed the petitioner that a three stage surgery would be needed to perfectly address the problem. 5.The first surgery was performed on 20.11.2005. Thereafter, the left leg of the petitioner began to swell and hence, the petitioner was admitted in the vascular care centre for nearly 15 days. The petitioner had to wait till the swelling subsided. Ultimately, the second surgery was performed during May 2006 and the third surgery was performed during 6.In view of the above facts, the petitioner claims to have spent nearly Rs. 1.5 Lakhs towards surgery expenses and she was also forced to spend money towards medicine, rent and travel expenses. That apart, the petitioner was not able to take care of her new born child for nearly nine months. In view of the same, the petitioner has sought for compensation against the respondents and she has also sought for taking action against the 4th respondent for her negligence in performing the operation. The second limb of the relief sought for by the petitioner becomes infructuous since the 4th respondent died during the pendency of this Writ Petition. Hence, this Court has to consider only the issue of negligence and the consequent payment of compensation. 7.The 2nd respondent has filed a counter affidavit. The relevant portions in the counter affidavit are extracted hereunder : “8. It is humbly submitted that Fourth Respondent herein was leave 13.11.2005. Another Gynaecologist namely Dr. Vijayanthi found that the wound of the patient again broken down and it turned cut and then she called the surgeon immediately. The patient was examined by the surgeon on the same day. After examination of the wound of the patient, the Surgeon opined that the skin and muscle was infected and the patient put on antibiotics and the wound be re-sutured only after 15 days, after controlling the infection. This opinion communicated to the patient's husband immediately (i.e) on 13.11.2005. On 16.11.2005 it was informed to the patient's husband that patient may be taken to Coimbatore
Medical College Hospital, Coimbatore for the further treatment where the experts are available with good intention. But, the patient and her husband ignored the advice of the Doctor and chosen to go to a private Hospital. At their request, the patient was discharged from Government Hospital, Mettupalayam on 16.11.2005. These facts distinct that no negligence on the part of the third and fourth respondent. 9. I respectfully further submit that patient and her husband ware independently chosen to go for treatment at private Hospital. For their own decision, put allegations on the Government Hospital and the Doctor who gave treatment to her is unfair and unethical. 10. I further submit that negligence committed by the patient and her husband. In order to hide their mistakes preferred this writ petition and seeking compensation and action on the doctor who gave treatment to her with good intention. Therefore, the contention of the petitioner against the Government Hospital and the Doctor is unfair and unethical. petitioner in the type set along with this writ petition are the concrete documentary evidence that there no negligence on the part of the Government Hospital and the Doctor who gave treatment to the petitioner. 12. I humbly submit that the Joint Director or Health Services, Coimbatore @ Tiruppur has submitted inquiry report to the District Collector, Coimbatore Vide their Letter Ref.No.2239/E8/2005 Dated: 21.09.2006. In this inquiry report, the Joint Director of Health Services, Coimbatore @ Tiruppur has been mentioned as follows: "In my opinion there is a possibility of occurrence of complete perineal tear in the patient Mrs.Banupriya which can be treated and managed at Coimbatore Medical College Hospital, Coimbatore where there were enough facilities available. Under the above enough circumstances and on the basis of the opinion statement submitted the by the expert doctors I No negligence is noticed on the part of Doctors who gave treatment to the patient and hence the question of rendering financial remedy to the petitioner does not arise.”
8.The 3rd and 4th respondents have also filed counter affidavits. Since they have taken a similar defence, it will suffice to take note of the counter affidavit filed by the 3rd respondent and the relevant portions are extracted hereunder: “5. It is respectfully submitted that after delivery of the baby, the episiotomy was sutured well and the patient's pulse rate and B.P. was good and the patient was then treated with antibiotics. The petitioner started passing urine freely for four days and also passed motion and her wound was clean until then. While so when on the fifth day that is on 09.11.2005 when the doctor concerned examined the patient's wound so as to discharge her, it was found there was a breakdown of muscle and skin layer which is a common complication for any surgical procedure depending upon the health and hence the fourth respondent put the patient on higher antibiotics and re-sutured the wound. Such repaired wound sometimes breaks down more than once, inspite of efficient and meticulous efforts requiring repeated repairs because of poor resistance power of the patient and proximity of the wound to anus which leads to all infections with known and unknown bacteria, some of which are resistant to all available antibiotics. 6.It is respectfully submitted that after re-suturing, the petitioner passed urine and motion freely through proper passages. While so she came to know, that when the doctor concerned was on leave on 13.11 2005, another gynaecologist Dr. Vijayanthi found that the wound of the petitioner was again broken down and it turned out to be complete perineal tear. The said doctor, it seems immediately called surgeon Dr. Ilanchezhian a surgeon who was in the same hospital. 7. It is respectfully submitted that the said doctor after examination of the wound of the patient gave his opinion that as the skin and muscle was infected, the patient be put on antibiotics and the wound be re- sutured only after 15 days after controlling the infection. The said surgeon also advised the duty Doctor to refer the patient to Coimbatore
Medical College Hospital, the higher centre of treatment to get expert and adequate treatment. The opinion of the said surgeon was also communicated to the petitioner's husband. 8.It is respectfully submitted that on 16.11.2005, when the doctor concerned was insisted the petitioner's husband that the patient may be taken to Coimbatore Medical College Hospital, Coimbatore for further treatment where experts are available, the petitioner's husband refused to heed to the advice of the doctor concerned and insisted for discharging the patient and hence having no other go, the doctor concerned discharged the patient on the said day.” 9.Heard Ms.Poongkhulali, learned counsel for the petitioner, Mr.T.K.Saravanan learned Government Advocate for R1 and R2 and Mr.N..Damodaran, learned counsel for R3 10.The learned counsel for the petitioner submitted that there was negligence on the part of the 4th respondent since she did not take due care while performing episiotomy and as a result of the same, there was damage/rupture of the anus resulting in unbearable suffering for the petitioner. The learned counsel further submitted that the 3rd respondent hospital was not taking immediate steps to treat the infected portion and from 5.11.2005 onwards, the petitioner was made to face unbearable pain and hardship till 16.11.2005 and the husband of the petitioner was forced to discharge her and give her treatment in a private hospital. As a result of the negligence of the 3rd respondent hospital, the petitioner had to undergo three operations thereafter and also undergo treatment in a vascular care centre. In view of the same, the petitioner was forced to bear huge expenses and the petitioner was not even in a position to take care of her child for nearly nine months. The learned counsel submitted that this is a fit case where the respondents must be directed to pay compensation for their negligence. 11.Per contra, the learned Government Advocate appearing on behalf of the respondents submitted that the 4th respondent was forced to adopt episiotomy as a surgical procedure in order to create space for the delivery of the baby. After the delivery, it was
sutured well and the petitioner was treated by giving her antibiotics. Thereafter, there was a complication which is common in any surgical procedure and hence, the wound was re-sutured. The petitioner was also given higher antibiotics. Unfortunately, the suture once again gave way and it was diagnosed that there was complete perineal tear. Since there was an infection, the petitioner was put on antibiotics and the 3rd respondent waited for the infection to get controlled and thereafter, to perform the operation. The husband of the petitioner was also advised that the surgery can be done at the Coimbatore Medical College Hospital. However, since the husband of the petitioner insisted for discharge and refused to heed to the advice, the 3rd respondent had to discharge the petitioner. The learned Government Advocate therefore submitted that there was absolutely no negligence on the part of the respondents and the present Writ Petition is liable to be dismissed. The learned Government Advocate in order to substantiate his submissions, relied upon the following 1. Dr. (Mrs.) Chanda Rani Akhouri and others reported in 2022 2. S.K. Jhunjhunwala Vs. Dhanwanti Kaur and Another reported in (2019) 2 SCC 282. 3. Kusum Sharma and Others reported in (2010) 3 SCC 480. 4. Martin F.D’souza Vs. Mohd. Ishfaq reported in (2009) 3 SCC 1. 5. Jacob Mathew Vs. State of Punjab and Another reported in 12.This Court has carefully considered the submissions made on either side and the materials available on record. 13.This Court must bear in mind that while considering the grant of compensation in exercise of jurisdiction under Article 226 of the Constitution of India, this Court must be careful enough not to get into serious factual disputes which would require examination of witnesses and such cases can only be agitated before a Competent Civil Court. This Court must venture to decide on the questions of negligence and payment of compensation only in cases where it can be determined on the basis of the materials available before the Court and the same will not involve any appreciation of evidence.
14.This Court must also bear in mind the parameters fixed by the Apex Court while deciding the issue of negligence. In the present case, the issue of negligence has to be looked at, at two stages. The first stage was when the episiotomy procedure was performed by the 4th respondent. The second stage is when the wound started getting infected and whether the 3rd respondent hospital was negligent in taking care of the petitioner till 16.11.2005, when the petitioner was discharged against advice. The judgments that were relied upon by the learned Government Advocate pertains to the parameters to be applied by the Court while determining the negligence of a doctor, who performs a procedure or a surgery. The Apex Court has repeatedly held that a medical practitioner cannot be held to be negligent just because something went wrong while performing the procedure or surgery, inspite of the best efforts put in by the doctor and the doctor had exercised a reasonable degree of care, skill and knowledge as is expected under normal medical standards. 15.In the present case, the 4th respondent had to perform episiotomy, which is a regular procedure adopted in normal vaginal deliveries. In this procedure, an incision is made on the vagina of the patient to make space at the outlet bigger for the baby to come out comfortably and to make the birth easier and in order to avert a possible brain damage for the baby. On carefully going through the medical literature, it is seen that “it is common for the perineum to tear to some extent during childbirth. Tears can also occur inside the vagina or other parts of the vulva, including the labia. Up to 9 in every 10 first time mothers who have a vaginal birth will experience some sort of tear, graze or episiotomy. It is slightly less common for mothers who have had a vaginal birth before. For most women, these tears are minor and heal quickly.” 16.It is clear from the above that the 4th respondent was forced to adopt this procedure since the baby’s head was at the outlet and was not able to come out and the petitioner was not able to strain any further. That apart, the fetal heart rate was decreasing
and in order to save the baby, the 4th respondent applied outlet forceps after giving episiotomy, whereby, the perineum was cut down to create space for the delivery of baby. This procedure adopted by the 4th respondent cannot be held to be negligent and she had taken the decision in the interest of the petitioner and her baby. 17.The next issue that has to be gone into is as to whether a complete perineal tear that resulted after the performance of the procedure, can be held to be negligence on the part of the 4th respondent. On going through the medical literature, it is seen that a perineal tear is not uncommon after an episiotomy procedure. In fact, there is a possibility of 4 degrees of perineal tear. ● “First-degree - Small tears affecting only the skin which usually heal quickly and without treatment. ● Second-degree - Tears affecting the muscle of the perineum and the skin. These usually require stitches. ● Third- and fourth-degree tears - For some women (3.5 out of 100) the tear may be deeper. Third- or fourth- degree tears, also known as obstetric anal sphincter injuries (OASI), extend into the muscle that controls the anus (anal sphincter). These deeper 18.It is clear from the above that complete perineal tear that resulted from the procedure, cannot be held to be negligence on the part of the 4th respondent doctor. The enquiry report of the Joint Director of Health Services, dated 21.9.2006, was placed before this Court. While giving this report, the expert opinion of three doctors have been obtained. They have opined that such complete perineal tear is a possibility and in all such cases, the patient is put on antibiotics and the re-suture is done only after the healing of the tissues. The Joint Director has also opined that a complete perineal tear is always a possibility in certain cases of forceps delivery. 19.In view of the above, this Court has to necessarily take into consideration the medical literature and the opinion given by experts, since this Court is not an expert in the
field of medicine and this Court does not have the expertise to hold that the procedure performed on the petitioner by the 4th respondent resulting in the complete perineal tear was as a result of insufficient care taken by the 4th respondent. 20.This Court has to now consider as to whether there is negligence on the part of the 3rd respondent, in not taking proper care of the petitioner for the period from 5.11.2005 to 16.11.2005. It is true that the petitioner was experiencing extreme pain and was also put to a lot of discomfort due to the oozing of puss and the bad smell it was emanating. It is clear from the records that her rectum was cut/injured due to the use of forceps. This resulted in difficulty in urinating and defecating, according to the petitioner. The respondents have taken a stand to the effect that the petitioner was passing urine and motion freely till 9.11.2005. Thereafter, there was a breakdown of muscle and skin layer and according to the 3rd respondent, the wound was re-sutured and the petitioner was passing urine and motion freely. Once again on 13.11.2005, there was a breakdown and it was only at that point of time, it was diagnosed as a complete perineal tear. One, Dr. Ilanchezian was immediately called and he, after examining the wound gave an opinion that the petitioner must be put on antibiotics and the wound can be re-sutured only after the infection is controlled. The experts who had given their opinion have opined that re-suture will be normally done only after the tissues heal. 21.The husband of the petitioner was not able to see his wife suffering with pain and facing hardship. Hence, the petitioner was discharged against advice on 16.11.2005. According to the respondents, the husband of the petitioner was advised that the petitioner can be referred to the Coimbatore Medical College Hospital, for expert advice and treatment and this advice was not taken by the husband of the petitioner. The petitioner has taken a very specific stand that the 4th respondent refused to discharge the petitioner and she was
asked to wait till Dr. Ilenchezian returned back after his leave. The petitioner or her husband do not admit to the fact that they were advised to be shifted to the Coimbatore Medical College Hospital. Even in the discharge summary, there is absolutely no reference to the effect that the petitioner was referred to the Coimbatore Medical College Hospital. It only states that the patient was discharged at request. Even when the husband of the petitioner was examined at the time of enquiry, he categorically states that the petitioner was asked to take treatment in the same hospital and that a doctor will come from the Coimbatore Medical 22.In the considered view of this Court, the 3rd respondent hospital was expected to take effective decisions since the situation faced by the petitioner could not be effectively handled in the 3rd respondent hospital. This became apparent even on 13.11.2005, when the petitioner was diagnosed with a complete perineal tear. At that point of time, immediate steps must have been taken by the 3rd respondent to shift the petitioner to the Coimbatore Medical College Hospital. This decision does not require the consent of the petitioner or her husband. The interest of the patient gains significance and to waste time for 3 more days till 16.11.2005, virtually gave an impression in the mind of the husband of the petitioner that effective steps are not being taken to treat the petitioner and he was a witness to the pain and agony undergone by his wife. 23.If really, the petitioner had to wait till the entire wound is healed to perform the re-suture, it is quite curious to note that the first surgery was performed on the petitioner in the private hospital on 20.11.2005, which is within four days from the date of discharge from the 3rd respondent hospital. 24.The medical certificate that has been given by the private hospital shows that the petitioner had to undergo a three stage surgery to address the tear of the rectum. The first stage surgery was colostomy, the second stage surgery was CPT- repair and the third stage surgery was colostomy closure. The first stage of surgery was undergone by the petitioner
within four days after the discharge from the 3rd respondent hospital. This situation could have been averted by the 3rd respondent hospital by immediately shifting the petitioner to the Coimbatore Medical College Hospital atleast on 13.11.2005 and all these procedures could have been done in that hospital. The delay on the part of the 3 rd respondent which caused anxiety to the husband of the petitioner, should necessarily be held to be negligence on the part of the 3rd respondent hospital. The 3rd respondent hospital, after having realised that the petitioner cannot be given adequate care in the hospital, should have immediately shifted the petitioner to the Coimbatore Medical College Hospital. If this was not done and the 3rd respondent was waiting for the arrival of a doctor who had gone on leave, the petitioner cannot continue to face pain and agony and under the given circumstances, the husband of the petitioner thought it fit to shift the petitioner to a private hospital. In fine, this Court holds that there was a clear negligence on the part of the 3 rd respondent hospital for not having taken proper care of the petitioner and for having failed to shift the petitioner to Coimbatore Medical College Hospital when the situation really warranted. 25.The upshot of the above discussion leads to the conclusion that the 3rd respondent hospital must be held liable for negligence and the petitioner is entitled for payment of compensation by the 1st respondent since the Government is vicariously liable for negligence on the part of the Government hospital. 26.The petitioner was admitted four times in the hospital to undergo three surgeries and to recover for her swelling of leg, in a vascular care centre. In this process, the petitioner was forced to spend towards surgery expenses, medicine expenses, travel expenses and also rental expenses, when they were forced to stay at Sathyamangalam, till all the three surgeries were completed. That apart, the petitioner also faced untold hardship in not being able to take care of her new born baby effectively for nine months. In view of the same, this Court is inclined to fix a lumpsum compensation of Rs. 5 Lakhs payable to the petitioner.
27. In the result, this Writ Petition is allowed and there shall be a direction to the 1st respondent to pay a compensation of Rs.5 Lakhs (Rupees Five Lakhs only) to the petitioner within a period of six weeks from the date of receipt of copy of this Order. No costs.
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The Madras High Court has ordered a government hospital to pay Rs. 5 lakhs to a young mother. She had to have three surgeries because the hospital was too slow in moving her to a better facility. Because of this, she was separated from her new baby for nine months.
Justice Anand Venkatesh stated that the hospital knew it could not properly care for the mother. It should have quickly moved her to Coimbatore Medical College Hospital. Instead, the hospital waited for a doctor who was on leave. The mother continued to suffer, so her husband decided to move her to a private hospital. The court concluded that the hospital was clearly careless (negligent) because it failed to take proper care of the mother and did not move her to the Coimbatore hospital when it was clearly necessary.
In this case, the woman went to the hospital and gave birth to a baby boy. During delivery, the doctor had to use forceps because of a sudden problem, and she needed stitches. But the next day, pus started coming from her stitches. She had a lot of trouble using the bathroom. Four days later, the hospital removed her stitches and put new ones in.
However, her condition did not get better. The next day, Dr. Ilanchezian examined her, using a thin tube (catheter) to drain the pus. The mother was told she would need a second surgery. Since the hospital was not making any progress, her husband demanded she be allowed to leave. She was then taken to a private hospital. There, she had to have three separate surgeries and stayed for 15 days in a special center for blood vessel care.
Because of all this, the mother filed a lawsuit. She asked for money to cover her surgery, medical, travel, and even rental costs. She also sought payment for the emotional pain she suffered from not being able to care for her newborn baby for almost nine months.
The hospital and state, on the other hand, argued that such complications are common in any surgery. They said the hospital was only waiting for the infection to get under control before doing the operation. They claimed there was no intentional delay. They also stated that the mother's husband was told she could have the surgery at Coimbatore Medical College, but he insisted on taking her home. Therefore, they argued that the hospital was not careless at all and asked the court to reject the lawsuit.
When deciding the case, the court reminded everyone that, under a specific law (Article 226), it could not get involved in major disagreements about facts. It could only decide if there was carelessness (negligence) based on the clear information available, without needing to deeply analyze different proofs. The court also repeated that the highest court (Apex Court) has often said that a doctor cannot be called careless just because something went wrong during a procedure or surgery. This is true as long as the doctor tried their best and used the expected amount of care, skill, and knowledge for a medical professional.
In this case, the court found that the doctor's actions during the delivery were not careless. The doctor made decisions that were best for the mother and her baby. The tear that happened during the surgery was also not considered carelessness, because even experts agree this can happen in some deliveries where forceps are used. Therefore, the doctor was not at fault.
However, the court did notice that the hospital was slow in dealing with the problem. Although the hospital claimed they told the mother's husband to seek treatment in Coimbatore, there was no record of this in her discharge papers. The hospital was expected to quickly move the mother to Coimbatore Medical College if they couldn't properly manage her condition there. In such a serious situation, the patient's well-being is most important, and the hospital did not need the mother's or her husband's permission to move her.
The court also pointed out that the hospital said it was waiting for the infection to get better before doing the second surgery. But the private hospital, where the mother was later admitted, performed her surgery within just four days after she left the government hospital. All of this clearly showed that the government hospital was careless in taking proper care of the mother.
Since it was a government hospital, the State (the government) was legally responsible for the hospital's actions. So, the court ordered the State to pay the mother the compensation.
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(Civil) No. 1155 of 1987. (Under Article 32 of the Constitution of India). S.P. Malik and Mrs. Lalitha Kaushik for the Petitioner. Anil Dev Singh, R. Venkataramani, R.B. Mishra and Ms. A. Subhashini for the Respondents. The Judgment of the Court was delivered by DUTT, J. The petitioner was the Additional Registrar of this Court. His normal date of retirement was March 31, 1987. He, however, sought for voluntary retirement from the service of this Court and on his application in that regard, the following order dated December 6, 1985 was communicated to him by the Registrar of this Court: "OFFICE ORDER The Hon 'ble the Chief Justice of India has accepted the notice of Shri section Banerjee, Offg. Additional Registrar (Perma nent Deputy Registrar), seeking voluntary retirement from service under the provisions of Rule 48A of the Central Civil Services (Pension) Rules, 1972, and has permitted him to retire voluntarily from the service of the Registry of the Supreme Court of India with effect from the forenoon of January 1, 1986. " 564 It is clear from the order extracted above that the petitioner was permitted to retire voluntarily from the service of the Registry of the Supreme Court with effect from the forenoon of January 1, 1986. After the retirement of the petitioner, the Fourth Central Pay Commission (for short 'Pay Commission ') gave its report recommending the revision of salaries and pension of the Government employees. It is not disputed that the above recommendations of the Pay Commission have been accepted by the Government and that the benefit thereof is also avail able to the employees of this Court. Paragraph 17.3 of Chapter 17 of Part II at page 93 of the Report of the Pay Commission provides as follows: "17.3 In the case of employees retiring during the period January 1, 1986 to September 30, 1986, Government may consider treating the entire dearness allowance drawn by them up to December 31, 1985 as pay for pensionary bene fits. " The petitioner claimed the benefit of the recommendation of the Pay Commission as contained in the said paragraph 17.3, but it was not allowed on the ground that he did not, as he was not entitled to, draw salary for January 1, 1986 in view of the proviso to rule 5(2) of the Central Civil Service (Pension) Rules, 1972, hereinafter referred to as 'the Rules '. Rule 5(2) reads as follows: "5(2). The day on which a Government servant retires or is retired or is discharged or is allowed to resign from service, as the case may be, shall be treated as his last working day. The date of death shall also be treated as a working day. Provided that in the case of a Gov ernment servant who is retired pre maturely or who retires voluntarily under clause (j) to (m) of Rule 56 of the Fundamental Rules or Rule 48 (or Rule 48 A) as the case may be, the date of retirement shall be treated as a non working day. " At the hearing of the writ petition, it has also been vehemently urged on behalf of the respondents that as in view of the proviso to rule 5(2) of the Rules, the date of retirement of the petitioner should be treated as a non working day or, in other words, as the petitioner was not entitled to the salary for the day of his retirement, he was not 565 entitled to the benefit of the recommendation of the Pay Commission as contained in paragraph. 17.3 of the report extracted above. Under paragraph 17.3, the benefits recommended will be available to employees retiring during the period, January 1, 1986 to September 30, 1986. So the employees retiring on January 1, 1986 will be entitled to the benefit under para graph 17.3. The question that arises for our consideration is whether the petitioner has retired on January 1, 1986. We have already extracted the order of this Court dated Decem ber 6, 1985 whereby the petitioner was permitted to retire voluntarily from the service of the Registry of the Supreme Court with effect from the forenoon of January 1, 1986. It is true that in view of the proviso to rule 5(2) of the Rules, the petitioner will not be entitled to any salary for the day on which he actually retired. But, in our opinion, that has no bearing on the question as to the date of re tirement. Can it be said that the petitioner retired on December 31, 1985? The answer must be in the negative. Indeed, Mr. Anti Dev Singh, learned counsel appearing on behalf of the respondents, frankly conceded that the peti tioner could not be said to have retired on December 31, 1985. It is also not the case of the respondents that the petitioner had retired from the service of this Court on December 31, 1985. Then it must be held that the petitioner had retired with effect from January 1, 1986 and that is also the order of this Court dated December 6, 1985. It may be that the petitioner had retired with effect from the forenoon of January 1, 1986 as per the said order of this Court, that is to say, as soon as January 1, 1986 had com menced the petitioner retired. But, nevertheless, it has to be said that the petitioner had retired on January 1, 1986 and not on December 31, 1985. In the circumstances, the petitioner comes within the purview of paragraph 17.3 of the recommendations of the Pay Commission. After the conclusion of the hearing of the writ peti tion, an additional affidavit purported to have been af firmed by Mr. P.L. Sakarwal, the Director (Justice) of the Department of Justice. In paragraph 8 of the affidavit the deponent has craved leave of this Court to file this addi tional affidavit. It does not appear from the copy of the purported additional affidavit whether it has been affirmed or not inasmuch as no date of affirmation has been mentioned therein. Be that as it may, a photocopy of the Office Memo randum dated April 14, 1987 of the Ministry of Personnel, Public Grievances and Pensions, Department of Pensions & Pensioners ' Welfare has been annexed. It is submitted in the additional affidavit that the pension of Government servants retiring between 1.1.1986 and 30.6.1987 is to be governed in terms of 566 paragraphs 10.1, 10.2 and 11 of the said Office Memorandum. Further, it has been submitted that the petitioner had ceased to be in the employment of the Supreme Court with effect from 1.1.1986 (F.N.) and, accordingly, the said Office Memorandum is not applicable to the petitioner. Paragraph 3.1 of the Office Memorandum provides, inter alia, that the revised provisions as per these orders shall apply to Government servants who retire/die in harness on or after 1.1.1986. The said Office Memorandum will, therefore, be applicable to Government servants retiring on 1.1.1986. There is, therefore, no substance in the contention that the Office Memorandum dated April 14, 1987 will not apply to the petitioner. Be that as it may, we have already held that the petitioner had retired with effect from 1.1.1986 and he comes within the purview of paragraph 17.3 of the recommen dations of the Pay Commission. In the circumstances, the writ petition is allowed and the respondents are directed to calculate and pay to the petitioner within three months from today his pension in accordance with the recommendation of the Pay Commission as contained in paragraph 17.3 extracted above. There will, however, be no order as to costs. P.S.S. Petition allowed.
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Paragraph 17.3 of a government report said that government workers who retired between January 1, 1986, and September 30, 1986, should have all their cost of living allowance (called dearness allowance) up to December 31, 1985, counted as part of their salary when figuring out their pension. Rule 5(2) of the Central Civil Services (Pension) Rules, 1972 says that the day a government worker stops working is their last day. However, there's an exception. If a worker chooses to retire early under Rule 48 A, their retirement day is treated as a day they didn't work. The person in this case was allowed to retire early from the Supreme Court Registry starting on the morning of January 1, 1986. This was approved on December 6, 1985. But, his request to get the benefit of paragraph 17.3 was turned down. In his legal complaint, the government argued that because of the exception to rule 5(2), he wasn't paid for his retirement day. So, he shouldn't get the benefit of paragraph 17.3. The court allowed his complaint. It said that paragraph 17.3 says that workers who retired between January 1, 1986, and September 30, 1986, get these benefits. In this case, the person was allowed to retire early from the Supreme Court Registry starting on the morning of January 1, 1986. The fact that he didn't get paid for his retirement day because of the exception to rule 5(2) doesn't change the date of his retirement. He didn't retire on December 31, 1985. He retired starting on January 1, 1986, and that's what the court order from December 6, 1985, says. So, he qualifies for the benefits in paragraph 17.3 of the government report. The court ordered the government to calculate and pay his pension within three months, following the rules in paragraph 17.3.
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minal Appeal No. 443 of 1993. From the Judgment and Order dated 22.4.92 of the Calcutta High Court in Crl. Revision No. Sen, S.C. Ghosh, Rajiv K. Dutta and B.B. Tawakley for the Appellant. Amlan Ghosh and Ranjan Mukherjee for the Respondents. The appellant herein was, married to second respondent on 16th January, 1990 according to Hindu Rites and Customs. They lived together for sometime until second respondent left the matrimonial home to reside with her parents in order to prepare for Higher Secondary Examination which commenced on 5.4.90 920 and continued upto 10.5.90. In the month of April, 1990 she conceived, on coming to know that she was pregnant, the appellant and the family members did not want her to beget a child. Therefore she was forced to undergo abortion which was refused by the second respondent. During the stay She was meted out cruetreatment both physically and mentally. She came back to the matrimonial home during Durga Pooja in the month of October, 1990. She filed a petition under section 125 Cr. before the Learned Chief Judicial Magistrate, Alipore in Misc. Case No. 143 of 1991 both for herself and the child. By an order dated 14.8.91 which was passed ex parte he awarded a sum of Rs. 200 to the child. Against that order, he moved a revision to the High Court. Case No. 143 of 1991 for blood group test of the second respondent and the child. In that proceeding the petitioner herein disputed the paternity of the child and prayed for blood group test of the child to prove that he was not the father of the child. According to him if that could be established he would not be liable to pay maintenance. That application was dismissed on two grounds: (i) there were other methods in the Evidence Act to disprove the paternity (ii) moreover it is settled law that medical test cannot be conclusive of paternity. Aggrieved by this order, a revision was preferred before the High Court. Dismissing the revision it was held that section 112 of the Evidence Act says where during the continuance of valid marriage if a child is born that is a conclusive proof about the legitimacy. This section would constitute a stumbling block in the way of the petitioner getting his paternity disproved by blood group test. The English law permitting blood test for determining the paternity of legitimacy could not be applied in view of section 112 of the Evidence Act. Therefore it must be concluded that section 112 read with section 4 of the said Act debars evidence except in cases of non access for disproving the presumption of legitimacy and paternity. It is the contention of Mr. Ashok Sen, learned counsel for the appellant that the only way for the father to disprove the paternity is by blood group test. Having regard to the development of medical jurisprudence to deny that request to the appellant will be unreasonable. As a matter of fact, in England, this is commonly resorted to as it will leave no room for doubt. In 1968 (1) All England Reports p. 20 Re. 1 it was held that even without the consent of the guardian ad litem, the court had power to order an infant be subjected to a blood group test. 921 There is no justification for the court below to refuse the same on the ground that section 112 of the Evidence Act would be an obstacle in seeking relief of blood group test. Before we deal with the arguments, we will examine the law as available in England. The blood group of a child is determined by the parents ' genetic make up but the number of possibilities is such, that it is not possible to prove that certain individuals are the father on the basis of comparing blood groups, only, that they are not the father. Under that Act, it was assumed that a man was the father once a sexual relationship with the mother at the time of conception was proven unless he could show another man had intercourse with her at that time. Under the Act either party could ask for a blood test and either was entitled to refuse to take part, although only the mother can apply for maintenance. The Family Reforms Act, 1969 conferred powers on the court to direct taking blood test in civil proceedings in paternity cases. Courts were able to give directions for the use of the blood test and taking blood samples from the child, the mother and any person alleged to be the father. Since the passing of 1969 Act the general practice has been to use blood tests when paternity is in issue. However, it is to be stated the court cannot order a person to submit to tests but can draw adverse inferences from a refusal to do so. Fathers as well as mothers can apply for maintenance. This Act finally removed the legal aid for corroboration of mother 's statement of paternity. [1968] All England Reports p. 20 stated thus 922 "but they can say positively that a given man cannot be the father, because the blood groups of his and the child are so different." (emphasis supplied). In B.R.B. vs J.B. [1968] 2 All England Reports 1023 applied this dictum and held as under: "The Country court judge will refer it to a High Court Judge as a matter suitable for ancillary relief, and the High Court Judge can order the blood test. Likewise, of course, a magistrate 's court has no power to order a blood test against the will of the parties. The magistrate can only do it by consent of those concerned, namely, the grown ups and the mother on behalf of the child; but, nevertheless, if any of them does not consent, the magistrate can take that refusal into account1 adhere to the view which expressed in Re L. that (6) "If an adult unreasonably refuses to have a blood test, or to allow a child to have one, I think that it is open to the court in any civil proceedings (no matter whether it be a paternity issue or an affiliation summons,or a custody proceedings) to take his refusalas evidence against him, and may draw an inference there from adverse to him. This is simple common sense." "The conclusion of the whole matter is that a judge of the High Court has power to order a blood test whenever it is in the best interests of the child. The judges can be trusted to exercise this discretion wisely. I would set no limit, condition or bounds to the way in which judges exercise their discretion. "Having heard full argument on the case, lam satisfied beyond any reasonable doubt (to use the expression used in rebutting the presumption as to legitimacy) that LORD DENNING, M.R., was right in saying that such an order may be made in any case where the child is made a party to the proceedings and in the opinion of the judge of the High Court it is in the child 's best interests that it should be made. " 923 As regard United States the law as stated in Forensic Sciences edited by Cyril H. Wecht is as under: Parentage testing is the major (but not the exclusive) involvement of forensic serology in civil cases. Blood typing has been used to help resolve paternity cases since the mid 1920 'section According to Latters, there were 3,000 cases tested in Berlin in 1924, and Schiff and Boyd said that the first case went to court in Berlin in 1924. It took somewhat longer to satisfy the courts, both in Europe and in country, that parentage exclusions based upon blood grouping were completely valid. Wiener said that he had obtained an exclusion in a paternity case in this country which reached the courts early in 1933. In January of 1934, Justice Steinbrink of the New York Supreme Court in Brooklyn ordered that blood tests be performed in a disputed paternity action, using a s precedent a decision by the Italian Supreme Court of Cassation, but his order was reversed upon appeal. Soon afterward, however, laws were passed in a number of states providing the courts with statutory authority to order blood testing in disputed paternity cases. Paternity testing has developed somewhat more slowly in the Unitted States than in certain of the European countries, but today the differences in the number of systems employed, and judicial acceptance of the results, are no longer that great. A number of authorities have recently reviewed the subject of paternity testing in some detail, and in some cases have summarized the results of large number of cases that they have investigated. Walker points out that failure to exclude a man, even at the 95 percent level of paternity exclusion does not mean that the alleged father is proven to be biologic father, because absolute proof of paternity cannot be established by any known blood test available. Although this fact is well known and appreciated by workers it), the field of blood grouping and by attorneys active in this area, it is not generally understood by the lay public. However, blood group 924 serology, using proven genetic marker systems, represents the most accurate scientific information concerning paternity and is so recognised in the United States, as well as in a number of countries abroad. " In India there is no special statute governing this. Neither the Criminal Procedure Code nor the Evidence Act empowers the court to direct such a test to be made. In 1951 (1) Madras Law Journal p.58O Polavarapu Venkteswarlu, minor by guardian and mother Hanwnamma vs Polavarapu Subbayya in that case the application was preferred under section 151 of the Code of Civil Procedure invoking the inherent powers of the Court to direct a blood test. The learned judge was of the following view: Section 15 1, Civil Procedure Code, has been introduced in to the Statute book to give effect to the inherent powers. There is no procedure either in the Civil Procedure Code or in the Indian Evidence Act which provides for a test of the kind sought to be taken by the defendant in the present case. It is said by Mr. Ramakrishna for the respondent before m e that in England this sort of test is resorted to by Courts where the question of non access in connection with an issue of legitimacy arises for consideration. 570, evidence was given that the husband 's group was OM, that the wife 's was BM and that the child 's was ABN. The Court held that the husband was not the father of child, and granted a decree for nullity." "It is also pointed out by learned counsel that in the text books on Medical Jurisprudence and Toxicology by Rai Bahadur Jaising P. Moi, (8th Edition), at page 94, reference is made to a case decided by a Criminal Court at Mercare in June, 194 1, in which the paternity and maternity of the child being under dispute, the Court resorted to the results of the blood grouping test." But I am not in any event satisfied that if the parties are unwilling to offer their blood for a test of this kind this Court can force them to do so. " The same view was taken by the Kerala High Court in Vasu vs Santha 1975 Kerala Law Times p. 533 as "A special protection is given by the law to the status of legitimacy in India. The law is very strict regarding the type of the evidence which can be let in to rebut the presumption of legitimacy of a child. Even proof that the mother committed adultery with any number of men will not of itself suffice for proving the illegitimacy of the child. If she had access to her husband during the time the child could have been begotten the law will not countenance any attempt on the part of the husband to prove that the child is not actually his. The presumption of law of legitimacy of a child will not be lightly repelled. It will not be allowed to be broken or shaken by a mere balance of probability. The evidence of non access for the purpose of repelling it must be strong, distinct, satisfactory and conclusive see Morris vs Davies; , The standard of proof in this regard is similar to the standard of proof of guilt in a criminal case. The stigma of illegitimacy is very severe and we have not any of the protective legislations as in England t o protect illegitimate children. No doubt, this may in some cases require a husband to maintain children of whom he is probably not their father. The court cannot base a conclusion on evidence different from that required by the law or decide on a balance of probability which will be the result if blood test evidence is accepted. Before a blood test of a person is ordered his consert is required. The reason is that this test is a constraint on his personal liberty and cannot be carried out without his consent. Here no consent is given by any of the respondents. It is also doubtful whether a guardian ad litem can give this consent. Therefore, in these circumstances, the learned Munsiff was right in 926 refusing the prayer for a blood test of the appellant and respondents 2 and 3. The learned Judge is also correct in holding that there was no illegality in refusing a blood test. He has to prove that he had no opportunity to have any sexual intercourse with the 1st respondent at a time when these children could have been begotten. That is the only proof that is permitted under section II 2 to dislodge the conclusive presumption enjoined by the Section. " In Hargavind Soni vs Ramdulari AIR 1986 MP at 57 held as: "The blood grouping test is a perfect test to determine questions of disputed paternity of a child and can be relied upon by Courts as a circumstantial evidence. But no person can be compelled to give a sample of blood for blood grouping test against his will and no adverse inference can be drawn against him for this refusal. " Blood grouping test is a useful test to determine the question of disputed paternity. It can be relied upon by courts as a circumstantial evidence which ultimately excludes a certain invididual as a father of the child. However, it requires to be carefully noted no person can be compelled to give sample of blood for analysis against her will and no adverse inference can be drawn against her for this refusal. 1) p. 1054 has this to say "Medical Science is able to analyse the blood of individuals 927 into definite groups: and by examining the blood of a given man and a child to determine whether the man could or could not be the father. Blood tests cannot show positively that any man is father, but they can show positively that a given man could or could not be the father. It is obviously the latter aspect the proves most valuable in determining paternity, that is, the exclusion aspect for once it is determined that a man could not be the father, he is thereby automatically excluded from considerations of paternity. When a man is not the father of a child, it has been said that there is at least a 70 per cent chance that if blood tests are taken they will show. positively he is not the father, and in some cases the chance is even higher: between two giver men who have had sexual intercourse with. the mother at the time of conception, both of whom undergo blood tests, it has likewise been said that there is a 80 per cent chance that the tests will show that one of them is not the father with the irresistible inference that the other is the father. But the consideration remains that the party asserting the claim to have a child and the rival set of parents put to blood test must establish his right so to do. In my considered opinion it would be unjust and not fair either to direct a test for a collateral reason to assist a litigant in his or her claim. The child cannot be allowed to suffer because of his incapacity; the aim is to ensure that he gets his rights. If in a case the court has reason to believe that the application for blood test is of a fishing nature or designed for some ulterior motive, it would be justified in not acceding to such a prayer." In matters of this kind the court must have regard to section 112 of the Evidence Act. The presumption of legitimacy is this, that a child born of a married woman is deemed to be legitimate, it throws on the person who is interested in making out the illegitimacy, the whole burden of proving it. The law presumes both that a marriage ceremony is valid, any that every 928 person is legitimate. Marriage or filiation (parentage) may be presumed, the law in general presuming against vice and immoratility. " It is a rebuttable presumption of law that a child born. This presumption can only be displaced by a strong preponderannce of evidence, and not by a mere balance of probabilities. "Section II 2 lays down that if a person was born during the continuance of a valid marriage between his mother and any man or within two hundren and eighty days after its dissolution and the mother remains unmarried, it shall be taken as conclusive proof that he is the legitimate son of that man, unless it can be shown that the parties to the marriage had no access to each other at anytime when he could have been begotten. This rule of law based on the dictates of justice has always made the courts incline towards upholding the legitimacy of a child unless the facts are so compulsive and clinching as to necessarily warrant a finding that the child could not at all have been begotten to the father and as such a legitimation of the child would result in rank injustice to the father. This section requires the party disputing the paternity to prove non access in order to dispel the presumption. The effect of this section is this: there is a presumption and a very strong one though a reubttable one. Conclusive proof means as laid down under section 4 of the Evidence Act. From the above discussion it emerges: (1) that courts in India cannot order blood test as matter of course; 929 (2) wherever applications are made for such prayers in order to have roving inquiry, the prayer for blood test cannot be entertained. (3) There must be a strong primafacie case in that the husband must establish non access in order to dispel the presumption arising under section 112 of the Evidence Act. (4) The court must carefully examine as to what would be the consequence of ordering the blood test; whether it will have the effect of branding a child as a bastard and the mother as an unchaste woman. Examined in the light of the above, we find no difficulty in upholding the impugned order of the High Court, confirming the order of the Addl. We find the purpose of the application is nothing more than to avoid payment of maintenance, without making any ground whatever to have recourse to the test. Accordingly Criminal Appeal will stand dismissed. 2224/93 in S.L.P. (cr No. 2648/92 filed by Respondent No. 2 will stand allowed.
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The second person involved was married to the first person, who is appealing the case. The second person went to live with her parents to study for her final high school exams. While she was there, she became pregnant. The first person (her husband) and his family wanted her to get an abortion, but she didn't want to, and she had a baby. The second person asked the court to make her husband pay for her and the child to live. This was done using a section of the Criminal Procedure Code (a set of laws). The court agreed. The first person (the husband) didn't think he was the child's father. So, he asked the court for a blood test to prove it. He said that if the test showed he wasn't the father, he shouldn't have to pay for the child's upkeep. The court said no to the blood test. The first person then asked a higher court (High Court) to overturn that decision, but they also said no. So, the first person is now appealing to a higher court, with special permission. The court said no to the appeal, and also said: 1.1 Courts in India can’t just order blood tests whenever they want. Unlike in England, India doesn't have specific laws about this. The Criminal Procedure Code and the Evidence Act (laws about what can be used as proof in court) don't give courts the power to order these tests. 1.2 If people ask for blood tests just to go on a "fishing expedition" (looking for evidence without a good reason), the court shouldn't allow it. The court agreed with what was said in a previous case, Bhartiraj vs Sumesh Sachdeo. 2.1 Section 112 of the Evidence Act says that if a child is born during a marriage, it's assumed that the husband is the father. This can only be disproven if there's proof that the husband and wife didn't have sex. It's a legal assumption that the child is legitimate and that the couple had relations. To overturn this, you need strong evidence, not just a slight possibility. 2.2 The husband needs to show strong evidence that he and his wife didn't have sex around the time the child was conceived. The court referred to previous cases, Vasu vs Santha and Raghunath vs Shardabai. Another case, Morris vs Davies, was also mentioned. 3 The court has to be careful about ordering a blood test. They need to think about whether it would make the child seem illegitimate and the mother seem like she wasn't faithful. The court referred to a previous case, Dikhtar Jahan vs Mohammed Faroog. 4.1 Blood tests can be helpful in figuring out who the father is. Courts can use them as evidence to rule out someone as the father. 4.2 No one can be forced to give a blood sample. Also, if someone refuses to give a sample, the court can't assume they're hiding something. The court agreed with what was said in a previous case, Hargovind Soni vs Ramdulari. The court also referred to previous cases, Vasu vs Santha and Polavarapu Venkeeswarlu vs Polavarapu Subbayya. Several older cases, Subayya Gounder vs Bhoopala, Venkateswarlu vs Subbayya, and Hukum Chand Boid vs Kamalan and Singh, were cited. Other cases, Wilson vs Wilson, Re L, and B. R. B. vs J. B., were also mentioned, along with books on law and medicine. In this case, the husband only wanted the blood test to avoid paying for the child. He didn't have a good reason for the test. The High Court was right to agree with the lower court's decision to not allow the test.
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Appeal No. 123/55 669 Appeal by special leave from the judgment and order dated November 12, 1951, of the Punjab High Court in Writ Petition No. 116 of 1951. N. C. Chatterjee, section N. Andley, J. B. Dadachanji and Rameshwar Nath, for the appellants. section M. Sikri, Advocate General for the State of Punjab, N. section Bindra and D. Gupta, for the respondent. September 13. The Judgment of the Court was delivered by DAs GUPTA J. This appeal is against the judgment of the High Court of Punjab rejecting the appellant 's application under article 226 of the Constitution. In this application the appellants who had been carrying on the business of commission agents in Forward Contracts at Ludhiana alleged that the Punjab Forward Contracts Tax Act, 1951 (Punjab Act No. VII of 1951), was ultra vires the powers conferred upon the State Legislature and prayed for a declaration that the Act and the notification made and the rules promulgated thereunder by the respondent, State of Punjab, were void. There was a further prayer for directing the State of Punjab by a writ of mandamus or other appropriate writ to allow the petitioners to carry on the business of Forward Contracts or as commission agents in Forward Contracts unrestricted by the provisions of the above mentioned Act and the rules thereunder And not to enforce the Act. The respondent 's case as made in para. 5 of its written statement was that " the impugned Act is not ultra vires the State Legislature. It is a law with respect to the matters enumerated in& Entry 62 of the State List read with Entry No. 7 of the Concurrent List of the 7th Schedule. " The High Court held that: "The impugned Act, is an Act to tax speculation in futures, at least so far as dealers such as the present applicants are concerned, falls within Item 62 of the State List as an Act to impose taxes on betting and gambling, and to that extent at least is valid. " 670 In this view the High Court rejected the application. The only question for our decision is as regards the legislative competence of the State Legislature of Punjab to enact this statute. Though a reference under Entry 7 of the Concurrent List of the 7th Schedule of the Constitution was made in the respondent 's written statement no reliance appears to have been placed on this entry in the High Court nor has it been relied on before us by the learned counsel appearing on behalf of the respondent and it is quite clear that the impugned Act cannot fall within Item 7 of the Concurrent List which is in these terms:" Contracts, including partnership, agency, contracts of carriage, and other special forms of contracts, but not including contracts relating to agricultural land ". It is common ground before us that the Act must be held to be within the legislative competence of the Punjab State Legislature only if in pith and substance it fell within Item 62 of the State List and if it did not so fall it must be held to be beyond the State Legislature 's competence. Item 62 mentions " taxes on luxuries, including taxes on entertainment, amuse ments, betting and gambling. " If the impugned Act provides for a tax on betting and gambling then and then only it can come within Item 62. The Act provides for the levy of a tax on forward contracts and it has defined " forward contract" in section 2 in these words: "Forward contract" means an agreement, oral or written, for sale of goods on a future date but on the basis of which actual delivery of goods is not made or taken but only the difference between the price of the goods agreed upon and that prevailing on the date mentioned in the agreement or any other date is paid or received by the parties ". " Dealer " is defined in the same section to mean " any person, firm, Hindu Joint family or limited concern, including an arhti or " chamber " or association formed for the purpose of conducting business in forward contracts, who conducts such business in the course of trade in the State either on his own behalf or on behalf of any other person, arhti, "chamber" or association". ,Sale" is defined to mean 671 "the final, settlement in respect of an agreement to sell goods mentioned in a forward contract, and it shall be deemed to have been completed on the date originally fixed in the forward contract for this purpose or any other date on which the final settlement is made ". Section 4 is the charging section and provides for a levy on the business in forward contracts of a dealer a tax at such rates as the Government may by notification direct. Section 5 lays down that every dealer shall be liable to pay tax under this Act as long as he continues his business in forward contracts. Section 6 prohibits any dealer from carrying on business in forward contracts unless he has been registered and possesses a registration certificate. Section 7 deals with the mode of payment of the tax and for submission of returns while section 8 provides for assessment of the tax. As the term " forward contract " has been defined in the statute itself we have to forget for the purpose of deciding the present question any other notion about what a "forward contract" means. For the purpose of this statute every agreement for sale of goods on a future date is not a " forward contract ". It has to be an agreement for the sale of goods on a future date and has to satisfy two other conditions, viz., (1) actual delivery of the goods is not made on the basis of the agreement and (2) the difference between the price of the goods agreed upon and that prevailing on the date mentioned in the agreement or any other date is paid by the buyer or received by the seller. The test of a forward contract under this definition is that delivery of goods is not made or taken but only the difference between the price of the goods as agreed upon and that prevailing on some other date is paid. Is such a contract necessarily a wagering contract and therefore gambling ? When two parties enter into a formal contract for the sale and purchase of goods at a given price, and for their delivery at a given time it may be that they never intended an actual transfer of goods at all, but they intended only to pay or receive the difference according as the market price should vary from the 86 672 contract price. When such is the intention it has been held that is not a commercial transaction but a wager on the rise or fall of the market, which comes within the connotation of " gambling ". It is the fact that though in form an agreement for sale purports to contemplate delivery of the goods and the payment of the price, neither delivery nor payment of the price is contemplated by the parties and what is contemplated is merely the receipt and payment of the difference between the contract price and the price on a later day that makes the contract a wagering contract. In the definition of " forward contract in the impugned Act there is no reference, directly or indirectly ' to such an intention. It is only by reading for the words " actual delivery of goods is not made or taken " the words actual delivery of goods is not to be made or taken and by substituting for the words " is paid or received by the parties " the words " is to be paid or received by the parties " and also by omitting the words " on the basis of which " that the word " forward contract " as defined in the section can be held to refer to a wagering contract. This however we are not entitled to do. The reason why the Legislature did not use the words " to be made or taken " or " to be paid or received " in the definition clause is not far to seek. An agreement oral or written which in terms provides that actual delivery is not to be made or taken and that the entire price of the goods is not to be paid and only the difference between the price of the goods agreed upon and that prevailing on some other date would be paid would be hit by section 30 of the Contract Act and would not be enforceable. Parties to a written agreement for sale of goods would therefore take good care to see that the terms do not provide that delivery should not be made but only the difference is to be paid. There might be an oral understanding between the parties that no delivery should be demanded or made, but that only difference should be paid. But it will be next to impossible for a tax being imposed on the proof of such intention, not expressed in the written contract. When the agreement for sale of goods is oral, but the parties 673 agree as between themselves that no delivery would be made, but difference in price would be paid, it would be equally impossible for a taxing authority to discover in which of the contracts such an agreement has been made. The dispute whether a particular contract is a wagering contract or not arises in civil courts generally when the contract of sale is sought to be enforced and one of the parties tries to avoid the contract by recourse to section 30 of the Contract Act. When such a dispute comes before the Court, it becomes necessary to consider all the circumstances to see whether they warrant the legal inference that the parties never intended any actual delivery but intended only to pay or receive the difference according as the market price should vary from the contract price. It is therefore well nigh impossible for any taxing authority to brand a particular forward con. tract as a wagering contract ; nor is it to be expected that any party on whom the tax is sought to be levied, will voluntarily disclose that in the particular contract or in a number of contracts, the intention was not to deliver the goods but only to pay or receive the difference in price. Aware of these difficulties in the practical application of a law to levy tax on wagering contracts, the legislature decided to levy tax on contracts for sale of goods in which actual delivery is not factually made or taken, whatever be the intention at the time when the agreement was made. It appears clear therefore that the words " forward contract " as defined in the Act do not set out all the elements which are necessary to render a contract a wagering contract and so the impugned legislation to tax forward contracts as defined does not come within. Entry 62. The learned Advocate General for the State of Pun. jab tried to convince us that even though the words used in defining forward contract may include contracts which do not amount to wagering contracts, they are wide enough to include certain contracts which may be wagering contracts because of the fact that the parties to the contract, had no intention to 674 deliver the goods. If the definition is wide enough to include contracts which are wagering contracts, he contends, the statute should not he struck down as a whole but should be held to be valid in respect only of such wagering contracts. On behalf of the appellants Mr. N. C. Chatterjee has drawn our attention to the provisions of registration of " dealers " in section 6 and has argued that the very fact that the Legislature was calling upon persons dealing in " forward contracts " to register themselves and to prohibit dealing in forward contracts by non registered dealers, justifies the conclusion that the Legislature was not thinking of wagering contracts at all. As against this it is proper to note that the Constitution itself contemplated taxation on gambling " by State Legislatures. It is however one thing to tax gambling, and quite another thing for a Legislature to encourage gambling by asking persons to register themselves for this purpose. The definition of a " dealer " it has to be noticed includes " a limited concern, including, a Arhti, Chamber or association formed for the purpose of conducting business in forward contracts ". While it might happen in fact that an association would be formed for the purpose of conducting business in wagering contract, it is hardly likely that the Legislature would take upon itself the task of openly permitting and recognizing such associations. These, in our opinion, are good reasons for thinking that the Legislature did not contemplate wagering contracts at all in defining " forward contract" in the way it did. Assuming however that the definition is wide enough to include wagering contracts, the question arises whether the portion of the Act which would then be valid is severable from the portion which would remain invalid. One of the rules approved by this Court in R. M. D. Chamarbaugwala vs The Union of India (1), for deciding this question was laid down in these words: "In determining whether the valid parts of a statute are separable from the invalid parts thereof, it (1) ; 675 is the intention of the legislature that.is the determining factor. The test to be applied is whether the legislature would have enacted the valid part if it had known that the rest of the statute is invalid. " A second rule was that if "the valid and invalid parts of a statute are independent and do not form part of a scheme but what is left after omitting the invalid portion is so thin and truncated as to be in substance different from what it was when it emerged out of the legislature, then also it will be rejected in its entirety. " Applying either of these rules, we are bound to hold that the entire Act should in the present case be held invalid. It seems to us clear that if the Legislature had been conscious that taxation on all forward contracts was not within its legislative competence it would have at once seen that because of the difficulty of finding out which among the contracts for sale of goods on a future date are wagering contracts, it would not be worthwhile to enact any law for taxing wagering contracts only. It is equally clear that once the law is held to be invalid as regards forward contracts other than wagering contracts, what is left is " so thin and truncated as to be in substance different from what it was when it emerged out of the legislature ". The respondent 's contention that the statute should be hold to be valid in respect of wagering contracts even though invalid as regards other forward contracts must therefore also be rejected. Our conclusion therefore is that the impugned statute does not fall within Item 62 of the State List and that it is beyond the legislative competence of the State Legislature. The appellants were therefore entitled to appropriate reliefs as prayed for in their petition under article 226 of the Constitution. We therefore allow this appeal, set aside the order of the High Court and direct that the petition under article 226 of the Constitution be allowed and declare that the Punjab Forward Contracts Tax Act No. VII of 1951 is void and unconstitutional as it is ultra vires the powers of the State Legislature, that the notification made under the rules promulgated by the 676 respondent under this Act are also void and unconstitutional and that a mandamus do issue directing the respondent to allow the petitioners to carry on the business of forward contracts or as commission agents for forward contracts unrestricted by the provisions of the said Punjab Forward Contracts Tax Act No. VII of 1951 and the rules thereunder and not to enforce the provisions of this Act and the rules. The appellants will get their costs in this Court as also in the court below. Appeal allowed.
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Some business owners ("the appellants") made deals for future sales. They went to the High Court of Punjab and asked them to rule on a law called the Punjab Forward Contracts Tax Act of 1951. They argued the law was not legal because it went beyond what the state government was allowed to do. This argument was made under article 226 of the Constitution of India. The law taxed "forward contracts." These were defined as deals, spoken or written, to sell goods later. But, instead of actually handing over the goods, the parties just paid or received the difference between the agreed-upon price and the price on a certain date. This was defined in section 2 of the Act. The High Court thought the law was meant to tax gambling on future prices. They believed it fell under Entry 62 of the State List, which allows taxes on betting and gambling. The Supreme Court decided that the law's definition of "forward contract" didn't include everything needed to make a contract a bet. So, the lawmakers probably weren't thinking about bets when they defined "forward contracts." Therefore, the law doesn't fall under Entry 62, List II of the Constitution. The state government didn't have the power to make this law. The Court also said that even if the definition was broad enough to cover some betting-like contracts where the parties didn't plan to actually deliver goods, the valid part of the law would be too small. So, the entire law should be considered invalid. This decision was based on a similar case, R. M. D. Chamarbaugwala vs The Union of India, [1957] section C. R. 93o.
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Appeal No. 270 of 1959. Appeal by special leave from the judgment and order dated December 23, 1957, of the Allahabad High Court (Lucknow Bench) at Lucknow in Civil Miscellaneous Application (0. J.) No. 86 of 1954. C. B. Aggarwala, G. C. Mathur and C. P. Lal, for the appellants. Achhru Ram, section N. Andley, J. B. Dadachanji, Rameshwar Nath and P. L. Vohra, for the respondent. November, 25. The Judgment of Sarkar, Subba Rao and Mudholkar, JJ., was delivered by Subba Rao, J., and that of Gajendragadkar and Wanchoo, JJ., was delivered by Wanchoo, J. SUBBA RAO, J. This is an appeal by special leave against the judgment and order of the High Court of Judicature at Allahabad, Lucknow Bench, allowing the petition filed by the respondent under article 226 of the Constitution. The facts are in a small compass and may be briefly stated. In the year 1933 the respondent was appointed a constable in U. P. Police Force; on December 1, 1945, he was promoted to the rank of head constable and in May, 1952 he was posted as officer incharge of Police Station, Intiathok, District Gonda. Complaints were received by the District Magistrate, Gonda, to the effect that the respondent was receiving bribes in the discharge of his duties. On September 16, 1952, the District Magistrate, Gonda, directed the Sub Divisional Magistrate to make an enquiry in respect of the 674 said complaints. On November 3,1952, the Sub Divisional Magistrate, after making the necessary enquiries, submitted a report to the District Magistrate recommending the transfer of the respondent to some other station. On November 17, 1952, the District Magistrate sent an endorsement to the Superintendent of Police to the effect that the Sub Divisional Magistrate had found substantial complaints against the integrity of the respondent, that he had also received such complaints and that his general reputation for integrity was not good, but that his transfer should, however, come after sometime and that in the meantime his work might be closely watched. On being called upon by the Superintendent of Police to submit an explanation for his conduct, the respondent submitted his explanation on November 29, 1952. On December 17, 1952, the respondent was forced to go on leave for two months. Before the expiry of his leave, he was reverted to his substantive post of head constable and transferred to Sitapur. On February 17, 1953, he was promoted to the rank of officiating Sub Inspector and posted as Station Officer at Sidholi. On February 27, 1953, the Superintendent of Police made the following endorsement in his character roll: "A strong officer with plenty of push in him and met with a strong opposition in this new charge. Crime control was very good but complaints of corruption were received which could not be substantiated. Integrity certified. " Meanwhile on further complaints, the C.I.D. probed the matter further and on July 26, 1953, the Superintendent of Police, Investigation Branch, C.I.D., reported that the respondent was a habitual bribetaker. On July 28, 1953, he was placed under suspension and on August 18, 1953, he was charged under section 7 of the Police Act with remissness in the discharge of his duty and unfitness for the same inasmuch as while posted as a Station Officer, Police Station, Intiathok, he had been guilty of dishonesty, corruption and misbehaviour in that he had on nine occasions, particulars of which were given in the charge, accepted bribes. it may be mentioned that the magisterial inquiry 675 related to seven of the nine charges alleged against the respondent. The trial was conducted by the, Superintendent of Police and the respondent submitted his explanation on September 12, 1953. The Superintendent of Police, who conducted the trial, examined many witnesses and found that seven out of the nine charges had been established. Thereafter he issued a notice to the respondent calling upon him to show cause why he should not be dismissed from the police force. On February 20, 1954, the respondent sub mitted his explanation and the Superintendent of Police, by his order dated February 22, 1954, dismissed the respondent from service with effect from the said date. The appeal preferred by the respondent to the Deputy Inspector General of Police was dismissed by his order dated June 2, 1954. Thereafter the respondent on August 5, 1954, filed a petition under article 226 of the Constitution before the High Court of Judicature at Allahabad, Lucknow Bench, for quashing the order of dismissal. Before the High Court three points were raised, namely, (1) as the petitioner was officiating. as Sub Inspector of Police at the time of the departmental trial the Suprintendent of Police had no power to dismiss him, since an order in such circumstances could only be made by a police officer senior in rank to a Superintendent; (2) the trial was vitiated by a number of serious irregularities; and (3) the specific acts with which the petitioner was charged were cognizable offences and, therefore, the Superintendent of Police had no jurisdiction to proceed with a departmental trial without complying with the provisions of subparagraph (1) of para. 486 of the Police Regulations. The learned Judges of the High Court held that the respondent was charged with committing cognizable offences and therefore sub paragraph (1) of para. 486 governed the situation and that, as no case, as required by the said sub paragraph, was registered against the respondent in the police station, the order of dismissal was invalid. They further held that the case was not covered by the first proviso to sub paragraph (1) of para. 486, as, in their opinion, the information 676 about the commission of the offences was not in the first instance received by the Magistrate and forwarded to the police for inquiry. In view of that finding they found it unnecessary for them to express any opinion upon other arguments which had been advanced on behalf of the respondent. In the result they issued a writ in the nature of certiorari quashing the impugned orders. Hence the appeal. Mr. C. B. Agarwala, learned counsel appearing for the appellants, raised before us the following points: (1) The Governor exercised his pleasure through the Superintendent of Police, and, as the Police Regulations were only administrative directions, the non compliance therewith would not in any way affect the validity of the order of dismissal. (2) If the order of dismissal was held to have been made under the statutory power conferred upon the Superintendent of Police, the regulations providing for investigation in the first place under chapter XIV of the Criminal Procedure Code were only directory in nature, and inasmuch as no prejudice was caused to the respondent the non compliance with the said regulations would not affect the validity of the order of dismissal. (3) The Superintendent of Police was authorized to follow the alternative procedure prescribed by subparagraph (3) of para. 486 and, therefore, the inquiry held without following the procedure prescribed by rule I was not bad. (4) As the magisterial inquiry was held in regard to practically all the charges, the subject matter of the departmental trial, the case is not covered by the provisions of para. 486 of the Police Regulations. In the case of The State of U. P. vs Babu Ram Upadhya (1) in which we have just delivered the judgment, we have considered the first three point; and for the reasons mentioned therein we reject the first three contentions. The appellants must succeed on the fourth contention. From the facts already narrated, the conduct of the respondent, when he was officer incharge of the Police Station, Intiathok, was the subject matter of (1) Civil Appeal No. 119 of 1950; ; 677 magisterial inquiry. The Sub Divisional Magistrate made inquiry in respect of seven of the charges which were the subject matter of the departmental trial and. submitted a report to the District Magistrate. The District Magistrate, in his turn, made an endorsement on the report and communicated the same to the Superintendent of Police recommending the transfer of the respondent and suggesting that in the meanwhile the work of the respondent might be closely watched. Though the Superintendent of Police gave at first a good certificate to the respondent, in respect of the same a further probe was made through the C.I.D. Thereafter the Superintendent of Police conducted a departmental trial in respect of the aforesaid seven charges and two other new charges of the same nature. The inquiry ended in the dismissal of the respondent. In the circumstances it would be hypertechnical to hold that there was no magisterial inquiry in respect of the matter which was the subject matter of the departmental trial. On the said facts we hold that the departmental inquiry was only a further step in respect of the misconduct of the respondent in regard whereto the magisterial inquiry was held at an earlier stage. If so, the question is whether para. 486 would govern the present inquiry or it would fall out side its scope. The relevant provisions of the Police Regulations read: Paragraph 486: "When the offence alleged against a police officer amounts to an offence only under s: 7 of the Police Act, there can be no magisterial inquiry under the Criminal Procedure Code. In such cases, and in other cases until and unless a magisterial inquiry is ordered, inquiry will be made under the direction of the Superintendent of Police in accordance with the following rules;" Paragraph 489: "A police officer may be departmentally tried under section 7 of the Police Act (1) after he has been tried judicially; (2) after a magisterial inquiry under the Criminal Procedure Code; 86 678 (3) after a police investigation under the Criminal Procedure Code or a departmental enquiry under paragraph 486 III above." A combined reading of these provisions indicates that para. 86 does not apply to a case where a magisterial inquiry is ordered; and that a police officer can be departmentally tried under section 7 of the Police Act after such a magisterial inquiry. In this case the departmental trial was held subsequent to the completion of the magisterial inquiry and therefore it falls within the express terms of para. 489(2). The fact that in the interregnum the police received further complaints or that the C.I.D. made further enquiries do not affect the question, if substantially the subject matter of the magisterial inquiry and the departmental trial is the same. In this case we have held that it was substantially the same and therefore the departmental trial was validly held. We, therefore, set aside the order made by the High Court. As we have pointed out earlier, the High Court, in the view taken by it, did not express its opinion on the other questions raised and argued before it. In the circumstances, we remand the matter to the High Court for disposal in accordance with law. The costs of this appeal will abide the result. WANCHOO, J. We have read the judgment just delivered by our learned brother Subba Rao J. We agree with the order proposed by him. Our reasons for coming to this conclusion are, however, the same which we have given in C.A. 119 of 1959, The State of Uttar Pradesh vs Babu Ram Upadhya. Appeal allowed. Case remanded.
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The police officer was in charge of a police station. Then, people complained to the District Magistrate (a local official) that the officer was taking bribes. The District Magistrate had another official, the Sub Divisional Magistrate, investigate. This official wrote a report. The District Magistrate sent this report and his own comments to the Superintendent of Police (the police chief). The officer was told to take a 2-month leave. He was then demoted back to his old job as a Head Constable. But later, he was promoted to the temporary rank of Sub Inspector and moved to a different police station. More complaints came in. Another investigation was done, and it said the officer took bribes often. He was accused of bribery under section 7 of the Police Act, with 9 counts (separate charges). After a trial within the police department, the Superintendent of Police fired him. He filed a legal paper (a Writ Petition) with the High Court (a higher court). He argued that the Superintendent of Police didn't have the power to hold the trial because the charges were serious crimes. He said the police should have followed rule 486(1) of the U.P. Police Regulations first. The High Court agreed with him and canceled the firing order. The Supreme Court decided the case. Three judges (Sarkar, Subba Rao, and Mudholkar) said that the investigation by the Magistrate and the trial within the police department were about the same thing. So, the trial within the police department was valid. The fact that some time passed between the Magistrate's investigation and the trial didn't matter. Rule 486 didn't apply when the Magistrate ordered an investigation. After that investigation, the police officer could be tried within the department under section 7 of the Police Act. Two other judges (Gajendragadkar and Wanchoo) said that rule 486 was just a guideline. Even if the police didn't follow it exactly, the firing order was still valid.
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Civil Appeal Nos. 1575 and 1965 of 1971. From the Judgment and Order dated 12 1 1968 of the Calcutta High Court in Civil Rule No. 2523 and 2527 of 1960. section T. Desai, J. Ramamurthi and D. N. Gupta for the Respondents and Vice Versa. These two appeals one by the Union of India and the other by M/s Jardine Henderson Ltd. are by certificate granted by the Calcutta High Court. Since the facts in both the cases are very much similar involving the interpretation of the various clauses of section 3(1) of The , hereinafter referred to as the Validation Act, the two appeals have been heard together and are being disposed of by this judgment. There were two brothers named Basanta Kumar Daw, respondent No. 2 in Civil Appeal No. 1575 of 1971 and Haridhan Daw, respondent No. 2 in Civil Appeal No. The facts of Civil Appeal No. 1575 of 1971 are these: For realization of arrears of income tax dues the Certificate Officer of 24 Parganas forwarded to the Collector a Certificate in accordance with Section 46(2) of the Indian Income tax Act, 1922 specifying the amount of arrears due from respondent No. Thereupon a Certificate case was started against him (Basanta Kumar Daw) under the Bengal Public Demands Recovery Act, 1913, hereinafter called the Bengal Act, by the Certificate Officer acting as a Collector. Notice under section 7 was served on the Certificate debtor on 31 10 1949. Basanta Kumar Daw entered appearance and filed an objection under section 9 of the Bengal Act. This objection was rejected by the Certificate Officer by his Order dated March 8, 1951. On April 2, 1951 the Certificate debtor made an application for review of the said order dated 8 3 1951 stating therein, inter alia that the appeal preferred by him before the Income tax Appellate Tribunal had been allowed in part and some payments also had 559 been made since then; the Certificate case, therefore, could not proceed for the recovery of the sum of Rs. 36,874.10 annas, the original amount mentioned in the Certificate. But he made certain enquiries from the Income tax Officer whether the amount of the Certificate had to be reduced. The Income tax Officer informed him that the Tribunal had reduced the demand on appeal on 13 9 1950 and after adjustment of the previous payments made by the Certificate debtor the revised demand stood at Rs. Thereupon the Certificate Officer amended the Certificate on the basis of the information received from the Income tax Officer and reduced the demand. On July 18, 1956 he directed the issue of sale notice under Rule 46(2) framed under the Bengal Act in respect of the half share of Basanta Kumar Daw (the other half belonging to his brother Haridhan Daw) in premises nos. Now a few facts of the other appeal being Civil Appeal No. The Income tax officer sent a requisition to the Certificate officer of 24 Parganas for the recovery of a sum of Rs. 59,541.15 annas against Haridhan Daw, respondent No. 2 in this appeal. A notice under section 7 of the Bengal Act was served on the Certificate debtor on January 30, 1951. He also filed a petition of objection under section 9. But the Certificate Officer by his order dated January 13, 1954 rejected the objection filed by the Certificate debtor under the Bengal Act. A review application was also rejected in this case on January 27, 1954. On March 2, 1954, the Income tax Officer informed the Certificate Officer that the original demand of Rs. 59,541.15 annas had been enhanced to Rs. 59,604.7 annas under section 35 of the Income tax Act and requested him to realize the enhanced amount. The Certificate Officer thereupon informed the Income tax Officer that the Bengal Act did not provide for enhancing the demand of the existing Certificate and asked him to file a separate Certificate for the additional amount. He, however, continued the Certificate proceedings for the recovery of the original amount. Jardine Henderson Ltd., respondent in Civil Appeal No. 1575 of 1971 and appellant in Civil Appeal No. 560 In both the cases the Company received a notice on August 6, 1956 fixing a date for settling the terms of the sale proclamations in respect of the respective one half share of each of the two Certificate debtors. Immediately thereafter the respondent company made an application in each of the two cases that it had purchased the property being unaware of the pendency of any Certificate case against any of its vendors for realization of income tax dues and that the Company was the owner of the property and it was not liable to be sold as that of the Certificate debtor. The Certificate Officer rejected the objection holding that the purchase having been made after service of notice under section 7 of the Bengal Act on the Certificate debtor, was void as against any claim enforceable in execution of the Certificate and hence the Company had no right to object to the sale. The Company went up in appeal before the Commissioner and succeeded in both the cases. The petition giving rise to Civil Appeal No. The other petition giving rise to Civil Appeal No. 1965 of 1971 was dismissed by the same Bench and the Company has, therefore, come up in appeal. The Validation Act was not there when the orders were passed either by the Commissioner or the Board of Revenue. But in the High Court as also here the main controversy between the parties was the effect of the Validation Act on the two Certificate proceedings. Mr. V. section Desai, appearing for the Union of India, in the first instance submitted that the order reducing the amount of the Certificate in Civil Appeal No. 1575 was an order under section 10 of the Bengal Act. Hence the notice served under section 7 on the Certificate debtor continued to have its effect in spite of the reduction of the amount and no fresh notice under section 7 was necessary to be served. Section 7 reads as follows: "When a certificate has been filed in the office of a Certificate officer under section 4 or section 6, he shall cause to be served upon the certificate debtor, in the prescribed manner, a notice in the prescribed form and a copy of the certificate. " 561 The effect of service of notice of certificate is provided in section 8 which provides : "From and after the service of notice of any certificate under section 7 upon a certificate debtor (a) any private transfer or delivery of any of his immovable property situated in the district in which the certificate is filed, or of any interest in any such property, shall be void against any claim enforceable in execution of the certificate. " Under Section 9 the Certificate debtor may file a petition of objection denying his liability in whole or in part. Under section 10 it is provided: "The Certificate officer in whose office the original certificate is filed shall hear the petition, take evidence (if necessary), and determine whether the certificate debtor is liable for the whole or any part of the amount for which the certificate was signed; and may set aside, modify or vary the certificate accordingly :" On reading the provisions aforesaid it is clear that if the Certificate is modified or varied by the Certificate Officer under section 10 while disposing of the petition of objection filed by the certificate debtor under section 9, then the Certificate case proceeds further without a fresh notice under section 7. But in the instant case the amount was not reduced on the objection of the Certificate debtor but it was reduced on receipt of the information from the Income tax Officer. In the Bengal Act itself there is no express provision enabling a person other than the Certificate debtor claiming an interest in the property to be sold to file any objection. The Company preferred a claim objecting to the sale of property on the ground that it was not liable to sale as it had purchased the property from the two Certificate debtors. It was open to it to show under rule 40 that at the date of the service of notice under section 7 it had some interest in the property in dispute. If the notice served at the beginning 562 of the two Certificate cases under section 7 on the two Certificate debtors was not a valid notice in the sense that in one case on the reduction of the amount of the Certificate it became necessary to give a fresh notice and in the other without a fresh demand notice under the Income tax Act for the enhanced amount, the Certificate case could not proceed, then the Company had validly purchased the property and its purchase was not void. The property purchased by it could not then be sold for realization of the income tax dues against the two brothers. If, however, no fresh notice was necessary to be served in either of the two cases then it is plain that the Company 's purchase was void as against the claim enforceable in execution of the Certificate. The answer in both the cases has got to be given with reference to the Validation Act and no other point of any consequence was argued or could be pressed with any success in either of the two appeals. A notice of demand for each of the two years was served upon the assessee under section 29 of the Income tax Act, 1922. Thereafter the tax payable by the assessee was substantially reduced in appeal. The Income tax Officer informed the assessee of the reduced tax liability and called upon him to pay the reduced amount. No fresh notice of demand was issued under section 29. Pending further appeals to the Appellate Tribunal the assessee wanted the Certificate proceedings to be stayed and on his request being rejected he moved the High Court under Article 226 of the Constitution. The High Court held that the department was not entitled to treat the respondent as a defaulter in the absence of a fresh notice of demand and quashed the recovery proceedings. On appeal to this Court the majority view expressed was that the amount of tax assessed being reduced as a result of the orders of the Appellate Assistant Commissioner, a fresh demand notice had to be served on the respondent before he could be treated as a defaulter. The recovery proceedings initiated against him on the basis of the original demand notice were therefore rightly quashed by the High Court. The Statement of Objects and Reasons which led to the introduction and passing of the Validation Act would show that it was to get over the difficulties in the collection of income tax and other direct taxes created by the Supreme Court decision in Seghu Buchiah Setty 's case 563 (supra) that the Validation Act was passed with retrospective effect. The interpretation of this Act falls for our consideration for the first time in this Court. "Taxing Authority" has been defined in clause (d) of section 2 and clause (e) defines "Tax Recovery Officer" to mean an officer to whom a certificate for the recovery of arrears of Government dues may be issued under this Act. Section 3 without the proviso may be read as a whole: "Continuation and validation of certain proceedings. (1) Where any notice of demand in respect of any Government dues is served upon an assessee by a Taxing Authority under any scheduled Act, and any appeal or other proceeding is filed or taken in respect such Government dues, then, (a) where such Government dues are enhanced in such appeal or proceeding, the Taxing Authority shall serve upon the assessee another notice of demand only in respect of the amount by which such Government dues are enhanced and any proceedings in relation to such Government dues as are covered by the notice or notices of demand served upon him before the disposal of such appeal or proceeding may, without the service of any fresh notice of demand, be continued from the stage at which such proceedings stood immediately before such disposal; (b) where such Government dues are reduced in such appeal or proceeding (i) it shall not be necessary for the Taxing Authority to serve upon the assessee a fresh notice of demand; (ii) the Taxing Authority shall give intimation of the act of such reduction to the assessee, and where a certificate has been issued to the Tax Recovery Officer for the recovery of such amount, also to that officer; 564 (iii)any proceedings initiated on the basis of the notice or notices of demand served upon the assessee before the disposal of such appeal or proceeding may be continued in relation to the amount so reduced from the stage at which such proceedings stood immediately before such disposal; (c) no proceedings in relation to such Government dues (including the imposition of penalty or charging of interest) shall be invalid by reason only that no fresh notice of demand was served upon the assessee after the disposal of such appeal or proceeding or that such Government dues have been enhanced or reduced in such appeal or proceeding :" The Act was made retrospective by an express provision in section 5. Clause (a) deals with the case of an enhancement of Government dues and provides that the proceedings initiated may be continued from the stage at which such proceedings stood immediately before the disposal of the appeal or proceedings in which the enhancement was made. Another notice of demand is required to be served in respect of the amount by which the dues are enhanced. On a plain reading of clause (a) of section 3 it is clear that the intention of the legislature is not to allow the nullification of the proceedings which were initiated for recovery of the original demand. On the basis of another notice of demand for the enhanced amount, two courses are open to the department (1) to initiate another proceeding for the recovery of the amount by which the dues are enhanced treating it as a separate demand or (2) to cancel the first proceedings and start a fresh one for the recovery of the entire amount including the enhanced one. In Civil Appeal No. 1965 of 1971 this is exactly the view taken by the High Court and in our opinion rightly. Mr. section T. Desai appearing for the Company submitted that where the amount was enhanced in appeal or revision there was no express provision in the Income tax Act for service of a fresh or another notice of demand for the additional amount. But if the amount was enhanced under the power of rectification under section 35 then sub section (4) thereof requires: 565 "Where any such rectification has the effect of enhancing the assessment or reducing a refund the Income tax Officer shall serve on the assessee a notice of demand in the prescribed form specifying the sum payable, and such notice of demand shall be deemed to be issued under section 29, and the provisions of this Act shall apply accordingly. " The effect of this sub section, according to the counsel, has not been done away with by clause (a) of section 3 of the Validation Act. Firstly, on a correct interpretation of sub section (4) of section 35 it would be noticed that though the expression used is "the sum payable" but in the context it would mean only the "extra enhanced sum payable" and not the whole of the enhanced amount. The expression "sum payable" had to be used in sub section (4) because that sub section was also providing for a contingency where by the rectification order the amount of refund was reduced. The second reason is that even if it were to be held that in the case of enhancement the expression "the sum payable" in sub section (4) means the whole of the enhanced amount by a rule of harmonious construction it has got to be held that in view of section 3(1) (a) of the Validation Act even in the case of a rectification a notice of demand is to be served now only in respect of the amount by which the Government dues are enhanced. Now coming to the case of reduction dealt with in clause (b) of sub section (1) of section 3 of the Validation Act it would be seen that sub clause (i) clearly provides that it is not necessary for the Taxing Authority to serve upon the assessee a fresh notice of demand. The only thing which he is required to do is that he has to give intimation of the fact of such deduction to the assessee and to the Tax Recovery Officer. The purpose of giving intimation to the assessee is to bring it to his pointed knowledge that the demand against him has been reduced, although by other methods also such as by service of a copy of the Appellate Order or the revisional order being served on him he may be made aware of that. The intimation to the Tax Recovery Officer is essential as without that intimation from the Taxing Authority he cannot reduce the amount of the Certificate debt in the proceedings already commenced. The High Court has taken the view that the provision contained in sub clause (ii) of clause (b) of section 3(1) of the Validation Act is mandatory and in absence of a formal intima 566 tion to the assessee and to the Tax Recovery Officer as required by the said provision the proceedings initially started could not be continued under sub clause (iii). In our opinion the view of the High Court is not sustainable in law. On the facts of this case the assessee himself in his review application had clearly mentioned that the demand against him stood reduced in appeal. Although the Tax Recovery Officer rejected his review petition, as, probably, he had no power of review, he took the precautionary measure of making inquiry from the Taxing Authority. We, therefore, hold that on the facts of this case the requirement of sub clause (ii) stood fulfilled and nothing further had to be done in the matter by the Taxing Authority. That being so the proceedings initiated on the basis of the notice of demand served upon the assessee before the reduction of the amount in appeal could be continued in relation to the amount so reduced from the stage at which such proceedings stood immediately before such disposal as provided for in sub clause (iii). Clause (c) of section 3(1) of the Validation Act is also important and it clearly and expressly provides that no proceedings in relation to Government dues shall be invalid merely because no fresh notice of demand was served upon the assessee after the dues were enhanced or reduced in any appeal or proceeding. It is, therefore, plain that in neither of the two cases did the Certificate proceeding become invalid, in one case by reduction of the demand and in the other by an enhancement. In both the cases notices under section 7 of the Bengal Act had been served upon the Certificate debtors before the property in question was transferred by them to the Company. The transfer was, therefore, void against the Certificate claims in both the cases under section 8(a) of the Bengal Act. That case is, however, clearly distinguishable as in that the property was sold in Certificate proceedings started for the realization of the original amount even after the amount had been reduced in appeal. It is obvious that that sale was illegal and invalid as rightly held by the High Court because after reduction the demand had to be reduced on intimation by the Taxing Authority and the property could not be sold for the original amount. 567 For the reasons stated above, Civil Appeal No. 1575 of 1971 is allowed with costs payable by the respondent company, the Judgment and Order of the High Court are set aside and it is directed that the Certificate case shall proceed to disposal in accordance with law as expeditiously as possible. Civil Appeal No. 1965 of 1971 is dismissed but we make no order as to costs in this appeal. No.
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This was because the original notice asking for the tax amount was based on an assessment that was later lowered in an appeal. The court felt that a new notice had to be sent to the person before they could be considered a tax defaulter. Two brothers owned property that was bought by a company, M/s Jurdine Henderson (Ltd.), on September 20, 1954. This was after they had received notices under section 7 of the Bengal Public Demands Recovery Act, 1913. Soon after, the company applied to the court in both cases. They said they bought the property without knowing about any tax cases against the sellers. They said that because the company bought the property after the brothers received the section 7 notice, the sale was not valid against any tax claims. The company then asked the High Court to review the case under Article 227 of the Constitution. The petition related to Civil Appeal No. 1575 was allowed. The same court dismissed the other petition related to C.A. and (b) What was the effect of section 3(1)(a) and (b) of the Validation Act, 1964, along with Section 35(4) of the Income Tax Act, 1962? The Court allowed C.A. ^ HELD: 1. The Court decided that the company, as the buyer of the property, had the right to object to the sale. The company objected because they claimed the property shouldn't be sold since they had bought it from the brothers. However, under section 22, they can ask the court to cancel the sale of the property if they deposit the required amount. (a) The company was allowed to show under rule 40 that they had an interest in the property when the section 7 notice was served. If the section 7 notice served at the beginning of the two cases wasn't valid (because the amount was lowered in one case and a new notice was needed, and in the other case, a new notice was needed for the increased amount), then the company's purchase was valid. In that case, the property they bought couldn't be sold to pay the brothers' taxes. But if a new notice wasn't needed in either case, then the company's purchase was not valid against the tax claims. (b) Sections 7, 8, 9, and 10 of the Bengal Public Demands Recovery Act, 1913, say that if the court officer changes the amount in the certificate under Section 10 after an objection, the case can continue without a new section 7 notice. In this case, the amount was lowered because the court officer received information from the Income Tax Officer, not because of the brothers' objection. The Court decided that the transfer of the property to the company was not valid against the tax claims in both cases under section 8(a) of the Bengal Public Demands Recovery Act, 1913. In both cases, the brothers had received section 7 notices before they transferred the property to the company. The tax process didn't become invalid in either case, even though the amount was lowered in one case and increased in the other. This is because section 3(1)(c) of the Validation Act says that tax cases are not invalid just because a new notice wasn't sent after the amount was changed in an appeal. The case of Ram Swarup Gupta vs Behari Lal Baldeo Prasad and Ors. (a) Section 3 of the Validation Act shows that the government didn't want to stop the tax collection process just because the original amount was changed. But in the first case, the original process is not affected. (b) The argument that section 35(4) of the Income Tax Act was not changed by section 3(a) of the Validation Act, 1964, is not correct. In that case, "the sum payable" would be the difference between the original refund and the reduced amount. Second, even if "the sum payable" means the entire amount, section 3(1)(a) of the Validation Act means that a new notice is only needed for the amount by which the taxes are increased. Section 3(1)(b)(i) of the Validation Act says that the tax authority doesn't need to send the person being taxed a new notice. The authority only needs to tell the person and the Tax Recovery Officer about the change. Telling the Tax Recovery Officer is important because they can't lower the amount of the debt without this information. (a) The High Court's view that section 3(1)(b)(ii) of the Validation Act is required and that the case couldn't continue under section 3(1)(b)(iii) without telling the person and the Tax Recovery Officer is not correct. (b) In the case of C.A.
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1. The Petitioner before this Court has filed the present writ petition
under Article 226 of the Constitution of India in public interest, praying for
the following reliefs:-
“(a) Issue directions to the respondent no 1 to 3 to
identify the persons who caused damage to public
properties during unlawful protest with respect to the
citizenship (amendment) act, 2019 and to recover the
damages from them.
SINGH KIRMOLIYA W.P.(C) 2893/2020 Page 1 of 3
(b) To issue directions, thereby setting up an
independent machinery to investigate the damage
caused and to award compensation related thereto.
(c) Issue or pass any writ, direction or order, which
this Hon'ble Court may deem fit and proper under the
facts and circumstances of the case.”
2. The contention of the Petitioners herein is that a certain group of
protesters damaged public property during protests with respect to the
Citizenship (Amendment) Act, 2019 and, therefore, the Respondents may be
directed to identify such persons who have caused the said damage to public
property. The Petitioners also pray that an independent machinery may be
set up to investigate the damage so that damage can be assessed and
compensation can be paid.
3. Respondent No.3 has filed an affidavit in compliance of the Order
dated 21.03.2022. The affidavit reveals that Hon’ble Mr. Justice Sunil Gaur,
a former Judge of this Court has been appointed as the Claim Commissioner
to investigate the damages, and to award compensation relating to the riots
that took place during the protest, which are the subject matter of the present
writ petition. The notification dated 13.04.2020 to that effect has been
placed on record.
4. So far as the other aspect of registration of criminal cases is
concerned, the affidavit reveals that Delhi Police has filed details of public
property damaged during the protest and as many as 23 FIRs have been
registered in the matter. The stage of criminal case has also been reflected in
the chart. Further, Delhi Police has also quantified the damage caused to the
private property as a result of the protests. It is stated that as many as 518
SINGH KIRMOLIYA W.P.(C) 2893/2020 Page 2 of 3
FIRs have been registered. Meaning thereby, the Police has already taken
action in the matter.
5. In the considered opinion of this Court, once the Claim Commissioner
has already been appointed and is dealing with the issue in question for grant
of compensation and further considering that FIRs have been registered, no
further orders are required to be passed in the present writ petition.
6. Accordingly, the petition is disposed of, along with pending
application(s), if any.
SINGH KIRMOLIYA W.P.(C) 2893/2020 Page 3 of 3
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The Delhi High Court has closed a public interest lawsuit. This lawsuit asked for money from people who were accused of destroying public and private property during protests against the Citizenship (Amendment) Act in 2019. A two-judge panel, made up of Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad, stated their reason. They noted that a special official, called a Claim Commissioner, was already appointed to decide on giving money to cover losses. Also, police reports, known as FIRs, were already filed by the Delhi police. Because of this, the court felt they didn't need to issue any more orders in the case.
In a sworn statement filed for the lawsuit, the Delhi Police told the court about the progress. They had filed a total of 541 police reports (FIRs) against people who damaged public and private property. Out of these, only eight cases have finished in court. Trials are still ongoing for 51 percent of the cases. An earlier report from September 20, 2022, showed more details: 276 cases are still awaiting trial, and investigations are not yet done for 213 cases. In 2020, police filed 23 reports for damage to public property. This included a temple, mosques, security cameras, police shelters, and road barriers. Another 518 reports were filed for damage to private property, such as stores, homes, and cars. The Delhi Police also told the court that retired Justice Sunil Gaur was named as the Claim Commissioner. His job is to look into the damages and decide how much money should be paid out because of the riots.
The court carefully thought about it and decided. Since the Claim Commissioner was already appointed and is working on giving out money for the damages, and because police reports (FIRs) have been filed, they don't need to make any more decisions in this lawsuit. So, the court closed the lawsuit, along with any other related requests that were still waiting for a decision.
The court had sent official notices for this public interest lawsuit in March of last year. They asked for replies from the Ministry of Home Affairs, the Delhi Government, and the Delhi Police. An advocate (lawyer) and a law student filed this lawsuit. They claimed they had visited different parts of the city and were shocked by the damage to public properties during the riots. They said this caused a huge financial loss to the government. The lawsuit asked for an independent group to be created. This group would figure out the total damage and then collect the money from the people found responsible.
The Delhi Police, in their report, called the claims made in the lawsuit false and without proof. They stated that the police acted quickly, carefully, and well, in a "professional manner," during the riots. Lawyers Yudhvir Singh Chauhan, Shivangi Shokeen, and Aditya Sharma represented the people who filed the lawsuit.
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Civil Appeal No. 699 of 1985. From the Judgment and Order dated 17.5.1984 of the Orissa High Court in O. J. C. No. 936 of 1979. G.L. Sanghi, Adv., R.K. Mehta, Ms. Uma Jain, M.A. Firoz and P.N. Misra for the appearing parties. The Judgment of the Court was delivered by K. RAMASWAMY, J. These three appeals are against the judgment of the Orissa High Court in O.J.C. No. 936 of 1979. The Division Bench allowed the writ petition and quashed the gradation lists of sub Asstt. Engineers (Electrical) and Sub Asstt Engineer (Mechanical), Annexures 5 & 6 before the High Court and the promotions given to the respondents Nos. 4 and 5 therein Annexure 7. The Government and the Corporation were directed to consider the question of promotion treating the writ petitioner and the respondents as belonging to two cadres of Sub Asstt. Engineer (Electrical) And (Mechanical). These three appeals were filed, one by the Corporation, another by the State Government and the third one by the aggrieved employees. 344 The facts are simple. Shri Bidura Charan Mohapatra, the 6th respondent/first appellant in the third appeal, a diploma holder in Mechanical and Electrical Engineering, was appointed as Mechanical Supervisor on August 24, 1962 in the pay scale of Rs.215 396. Shri Parijat Ray, the 7th respondent/2nd appellant, equally possessed of diploma in Electrical and Mechanical Engineering, was appointed in the same scale of pay as a Mechanical Supervisor on November 5, 1962. Shri P.K. Mohanty, the writ petitioner in the High Court and the respondent in these appeals holds diploma in Electrical Engineering and was appointed as Hand Driller in the pay scale of Rs. 100 155, on October 23, 1963 and Sub Assistant Engineer (Electrical) in the payscale of Rs. 185 325 on September 1, 1965. The Lift Irrigation Corporation Ltd., a part of the Government Organisation, was carved out separately and the three persons alongwith others were drawn on deputation from the Government service to the Corporation in the year 1963. Three categories of services were existing in the Corporation, namely, Mechanical, Electrical and Mechanical Electrical Composite unit. In the year 1971, three tentative gradation lists were prepared for classification purpose of those three divisions as Sub Assistant Engineer (Mechanical), Sub Assistant Engineer (Electrical), Supervisors, Electrical and Mechanical which includes Electrical Supervisors, Mechanical Supervisors, Drilling Supervisors and Foreman cum Instructors. In 1977 the Corporation decided to reorganise its set up and to classify the employees into two categories, namely, Sub Assistant Engineer (Electrical), Sub Assistant Engineer (Mechanical) to attend to the respective works, namely, mechanical and electrical. The Corporation invited objections to amalgamate Composite Electrical and Mechanical Engineering Diploma Holders, either in Electrical or Mechanical Wing. Options were called for from the persons holding only the composite diploma, namely, Mechanical and Electrical Engineering Supervisors. The respondent writ petitioner did not file any objection to the scheme. On consideration of the objections filed by others, two gradation lists were prepared in the order of seniority from the respective dates of appointment to the posts and higher scale of pay held by respective persons and fitted them in the respective lists as per options. As stated earlier the respondent questioned their gradation in the Electrical Wing in the High Court and the High Court quashed it and the appellants obtained leave of this Court under article 136. The contention of the appellants is that the respondent has no right to be kept in a particular wing. The Corporation, with a view to H create two categories, namely, Mechanical and Electrical sought to 345 amalgamate the third Composite Mechanical/Electrical Wing and sought for options from the persons holding the composite posts. This was taken due to administrative exigency. The Corporation has power to carve out by amalgamating three sections, into two divisions and to prepare the seniority lists from the respective date of their initial appointment, etc. The High Court, therefore, was unjustified to quash the gradation lists. It was contended for the respondent by Sri Misra, his learned counsel, that the persons from the three wings are only deputationists holding lien on Government posts. The Corporation did not frame any scheme of its own to appoint its own employees, nor given options to all the deputationists for confirmation as its employees. So long as the employees are continuing on deputation, they are entitled to have seniority in the respective wings. The writ petitioner admittedly has been working on the Electrical Wing and was No. 2 in the order of seniority as Sub Assistant Engineer (Electrical). His right to seniority, cannot be disturbed by taking Mechanical Supervisor into the Electrical Wing, offending his right to promotion enshrined under articles 14 and 16 of the Constitution. The writ petitioner holds only Diploma in Electrical Engineering. S/Shri Bidura Charan Mohapatra and Parijat Ray hold double diploma of Mechanical and Electrical Engineering. It is settled law that the Government or the Corporation, due to administrative exigencies, is entitled to and has power to reorganise the existing cadres of amalgamate some or carve out separate cadres. The pre existing three separate cadres, namely, Electrical, Mechanical and the composite cadre, namely, Electrical Mechanical were sought to be amalgamated into two cadres by absorbing the personnel working in the composite cadre, namely, Electrical Mechanical in either Electrical cadre or Mechanical cadre. Options have been called for in that regard from all the persons working in the Electrical Mechanical cadre and the appellants exercised their options for absorption in Electrical cadre. The employees working in the Electrical and Mechanical cadres were also aware of the same. It was, therefore, open to the respondent to raise any objection to the policy at that stage. But he failed to so. The decision to amalgamate the existing cadres by reorganising into two cadres was a policy decision taken on administrative exigencies. The policy decision is not open to judicial review unless it is mala fide, arbitrary or bereft of any descernable principle. On account of the amalgamation and adjusting the composite Electrical Mechanical cadre in either of the Electrical or Mechanical cadre as per the options given, the order of seniority of the employees working in Electrical or Mechanical cadres is likely to be reviewed. When the persons in the 346 composite Electrical Mechanical cadre opted to the Electrical cadre, they are entitled to be considered for their fitment to the cadre as per the seniority from the date of their initial appointment vis a vis their scale of pay. This was the procedure adopted by the Corporation in fixing the inter se seniority. The procedure adopted is just, fair and reasonable and beneficial to all the employees without effecting their scales of pay or loosing the seniority from the date of initial appointment. Undoubtedly, in this process the respondent/writ petitioner lost some place in seniority which is consequential to amalgamation. He has not been deprived of his right to be considered for promotion, only his chances of promotion have been receded. It was not the case of the respondent that the action was actuated by mala fide or colourable exercise of power. There is no fundamental right to promotion, but an employee has only right to be considered for promotion, when it arises, in accordance with the relevant rules. From this perspective in our view the conclusion of the High Court that the gradation list prepared by the Corporation is in violation of the right of the respondent/ writ petitioner to equality enshrined under article 14 read with article 16 of the Constitution, and the respondent/writ petitioner was unjustly denied of the same is obviously unjustified. The appeals are accordingly allowed and the writ petition stands dismissed. But in the circumstances, parties are directed to bear their respective costs. N.P.V. Appeals allowed.
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The Lift Irrigation Corporation Ltd. used to have three types of services: Mechanical, Electrical, and a mix of both. Later, the company wanted to change things. It decided to combine the mixed group of workers into either the Electrical or Mechanical departments. The company asked for feedback on this plan. The company also asked workers who had training in both Mechanical and Electrical work to choose which department they wanted to join. After looking at the choices, the company made two lists of employees based on how long they had worked there and how much they were paid. The employees were placed on the lists based on their choices. One employee, called Respondent No. 1, was an Electrical Engineer. He was working for the company temporarily from a government job. He did not complain about the new plan. However, he later argued in court that other employees, Respondents No. 6 and 7, should not be ranked higher than him on the Electrical list. The High Court agreed and said the company should create separate lists for Electrical and Mechanical engineers. The company, the government, and the unhappy employees appealed. They argued that the company had the right to combine the three departments into two. They also said that the lists should be based on how long each employee had worked there. Respondent No. 1 argued that his position on the Electrical list should not be lowered by adding Mechanical engineers. He said this violated his right to be promoted equally under the law. The Court decided in favor of the company. 1. 1 The government or the company has the power to reorganize departments or create new ones when needed. The decision to combine departments is a policy decision. It should not be overturned by a court unless it is unfair, random, or makes no sense. 2. 2 When the company combined departments, the order of who was more senior might change. People who worked in the mixed Electrical and Mechanical department could choose to join either the Electrical or Mechanical department. They were then ranked based on how long they had worked there and how much they were paid. The company's way of doing things was fair and helped all employees. It did not change their pay or how long they had worked there. It's true that Respondent No. 1 was ranked lower, but this was a result of the combination. He still had the right to be considered for promotion. Only his chances of getting promoted were affected. 3. 3 There is no guarantee that someone will be promoted. An employee only has the right to be considered for a promotion when it is available, based on the rules. 4. 4 The High Court was wrong to say that the company's list violated Respondent No. 1's right to equal treatment under the law.
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From the Judgment and Order dated 3.9.1988 of the Bombay High Court in Appeal from Order No. Under an agreement dated 23rd of August, 1951 the appellant and his father, who were then the joint tenants of the said property, agreed to hold the same as tenants in common, each having an equal undivided share therein so that each can dispose of his undivided share in the property and each share become a separate stock of descent. On 16th April, 1952 the appellant 's father trans ferred his undivided haft share in the suit property in favour of his another son by name Sohrab Warden in cansider ation of the said Sohrab releasing in favour of his father his undivided share in some other property described in the second schedule to that document. Re spondents 1 to 3 sold their undivided one half share in the said property to the fourth respondent and his wife under a sale deed dated 16th April, 1987. On the 18th April, 1987 praying for a decree directing respondents 1, 2 and 3 from parting with possession of the said property or any part thereof and/or inducting any third party including respond ent 4 into the said property or any part or portion thereof, and for further directions against respondents 4 and 5 from entering into or taking possession and/or remaining in possession or enjoyment of the suit property from defendants 1, 2 and 3 or otherwise. The fifth respondent was impleaded on the assumption that he and the fourth respondent jointly purchased the property but it is now accepted that he is not one of the purchasers and the property was purchased by the fourth respondent and his wife. Pending the suit the appel lant prayed for an interim injunction restraining the re spondents 1 to 3 from parting with possession of the said property or any part thereof and/or inducting the fourth respondent into the suit property or any part or portion thereof and a similar injunction restraining the fourth respondent from entering into or taking possession and/or 338 remaining in possession or enjoyment of the suit property or part thereof. The suit was filed on the ground that the suit property is a dwelling house belonging to an undivided family, that there had not been any division of the said property at any time, that the plaintiff and his deceased brother Sohrab during his fife time were for convenience occupying differ ent portions, the plaintiff occupying the first floor while the deceased Sohrab was occupying the ground floor. In the circumstances the fourth defendant who is a stranger to the family has no right to have joint possession or common enjoyment of the property along with the plaintiff on the basis of the purchase of the undivided share. In the counter affidavit filed by the fourth respondent and the first respondent on behalf of herself and two minor sons it was contended that though the appellant and respond ents 1, 2 and 3 were owning the property in equal moity they were holding it in their individual capacity and not as members of joint family and that the suit property is not joint family property or property belonging to an undivided family. The fourth respondent had taken possession of that portion of the property which was in 339 occupation of respondents 1 to 3 in pursuance of the sale deed. The trial court found that the suit property is dwelling house belonging to an undivided family, that there was no partition of the same by metes and bounds at any time, that the plaintiff and his father at the material time were undivided qua the entire suit property, that though the family of the appellant and the family of his brother Sohrab may be divided for food and worship they were not divided qua the suit property, that so far as the suit property is concerned the appellant and his family and the family of respondents 1, 2 and 3 were joint and undivided and that the case would fall within the scope of the second paragraph of section 44 of the Transfer of Property Act and that, there fore, respondent 4 and his wife as strangers were not enti tled to joint possession of the said family dwelling house. Since the defendant had claimed that he already entered into possession interim mandatory injunction was granted to the effect that the fourth respondent, his servants and his agents are restrained "from remaining in possession or enjoyment of the suit property" or any part or portion thereof. However, the learned Judge ordered that this in junction order would not prevent the fourth respondent to occasionally enter the suit property to enquire that on one else other than the plaintiff and his family members is entering into possession of the portion of the ground floor and one garage which he has purchased. On appeal the High Court was of the view that prims facie the facts indicate that throughout the parties have lived separately, that there appear to have been severance in status and it is not possible to give a finding that there has been no partition between the parties, that the matter requires evidence on either side as to what extent the ground floor could have ever been considered as a family dwelling house that granting of interim mandatory injunction will have the effect of virtually deciding the suit without a trial and that the plaintiff has not made out a prima facie case that the plaintiff would suffer irreparable damage, if any injunction is not granted or that the balance of convenience is in his favour. Sale deed in favour of the fourth respondent recites that the possession of that portion of the property which was the subject matter of the sale had been handed over to the purchaser and that purchaser can continue to be in possession without any let or hindrance by the vendees. That was the finding of the trial court and it was on that basis the injunction in a mandatory form was granted. We, therefore, hold that the purchasers have occupied the disputed portion and the ques tion, therefore, for consideration is whether the appellant is entitled to the injunction in a mandatory form directing the fourth respondent purchaser to vacate the premises. The principal dilemma about the grant of interlocutory injunctions, whether prohibitory or manda tory, is that there is by definition a risk that the court may make the 'wrong ' decision, in the sense of granting an injunction to a party who fails to establish his right at the trial (or would fail if there was a trial) or alterna tively, in failing to grant an injunction to a party who succeeds (or would succeed) at trial. Again at page 781 the learned Judge observed: "The question of substance is whether the granting of the injunction would carry that higher risk of injustice which is normally associated with the grant of a mandatory injunc tion. If it appears to the court that, excep tionally, the case is one in which withholding a mandatory interlocutory injunction would be in fact carry a greater risk of. para 948 it is stated: "A mandatory injunction can be granted on an interlocutory application as well as at the hearing, but, in the absence of special circumstances, it will not normally be granted. However, if the case is clear and one which the court thinks ought to be decided at once, or if the act done is a simple and summary one which can be easily remedied, or if the defendant attempts to steel a march on the plaintiff, such as where, on receipt of notice that an injunction is about to be applied for, the defendant hurries on the work in respect of which complaint is made so that when he receives notice of an interim injunction it is completed, a mandatory injunction will be granted on an interlocutory applications. " In one of the earliest cases in Rasul Karim & Anr. Subramania Chetty, ILR 191841 Mad. 436, it was held that the High Court was competent to issue an interim injunction in a mandatory form. It was further held in this case that in granting an interim injunction what the Court had to determine was whether there was a fair and substantial question to be decided as to what the rights of the parties were and whether the nature and difficulty of the questions was such that it was proper that the injunc tion should be granted until the time for deciding them should arrive. 428 a Division Bench was of the view that if the mandatory injunction is granted at all on an interlocutory application it is granted only to restore the status quo and not granted to establish a new state of things differing from the state which existed at the date when the suit was instituted. In considering the question of interim mandatory injunction in a suit filed under section 44 of the Act the Court has also to keep in mind the restriction on the rights of the trans feree to joint possession under that section. Where one of two or more co owners of immoveable property legally competent in that behalf transfers his share of such property or any interest therein, the trans feree acquires, as to such share or interest, and so far as is necessary to give effect to the transfer, the transfer or 's right to joint possession or other common or part enjoyment of the property, and to enforce a partition of the same, but subject to the conditions and liability affecting, at the date of the transfer, the share or interest so trans ferred. Where the transferee of a share of a dwelling house belong ing to an undivided family is not a member of the family, nothing in this section shall be deemed. In order to attract the second paragraph of this section the 345 subject matter of the transfer has to be a dwelling house belonging to an undivided family and the transfer is a share in the same to a person who is not a member of the family. Therefore, in order to satisfy the first ingredient of clear existence of the right and its infringement, the plaintiff will have to show a probable case that the suit property is a dwelling house and it belonged to an undivided family. On the second and third ingredients having regard to the restriction on the rights of a trans feree for joint possession and the dominant purpose of the second paragraph of section 44 of the Act, there is danger of an injury or violation of the corresponding rights of the other members of the family and an irreparable harm to the plaintiff and the Court 's interference is necessary to protect the interest of the plaintiff. Since the relief of an interim injunction is all the same an equitable relief the Court shall also consider whether the comparative mis chief or inconvenience which is likely to issue from with holding the injunction will be greater than that which is likely to arise from granting it, which means that the balance of convenience is in favour of the plaintiff. The first point that has to be considered, therefore, is whether one can have a reasonably certain view at this stage before the actual trial that the suit property is a 'dwell ing house belonging to an undivided family ' within the meaning of section 44 of the Act. That section provides that where a share of a dwelling house belonging to an undivided family has been transferred to a person who is not a member of such family and such transferee sues for partition, the Court shall, if any member of the family, being a share holder shall undertake to buy the share of such transferee make a valuation of such share in such manner as it thinks fit and direct the ' sale of such share to such shareholder. The argument was that the words 'undivided family ' as used in the section mean a joint family and are confined to Hindus or to Muhammadans, who have adopted the Hindu rule as to joint family property. The words 'undivided family ' as used in this section appear to be borrowed from section 44 of the Transfer of Property Act. The last clause of that section prescribes that where the transferee of a share of a dwell ing house belonging to an undivided family is not a member of the family, nothing in this section shall be deemed to entitle him to joint possession or other common or part enjoyment of the dwelling house. This provision of the Statute is clearly of general application, and the effect of it is to compel the transferee of a dwelling house belonging to an undivided family, who is a stranger to the family, to enforce his rights in regard to such share by partition. There appears to me to be no reason why the words 'undivided family ' as used in section 4 of the Partition Act, should have a narrator meaning than they have in section 44 of the Transfer of Property Act. With reference to the object and purpose of such a provision the Full Bench further observed: "as was pointed out by Mr. Wells, Judicial Commissioner, in the case of Kalka Parshad vs Bankey Lall, [1906] 9 Oudh Cases, 158 is to prevent a transferee of a member of a family who is an outsider from forcing his way into a dwell ing house in which other members of his transferor 's family have a right to live, and that the words 'undivided family ' must be taken to mean 'undivided qua the dwelling house in question, and to be a family which owns the house but has not divided it '. " The learned Judge applied the principle enunciated in Sultan Begam vs Debi Prasad, (supra) to this family and held that it was an undivided family since the house had not been divided by metes and bounds among themselves. After referring to the judgments we have quoted above and following the principles therein, Ranganath Misra, J. as he then was held: "If in this state of things, a member of the family trans fers his share in the dwelling house to a stranger paragraph 2 of section 44 of the Transfer of Property Act comes into play and the transferee does not become entitled to joint possession or any joint enjoyment of the dwelling house although he would have the right to enforce a partition of his share. The object of the provision in section 44 is to prevent the 348 intrusion of the strangers into the family residence which is allowed to be possessed and enjoyed by the members of the family alone in spite of the transfer of a share therein in favour of a stranger. Once it is held that the plaintiff is entitled to protection under the second part of section 44 of the Transfer of Property Act and the stranger purchas ers are liable to be restrained, it would follow that even if the defendants have been put in possession or have come jointly to possess they can be kept out by injunction. It is not disputed that prior to 1951 the suit dwelling house belonged to the undivided family of the appellant and his father and they were owning the same as joint tenants. In the view of the High Court this conversion of joint tenancy of an undivided family into a tenancy in common of the members of that undivided family amounts to a division in the family itself with reference to the property and that, therefore, there shall be deemed to have been a partition between the appellant and his father. We are afraid that some notions of co parcenary property of a Hindu joint family have been brought in which may not be quite accurate in considering section 44; but what is relevant for the purpose of these proceedings was whether the selling house belonged to an undivided family. We have already pointed out that even if the family is divided in status in the sense that they were holding the property as tenants in common but undivided qua the property that is the property had not been divided by metes and bounds it would be within the provisions section 44 of the Act. We had also noticed earlier that Cawasji, the father of the appellant transferred his undivided half share in the suit property in favour of his son Sohrab under a deed dated 16 4 1982. The transfer by the father in favour of Sohrab was a transfer in favour of a member of a family as Sohrab was living with them. In the absence of a document evidencing partition of the suit house by metes and bounds and on the documentary evidence showing that the property is held by the appellant and his brother in equal undivided shares, we are of the view that the plaintiff appellant has shown a prima facie case that the dwelling house belonged to an undivided family consist ing of himself and his brother. The two brothers, therefore, shall be deemed to be holding the property as members of an undivided family and in the absence of the partition by metes and bounds qua this property they shall be deemed to have been holding the dwelling house as an undivided family. While section 44 does not give a transferee of a dwelling house belonging to an undivided family a right to joint possession and confer a corresponding right on the other members of the family to deny the right to joint possession to a stranger transferee, section 4 of the Partition Act gives a right to a member of the family who has not transferred his share to purchase the transferee 's share on a value to be fixed in accordance with law when the transferee filed a suit for partition. Both these are valuable rights to the members of the undivided family whatever may be the object or purpose for which they were conferred on such members. As we have pointed out in some cases it is stated that the right to joint possession is denied to a transferee in order to prevent a transferee who is an outsider from forcing his way into a dwelling house in which the other members of his transferee 's family have a right to live. In some other cases giving joint possession was considered to be illegal and the only right of the stranger purchaser is to sue for partition. 351 Mr. Sorabjee the learned counsel for the appellant brought to our notice a number of circumstances which go to show that the fourth respondent was fully aware of the limited and restrictive title of respondents 1, 2 and 3 and the bar for joint possession provided in the second para graph of section 44 of the Transfer of Property Act and having purchased with such full knowledge tried to over reach the Court by keeping the whole transaction secret and taking possession of the property purchased before the appellant could get legal redress from the Court. Clause 6 of the agreement also specifically provided that: "In case pending the completion of this sale any suit be filed by the said co owner Dorab or other person against the Vendors, or any one or more of them, and an injunction (not being an ad interim injunction) is obtained restraining the Vendors from selling or disposing of the said property, then the Vendors shall have the option to keep this sale in abeyance or to cancel and rescind this agreement. This provision in the agreement clearly show that the fourth respondent knew that respondents 1 to 3 have only a limited right to transfer their undivided one half share to a stranger purchaser and they contemplated litigation in this regard. These facts in our view clearly establish that not only a refusal to grant an interim mandatory injunction will do irreparable injury to the appellant but also balance of convenience is in favour of the appellant fox, the grant of such injunction. In the result we allow the appeal, set aside the judgment of the High Court and restore that of the trial court with costs in this appeal.
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The person appealing the case (called the appellant) owned the property in question along with his father and mother. They were all joint owners. After the appellant's mother died, he and his father made an agreement in 1951. It stated they would own the property as "tenants in common," meaning they each owned a share separately. In 1952, the appellant's father gave his half of the property to another son, Sohrab. So, the appellant and Sohrab each owned half of the property as tenants in common. They sold it to the fourth respondent and his wife. He used a law called Section 44 of the Transfer of Property Act. He argued that the property was a family home that hadn't been formally divided. Because the fourth respondent was not part of the family, he shouldn't have the right to live there or use the property with the family based on buying half the share. The appellant also requested an order from the court. He wanted to stop respondents 1, 2, and 3 from giving up control of the property. He claimed he would suffer serious harm if this wasn't granted, and that fairness was on his side. But when they tried to enforce it, they learned the fourth respondent had already moved in. The respondents fought back against the lawsuit and the request for an order. They said the appellant and respondents 1, 2, and 3 owned equal shares. But they claimed the property wasn't a joint family property and it had already been divided for how it was used. Sohrab's family had been using the ground floor and a garage. They said the fourth respondent had already taken control of that part of the property. They also argued that they would suffer serious harm if the order was granted, and that fairness was not on the appellant's side. The trial court decided that the property was a family home that hadn't been formally divided. It said the appellant and his family, and the family of respondents 1, 2, and 3, were joint and undivided as far as the property was concerned. The court said this situation fell under Section 44 of the Transfer of Property Act. It said the fourth respondent and his wife, as outsiders, didn't have the right to live in the house. Since the fourth respondent claimed he had already moved in, the court ordered him, his workers, and his agents to stop living in or using the property. This is called a mandatory injunction. It appeared there had been a split in their status, so it couldn't be said there was no division between them. Granting the order would basically decide the case without a trial. The court also said the appellant hadn't shown he would suffer serious harm if the order wasn't granted, or that fairness was on his side. Because of this, the High Court allowed the appeal and canceled the order. Before the Supreme Court, the appellant argued that the fourth respondent knew that respondents 1, 2, and 3 had limited rights. He also knew about the restriction on joint possession in Section 44 of the Transfer of Property Act. He still bought the property secretly and moved in before the appellant could get help from the court. The Supreme Court allowed the appeal and made the following points: (1) Courts can grant temporary mandatory orders in some special situations. But because granting or denying such an order can cause serious harm to one side, courts have developed guidelines. (3) Generally, the guidelines are: (1) The person asking for the order has a strong case. (3) Fairness favors the person asking for the order. (4) Because it's based on fairness, granting or denying a temporary mandatory order is up to the court's judgment, based on the facts of each case. (5) When considering this type of order in a case under Section 44, the court must remember the restrictions on a buyer's rights to joint possession under that law. (6) To be covered by Section 44, the property must be a family home that hasn't been formally divided. (8) Even if the family is divided in the sense that they own the property as tenants in common, if the property hasn't been physically divided, Section 44 still applies. (9) Because there was no document showing the house was formally divided and documents showed the appellant and his brother owned equal shares, the appellant showed a good case that the house belonged to an undivided family. (10) The agreement to sell shows the fourth respondent knew respondents 1 to 3 had limited rights to sell their share to an outsider. They expected a lawsuit about this.
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Ms. Priyanka Chowdhury …for the Appellants.
Mr. Kunal Vajani ……. For the respondent no. 1.
1. This intra-court appeal by the Chief Election
Commissioner and Others is filed challenging
the order of the learned Single Judge
interfering with the “noting of defects” on the
writ petitioner’s nomination for the election
notified by the Election Commission of India
on 02.03.2021 to the Constituent Assembly
in the State of West Bengal in terms of the
provision of the Representation of the People
Act, 1951; hereinafter, “RP Act”, for short.
2. The appeal is founded fundamentally on the
plea that the order of the learned Single
Judge was issued on the face of the bar to
interference by courts in electoral matters
imposed under Article 329(b) of the
Constitution of India. It is also the plea that
the order impugned in this appeal was issued
without notice to the statutory authorities
under the RP Act, including the Returning
3. Supporting the appeal, learned Senior
Counsel Rakesh Divedhi made reference to
the decision of the Hon’ble Supreme Court of
India in Mohinder Singh Gill and another vs.
others (1978) 1 SCC 405 and Election
Commission of India Vs. Ashok Kumar &
others, (2000) 8 SCC 216 = AIR 2000 SC
2977. Specific reference was made to
paragraphs 28 and 30 of the judgment in
Election Commission of India Vs. Ashok Kumar
as reported in AIR.
4. Per contra, learned Senior Advocate Kapil
Sibal supporting the impugned judgment
argued that, seeking judicial review in
relation to the defects noted regarding
nomination and the resultant decision will
not have the effect of interrupting,
obstructing or protracting the election
proceedings in any manner when such
question is raised before the time fixed for
withdrawal of the nominations; and thus,
judicial review is available. Reference was
also made to the material papers of the writ
petition to demonstrate that there was no
defect of a substantial nature or otherwise in
the nomination submitted by the writ
petitioner.
5. Examining Section 36(4) and Section
100(1)(c) of the RP Act, we note that scrutiny
of nomination papers is a stage in the
election process and the result of such
scrutiny would be available for adjudication
in terms of Section 100(1)(c) of the RP Act
which makes improper rejection of
nomination as a ground to declare the
election to be void; while clause 4 of Section
36 which relates to scrutiny of nomination
provides that the Returning Officer shall not
reject any nomination paper on the ground of
any defect which is not of a “substantial
character”. Trying to draw a line between the
phrase ‘improperly rejected’ in Section
100(1)(c) of the RP Act and the rejection of
nomination paper on the ground of any defect
which is not of a “substantial character” as
occurring in Section 36(4) of the RP Act, it
would be so thin that it always swings in
favour of having that issue open for
consideration in the Election Petition. This is
also because, any rejection of the nomination
paper by the returning officer on the ground
of any defect and the question whether such
defect is of a ‘substantial character’ or not, as
well as the question whether such rejection
amounts to improper rejection for the
purpose of Section 100(1)(c) of the RP Act are
essentially mixed questions of facts and law.
In the trial of Election Petition in terms of
Chapter III in Part VI of the RP Act, such
issue could be gone into comprehensively.
Such questions are not to be decided by the
writ court merely as if it is a jurisdictional
issue or an issue of law only.
6. Relying on the decision of the Hon’ble
Supreme Court of India referred in N.P.
Constituency, Namakkal, Salem Dist. & others
reported as AIR 1952 SC 64, Their Lordships
of the Apex Court, in Manda Jaganath Vs.
K.S. Rathnam and others reported in (2004) 7
SCC 492, held that the possible erroneous
actions of Returning Officer which could be
considered as amenable to correction in the
writ jurisdiction are only such errors which
would have the effect of interfering in the free
flow of the scheduled election or hinder the
progress of the election. It was held that if by
an erroneous order, conduct of the election is
not hindered, then the courts under Article
226 of the Constitution should not interfere
with the orders of the Returning Officer,
remedy for which lies in an Election Petition
only. The paramount consideration is and
ought to be the progress of the election.
7. For the aforesaid reasons, this appeal
succeeds. It is accordingly allowed and the
order of the learned Single Judge is set aside.
The prayer for stay made by learned counsel
appearing for the respondent no. 1 is considered and
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A group of judges at the Calcutta High Court has ruled that courts can only review mistakes made by an election official, called a Returning Officer, if those mistakes actually get in the way of the election process running smoothly. This review is done using a special court power called "writ jurisdiction."
The judges, including Chief Justice Thottathil B. Radhakrishnan and Justice Aniruddha Roy, explained that courts should only use this special power to correct errors if those errors truly stop or slow down the planned election.
The judges also referred to an earlier decision by the Supreme Court. They stated that if an election official's mistake does not stop the election from going forward, then courts should not step in. Instead, any complaints about such mistakes should only be made through a formal legal challenge called an "Election Petition" after the election.
Background
In this particular case, the group of judges was reviewing an appeal from the Chief Election Commissioner. The Commissioner was challenging a previous decision by a single High Court judge. That judge's decision was accused of meddling with how flaws were marked on a candidate's application (nomination paper) for the upcoming Bengal elections.
The main reason for the appeal was that a special court request, or writ petition, should not be allowed in election matters. This is because a part of the Constitution (Article 329(b)) says that challenges to elections for national or state lawmakers can only be made through an "election petition."
The Election Commission also argued that the challenged decision was made without telling the official election bodies, like the Returning Officer, who are responsible under the election law (Representation of Peoples Act).
Findings
The Court observed that the decision being challenged was made when the candidate's application papers were still being checked.
It noted that Section 36 of the election law (RP Act) explains how election applications are reviewed. This section allows the Returning Officer to look at these papers and deal with any complaints about them.
A specific part of that section (Sub-clause 4) warns that the Returning Officer should not reject an application just because of a small, unimportant mistake.
The Court further clarified that the outcome of this checking of papers can only be challenged in court later, according to Section 100 (1)(c) of the RP Act. This section says that if an application was "improperly rejected," it can be a reason to cancel the election.
Given these laws, the judges felt that it is very difficult to tell the difference between an application that was "improperly rejected" (under Section 100(1)(c) of the RP Act) and one rejected for a minor, "not substantial" flaw (under Section 36(4) of the RP Act). Because the difference is so small, these issues should always be decided during an Election Petition after the election.
The court explained that this is because deciding if an election official's rejection of an application was valid, and whether the mistake was truly important, are complicated questions. These questions involve both the actual events that happened and legal interpretations.
Case Title: Chief Election Commissioner & Ors. v. Ujjwal Kumar & Anr.
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Appeal No. 611 of 1962. Appeal by special leave from the judgment and decree dated February 11, 1959. of the Patna High Court in Appeal from Original Decree No. 525 of 1951. Bishan Narain. D. R. Prem. B. R. G. K. Achar and R. N. Sachthey, for the appellant. A. V. Viswanatha Sastri and K. K. Sinha, for respondents Nos. 1 to 5. The Judgment of the Court was delivered by Raghubar Dayal J. Bilas Rai Bohra, son of Bansidhar Bohra and Sree Ram Bohra, son of Ganpat Ram Bohra, sued the Union of India for the recovery of Rs. 13,448 from the defendant for 831 compensation on account of loss and damage suffered by the plaintiffs owing to non delivery of II bales of cloth which had been consigned on October 20, 194 8 by M/s Ram Kishan Das Sagarmal of Bombay to the plaintiffs under the description of M/s Banshidhar Ganpat Rai. It was alleged in para 1 of the plaint that the plaintiffs carried on business in cloth and other articles in the name and style of M/s Bansidhar Ganpat Rai which was their joint family trading firm governed by the Mitakshara School of Hindu Law of which joint family the plaintiffs were the kartas and representatives and that they sued as such. This statement in para 1 of the plaint was not admitted in the written statement. The trial Court decreed the suit on August 29, 1951. The decree, inter alia, said : "It is ordered that the suit be decreed with costs defendants do pay to the plaintiffs the sum of Rs. 13,448 with interest thereon." The Union of India appealed to the High Court of Patna and prayed for the setting aside of the decree and for the dismissal of the suit with costs. The plaintiffs respondents were served with notice of the appeal. Subsequently Bilas Rai Bohra died on July 24, 1957. On September 5, 1958, the Union of India presented an application for substitution under 0. 22, r. 4 read with 0. 22, r. 1 1, C.P.C. for setting aside the abatement and condonation of delay. It was stated in the application that the applicant 's advocate came to know of the death of Bilas Rai Bohra, plaintiff No. 1, on May 14, 1958 when the case was on the daily list with a note to that effect, that he promptly communicated the fact to the railway authorities but due to the mistake of the Attacher, proper steps for substitution could not be taken in time. It was further stated that after a good deal of enquiry and efforts for three days the date of the death of Bilas Rai Bohra and the names and addresses of his heirs and legal representatives could be ascertained. A prayer was made for substituting the heirs of Bilas Rai Bohra, they being his sons, a widow and a daughter. Their names were mentioned in the application. This application was opposed on behalf of the heirs of Bilas Rai Bohra. It was mentioned therein that on September 27, 1957, an application for substitution of the heirs of Bilas Rai Bohra was made in another appeal in which the Union of India was a respondent and that therefore the Union of India and its Advocate were aware of the death of Bilas Rai Bohra and of the names of his heirs. 832 On December 1, 1958, the High Court dismissed the applica tion for the setting aside of the abatement of the appeal against Bilas Rai Bohra and for the substitution of the heirs as it was of opinion that there had been gross negligence on the part of the appellant, the Union of India, as its counsel had information about the death of Bilas Rai Bohra at least on May 16, 1958. The High Court did not feel satisfied on the facts of the case that any ground had been made out for setting aside the abatement of the appeal. It may be mentioned here that it was not urged in the High Court that there had been no abatement of the appeal against the heirs and legal representatives of Bilas Rai Bohra. It could not have been urged when the Union of India itself had applied for the setting aside of the abatement and the substitution of the heirs and legal representatives of Bilas Rai Bohra. The appeal of the Union of India against the surviving respondent, viz., Sree Ram Bohra, came up for hearing on February II, 1959, when a preliminary objection was raised on behalf of the respondent to the effect that the appeal had abated entirely as it had abated against the heirs of plaintiff respondent No. 1. It was contended for the Union of India that the two plaintiffs, viz., Bilas Rai Bohra, deceased, and Sree Ram Bohra, had filed the suit as kartas of the joint family which was the owner of the firm of M/s Bansidhar Ganpat Rai and that after the death of one of the kartas the other plaintiff who was also described in the plaintiff 's suit as karta was competent to represent the family and so there could be no question of abatement of the entire appeal. Again, it was not contended that the appeal against the heirs of Bilas Rai Bohra had not abated. The High Court upheld the preliminary objection and held that the appeal had become incompetent and was liable to be dismissed. It was of opinion that even if it be taken that both th plaintiffs had filed the suit in their capacity as kartas of the same joint family, the joint family had gained by virtue of the appeal having abated against the heirs of Bilas Rai Bohra as the decree passed in favour of the joint family through the representation of Bilas Rai Bohra could not be set aside and in case the appeal was permitted to proceed against the joint family in the presence of the other karta Sree Ram Bohra, there might be occasion for the coming into existence of two inconsistent decrees. The High Court, accordingly, dismissed the appeal. It was against 83 3 this order that the Union of India obtained the certificate from the High Court under article 133 and then filed this appeal. The sole point for decision in the appeal then is whether the appeal of the Union of India before the High Court against the respondent Sree Ram Bohra, respondent No. 2, was competent after it had abated against respondent No. 1, Bilas Rai Bohra, on account of his heirs and legal representatives being not brought on the record. It has not been disputed for the appellant that in case it is held that the appeal had abated against the heirs and legal representatives of Bilas Rai Bohra, it became incompetent against the surviving respondent alone. The suit was filed by both the plaintiffs. Both were respondents in the appeal. The decree was a joint one, without any specification regarding the shares of each of the decree holders. The appeal must, therefore, become incompetent if it has abated against one of the respondents. What is really urged for the appellant is that there could be no abatement of the appeal on the death of Sree Ram Bohra and the omission to bring on record his heirs and representatives, as the real plaintiff was the joint family which owned the firm Bansidhar Ganpat Rai, the consignee of the bales which were not delivered and as the suit had been brought by the two named plaintiffs as the kartas of the joint family. It is said that on the death of one of the kartas, the other karta continued to represent the joint family, the real plaintiff respondent, and that therefore there could not be any abatement of the appeal. We do not consider the contention sound. We have not been referred to any text of Hindu Law or any decided case in support of the proposition that a joint Hindu family can have more than one karta. The very idea of there being two kartas of a joint Hindu family does not appear, prima facie, consistent with the concept of a karta. Their describing themselves as kartas of the joint Hindu family owning the firm and their suing as such cannot make them kartas of the joint Hindu family if the Hindu Law does not contemplate the existence of two kartas. In paragraph 236 of Mulla 's Hindu Law, XII Edition, is said "Property belonging to a joint family is ordinarily managed by the father or other senior member for the time being of the family. The manager of a joint family is called karta. 834 The father is in all cases naturally, and in the case of minor sons necessarily, the manager of the joint family property " The existence of two kartas cannot lead to the smooth management of the property of the joint Hindu family and the other affairs of the family in view of the powers which the karta of a joint Hindu family possesses under the Hindu Law, powers which are not restricted to only such powers which ordinarily the manager of property of certain persons who confer authority on him to manage the property possesses. The karta of the joint Hindu family is certainly the manager of the family property but undoubtedly possesses powers which the ordinary manager does not possess. The karta cannot therefore be just equated with the manager of property. Reference was made to the case reported as Bhagwan Dayal vs Mst. Reoti Devi(1). It was stated at p. 482 : "The legal position may be stated thus : Coparcenary is a creature of Hindu law and cannot be created by agreement of parties except in the case of reunion. It is a corporate body or a family unit. The law also recognizes a branch of the family as a subordinate corporate body. The said family unit, whether the larger one or the subordinate one, can acquire, hold and dispose of family property subject to the limitations laid down by law. Ordinarily the manager, or by consent, express or implied, of the members of the family, any other member or members can carry on business or acquire property. subject to the limitations laid down by the said law, for or on behalf of the family. " The fact that any other member or members other than the manager of the joint Hindu family, carry on business etc., on behalf of the family, does not mean that such members who act for the family do so as kartas of the family. In the absence of any text of Hindu law or of any previous decision that a joint Hindu family can have two kartas we are not prepared to express any definite opinion on the question whether there can be two kartas of a joint Hindu family and, if there can be two kartas, what would be the effect of the death of one of them on the maintainability of a suit brought by both of them. (1) ; 835 Two persons may look after the affairs of a joint Hindu family on the basis of the members of the joint Hindu family clothing them with authority to represent the family. They would be two persons entitled to represent the family and their power to represent would depend on the terms of the authority conferred on them by the members of the joint Hindu family. Their authority to act for the family is not derived under any principle of Hindu law, but is based on the members of the joint Hindu family conferring certain authority on them. It cannot, therefore, be said that when two such representatives of a joint Hindu family sue and obtain a decree in their favour for the benefit of the joint Hindu family, and an appeal is filed against both of them as respondents representing the joint Hindu family, the other representative would continue to represent the joint family on the death of one of the representatives. He could not possibly do so when the authority given by the joint Hindu family be to the effect that both of them were to act jointly. In the absence of any knowledge about the terms of authority of the two representatives, it is not possible to urge successfully that on the death of one of the representatives, the other representative still continued to represent the joint Hindu family. On the death of one of the representatives, the karta of the family, in accordance with the principles of Hindu law, will automatically be the person entitled to represent the joint Hindu family till such time that the family again decides to confer the authority on specified members of the joint Hindu family to represent it. There is no material on the record to indicate the terms and scope of the authority conferred on the two plaintiffs by the joint Hindu family. We, therefore, consider the matter in appeal on the basis that the suit was brought by two persons as plaintiffs. They can at best be taken to represent the joint Hindu family which owned that firm Bansidhar Ganpat Rai. Any one of them cannot represent the joint family after the death of the other till his authority to represent the family is confirmed by the members of the family. There is no allegation or proof about such confirmation or fresh vesting of authority in the second plaintiff, viz., Sree Ram Bohra. For the purpose of the suit, there were two plaintiffs and on the death of one of them it was necessary for the opposite party to implead his heirs and legal representatives within time. It failed to do so and therefore the appeal against those heirs and representatives of Bilas Rai Bohra was rightly held to have abated. The result of such abatement makes this appeal against the other respondent incompetent as the decree against both the respon 836 dents viz., Bilas Rai Bohra and Sree Ram Bohra was a joint decree. There was nothing in the decree to indicate for whose benefit it was passed or in what proportions the two decree holders were to get the decretal amount. The appeal against Sree Ram Bohra was therefore incompetent. This view is supported by the decision of this Court in The State of Punjab vs Nathu Ram(1). It was held there that when the decree in favour of the respondents is joint and indivisible, the appeal against the respondents other than the deceased respondent cannot be proceeded with if the appeal against the deceased respondent has abated. We are, therefore, of opinion that the High Court was right in holding that the appeal against Sree Ram Bohra alone became incompetent. It has been further argued for the appellant that the High Court should have allowed the appellant 's application for setting aside the abatement. The High Court exercised its discretion judiciously, after taking into consideration the facts urged in support of the prayer that the abatement of the appeal be set aside. We do not find any reason to consider that the discretion was not properly exercised. We, therefore, do not consider this a fit case to interfere with the discretion exercised by the High Court in this regard. We, therefore, dismiss the appeal with costs. Appeal dismissed.
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The person answering the suit and someone named B sued and won a court order for money from the person appealing. The person appealing took the case to a higher court. B then died. The higher court refused to cancel the ending of the appeal against B. It also would not allow someone else to take B's place because the court thought the person appealing had been very careless. When the higher court heard the appeal, the person answering the suit said the whole appeal was over because of B's death. The higher court agreed. The person appealing then took the case to a higher court, saying that the appeal should not be over. They argued that the person answering the suit and B were both heads of a family business. When one head died, the other head still represented the business, which was the real person answering the suit. HELD: The appeal against the person answering the suit was not valid. When two family business leaders sued and won a court order for the benefit of the family business, and an appeal was filed against both of them as those representing the family business, the other leader would not continue to represent the family business when one of the leaders died. Any one of them could not represent the family business after the death of the other, until their right to represent the family was approved by the family members. The State of Punjab vs Nathu Ram was cited as a source.
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: Special Leave Petition (Criminal) No. 2076 of 1978. From the Judgment and Order dated 17 3 1978 of the Punjab and Haryana High Court in Criminal Revision No. 181/77) R.L. Kohli, S.K. Sabharwal and Subhash Chander for the Petitioner. 46 R.N. Sachthey for Respondent No. 1. Prem Malhotra for Respondent No. 2. The Order of the Court was delivered by KRISHNA IYER, J. What constrains us to explain at some length our reasons for rejection of leave to appeal in this case is the desideratum that every executive challenge to justice in action is a call to the court to strengthen public confidence by infusing functional freshness into the relevant law sufficient to overpower the apprehended evil. The house of the petitioner is said to have been burgled and he alleges that he lost many valuables. The police, on information being laid, searched and recovered the property. Eventually, charges were framed by the trial court against one Hussan Lal, a jeweller, and one Madan Lal, an alleged collaborator (respondents Nos. 2 and 3 in this petition) under section 411 I.P.C. and one Ashok Kumar under section 380, I.P.C. During the pendency of the criminal case, the Assistant Public Prosecutor applied for withdrawal from prosecution under section 321, Cr. P.C. on the ground that on fresh investigation by a senior officer the alleged search and seizure were discovered to be a frame up by the concerned police officer in order to pressurise the accused Hussan Lal to withdraw a certain civil litigation. On the court requiring a fuller application the Assistant Public Prosecutor made a fresh and more detailed petition for withdrawal which was eventually granted by the trial court, despite the petitioner 's remonstrance that the withdrawal was prompted by the political influence wielded by Hussan Lal leading to instructions from high quarters to the Assistant Public Prosecutor to withdraw from the case concerning that accused. It was alleged that in carrying out the instructions the Assistant Public Prosecutor did not apply an independent mind. The court nevertheless accepted the request of the Assistant Public Prosecutor and directed acquittal of Hussan Lal, while continuing the case against the remaining two accused. The order was unsuccessfully assailed in revision before the High Court by the petitioner. Undaunted by that dismissal, he has moved this court under article 136 of the Constitution. In view of the startling disclosures on either side we have listened at some length to the oral submissions in supplementation of the affidavits in the record. The three focal points of arguments are whether (i) a case which pends in court can be subject to a second police investigation without the judge even knowing about it, (ii) political considerations of the Executive vitiate the motion for withdrawal of pending proceeding, and (iii) the District Magistrate 's order to withdraw from a case communicated to the Public Prosecutor and carried out by him, is compliance with section 494. 47 When a crime is committed in this country, the assessment of guilt and the award of punishment or, alternatively, the discharge or acquittal of the accused are part of the criminal justice process administered by the courts of the land. It is not the function of the executive to administer criminal justice and in our system, judges are not fungible, as Justice Dougles in Chandler,(1) asserted: Judges are not fungible; they cover the constitutional spectrum; and a particular judge 's emphasis may make a world of difference when it comes to rulings on evidence. the temper of the courtroom, the tolerance for a proffered defense, and the like. Lawyers recognize this when they, talk about 'shopping ' for a judge; Senators recognize this when they are asked to give their 'advice and consent ' to judicial appointments; laymen recognize this when they appraise the quality and image of the judiciary in their own community. " When a case is pending in a criminal court its procedure and progress are governed by the Criminal Procedure Code or other relevant statute To intercept and recall an enquiry or trial in a court, save in the manner and to the extent provided for in the law, is itself a violation of the law. Whatever needs to be done must be done in accordance with the law. The function of administering justice, under our constitutional order, belongs to those entrusted with judicial power. One of the few exceptions to the uninterrupted flow of the court 's process is section 321, Cr. But even here it is the Public Prosecutor, and not any executive authority, who is entrusted by the Code with the power to withdraw from a prosecution, and that also with the consent of the court. We repeat for emphasis. To interdict, intercept or jettison an enquiry or trial in a court, save in the manner and to the extent provided for in the Code itself, is lawlessness. The even course of criminal justice cannot be thwarted by the Executive, however high the accused, however sure Government feels a case is false, however unpalatable the continuance of the prosecution to the powers that be who wish to scuttle court justice because of hubris, affection or other noble or ignoble consideration. Justicing, under our constitutional order, belongs to the judges. Among the very few exceptions to this uninterrupted flow of the court process is section 494, Cr. Even here, the Public Prosecutor not any executive authority is entrusted by the Code with a limited power to withdraw from a prosecution, with the (1) Chandler vs Judicial Council of the Tenth Circuit of the U.S. , 1970. 48 court 's consent whereupon the case comes to a close. What the law has ignited, the law alone shall extinguish. Although skeletal, the conditions for such withdrawal are implicit in the provision, besides the general principles which have been evolved through precedents. Once a prosecution is launched, its relentless course cannot be halted except on sound considerations germane to public justice. All public power is a public trust, and the Public Prosecutor cannot act save in discharge of that public trust, a public trust geared to public justice. The consent of the court under section 321 as a condition for withdrawal is imposed as a check on the exercise. of that power. Consent will be given only if public justice in the larger sense is promoted rather than subverted by such withdrawal. That is the essence of the nolle prosequi jurisprudence. We wish to stress, since impermissible influences occasionally infiltrate into this forbidden ground, that court justice is out of bounds for masters and minions elsewhere. We do not truncate the amplitude of the public policy behind section 494 Cr. P.C. but warn off tempting, adulteration of this policy, taking the public prosecutor for granted. Maybe, the executive, for plural concerns and diverse reasons, may rightfully desire a criminal case to be scotched. The fact that broader considerations of public peace, larger considerations of public justice and even deeper considerations of promotion of long lasting security in a locality, of order in a disorderly situation or harmony in a factious milieu, or halting a false and vexatious prosecution in a court, persuades the Executive, pro bono pulico, sacrifice a pending case for a wider benefit, is not ruled out although the power must be sparingly exercised and the statutory agency to be satisfied is the public prosecutor, not the District Magistrate or Minister. The concurrence of the court is necessary. The subsequent discovery of a hoax behind the prosecution or false basis for the criminal proceeding as is alleged in this case, may well be a relevant ground for withdrawal. For the court should not be misused to continue a case conclusively proved to be a counterfeit. This statement of the law is not exhaustive but is enough for the present purpose and, indeed, is well grounded on precedents. The promotion of law and order is an aspect of public justice. Grounds of public policy may call for withdrawal of the prosecution. A prosecution discovered to be false and vexatious cannot be allowed to proceed. The grounds cover a large canvas. But the power must be cautiously exercised, and the statutory agency to be satisfied is the Public Prosecutor in the first instance, not the District Magistrate or other executive authority. Finally, the consent of the court is impera 49 tive. The law was explained by this Court in M. N. Sankaranarayana Nair vs P. V. Bala Krishina & Ors.(1) "A reading of Sec. 494 would show that it is the public prosecutor who is in charge of the case that must ask for permission of the Court to withdraw from the prosecution of any person either generally or in respect of one or more of the offences for which he is tried. This permission can be sought by him at any stage either during the enquiry or after committal or even before the judgment is pronounced. The section does not, however, indicate the reasons which should weigh with the Public Prosecutor to move the Court for permission nor the grounds on which the Court will grant or refuse permission. Though the Section is in general terms and does not circumscribe the powers of the Public Prosecutor to seek permission to withdraw from the prosecution the essential consideration which is implicit in the grant of the power is that it should be in the interest of administration of justice which may be either that it will not be able to produce sufficient information before prosecuting agency would falsify the prosecution evidence or any other similar circumstances which it is difficult to predicate as they are dependent entirely on the facts and circumstances of each case. Nonetheless it is the duty of the Court also to see in furtherance of justice that the permission is not sought on grounds extraneous to the interest of justice or that offences which are offences against the State go unpunished merely because the Government as a matter of general policy or expediency unconnected with its duty to prosecutor offenders under the law directs the Public Prosecutor to withdraw from the prosecution and the Public Prosecutor merely does so at its behest. " The position was confirmed in Bansi Lal vs Chandan Lal(2) and Balwant Singh & Ors. vs Bihar(3). The law is thus well settled and its application is all that calls for caution. In the special situation of this case, two principles must be hammered home. The decision to withdraw must be of the Public Prosecutor, not of other authorities, even of those whose displeasure may affect his continuance in office. (1) ; (2) A.I.R. 1976 S.C. 370. (3) ; 50 The court is monitor, not servitor, and must check to see if the essentials of the law are not breached, without, of course, crippling or usurping the power of the public prosecutor. The two matters which are significant are (a) whether the considerations are germane, and (b) whether the actual decision was made or only obeyed by the Public Prosecutor. In the setting of the present facts, the enquiry must be whether the considerations on which withdrawal was sought by the Assistant Public Prosecutor were germane and pertinent, and whether the actual decision to withdraw was made by the Assistant Public Prosecutor or was the result of blind compliance with executive authority. If it appears from the material before the Court that germane or relevant considerations did not prompt the motion for withdrawal but it was the pressure of political influence, the Court will withhold its consent. The functionary clothed by the Code with the power to withdraw from the prosecution is the Public Prosecutor. The Public Prosecutor is not the executive, nor a flunkey of political power. Invested by the statute with a discretion to withdraw or not to withdraw, it is for him to apply an independent mind and exercise his discretion. In doing so, he acts as a limb of the judicative process, not as an extension of the executive. In the present case, it appears that when the court commenced proceedings, the accused Hussan Lal complained to higher police officers that the concerned Assistant Sub Inspector had initiated the case merely for the purpose of putting pressure on him to compromise a suit against a close relative. The allegations were enquired into by a senior officer and the District Magistrate, on the basis of the material coming to light, directed disciplinary action against the Assistant Sub Inspector and instructed the Assistant Public Prosecutor to withdraw from the case against Hussan Lal. We find no evidence to support the allegations of political influence. At the same time, it is necessary to point out that the District Magistrate acted illegally in directing the Assistant Public Prosecutor to withdraw. It has been alleged that the second investigation of the case on the executive side, which led to the discovery that the earlier investigation was motivated, was vitiated by the omission to question the first informant. That was a matter for the Assistant Public Prosecutor to consider when deciding whether or not to withdraw from the prosecution. On the principal question arising in this case, the record shows that the Public Prosecutor applied his mind to the disclosures emerging from the second enquiry, and he found that "even the recovery wit 51 nesses Sarvashri Mato Ram and Phool Singh did not support that they had witnessed the recovery or any disclosure statement was made in their presence by Madan Lal accused. " He found that Phool Singh at the relevant time was bed ridden and had since expired. He also discovered that Mato Ram had stated that nothing had happened in his presence but his signatures were obtained by the Investigating Officer. It is abundantly clear that the Assistant Public Prosecutor made an independent decision on the material before him and did not act in blind compliance with the instructions of the District Magistrate. We cannot dispose of this petition without drawing attention to the very disturbing presence of the District Magistrate in the withdrawal proceedings. The jurisprudence of genuflexion is alien to our system and the law expects every repository of power to do his duty by the Constitution and the laws, regardless of commands, directives, threats and temptations. The Code is the master for the criminal process. Any authority who coerces or orders or pressurises a functionary like a public prosecutor, in the exclusive province of his discretion violates the rule of law and any public prosecutor who bends before such command betrays the authority of his office. May be, Government or the District Magistrate will consider that a prosecution or class of prosecutions deserves to be withdrawn on grounds of policy or reasons of public interest relevant to law and justice in their larger connotation and request the public prosecutor to consider whether the case or cases may not be withdrawn. Thereupon, the Prosecutor will give due weight to the material placed, the policy behind the recommendation and the responsbile position of Government which, in the last analysis, has to maintain public order and promote public justice. But the decision to withdraw must be his. The District Magistrate who is an Executive Officer is not the Public Prosecutor and cannot dictate to him either. Maybe, the officer had not apprised himself of the autonomous position of the Public Prosecutor or of the impropriety of his intrusion into the Public Prosecutor 's discretion by making an order of withdrawal. Similar mistakes are becoming commoner at various levels and that is why we have had to make the position of law perfectly clear. We emphasise that the rule of law warns off the executive authorities from the justicing process in the matter of withdrawal of cases. Since we are satisfied that the Public Prosecutor did not yield to the directive of the District Magistrate but made an independent study of informing himself of the materials placed before the court and then sought permission to withdraw from the prosecution, we decline to reverse the order passed by the courts below. 52 This trial court was satisfied that the Assistant Public Prosecutor had not exercised the power of withdrawal for any illegitimate purpose and the High Court endorsed that conclusion. We are not disposed to interfere with the order of the High Court. One obvious grievance of the petitioner deserves to be remedied. He is interested in getting back his stolen goods. The accused claims no property in the goods. In the event of the complainant identifying them as his property, the trial court will consider passing appropriate orders for their return to him. Surely, criminal justice has many dimensions beyond conviction and sentence, acquittal and innocence. The victim is not to be forgotten but must be restored to the extent possible. The petition is rejected. N.K.A. Petition dismissed.
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The person making the complaint said his house was broken into and many valuable things were stolen. The police found the stolen items. Later, the trial court charged two more people who were said to have helped. While the criminal case was going on, the Assistant Public Prosecutor (a lawyer for the government) asked to stop the prosecution (case) under section 321 of the Criminal Procedure Code (a set of laws for criminal cases). He said that a senior officer did a new investigation and found out that the police officer in charge had made up the search and seizure. The Assistant Public Prosecutor gave a new, more detailed request to withdraw the case. The trial court allowed it, even though the person who made the complaint protested. He said that a jeweler had political power and influenced people in high positions to tell the Assistant Public Prosecutor to drop the case against that accused person. It was claimed that the Assistant Public Prosecutor didn't think for himself when he followed these instructions. However, the trial court agreed to the Assistant Public Prosecutor's request and acquitted (found not guilty) the jeweler. The case continued against the other two accused people. The person who made the complaint tried to challenge this decision in the High Court (a higher court), but he was not successful. He then appealed to the Supreme Court (the highest court) under Article 136 of the Constitution (the set of laws for the country). He argued that: (i) a case in court cannot be investigated again by the police without the judge knowing, (ii) political reasons from the government should not affect the decision to withdraw a case, and (iii) the District Magistrate's order to withdraw the case, which was given to the Public Prosecutor and followed by him, is the same as following section 494 (another section of the Criminal Procedure Code). The Court said: When a crime happens, deciding if someone is guilty and giving punishment, or releasing or acquitting the accused person, is part of the criminal justice system handled by the courts. It is not the government's job to handle criminal justice. In our system, judges are not interchangeable. When a case is in a criminal court, the Criminal Procedure Code or other relevant laws control how it proceeds. To stop or change an investigation or trial in a court, except in the way and to the extent allowed by the law, is breaking the law. Whatever needs to be done must follow the law. Administering (handling) justice, according to our Constitution, belongs to those with judicial power (judges). One of the few exceptions to the normal court process is section 321 of the Criminal Procedure Code. But even here, the Public Prosecutor, not any government authority, is allowed by the Code to withdraw from a prosecution, and only with the court's permission. To interfere with or stop an investigation or trial in a court, except as allowed by the Code itself, is against the law. The criminal justice system cannot be stopped by the government, no matter how important the accused person is, how sure the government is that the case is false, or how much the powerful people want to stop the prosecution because of pride, affection, or other reasons. One of the very few exceptions to the normal court process is section 494 of the Criminal Procedure Code. Even here, the Public Prosecutor is given a limited power by the Code to withdraw from a prosecution with the court's permission, which ends the case. What the law has started, only the law can end. Promoting law and order is part of public justice. A prosecution found to be false and annoying cannot be allowed to continue. The Public Prosecutor, not the District Magistrate or other government authority, must be convinced first. It was claimed that the second investigation of the case by the government, which led to finding out that the first investigation was biased, was flawed because the person who first reported the crime was not questioned. That was something for the Assistant Public Prosecutor to consider when deciding whether to withdraw from the prosecution or not. It is clear that the Assistant Public Prosecutor made his own decision based on the information he had and did not blindly follow the District Magistrate's instructions. The rule of law prevents government authorities from interfering with the justice process when it comes to withdrawing cases. Because the courts were satisfied that the Public Prosecutor did not give in to the District Magistrate's order but made his own study of the information and then asked for permission to withdraw from the prosecution, the Supreme Court refused to change the lower courts' decision. Sankaranarayana Nair vs P.V. Bala Krishna & Ors. ; Bansi Lal vs Chandan Lal, AIR 1976 SC 370: Balwant Singh & Ors. vs Bihar, ; , affirmed. (These are references to other similar cases that support the court's decision.)
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Civil Appeal No. 1716 of 1969. Appeal by special leave from the award dated the 31st March, 1969 of the Labour Court, Kolhapur, Maharashtra in Reference (IDA) No. f 1968. B. Sen and I. N. Shroff, for the appellant. R. K. Garg, section C. Agarwal and V. J. Francis, for the respondent. The Judgment of the Court was delivered by GOSWAMI, J. The important question which has been pinpointed hl this appeal by special leave is whether when a domestic inquiry held by an employer is found by the labour court as violative of the principles of natural justice there is any duty cast upon that court to give an opportunity to the employer to adduce evidence afresh before it and whether to do so would vitiate its award. 362 In the present case the workman concerned was charged under the standing orders of the company for soliciting or collecting from the employees contributions for some purpose (allegedly purchase of microphone and loud speaker arrangements) within the factory premises. The workman denied the charge of soliciting or collecting contribution within the factory premises (for purchase of microphone and loudspeaker) but added that for this purpose I collect the said contribution outside the gate of the Company and this being so, such erroneous information supplied to you by someone should not be considered acceptable". After holding the domestic inquiry in which some witnesses were examined by the employer and cross examined by the workman and questioning the workman at the outset as well as at the end of the inquiry, the Enquiry Officer Submitted very brief report to the Works Manager (hereinafter the Manager) holding that the charges were established. He did not give any detailed reasons for preferring the evidence of the six witnesses examined on behalf of the employer in the inquiry to the version of the workman. The Manager after perusal of the report of the Enquiry officer passed the order of dismissal without adverting to the evidence in the inquiry. This was particularly necessary since the Enquiry Officer had not given his reasons for his finding. Another incident occurred during the inquiry before the Manager. The workman after answering the first question of the Manager. when another question was put, abruptly left the inquiry without paying any heed to the orders of the Manager and to persuasion of other officer resent asking him to wait. In this appeal we will proceed on the assumption that the domestic inquiry was rightly found by the labour court to be defective. The labour court is aware of the legal position that it was competent in this case to take evidence of the parties and come to its own conclusion on the merits of the case and to decide whether the order of dismissal was justified or not to enable it to consider about the relief, if any, to he awarded to the workman. The labour court, however, observed in its award that in the instant case no evidence regarding merits is led by the opponent before this Court. It is open to the Labour Court to hold an enquiry itself. The natural result of vitiating the enquiry would therefore be to set aside the order of dismissal and to direct the reinstatement in service of the dismissed employee with all back wages". The question posed at the commencement of our judgment is thus highlighted by the aforesaid observations of the labour court and we are required to consider whether after the labour court comes to a decision about the inquiry being defective it has any duty to announce its decision in that behalf to enable the employer an opportunity to adduce evidence before it to justify the order on the charge levelled against a workman. no doubt that when the employer chooses to do so the workman will have his opportunity to rebut such evidence. There is also no doubt, whatsoever, that if the employer declines to avail of such an opportunity, it will be open to the labour court to make an appropriate award and the employer will thereafter be able to make no grievance on that score. In dealing with a case of dismissal of an industrial employee, this Court has time and again adverted to various principles and it is not necessary to recount all those decisions. Inter alia, the question that arose in that appeal was as to whether, since the management held no inquiry as required by the standing orders, it could not justify the discharge before the Tribunal. In Motipur Sugar Factory 's case (supra), the Court observed at page 597 of the report as follows : "If it is held that in cases where the employer dismisses his employee without holding an enquiry, the dismissal must he set aside by the industrial tribunal only on that ground, it would inevitably mean that the employer will immediately proceed to hold the enquiry and pass an order dismissing the employee once again. In that case, another industrial dispute would arise and the employer would be entitled to rely. This course would mean delay and on the second occasion it will entitle the employer to claim the benefit of the domestic enquiry given. On the other hand, if in such cases the employer is given an opportunity to justify the impugned dismissal on the merits of his case being considered by the tribunal for itself and that clearly would be to the benefit of the employee. That is why this Court has consistently held that if the domestic enquiry is irregular, invalid or improper, the tribunal may give an opportunity to the employer to prove his case and in doing so the tribunal tries the merits itself. This view is consistent with the approach which industrial adjudication generally adopts with a view to do justice between the parties without relying too much on technical considerations and with the object of avoiding delay in the disposal of industrial disputes". The consequence that can ensue from a contrary view, as noticed by the, Court in Motipur Sugar Factory 's case (supra), will appear from what took place in the Management of Northern Railway. Cooperative Society Ltd. vs Industrial Tribunal, Rajasthan, Jaipur and Anr. (2) where pursuant to the award after reinstating the employee the management (1) ; (2) ; 364 drew a fresh proceeding and passed a fresh order of removal and the A said order was again the subject matter of another reference to the industrial tribunal. The pertinent question that arises for consideration is whether it is the duty of the tribunal to make known its decision to the parties on this jurisdictional aspect of the case so that the employer can avail of the opportunity to justify the dismissal based on the charge. In Management of Ritz Theatre (P) Ltd. vs Its workmen (1), this Court was required to deal with rather ingenious argument. It was contended in that case by the workmen, in support of the tribunal 's decision, that since the management at the very commencement of the trial before the Tribunal adduced evidence with regard to the merits of the case it should be held that it had given up its claim to the propriety or validity of the domestic enquiry. While repelling this argument this court made some significant observations: "In enquiries of this kind, the first question which the Tribunal has to consider is whether a proper enquiry has been held or not. Logically, it is only where the Tribunal is satisfied that a proper enquiry has not been held or that the enquiry having been held properly the finding recorded at such an enquiry are perverse, that the Tribunal derives jurisdiction to deal with the merits of the dispute. Ir the view taken by Tribunal was held to be correct, it would lead to this anamoly that the employer would be precluded from justifying the dismissal of his employee by leading additional evidence unless he takes the risk of inviting the Tribunal to deal with the merits for itself, because as soon as he asks for permission to lead additional evidence, it would follow that he gives up his stand based on the holding of the domestic enquiry. Other wise, it may have to be held that in all such cases no evidence should be led on the merits unless the issue about the enquiry is tried as a preliminary issue. If the finding on that preliminary issue is in favour of the employer, then, no additional evidence need be cited by the employer; if the finding on the said issue is against hm, permission will have to be given to the employer to cite additional evidence". Although this Court in Ritz Theatre 's case (supra) observed that such a procedure may be "elaborate and somewhat cumbersome" it was not held to be illegal nor had if been rejected out of hand In State Bank of India vs R. K. Jain & ors. (2), this Court had to deal with a similar question. The contention on behalf of the management in that case was that "Even assuming that the domestic inquiry conducted by the Bank was in any manner vitiated, the Industrial Tribunal (1) [1963] 3 S.C.R.461, 469 470. (2) [1972] I S.C.R. 365 erred in law in not giving an opportunity to the management to adduce evidence before it to establish the validity of the order of discharge". In dealing with the above contention this Court observed as follows: "If the management defend its action solely on the basis that the domestic inquiry held by it is proper and valid and if Tribunal holds against the management on that point, the management will fail. It is essentially a matter for the management to decide about the stand that it proposes to take before the Tribunal. It may be emphasised, that it is the right of the management to sustain its order by adducing also . It is a right given to the management and it is for the management to avail it self of the said opportunity". On the facts of that case this Court held that the management, having made it clear to the Tribunal that it was resting its case solely on the domestic enquiry, had no right to make a grievance that it should have been given an opportunity to adduce evidence on facts before the Tribunal in justification of its order. This Court further observed in that case that "no such opportunity was asked for by the appellant nor even availed of". This Court in that case took into account management 's consistent stand throughout before Tribunal as also that it made no grievance on the score of non availability of opportunity to adduce evidence even in the special leave petition. The claim of the Bank in that case was rejected on the peculiar facts found by this Court. Referring to the State Bank 's case (supra) in Delhi Cloth & General Mills Co. vs Ludh Budh Singh(l), this Court observed that "the grievance of the management before this Court that the Tribunal should have given such an opportunity Suo moto was not accepted in the circumstances of that case". There was a further observation in the Delhi Cloth & General Mills ' case (supra) to the following effect: "It may be pointed out that the Delhi and Madhya Pradesh High Courts had held that it is the duty of the Tribunal to decide, in the first instance, the propriety of the domestic enquiry held by the management and if it records, a finding against the management, it should suo moto provide an opportunity to the management to adduce additional evidence though the management had made no such request. This view was held to be erroneous by this Court, in State Bank of India vs R. K. Jain & others" (supra). CI/75 366 We may now refer to the propositions (4), (5) and (6) in the A Delhi Cloth and General Mills ' case (supra): (4) "When a domestic enquiry has been held by the management and the management relies on the same, it is open to the latter to request the Tribunal to try the validity of r the domestic enquiry as a preliminary issue and also ask for an opportunity to adduce evidence before the Tribunal, if the finding on the preliminary issue is against the management. However elaborate and cumbersome the procedure may be, under such circumstances, it is open to the Tribunal to deal, in the first instance, as a preliminary issue the validity of the s domestic enquiry. If its finding on the preliminary issue is in favour of the management, then no additional evidence need be cited by the management But, if the finding on the preliminary issue is against the management, the Tribunal will have to give the employer an opportunity to cite additional evidence and also give a similar opportunity to the employee to lead evidence contra, as the request to adduce evidence had been made by the management to the Tribunal during the course of the proceedings and before the trial has come to an end . " (5) "The management has got a right to attempt to sustain its order by adducing independent evidence before the Tribunal. But the management should avail itself of the . If no such opportunity has been availed of, or asked for by the management, before the proceedings are closed, the employer can make no grievance that the Tribunal did not provide such an opportunity. The Tribunal will have before it only the enquiry proceedings and it has to decide whether the proceedings have been held properly and the findings recorded therein are also proper". (6) "If the employer relies only on the domestic enquiry and does not simultaneously lead additional evidence or ask for an opportunity during pendency of the proceedings to adduce such evidence, the duty of the Tribunal is only to consider the validity of the domestic enquiry as well as the finding recorded therein and decide the matter. If the Tribunal decodes that the domestic enquiry has not been held properly, it is not its function to invite suo moto the employer to adduce evidence before it to justify the action taken by it". In the Delhi Cloth and General Mills ' case (supra) dealing with the case of the management 's application to adduce evidence after close of arguments, although on the same day after the Court reserved judgment, this Court observed as follows: "The appellant did not ask for an opportunity to adduce evidence when the proceeding were pending nor did it avail itself of the right given to it in law to adduce evidence before he Tribunal during the pendency of the proceedings". For our purpose we will extract from that decision only propositions 4, 6, 7 and 8: (4) "Even if no enquiry has been held by an employer or if the enquiry held by him is found to be defective, the, Tribunal in order to satisfy itself about the legality and validity of the order, has to give an opportunity to the employer and employee to adduce evidence before it. It is open to the employer to adduce evidence for the first time justifying his action". (6) "The Tribunal gets jurisdiction to consider the evidence placed before it for the first time in justification of the action taken only, if no enquiry has been held or after the enquiry conducted by an employer is found to be defective". (7) "It has never been recognised that the Tribunal should straightway, without anything more, direct reinstatement of a dismissed or discharged employee, once it is found that no domestic enquiry has been held or the said enquiry is found to be defective". (8) "An employer, who wants to avail himself of the opportunity of adducing evidence for the first time before the Tribunal to justify his action, should ask for it at the appropriate stage. If such an opportunity is asked for, the Tribunal has no power to refuse. The giving of an opportunity to an employer to adduce evidence for the first time before the Tribunal is in the interest of both the management and the employee and to enable the Tribunal itself to be satisfied about the alleged misconduct". What is the appropriate stage was specifically adverted to in the Delhi Cloth & General Mills ' case (supra) which we are now required to seriously consider whether this conclusion is correct and ensures justice to all concerned in an industrial adjudicating. It is, however, fair and in accordance with the principles of natural justice for the labour court to withhold its decision on a jurisdictional point at the appropriate stage and visit a party with evil consequences of a default on its part in not asking the court to give an opportunity to adduce additional evidence at the commencement of the proceedings or at any rate, in advance of the pronouncement of the order in that behalf ? 368 dismissal and not merely whether a correct procedure had been followed by the management before passing the order of dismissal. Besides, even if the order of dismissal is set aside on the ground of defect of enquiry. Where will this lead to ? This is neither going to achieve the paramount object of the Act namely industrial peace, since the award in that case will not lead to a settlement of the dispute. be revived and industrial peace will again be ruptured. Again another object of expeditious disposal of an industrial dispute (sec section 15) will be clearly defeated resulting in duplication of proceedings. This position has to be avoided in the interest of labour as well as of the employer and in furtherance of the ultimate aim of the Act to foster industrial peace. We are, therefore, clearly of opinion that when a case of dismissal or discharge of an employee is referred for industrial adjudication the labour court should first decide as a preliminary issue whether the domestic enquiry has violated the principles of natural justice. When there is no domestic enquiry or defective enquiry is admitted by the employer, there will be no difficulty. But when the matter is in controversy between the parties that question must be decided as a preliminary issue. On that decision being pronounced it will be for the management to decide whether it will adduce any evidence before the labour court. If it chooses not to adduce any evidence, it will not be thereafter permissible in any proceeding to raise the issue. We should also make it clear that there will be no justification for any party to stall the final adjudication of the dispute by the labour court by questioning its decision with regard to the preliminary issue when the matter, if worthy, can be agitated even after the final award. We are making these observations in our anxiety that there is no undue delay in industrial adjudication. In the present case, however, besides the long delay that has already taken place, since the law laid down by this Court was not very clear at the time of the award in casting a duty upon the labour court to decide the preliminary issue and also in view of the submission of the appellant that it is prepared to pay the entire salary of the workman upto date it will meet the interest of justice if the order of reinstatement is converted to one of compensation in terms of his entire salary from the date of dismissal to the date of this decision except for what has already been paid to him instead of remitting the. matter to the labour court for disposal in the light of this judgment by setting aside the award. In the result the appeal is dismissed with the above modification of the relief There will be, however, no order as to cost. Appeal dismissed.
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If a company investigates an employee and the labor court (a court that deals with employment issues) finds the investigation unfair, does the court have to let the company present new evidence? And, if the court doesn't allow new evidence, does that ruin the court's decision? The court decided that when an employee's firing is being reviewed, the labor court should first decide if the company's investigation was fair. This is decided as an initial, separate issue. If there was no investigation, or the company admits it was flawed, there's no problem. But if the fairness of the investigation is disputed, that question must be decided first. After that decision, the company can decide if it wants to present evidence to the labor court. If the company chooses not to present evidence, it can't bring up the issue later in any other legal action. No one should delay the labor court's final decision by questioning its decision on the initial fairness issue. If there's a real problem, it can be argued even after the final ruling. It's okay for a higher court to refuse to get involved at this early stage. (Several legal cases are mentioned as references.)
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4. FSL Report not part of the Charge 18 - 21 1. The present Revision Petition has been filed, to set aside the order dated 05.05.2022, passed by the Learned Trial Court, North District, Rohini Courts, Delhi, wherein Default Bail of the Petitioner, under Section 167(2) Cr.P.C. was dismissed by the learned Trial 2. The brief facts leading to the present petition are as under: a) The Petitioner is in custody in case FIR no. 96/2021 under Sections 21 and 29 of the Narcotics Drugs and Psychotropic Substances Act, 1985 (hereinafter “NDPS Act”) registered at P.S. Narela Industrial Area. On completion of the investigation, the charge sheet was filed on 03.03.2021 without the Forensic Science Laboratory (FSL) report. The charge sheet already filed mentioned that the supplementary charge sheet would be filed on the receipt of the report from forensic laboratory. The Petitioner was arrested on 04.03.2021, wherein he was found in possession of 300 gms of Heroine and 06 gms of heroine was recovered from the co-accused. b) The Petitioner filed an application for bail in default under Section 167(2) of the Cr.P.C. before the learned Trial Court, claiming that the complete charge sheet was not filed within the stipulated time frame under Section 36A (4) of the NDPS Act. The learned Trial Court observed that the accused would not be entitled to Default Bail as the charge sheet has been filed even though the FSL Report is not filed. In furtherance, it was observed by the learned Trial Court that the quantity recovered from the Petition would fall under the bar of commercial quantity. Thus, the onus would be upon the Petitioner to satisfy the learned Trial Court. The observations made read as under:- “…The plea of default bail as the charge-sheet has been admittedly filed within a period of 180 days of the remand, but the same is without FSL result of the seized contraband. The said issue is already settled by Hon'ble Delhi High
Court in case titled Krishan Lal V. State, 39(1989) DLT 392 and MohdArbaz vs State Cr Rev no. 1219/2019 dated 03.11.2020. The said issue though is now pending qua NDPS Act cases before the Hon'ble Supreme Court and therefore, till that time, the proposition of law as laid by Hon'ble Delhi High Court in Krishan Lal (supra) case holds field. The amount of quantity recovered from the accused/applicant falls under the category of commercial quantity and bar under 37 of the NDPS Act is also applicable. Therefore, the onus is upon the applicant to satisfy the twin conditions imposed as mandated in judgment viz; Union of India through NCB Lucknow V. Nawaz Khan, The judgments relied upon by Ld. Counsel for the accused/applicant are not applicable to the present case being distinguishable on facts. In view of the above facts and circumstances of the case, I am of the considered view that no ground is made out for grant of bail to accused/applicant. Therefore, the application moved on behalf of the accused/applicant stands dismissed…” Submissions of Learned Counsels 3. It is stated by the learned Counsel for the petitioner that the charge sheet is incomplete without FSL Report, since the IO does not know whether the substance recovered is actually a banned substance under Sections 21 and 29 of the NDPS Act. 4. Ld. Counsel for the APP for State states that the question of whether the charge sheet is incomplete without FSL Report or not, is yet to be decided by the Hon’ble Supreme Court and therefore the reliance should be placed on the law presently laid down by the Division Bench of this Court in Kishan Lal vs State 1989 SCC OnLine Del 348 and the Coordinate Bench of this Court in Babu vs The State (Govt. Of NCT of Delhi) BAIL APPLN. 2075/2020 and Mohd. Arbaz vs State of NCT of Delhi CRL. REV. P. 1219/2019. The cases above mentioned have held that the FSL Report shall not
form part of the charge sheet and hence, the plea for grant of bail in default was dismissed. 5. The procedure for application of Default bail finds its roots in Section 167(2) of the Cr.P.C. It is imperative to understand the objective and relevance of the provision of Section 167 for adjudication of the issue in hand. It is trite law that Default Bail under Section 167 can only be availed before the filing of the charge sheet. The period for the calculation of the number of days of detention would commence from the date of remand of the accused and not from the date of arrest. (reference from Ravi Prakash Singh vs State of Bihar, (2015) 8 SCC 340). The period could be perused from the Custody Maximum Number of Days 6. It has been repeatedly emphasized by various courts that the right to seek default bail is an indefeasible right provided to the accused. The object of the Default Bail is inherently linked to Article 21 of the Constitution of India, laying emphasis on safeguarding the life and personal liberty of the accused against arbitrary detention. Section 167 states: - “…167. Procedure when investigation cannot be completed in twenty-four hours.— (1) Whenever any person is arrested and detained in custody, and it appears that the investigation cannot be completed within the period of twenty-four hours fixed by section 57, and there are grounds for believing that the accusation or information is wellfounded, the officer in charge of the police station or the police officer making the investigation, if he is not below the rank of sub-inspector, shall forthwith transmit to the nearest Judicial Magistrate a copy of the entries in the diary hereinafter prescribed relating to the case, and shall at the same time forward the accused to such Magistrate. (2) The Magistrate to whom an accused person is forwarded under this section may, whether he has or has not jurisdiction to try the case, from time to time, authorise the detention of the accused in such custody as such Magistrate thinks fit, for a term not exceeding fifteen days in the whole;
and if he has no jurisdiction to try the case or commit it for trial, and considers further detention unnecessary, he may order the accused to be forwarded to a Magistrate having such jurisdiction: Provided that— 1 [(a) the Magistrate may authorise the detention of the accused person, otherwise than in custody of the police, beyond the period of fifteen days, if he is satisfied that adequate grounds exist for doing so, but no Magistrate shall authorise the detention of the accused person in custody under this paragraph for a total period exceeding— (i) ninety days, where the investigation relates to an offence punishable with death, imprisonment for life or imprisonment for a term of not less than ten years; (ii) sixty days, where the investigation relates to any other offence, and, on the expiry of the said period of ninety days, or sixty days, as the case may be, the accused person shall be released on bail if he is prepared to and does furnish bail, and every person released on bail under this sub-section shall be deemed to be so released under the provisions of Chapter XXXIII for the purposes of that Chapter;] 2 [(b) no Magistrate shall authorise detention of the accused in custody of the police under this section unless the accused is produced before him in person for the first time and subsequently every time till the accused remains in the custody of the police, but the Magistrate may extend further detention in judicial custody on production of the accused either in person or through the medium of electronic video linkage;] (c) no Magistrate of the second class, not specially empowered in this behalf by the High Court, shall authorise detention in the custody [Explanation I.—For the avoidance of doubts, it is hereby declared that, notwithstanding the expiry of the period specified in paragraph (a), the accused shall be detained in custody so long as he does not furnish bail.] 4 [Explanation II.—If any question arises whether an accused person was produced before the Magistrate as required under clause
(b), the production of the accused person may be proved by his signature on the order authorising detention or by the order certified by the Magistrate as to production of the accused person through the medium of electronic video linkage, as the case may be.] 1 [Provided further that in case of a woman under eighteen years of age, the detention shall be authorised to be in the custody of a remand home or recognised social institution.] 2 [(2A) Notwithstanding anything contained in sub-section (1) or sub-section (2), the officer in charge of the police station or the police officer making the investigation, if he is not below the rank of a sub-inspector, may, where a Judicial Magistrate is not available, transmit to the nearest Executive Magistrate, on whom the powers of a Judicial Magistrate or Metropolitan Magistrate have been conferred, a copy of the entry in the diary hereinafter prescribed relating to the case, and shall, at the same time, forward the accused to such Executive Magistrate, and thereupon such Executive Magistrate, may, for reasons to be recorded in writing, authorise the detention of the accused person in such custody as he may think fit for a term not exceeding seven days in the aggregate; and, on the expiry of the period of detention so authorised, the accused person shall be released on bail except where an order for further detention of the accused person has been made by a Magistrate competent to make such order; and, where no order for such further detention is made, the period during which the accused person was detained in custody under the orders made by an Executive Magistrate under this sub-section, shall be taken into account in computing the period specified in paragraph (a) of the proviso to sub-section (2): Provided that before the expiry of the period aforesaid, the Executive Magistrate shall transmit to the nearest Judicial Magistrate the records of the case together with a copy of the entries in the diary relating to the case which was transmitted to him by the officer in charge of the police station or the police
officer making the investigation, as the case may be.] (3) A Magistrate authorising under this section detention in the custody of the police shall record his reasons for so doing. (4) Any Magistrate other than the Chief Judicial Magistrate making such order shall forward a copy of his order, with his reasons for making it, to the Chief Judicial Magistrate. (5) If in any case triable by a Magistrate as a summons-case, the investigation is not concluded within a period of six months from the date on which the accused was arrested, the Magistrate shall make an order stopping further investigation into the offence unless the officer making the investigation satisfies the Magistrate that for special reasons and in the interests of justice the continuation of the investigation beyond the period of six months is necessary. (6) Where any order stopping further investigation into an offence has been made under sub-section (5), the Sessions Judge may, if he is satisfied, on an application made to him or otherwise, that further investigation into the offence ought to be made, vacate the order made under sub-section (5) and direct further investigation to be made into the offence subject to such directions with regard to bail and other matters as he may specify…” 7. In Sanjay Dutt vs State through CBI, Bombay (II), (1994) 5 SCC 410, the Constitution Bench of the Hon’ble Supreme Court held that the indefeasible right of the accused to be released on bail for not filing the charge sheet within the statutory period is enforceable by the accused only till the filing of the challan. Further, if an accused does not avail Default Bail, they can always seek Regular Bail under Cr.P.C.. The observation reads as under :- “48. We have no doubt that the common stance before us of the nature of indefeasible right of the accused to be released on bail by virtue of Section 20(4)(bb) is based on a correct reading of the principle indicated in that decision. The indefeasible right accruing to the accused in such a situation
is enforceable only prior to the filing of the challan and it does not survive or remain enforceable on the challan being filed, if already not availed of. Once the challan has been filed, the question of grant of bail has to be considered and decided only with reference to the merits of the case under the provisions relating to grant of bail to an accused after the filing of the challan. The custody of the accused after the challan has been filed is not governed by Section 167 but different provisions of the Code of Criminal Procedure. If that right had accrued to the accused but it remained unenforced till the filing of the challan, then there is no question of its enforcement thereafter since it is extinguished the moment challan is filed because Section 167 CrPC ceases to apply. The Division Bench also indicated that if there be such an application of the accused for release on bail and also a prayer for extension of time to complete the investigation according to the proviso in Section 20(4)(bb), both of them should be considered together. It is obvious that no bail can be given even in such a case unless the prayer for extension of the period is rejected. In short, the grant of bail in such a situation is also subject to refusal of the prayer for extension of time, if such a prayer is made. If the accused applies for bail under this provision on expiry of the period of 180 days or the extended period, as the case may be, then he has to be released on bail forthwith. The accused, so released on bail may be arrested and committed to custody according to the provisions of the Code of Criminal Procedure. It is settled by Constitution Bench decisions that a petition seeking the writ of habeas corpus on the ground of absence of a valid order of remand or detention of the accused, has to be dismissed, if on the date of return of the rule, the custody or detention is on the basis of a valid order. (See Naranjan Singh Nathawan v. State of 656] ; Ram Narayan Singh v. State of Delhi [1953 SCR 652 :
AIR 1953 SC 277 : 1953 Cri LJ 1113] and A.K. Gopalan v. Government of India [(1966) 2 SCR 427 : AIR 1966 SC 816 8. In a recent judgement of the Hon’ble Supreme Court, M. Ravindran vs The Intelligence Officer, Directorate of Revenue Intelligence (2021) 2 SCC 485, the Three-Judge Bench looked into the trajectory of Section 167(2) and the relation of the provision within the Constitutional parlance. The Hon’ble Supreme Court made the following observations: - “… II. Section 167(2) and the Fundamental Right to Life and 17. Before we proceed to expand upon the parameters of the right to default bail under Section 167(2) as interpreted by various decisions of this Court, we find it pertinent to note the observations made by this Court in Uday Mohanlal Acharya [Uday Mohanlal Acharya v. State of Maharashtra, (2001) 5 SCC 453 : 2001 SCC (Cri) 760] on the fundamental right to personal liberty of the person and the effect of deprivation of the same as follows: (SCC p. 472, para 13) “13. … Personal liberty is one of the cherished objects of the Indian Constitution and deprivation of the same can only be in accordance with law and in conformity with the provisions thereof, as stipulated under Article 21 of the Constitution. When the law provides that the Magistrate could authorise the detention of the accused in custody up to a maximum period as indicated in the proviso to sub-section (2) of Section 167, any further detention beyond the period without filing of a challan by the investigating agency would be a subterfuge and would not be in accordance with law and in conformity with the provisions of the Criminal Procedure Code, and as such, could be violative of Article 21 of the 17.1. Article 21 of the Constitution of India provides that “no person shall be deprived of his life or personal liberty except according to procedure established by law”. It has
been settled by a Constitution Bench of this Court in Maneka Gandhi v. Union of India [Maneka Gandhi v. Union of India, (1978) 1 SCC 248] , that such a procedure cannot be arbitrary, unfair or unreasonable. The history of the enactment of Section 167(2) CrPC and the safeguard of “default bail” contained in the proviso thereto is intrinsically linked to Article 21 and is nothing but a legislative exposition of the constitutional safeguard that no person shall be detained except in accordance with rule of 17.2. Under Section 167 of the Code of Criminal Procedure, 1898 (“the 1898 Code”) which was in force prior to the enactment of the CrPC, the maximum period for which an accused could be remanded to custody, either police or judicial, was 15 days. However, since it was often unworkable to conclude complicated investigations within 15 days, a practice arose wherein investigating officers would file “preliminary charge-sheets” after the expiry of the remand period. The State would then request the Magistrate to postpone commencement of the trial and authorise further remand of the accused under Section 344 of the 1898 Code till the time the investigation was completed and the final charge-sheet was filed. The Law Commission of India in Report No. 14 on Reforms of the Judicial Administration (Vol. II, 1948, pp. 758-760) pointed out that in many cases the accused were languishing for several months in custody without any final report being filed before the courts. It was also pointed out that there was conflict in judicial opinion as to whether the Magistrate was bound to release the accused if the police report was not filed within 15 days. 17.3. Hence the Law Commission in Report No. 14 recommended the need for an appropriate provision specifically providing for continued remand after the expiry of 15 days, in a manner that “while meeting the needs of a full and proper investigation in cases of serious crime, will still safeguard the liberty of the person of the individual”. Further, that the legislature should prescribe a maximum
time period beyond which no accused could be detained without filing of the police report before the Magistrate. It was pointed out that in England, even a person accused of grave offences such as treason could not be indefinitely detained in prison till commencement of the trial. 17.4. The suggestion made in Report No. 14 was reiterated by the Law Commission in Report No. 41 on The Code of Criminal Procedure, 1898 (Vol. I, 1969, pp. 76-77). The Law Commission re-emphasised the need to guard against the misuse of Section 344 of the 1898 Code by filing “preliminary reports” for remanding the accused beyond the statutory period prescribed under Section 167. It was pointed out that this could lead to serious abuse wherein “the arrested person can in this manner be kept in custody indefinitely while the investigation can go on in a leisurely manner”. Hence the Commission recommended fixing of a maximum time-limit of 60 days for remand. The Commission considered the reservation expressed earlier in Report No. 37 that such an extension may result in the 60-day period becoming a matter of routine. However, faith was expressed that proper supervision by the superior courts would help circumvent the same. 17.5. The suggestions made in Report No. 41 were taken note of and incorporated by the Central Government while drafting the Code of Criminal Procedure Bill in 1970. Ultimately, the 1898 Code was replaced by the present CrPC. The Statement of Objects and Reasons of the CrPC provides that the Government took the following important considerations into account while evaluating the recommendations of the Law Commission: “3. The recommendations of the Commission were examined carefully by the Government, keeping in view, among others, the following basic considerations: (i) an accused person should get a fair trial in accordance with the accepted principles of natural justice; (ii) every effort should be made to avoid delay in investigation and trial which is harmful not only to the individuals involved but also to (iii) the procedure should not be complicated and should, to the utmost extent possible, ensure fair deal to the poorer sections of the
community.” 17.6. It was in this backdrop that Section 167(2) was enacted within the present day CrPC, providing for time-limits on the period of remand of the accused, proportionate to the seriousness of the offence committed, failing which the accused acquires the indefeasible right to bail. As is evident from the recommendations of the Law Commission mentioned supra, the intent of the legislature was to balance the need for sufficient time-limits to complete the investigation with the need to protect the civil liberties of the accused. Section 167(2) provides for a clear mandate that the investigative agency must collect the required evidence within the prescribed time period, failing which the accused can no longer be detained. This ensures that the investigating officers are compelled to act swiftly and efficiently without misusing the prospect of further remand. This also ensures that the court takes cognizance of the case without any undue delay from the date of giving information of the offence, so that society at large does not lose faith and develop cynicism towards the criminal justice system. 17.7. Therefore, as mentioned supra, Section 167(2) is integrally linked to the constitutional commitment under Article 21 promising protection of life and personal liberty against unlawful and arbitrary detention, and must be interpreted in a manner which serves this purpose. In this regard we find it useful to refer to the decision of the three- Judge Bench of this Court in Rakesh Kumar Paul v. State of Assam [Rakesh Kumar Paul v. State of Assam, (2017) 15 SCC 67 : (2018) 1 SCC (Cri) 401] , which laid down certain seminal principles as to the interpretation of Section 167(2) CrPC though the questions of law involved were somewhat different from the present case. The questions before the three-Judge Bench in Rakesh Kumar Paul [Rakesh Kumar Paul v. State of Assam, (2017) 15 SCC 67 : (2018) 1 SCC (Cri) 401] were whether, firstly, the 90-day remand
extension under Section 167(2)(a)(i) would be applicable in respect of offences where the maximum period of imprisonment was 10 years, though the minimum period was less than 10 years. Secondly, whether the application for bail filed by the accused could be construed as an application for default bail, even though the expiry of the statutory period under Section 167(2) had not been specifically pleaded as a ground for bail. The majority opinion held that the 90-day limit is only available in respect of offences where a minimum ten year' imprisonment period is stipulated, and that the oral arguments for default bail made by the counsel for the accused before the High Court would suffice in lieu of a written application. This was based on the reasoning that the court should not be too technical in matters of personal liberty. Madan B. Lokur, J. in his majority opinion, pertinently observed as follows: (SCC pp. 95-96 & 99, paras “29. Notwithstanding this, the basic legislative intent of completing investigations within twenty-four hours and also within an otherwise time-bound period remains unchanged, even though that period has been extended over the years. This is an indication that in addition to giving adequate time to complete investigations, the legislature has also and always put a premium on personal liberty and has always felt that it would be unfair to an accused to remain in custody for a prolonged or indefinite period. It is for this reason and also to hold the investigating agency accountable that time-limits have been laid down by the legislature. … prolonged period have prompted the legislature for more than a century to ensure expeditious conclusion of investigations so that an accused person is not unnecessarily deprived of his or her personal liberty by remaining in prolonged custody for an offence that he or she might not even have committed. In our opinion, the entire debate before us must also be looked at from the point of view of expeditious conclusion of investigations and from the angle of personal liberty and not from a purely dictionary or textual perspective as canvassed by the learned
counsel for the State. 41. We take this view keeping in mind that in matters of personal liberty and Article 21 of the Constitution, it is not always advisable to be formalistic or technical. The history of the personal liberty jurisprudence of this Court and other constitutional courts includes petitions for a writ of habeas corpus and for other writs being entertained even on the basis of a letter addressed to the Chief Justice or the Court.” (emphasis supplied) Therefore, the courts cannot adopt a rigid or formalistic approach whilst considering any issue that touches upon the rights contained in Article 21. 17.8. We may also refer with benefit to the recent judgment of this Court in S. Kasi v. State [S. Kasi v. State, (2021) 12 SCC 1 : 2020 SCC OnLine SC 529] , wherein it was observed that the indefeasible right to default bail under Section 167(2) is an integral part of the right to personal liberty under Article 21, and the said right to bail cannot be suspended even during a pandemic situation as is prevailing currently. It was emphasised that the right of the accused to be set at liberty takes precedence over the right of the State to carry on the investigation and submit a charge-sheet. 17.9. Additionally, it is well-settled that in case of any ambiguity in the construction of a penal statute, the courts must favour the interpretation which leans towards protecting the rights of the accused, given the ubiquitous power disparity between the individual accused and the State machinery. This is applicable not only in the case of substantive penal statutes but also in the case of procedures providing for the curtailment of the liberty of the accused. 17.10. With respect to the CrPC particularly, the Statement of Objects and Reasons (supra) is an important aid of construction. Section 167(2) has to be interpreted keeping in mind the threefold objectives expressed by the legislature, namely, ensuring a fair trial, expeditious investigation and trial, and setting down a rationalised procedure that protects
the interests of indigent sections of society. These objects are nothing but subsets of the overarching fundamental right guaranteed under Article 21. 17.11. Hence, it is from the perspective of upholding the fundamental right to life and personal liberty under Article 21 that we shall clarify and reconcile the various judicial interpretations of Section 167(2) for the purpose of resolving the dilemma that has arisen in the present case.” 9. In the present case, the charge sheet was filed on 03.03.2021, however, without the FSL report. The charge sheet was thus filed within the limitation period prescribed under law. The question in dispute narrows down as to whether the FSL report forms part of the charge sheet and is an essential prerequisite to file with the charge sheet. FSL Report not part of the Charge Sheet 10. In Kishan Lal vs State 1989 SCC OnLine Del 348, a Division Bench of this Court observed that a police report does not need to enclose an expert opinion of Government Scientific expert with the charge sheet and thus, no bail was granted under Section 167(2) as the charge sheet was already filed within stipulated time. The observation reads as follows:- “… 5. The question raised by the petitioners in a nut shell is whether the investigation of a case under the NDPS Act can be said to be complete in the absence of the report of the Scientific Officer and Chemical Examiner? The contention is that where the accused person is allegedly found in possession of or transporting a prohibited drug or substance, mainly two facts have to be established by the prosecution viz., (1) that of recovery of the commodity or substance and (2) that the possession of the said recovered material is illegal under the provisions of the NDPS Act. It is submitted that the Investigating Officer would be unable to give his opinion regarding the second aspect till he obtains the report of the expert and, therefore, the report submitted by the Investigating Officer even if purported to be under Section 173(2) of the Code, must be held, to be based on in complete investigation.
6. The learned Single Judge in his reference order has noticed that the reported cases in which this question has been settled related to offences under the Penal Code, 1860. It was urged before him that the principles enunciated in those cases are not applicable to cases involving an offence under the NDPS Act or the old Opium Act or the Excise Act. To appreciate the contentions raised in these petitions, we have to notice the case law to some extent to highlight the settled principles. 7. It has been held by the Supreme Court that although the police are not permitted to send an incomplete report under Section 173(2) of the Code, yet the investigation except for the report of an expert like the Serologist or Scientific Officer and Chemical Examiner is complete and, therefore, the Magistrate is empowered to take cognizance of the offence on a police report which does not include the expert's opinion. In Tara Singh v. State, AIR 1951 SC 441, (1) the Polka had infact filed a report dated the 2nd October, 1949 terming it as an “incomplete challan”, and on the 5th October they filed a report which they called a “complete challan”. Thereafter on the 19th October they filed yet another report which was termed as “supplementary challan”. The objection taken at the trial was that the Magistrate had no power to take cognizance of the case on 3rd October when the incomplete challan dated 2nd October, 1949 was placed before him. It was contended that the Police are not permitted to file an incomplete report under Section 173(2) of the Code.” 11. Further in view of the decision of Kishan Lal vs State (supra), a Coordinate Bench of this Court in a recent judgement of Babu vs The State (Govt. Of NCT of Delhi) BAIL APPLN. 2075/2020 dated 25.09.2020, observed as under: - “…18. Though this Court is of the view that the decision of the Division Bench of the Punjab and Haryana High Court is an appropriate opinion in relation to cognizance of an
offence under NDPS Act without the FSL report being an illegality, however, bound by the Division Bench decision of this Court, judicial discipline mandates this Court to follow the same. Consequently, in view of the decision of the Division Bench of this Court in Kishan Lal vs. State (supra), it is held that the petitioner is not entitled to grant of bail under Section 167(2) CrPC for non-filing of the FSL report along with the charge sheet…” 12. A similar view was followed by the Coordinate Bench of this Court in Mohd. Arbaz vs State of NCT of Delhi CRL. REV. P. 1219/2019 on 03.11.2020, wherein it was observed that the accused should not be entitled to bail in default as the charge sheet was already filed. The Court held that the report shall not form part of the charge sheet and hence, the bail under Section 167(2) was rejected. An appeal against the said judgement is pending before the Hon'ble Supreme Court in Mohd. Arbaz vs State of NCT of Delhi SLP(Crl.) Nos. 8164-8166/2021. The observation of the Hon’ble High Court “…24. This Court concurs with the view expressed by the Coordinate Bench of this Court in Babu (supra). Thus, the view expressed by the Division Bench of Punjab and Haryana High Court in Ajit Singh @Jeeta(supra) and the view expressed by the Bombay High Court in Sunil VasantraoPhulbande(supra),convinced this Court that the view of the Division Bench in Kishan Lal (supra) is binding. 25. In view of the above, the petitioners’ contention that the report submitted on 27.05.2019 could not be construed as a report under Section 173(2) of the Cr.PC must be rejected. The first question is, thus, answered in the negative…” 13. At present, the settled law persists in the view that non filing of FSL Report with the charge sheet does not fall within the realms of
Section 173(2) of the Cr.P.C so as to consider it as “incomplete report”. In the present case although FSL Report has not been filed, however, the charge sheet was already filed on 03.03.2021 within the time period as per law. Further, the amount of quantity recovered from the accused is of commercial nature baring the accused from bail under Section 37 of the NDPS Act. 14. In view of the above, the court finds no infirmity in the impugned order dated 05.05.2022. The application moved by the petitioners seeking bail in default under the provisions of Section 167(2) of the Cr.P.C. is dismissed.
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The Delhi High Court stated that the main purpose of "default bail" is closely tied to Article 21 of India's Constitution. This part of the Constitution protects a person's life and personal freedom, making sure they aren't held in jail unfairly.
Justice Swarana Kanta Sharma made this point while rejecting an appeal. The appeal was filed by someone accused in a drug case under the Narcotics Drugs and Psychotropic Substances Act, 1985 (NDPS Act). This person was challenging a lower court's decision that denied him default bail.
The accused person (called the "Petitioner") was in jail because of a police report filed under sections 21 and 29 of the NDPS Act. After the police finished their investigation, they filed a formal accusation document, called a "chargesheet," on March 3, 2021. However, this chargesheet did not include the report from the forensic science lab (FSL).
The chargesheet stated that another, additional chargesheet would be filed once the forensic lab report arrived. The Petitioner himself was arrested on March 4 of the previous year. He was caught with 300 grams of heroin, and an additional 6 grams of heroin was found with another person involved in the case.
The lower court had rejected the Petitioner's request for default bail. It did so because a chargesheet had been filed, even though the FSL report was missing. The court also noted that the amount of drugs found with the Petitioner was considered a "commercial quantity." This amount carries stricter penalties and makes it harder to get bail.
The High Court believed that default bail, which is allowed under section 167 of the CrPC (Code of Criminal Procedure), can only be used *before* the police file a chargesheet. It also stated that the count for how long a person has been held starts from the day they are officially put into custody by a judge, not from the day they were first arrested.
The Court mentioned that many courts have often stressed that the right to "default bail" is a fundamental right for an accused person that cannot be taken away. The Court repeated that the main purpose of default bail is tied to Article 21 of India's Constitution. This article focuses on protecting a person's life and personal freedom from unfair imprisonment.
The Court also stated that simply not filing the FSL report along with the chargesheet doesn't mean the chargesheet itself is "incomplete" under section 173(2) of the CrPC.
The Court said that current established law holds that not having the FSL report doesn't automatically stop the legal process or grant default bail, as long as the chargesheet was filed on time. Moreover, the amount of drugs found with the accused person was a "commercial quantity." This type of quantity prevents the accused from getting bail under Section 37 of the NDPS Act.
Because the High Court found no fault with the lower court's decision, it rejected the Petitioner's appeal.
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1. Heard Sri Ravi Sahu, learned counsel for the revisionists as well as Sri Munne Lal, learned A.G.A. 2. This is a revision under Sections 397/401 CrPC filed by the revisionists herein, wherein challenge has been raised to the order dated 2.11.2020 passed by the Court of Sessions Judge, Mahoba in Sessions Trial No. 16 of 2019, I.A. No.01/2019, (State of U.P. Versus Khem Chandra @ Phullu & others), arising out of Case Crime no. 249 of 2018, under Sections 3. Learned counsel for the revisionist has argued that a FIR has been lodged on 16.11.2018 by O.P. no.2 / Complainant before P.S. Panwari, Mohaba, being FIR no. 0249 under Section 302 IPC, relatable to the commission of the offence on 14.11.2018 against the revisionist, who are two in number with an allegation that the brother of the complainant being Dharmendra Sen son of Lakhan Lal aged about 32 years was working under the revisionists herein, who happened to be the contractor. Certain dispute arose regarding payment of the remuneration, which occasioned in commission of alleged offence, pursuant whereto the dead body of the brother of the complainant was found. Learned counsel for the revisionists has drawn the attention towards Annexure-2 which happens to be post mortem report as well as statement of the complainant, which is at page-62 of the paper-book as well as of Smt. Poonam, wife of the deceased, so as to contend that the revisionists have been falsely implicated in the case in question. Learned counsel for the revisionists has further drawn the attention of this Court towards the fact that the police report, which is in the shape of final report has been submitted in favour of the revisionists, whereby their names have been expunged. However, according to the revisionist, an application under Section 319 CrPC has been filed for summoning of the revisionists, which even infact is nothing but the grossest misuse of the
process of the law at the behest of O.P. no.2/ complainant. Learned counsel for the revisionist in the confessional statement of one of the accused, though he was not named in the FIR against whom charge sheet has been submitted, linkage of the revisionists vis-a-vis commission of the crime does not surface at all. According to learned counsel for the revisionists the entire exercise so undertaken is illegal, revisionists have not committed the aforesaid offence, and even otherwise, the law laid down by the Hon'ble Apex Court in the case of Hardeep Puri as followed in subsequent judgment, has suitably mandated that while exercising the powers under Section 319 CrPC, there should be sufficient evidence that should be more than the prima facie in order to summon the so called accused and the said exercise cannot be taken in a routine, mechanical and light manner. 4. Sri Munne Lal, the learned A.G.A, on the other hand, argued that from the narration of the allegation contained in the FIR vis-a-vis, the statement of PW Nos. 1 Arvind Sen, 2-Smt. Poonam, and 3- Moorat Dhwaj, the name of the revisionists have been pin pointed and further there was sufficient evidence on record to exercise power under Section 319 CrPC and he has been rightly did so. 5. For the ready reference section 319 of the Cr.P.C. 1973 is quoted hereinunder. “319. Power to proceed against other persons appearing to be guilty of offence.— (1) Where, in the course of any inquiry into, or trial of, an offence, it appears from the evidence that any person not being the accused has committed any offence for which such person could be tried together with the accused, the Court may proceed against such person for the offence which he appears to have committed. (2) Where such person is not attending the Court, he may be arrested or summoned, as the circumstances of the case may require, for the purpose aforesaid. (3) Any person attending the Court, although not under arrest or upon a
summons, may be detained by such Court for the purpose of the inquiry into, or trial of, the offence which he appears to have committed. (4) Where the Court proceeds against any person under sub-section (1), (a) the proceedings in respect of such person shall be commenced afresh, and the witnesses re-heard; (b) subject to the provisions of clause (a), the case may proceed as if such person had been an accused person when the Court took cognizance of the offence upon which the inquiry or trial was commenced.” 6. The issue with respect to the scope and ambit of the powers so conferred upon the Magistrate u/s 319 Cr.P.C. 1973 is no more res integra as the Constitutional Bench of the Hon'ble Supreme Court in the case of Hardeep Singh Vs. State of Punjab reported in 2014 (3) SCC 92 has “8. The Constitutional mandate under Articles 20 and 21 of the Constitution of India, 1950 (hereinafter referred to as the ‘Constitution’) provides a protective umbrella for the smooth administration of justice making adequate provisions to ensure a fair and efficacious trial so that the accused does not get prejudiced after the law has been put into motion to try him for the offence but at the same time also gives equal protection to victims and to the society at large to ensure that the guilty does not get away from the clutches of law. For the empowerment of the courts to ensure that the criminal administration of justice works properly, the law was appropriately codified and modified by the legislature under the Cr.P.C. indicating as to how the courts should proceed in order to ultimately find out the truth so that an innocent does not get punished but at the same time, the guilty are brought to book under the law. It is these ideals as enshrined under the Constitution and our laws that have led to several decisions, whereby innovating methods and progressive tools have been forged to find out the real truth and to ensure that the guilty does not go unpunished. 9. The presumption of innocence is the general law of the land as every
man is presumed to be innocent unless proven to be guilty. Alternatively, certain statutory presumptions in relation to certain class of offences have been raised against the accused whereby the presumption of guilt prevails till the accused discharges his burden upon an onus being cast upon him under the law to prove himself to be innocent. These competing theories have been kept in mind by the legislature. The entire effort, therefore, is not to allow the real perpetrator of an offence to get away unpunished. This is also a part of fair trial and in our opinion, in order to achieve this very end that the legislature thought of incorporating provisions of Section 319 Cr.P.C. It is with the said object in mind that a constructive and purposive interpretation should be adopted that advances the cause of justice and does not dilute the intention of the statute conferring powers on the court to carry out the above mentioned avowed object and purpose to try the person to the satisfaction of the court as an accomplice in the commission of the offence that is subject matter of trial. 10. In order to answer the aforesaid questions posed, it will be appropriate to refer to Section 351 of the Criminal Procedure Code, 1898 (hereinafter referred to as `Old Code’), where an analogous provision existed, empowering the court to summon any person other than the accused if he is found to be connected with the commission of the offence. However, when the new Cr.P.C. was being drafted, regard was had to 41st Report of the Law Commission where in the paragraphs 24.80 and 24.81 recommendations were made to make this provision more comprehensive. The said recommendations read: “24.80 It happens sometimes, though not very often, that a Magistrate hearing a case against certain accused finds from the evidence that some person, other than the accused before him, is also concerned in that very offence or in a connected offence. It is proper that Magistrate should have the power to call and join him in proceedings. Section 351 provides for such a situation, but only if that person happens to be attending the Court. He can
then be detained and proceeded against. There is no express provision in Section 351 for summoning such a person if he is not present in court. Such a provision would make Section 351 fairly comprehensive, and we think it proper to expressly provide for that situation. 24.81 Section 351 assumes that the Magistrate proceeding under it has the power of taking cognizance of the new case. It does not, however, say in what manner cognizance is taken by the Magistrate. The modes of taking cognizance are mentioned in Section 190, and are apparently exhaustive. The question is, whether against the newly added accused, cognizance will be supposed to have been taken on the Magistrates own information under Section 190(1), or only in the manner in which cognizance was first taken of the offence against the accused. The question is important, because the methods of inquiry and trial in the two cases differ. About the true position under the existing law, there has been difference of opinion, and we think it should be made clear. It seems to us that the main purpose of this particular provision is that the whole case against all known suspects should be proceeded with expeditiously and convenience requires that cognizance against the newly added accused should be taken in the same manner against the other accused. We, therefore, propose to recast Section 351 making it comprehensive and providing that there will be no difference in the mode of taking cognizance if a new person is added as an accused during the proceedings. It is, of course, necessary (as is already provided) that in such a situation the evidence must he reheard in the presence of the newly added 11. Section 319 Cr.P.C. as it exists today, is quoted hereunder: “319 Cr.P.C. -Power to proceed against other persons appearing to be guilty of offence.- (1) Where, in the course of any inquiry into, or trial of, an offence, it appears from the evidence that any person not being the accused has committed any offence for which such person could be tried together with the accused, the Court may proceed against such person for the offence
which he appears to have committed. (2) Where such person is not attending the Court, he may be arrested or summoned, as the circumstances of the case may require, for the purpose aforesaid. (3) Any person attending the Court, although not under arrest or upon a summons, may be detained by such Court for the purpose of the inquiry into, or trial of, the offence which he appears to have committed. (4) Where the Court proceeds against any person under (a) the proceedings in respect of such person shall be commenced afresh, and the witnesses re-heard; (b) subject to the provisions of clause (a), the case may proceed as if such person had been an accused person when the Court took cognizance of the offence upon which the inquiry or trial was commenced.” 12. Section 319 Cr.P.C. springs out of the doctrine judex damnatur cum nocens absolvitur (Judge is condemned when guilty is acquitted) and this doctrine must be used as a beacon light while explaining the ambit and the spirit underlying the enactment of Section 319 Cr.P.C. 13. It is the duty of the Court to do justice by punishing the real culprit. Where the investigating agency for any reason does not array one of the real culprits as an accused, the court is not powerless in calling the said accused to face trial. The question remains under what circumstances and at what stage should the court exercise its power as contemplated in 14. The submissions that were raised before us covered a very wide canvas and the learned counsel have taken us through various provisions of Cr.P.C. and the judgments that have been relied on for the said purpose. The controversy centers around the stage at which such powers can be invoked by the court and the material on the basis whereof such powers can be exercised. 15. It would be necessary to put on record that the power conferred under Section 319 Cr.P.C. is only on the court. This has to be understood in the context that Section 319 Cr.P.C. empowers only the
court to proceed against such person. The word “court” in our hierarchy of criminal courts has been defined under Section 6 Cr.P.C., which includes the Courts of Sessions, Judicial Magistrates, Metropolitan Magistrates as well as Executive Magistrates. The Court of Sessions is defined in Section 9 Cr.P.C. and the Courts of Judicial Magistrates has been defined under Section 11 thereof. The Courts of Metropolitan Magistrates has been defined under Section 16 Cr.P.C. The courts which can try offences committed under the Indian Penal Code, 1860 or any offence under any other law, have been specified under Section 26 Cr.P.C. read with First Schedule. The explanatory note (2) under the heading of “Classification of Offences” under the First Schedule specifies the expression ‘magistrate of first class’ and ‘any magistrate’ to include Metropolitan Magistrates who are empowered to try the offences under the said Schedule but excludes Executive 16. It is at this stage the comparison of the words used under Section 319 Cr.P.C. has to be understood distinctively from the word used under Section 2(g) defining an inquiry other than the trial by a magistrate or a court. Here the legislature has used two words, namely the magistrate or court, whereas under Section 319 Cr.P.C., as indicated above, only the word “court” has been recited. This has been done by the legislature to emphasise that the power under Section 319 Cr.P.C. is exercisable only by the court and not by any officer not acting as a court. Thus, the magistrate not functioning or exercising powers as a court can make an inquiry in particular proceeding other than a trial but the material so collected would not be by a court during the course of an inquiry or a trial. The conclusion therefore, in short, is that in order to invoke the power under Section 319 Cr.P.C., it is only a Court of Sessions or a Court of Magistrate performing the duties as a court under the Cr.P.C. that can utilise the material before it for the purpose of the said Section.
17. Section 319 Cr.P.C. allows the court to proceed against any person who is not an accused in a case before it. Thus, the person against whom summons are issued in exercise of such powers, has to necessarily not be an accused already facing trial. He can either be a person named in Column 2 of the chargesheet filed under Section 173 Cr.P.C. or a person whose name has been disclosed in any material before the court that is to be considered for the purpose of trying the offence, but not investigated. He has to be a person whose complicity may be indicated and connected with the commission of the offence. 18. The legislature cannot be presumed to have imagined all the circumstances and, therefore, it is the duty of the court to give full effect to the words used by the legislature so as to encompass any situation which the court may have to tackle while proceeding to try an offence and not allow a person who deserves to be tried to go scot free by being not arraigned in the trial in spite of possibility of his complicity which can be gathered from the documents presented by the prosecution.” 7. The judgment in the case of Hardeep Singh (Supra) has also been considered and taken note in the judgment in the case of S. Mohammad Ispahani Vs. Yogendra Chandak and Others reported in (2017) 16 SCC 226 wherein paragraph nos. 28 and 29 the Hon’ble Apex Court has observed as under. “28) Insofar as power of the Court under Section 319 of the Cr.P.C. to summon even those persons who are not named in the charge sheet to appear and face trial is concerned, the same is unquestionable. Section 319 of the Cr.P.C. is meant to rope in even those persons who were not implicated when the charge sheet was filed but during the trial the Court finds that sufficient evidence has come on record to summon them and face the trial. In Hardeep Singh’s case, the Constitution Bench of this Court has settled the law in this behalf with authoritative pronouncement, thereby removing the cobweb which had been created
while interpreting this provision earlier. As far as object behind Section 319 of the Cr.P.C. is concerned, the Court had highlighted the same as “The court is sole repository of justice and a duty is cast upon it to uphold the rule of law and, therefore, it will be inappropriate to deny the existence of such powers with the courts in our criminal justice system where it is not uncommon that the real accused, at times, get away by manipulating the investigating and/or the prosecuting agency. The desire to avoid trial is so strong that an accused makes efforts at times to get himself absolved even at the stage of investigation or inquiry even though he may be connected with the commission of the offence.” 29) At the same time, the Constitution Bench has clarified that the power under Section 319 of the Cr.P.C. can only be exercised on ‘evidence’ recorded in the Court and not material gathered at the investigation stage, which has already been tested at the stage under Section 190 of the Cr.P.C. and issue of process under Section 204 of the Cr.P.C. This principle laid down in Hardeep Singh’s case has been explained in Brjendra Singh and Others v. State of Rajasthan in the following manner: “10. It also goes without saying that Section 319 CrPC, which is an enabling provision empowering the Court to 6 (2017) 7 SCC 706 Criminal Appeal No. 1720 of 2017 & Ors. appropriate steps for proceeding against any person, not being an accused, can be exercised at any time after the charge-sheet is filed and before the pronouncement of the judgment, except during the stage of Sections 207/208 CrPC, the committal, etc. which is only a pre-trial stage intended to put the process into motion. 11. In Hardeep Singh case , the Constitution Bench has also settled the controversy on the issue as to whether the word “evidence” used in Section 319(1) CrPC has been used in a comprehensive sense and indicates the evidence collected during investigation or the word “evidence” is limited to the evidence recorded during trial. It is held
that it is that material, after cognizance is taken by the court, that is available to it while making an inquiry into or trying an offence, which the court can utilise or take into consideration for supporting reasons to summon any person on the basis of evidence adduced before the court. The word “evidence” has to be understood in its wider sense, both at the stage of trial and even at the stage of inquiry. It means that the power to proceed against any person after summoning him can be exercised on the basis of any such material as brought forth before it. At the same time, this Court cautioned that the duty and obligation of the court becomes more onerous to invoke such powers consciously on such material after evidence has been led during trial. The Court also clarified that “ evidence” under Section 319 CrPC could even be examination-in-chief and the Court is not required to wait till such evidence is tested on cross-examination, as it is the satisfaction of the court which can be gathered from the reasons recorded by the court in respect of complicity of some other person(s) not facing trial in the offence. satisfaction that is required for invoking the powers under Section 319 CrPC and the related question is as to in what situations this power should be exercised in respect of a person named in the FIR but not charge- sheeted. These two aspects were also specifically dealt with by the Constitution Bench in Hardeep Singh case and answered in the following manner: (SCC pp. 135 & “95. At the time of taking cognizance, the court has to see whether a prima facie case is made out to proceed against the accused. Under Section 319 CrPC, though the test of prima facie case is the same, the degree of satisfaction that is required is much stricter. A two-Judge Bench Criminal Appeal No. 1720 of 2017 & Ors. this Court in Vikas v. State of Rajasthan [Vikas v. State of Rajasthan, (2014) 3 SCC
321 : (2014) 2 SCC (Cri) 172] , held that on the [Ed. : The words between two asterisks have been emphasised in original.] objective satisfaction [Ed. : The words between two asterisks have been emphasised in original.] of the court a person may be “arrested” or “summoned”, as the circumstances of the case may require, if it appears from the evidence that any such person not being the accused has committed an offence for which such person could be tried together with the already arraigned accused persons. 105. Power under Section 319 CrPC is a discretionary and an extraordinary power. It is to be exercised sparingly and only in those cases where the circumstances of the case so warrant. It is not to be exercised because the Magistrate or the Sessions Judge is of the opinion that some other person may also be guilty of committing that offence. Only where strong and cogent evidence occurs against a person from the evidence led before the court that such power should be exercised and not in a casual and cavalier manner. 106. Thus, we hold that though only a prima facie case is to be established from the evidence led before the court, not necessarily tested on the anvil of cross-examination, it requires much stronger evidence than mere probability of his complicity. The test that has to be applied is one which is more than prima facie case as exercised at the time of framing of charge , but short of satisfaction to an extent that the evidence, if goes unrebutted, would lead to conviction. In the absence of such satisfaction, the court should refrain from exercising power under Section 319 CrPC. In Section 319 CrPC the purpose of providing if “it appears from the evidence that any person not being the accused has committed any offence” is clear from the words “ [Ed. : The words between two asterisks have been emphasised in original.] for which such person could be tried together with the accused [Ed. : The words between two asterisks have been emphasised in original.] ”. The
words used are not “for which such person could be Criminal Appeal No. 1720 of 2017 & Ors. ”. There is, therefore, no scope for the court acting under Section 319 CrPC to form any opinion as to the guilt of the accused.” 13. In order to answer the question, some of the principles enunciated in Hardeep Singh case may be recapitulated: power under Section 319 CrPC can be exercised by the trial court at any stage during the trial i.e. before the conclusion of trial, to summon any person as an accused and face the trial in the ongoing case, once the trial court finds that there is some “evidence” against such a person on the basis of which evidence it can be gathered that he appears to be guilty of the offence. The “evidence” herein means the material that is brought before the court during trial. Insofar as the material/evidence collected by the IO at the stage of inquiry is concerned, it can be utilised for corroboration and to support the evidence recorded by the court to invoke the power under Section 319 CrPC. No doubt, such evidence that has surfaced in examination-in-chief, without cross-examination of witnesses, can also be taken into consideration. However, since it is a discretionary power given to the court under Section 319 CrPC and is also an extraordinary one, same has to be exercised sparingly and only in those cases where the circumstances of the case so warrant. The degree of satisfaction is more than the degree which is warranted at the time of framing of the charges against others in respect of whom charge-sheet was filed. Only where strong and cogent evidence occurs against a person from the evidence led before the court that such power should be exercised. It is not to be exercised in a casual or a cavalier manner. The prima facie opinion which is to be formed requires stronger evidence than mere probability of his complicity.” (emphasis supplied) 8. The legislature was quite conscious while engrafting section 319 Cr.P.C. while employing the words “in the course of any
inquiry into, or trial of, an offence, it appears from the evidence”. The aforesaid words so employed under section 319 Cr.P.C. itself shows that degree of satisfaction has to be accorded by the Magistrate while exercising powers u/s 319 Cr.P.C. 9. Obviously, degree of satisfaction defers from case to case and according to the degree of satisfaction the test to be applied as one should be more than prima facie case at the stage of framing of charges. The Hon'ble Supreme Court in the case of Hardeep Singh (Supra) has observed as under:- “93. Section 319(1) Cr.P.C. empowers the court to proceed against other persons who appear to be guilty of offence, though not an accused before the court. The word “appear” means “clear to the comprehension”, or a phrase near to, if not synonymous with “proved”. It imparts a lesser degree of probability than proof. 94. In Pyare Lal Bhargava v. The State of Rajasthan, AIR 1963 SC 1094, a four-Judge Bench of this Court was concerned with the meaning of the word ‘appear’. The court held that the appropriate meaning of the word ‘appears’ is ‘seems’. It imports a lesser degree of probability than proof. In Ram Singh & Ors. v. Ram Niwas & Anr., (2009) 14 SCC 25, a two- Judge Bench of this Court was again required to examine the importance of the word ‘appear’ as appearing in the Section. The Court held that for the fulfillment of the condition that it appears to the court that a person had committed an offence, the court must satisfy itself about the existence of an exceptional circumstance enabling it to exercise an extraordinary jurisdiction. What is, therefore, necessary for the court is to arrive at a satisfaction that the evidence adduced on behalf of the prosecution, if unrebutted, may lead to conviction of the persons sought to be added as an accused in the case. 95. At the time of taking cognizance, the court has to see whether a
prima facie case is made out to proceed against the accused. Under Section 319 Cr.P.C., though the test of prima facie case is the same, the degree of satisfaction that is required is much stricter. A two- Judge Bench of this Court in Vikas v. State of Rajasthan, 2013 (11) SCALE 23, held that on the objective satisfaction of the court a person may be 'arrested' or 'summoned', as the circumstances of the case may require, if it appears from the evidence that any such person not being the accused has committed an offence for which such person could be tried together with the already arraigned accused persons. 96. In Rajendra Singh (Supra), the Court observed: “Be it noted, the court need not be satisfied that he has committed an offence. It need only appear to it that he has committed an offence. In other words, from the evidence it need only appear to it that someone else has committed an offence, to exercise jurisdiction under Section 319 of the Code. Even then, it has a discretion not to proceed, since the expression used is “may” and not “shall”. The legislature apparently wanted to leave that discretion to the trial court so as to enable it to exercise its jurisdiction under this section. The expression “appears” indicates an application of mind by the court to the evidence that has come before it and then taking a decision to proceed under Section 319 of the Code or not.” 97. In Mohd. Shafi (Supra), this Court held that it is evident that before a court exercises its discretionary jurisdiction in terms of Section 319 Cr.P.C., it must arrive at a satisfaction that there exists a possibility that the accused so summoned in all likelihood would be convicted. 98. In Sarabjit Singh & Anr. v. State of Punjab & Anr., AIR 2009 SC 2792, while explaining the scope of Section 319 Cr.P.C., a two-Judge Bench of “….For the aforementioned purpose, the courts are required to apply stringent tests; one of the tests being whether evidence on record is such which would
reasonably lead to conviction of the person sought to be Whereas the test of prima facie case may be sufficient for taking cognizance of an offence at the stage of framing of charge, the court must be satisfied that there exists a strong suspicion. While framing charge in terms of Section 227 of the Code, the court must consider the entire materials on record to form an opinion that the evidence if unrebutted would lead to a judgment of conviction. Whether a higher standard be set up for the purpose of invoking the jurisdiction under Section 319 of the Code is the question. The answer to these questions should be rendered in the affirmative. Unless a higher standard for the purpose of forming an opinion to summon a person as an additional accused is laid down, the ingredients thereof viz. (i) an extraordinary case, and (ii) a case for sparingly (sic sparing) exercise of jurisdiction, would not be satisfied.” (Emphasis added) 99. In Brindaban Das & Ors. v. State of West Bengal, AIR 2009 SC 1248, a two-Judge Bench of this Court took a similar view observing that the court is required to consider whether such evidence would be sufficient to convict the person being summoned. Since issuance of summons under Section 319 Cr.P.C. entails a de novo trial and a large number of witnesses may have been examined and their re-examination could prejudice the prosecution and delay the trial, the trial court has to exercise such discretion with great care and perspicacity. A similar view has been re-iterated by this Court in Michael Machado & Anr. v. Central Bureau of Investigation & Ors., AIR 2000 SC 1127. 100. However, there is a series of cases wherein this Court while dealing with the provisions of Section 227, 228, 239, 240, 241, 242 and 245 Cr.P.C., has consistently held that the court at the stage of framing of the charge has to apply its mind to the question whether or not there is any ground for presuming the commission of an offence by the accused. The court has to see as to whether the material brought on record reasonably
connect the accused with the offence. Nothing more is required to be enquired into. While dealing with the aforesaid provisions, the test of prima facie case is to be applied. The Court has to find out whether the materials offered by the prosecution to be adduced as evidence are sufficient for the court to proceed against the accused further. (Vide: State of Karnataka v. L. Munishwamy & Ors., AIR 1977 SC 1489; All India Bank Officers' Confederation etc. v. Union of India & Ors., AIR 1989 SC 2045; Stree Atyachar Virodhi Parishad v. Dilip Nathumal Chordia, (1989) 1 SCC 715; State of M.P. v. Dr. Krishna Chandra Saksena, (1996) 11 SCC 439; and State of M.P. v. Mohan Lal Soni. 101.In Dilawar Babu Kurane v. State of Maharashtra AIR 2002 SC 564, this Court while dealing with the provisions of Section 227 and 228 Cr.P.C., placed a very heavy reliance on the earlier judgment of this Court in Union of India v. Prafulla Kumar Samal & Anr., AIR 1979 SC 366 and held that while considering the question of framing the charges, the court may weigh the evidence for the limited purpose of finding out whether or not a prima facie case against the accused has been made out and whether the materials placed before this Court disclose grave suspicion against the accused which has not been properly explained. In such an eventuality, the court is justified in framing the charges and proceeding with the trial. The court has to consider the broad probabilities of the case, the total effect of the evidence and the documents produced before the court but court should not make a roving enquiry into the pros and cons of the matter and weigh evidence as if it is conducting a trial. 102 In Suresh v. State of Maharashtra, AIR 2001 SC 1375, this Court after taking note of the earlier judgments in Niranjan Singh Karam Singh Punjabi v. Jitendra Bhimraj Bijjaya, AIR 1990 SC 1962 and State of
Maharashtra v. Priya Sharan Maharaj, AIR 1997 SC 2041, held as under: “9.……at the stage of Sections 227 and 228 the Court is required to evaluate the material and documents on record with a view to finding out if the facts emerging therefrom taken at their face value disclose the existence of all the ingredients constituting the alleged offence. The Court may, for this limited purpose, sift the evidence as it cannot be expected even at that initial stage to accept all that the prosecution states as gospel truth even if it is opposed to common sense or the broad probabilities of the case. Therefore, at the stage of framing of the charge the Court has to consider the material with a view to find out if there is ground for presuming that the accused has committed the offence or that there is not sufficient ground for proceeding against him and not for the purpose of arriving at the conclusion that it is not likely to lead to a conviction.” (Emphasis supplied) 103. Similarly in State of Bihar v. Ramesh Singh, AIR 1977 SC 2018, while dealing with the issue, this Court held: “……If the evidence which the Prosecutor proposes to adduce to prove the guilt of the accused even if fully accepted before it is challenged in cross-examination or rebutted by the defence evidence, if any, cannot show that the accused committed the offence, then there will be no sufficient ground for proceeding with the trial…..” 104. In Palanisamy Gounder & Anr. v. State, represented by Inspector of Police, (2005) 12 SCC 327, this Court deprecated the practice of invoking the power under Section 319 Cr.P.C. just to conduct a fishing inquiry, as in that case, the trial court exercised that power just to find out the real truth, though there was no valid ground to proceed against the person summoned by the court. 105. Power under Section 319 Cr.P.C. is a discretionary and an extra- ordinary power. It is to be exercised sparingly and only in those cases where the circumstances of the case so warrant. It is not to be exercised
because the Magistrate or the Sessions Judge is of the opinion that some other person may also be guilty of committing that offence. Only where strong and cogent evidence occurs against a person from the evidence led before the court that such power should be exercised and not in a casual and cavalier manner. 106. Thus, we hold that though only a prima facie case is to be established from the evidence led before the court not necessarily tested on the anvil of Cross-Examination, it requires much stronger evidence than mere probability of his complicity. The test that has to be applied is one which is more than prima facie case as exercised at the time of framing of charge, but short of satisfaction to an extent that the evidence, if goes unrebutted, would lead to conviction. In the absence of such satisfaction, the court should refrain from exercising power under Section 319 Cr.P.C. In Section 319 Cr.P.C. the purpose of providing if ‘it appears from the evidence that any person not being the accused has committed any offence’ is clear from the words “for which such person could be tried together with the accused.” The words used are not ‘for which such person could be convicted’. There is, therefore, no scope for the Court acting under Section 319 Cr.P.C. to form any opinion as to the guilt of the accused.” 10. The Hon’ble Apex court in the case of Hardeep Singh (Supra) has also analysed the contingencies in what situation can the power u/s 319 Cr.P.C. be exercised in the cases when a persons is not named in the FIR though named in the FIR but not charge sheeted or has been discharged. The Hon’ble Apex Court has “107. In Joginder Singh & Anr. v. State of Punjab & Anr., AIR 1979 SC 339, a three-Judge Bench of this Court held that as regards the contention that the phrase “any person not being the accused” occurring in Section 319 Cr.P.C. excludes from its operation an accused who has been released by the police under Section 169 Cr.P.C. and has been
shown in Column 2 of the charge-sheet, the contention has merely to be rejected. The said expression clearly covers any person who is not being tried already by the Court and the very purpose of enacting such a provision like Section 319 (1) Cr.P.C. clearly shows that even persons who have been dropped by the police during investigation but against whom evidence showing their involvement in the offence comes before the criminal court, are included in the said expression. 108. In Anju Chaudhary v. Sate of U.P. & Anr., (2013) 6 SCC 384, a two- Judge Bench of this Court held that even in the cases where report under Section 173(2) Cr.P.C. is filed in the court and investigation records the name of a person in Column 2, or even does not name the person as an accused at all, the court in exercise of its powers vested under Section 319 Cr.P.C. can summon the person as an accused and even at that stage of summoning, no hearing is contemplated under the law. 109. In Suman v. State of Rajasthan & Anr., AIR 2010 SC 518, a two- Judge Bench of this Court observed that there is nothing in the language of this sub-section from which it can be inferred that a person who is named in the FIR or complaint, but against whom charge- sheet is not filed by the police, cannot be proceeded against even though in the course of any inquiry into or trial of any offence, the court finds that such person has committed an offence for which he could be tried together with the other accused. 110.In Lal Suraj (supra), a two-Judge Bench held that there is no dispute with the legal proposition that even if a person had not been charge- sheeted, he may come within the purview of the description of such a person as contained in Section 319 Cr.P.C. A similar view had been taken in Lok Ram (Supra), wherein it was held that a person, though had initially been named in the FIR as an accused, but not charge-sheeted, can
also be added to face the trial. 111. Even the Constitution Bench in Dharam Pal (CB) has held that the Sessions Court can also exercise its original jurisdiction and summon a person as an accused in case his name appears in Column 2 of the chargesheet, once the case had been committed to it. It means that a person whose name does not appear even in the FIR or in the chargesheet or whose name appears in the FIR and not in the main part of the chargesheet but in Column 2 and has not been summoned as an accused in exercise of the powers under Section 319 Cr.P.C. can still be summoned by the court, provided the court is satisfied that the conditions provided in the said statutory provisions stand fulfilled. 112. However, there is a great difference with regard to a person who has been discharged. A person who has been discharged stands on a different footing than a person who was never subjected to investigation or if subjected to, but not charge-sheeted. Such a person has stood the stage of inquiry before the court and upon judicial examination of the material collected during investigation; the court had come to the conclusion that there is not even a prima facie case to proceed against such person. Generally, the stage of evidence in trial is merely proving the material collected during investigation and therefore, there is not much change as regards the material existing against the person so discharged. Therefore, there must exist compelling circumstances to exercise such power. The Court should keep in mind that the witness when giving evidence against the person so discharged, is not doing so merely to seek revenge or is naming him at the behest of someone or for such other extraneous considerations. The court has to be circumspect in treating such evidence and try to separate the chaff from the grain. If after such careful examination of the evidence, the court is of the opinion that there does exist evidence to proceed against the person so discharged, it may take steps but only in accordance with section 398 Cr.P.C. without resorting to the provision of Section 319 Cr.P.C. directly.
113. In Sohan Lal & Ors. v. State of Rajasthan, (1990) 4 SCC 580, a two- Judge Bench of this Court held that once an accused has been discharged, the procedure for enquiry envisaged under Section 398 Cr.P.C. cannot be circumvented by prescribing to procedure under 114. In Municipal Corporation of Dehli v. Ram Kishan Rohtagi & Ors., AIR 1983 SC 67, this Court held that if the prosecution can at any stage produce evidence which satisfies the court that those who have not been arraigned as accused or against whom proceedings have been quashed, have also committed the offence, the Court can take cognizance against them under Section 319 Cr.P.C. and try them along with the other 115. Power under Section 398 Cr.P.C. is in the nature of revisional power which can be exercised only by the High Court or the Sessions Judge, as the case may be. According to Section 300 (5) Cr.P.C., a person discharged under Section 258 Cr.P.C. shall not be tried again for the same offence except with the consent of the Court by which he was discharged or of any other Court to which the first-mentioned Court is subordinate. Further, Section 398 Cr.P.C. provides that the High Court or the Sessions Judge may direct the Chief Judicial Magistrate by himself or by any of the Magistrate subordinate to him to make an inquiry into the case against any person who has already been discharged. Both these provisions contemplate an inquiry to be conducted before any person, who has already been discharged, is asked to again face trial if some evidence appears against him. As held earlier, Section 319 Cr.P.C. can also be invoked at the stage of inquiry. We do not see any reason why inquiry as contemplated by Section 300(5) Cr.P.C. and Section 398 Cr.P.C. cannot be an inquiry under Section 319 Cr.P.C. Accordingly, a person discharged can also be arraigned again as an accused but only
after an inquiry as contemplated by Section 300(5) and 398 Cr.P.C. If during or after such inquiry, there appears to be an evidence against such person, power under Section 319Cr.P.C. can be exercised. We may clarify that the word ‘trial’ under Section 319 Cr.P.C. would be eclipsed by virtue of above provisions and the same cannot be invoked so far as a person discharged is concerned, but no more. 116. Thus, it is evident that power under Section 319 Cr.P.C. can be exercised against a person not subjected to investigation, or a person placed in the Column 2 of the Charge-Sheet and against whom cognizance had not been taken, or a person who has been discharged. However, concerning a person who has been discharged, no proceedings can be commenced against him directly under Section 319 Cr.P.C. without taking recourse to provisions of Section 300(5) read with Section 11. The Constitutional Bench in the matter of Hardeep Singh (Supra) has also considered the scope, ambit and the importance of the word evidence and had analysed the same and held as “58. To answer the questions and to resolve the impediment that is being faced by the trial courts in exercising of powers under Section 319 Cr.P.C., the issue has to be investigated by examining the circumstances which give rise to a situation for the court to invoke such powers. The circumstances that lead to such inference being drawn up by the court for summoning a person arise out of the availability of the facts and material that comes up before the court and are made the basis for summoning such a person as an accomplice to the offence alleged to have been committed. The material should disclose the complicity of the person in the commission of the offence which has to be the material that appears from the evidence during the course of any inquiry into or trial of offence. The words as used in Section 319 Cr.P.C. indicate that the material has to be “where ….it appears from the evidence” before the court.
59. Before we answer this issue, let us examine the meaning of the word ‘evidence’. According to Section 3 of the Evidence Act, ‘evidence’ means (1) all statements which the Court permits or requires to be made before it by witnesses, in relation to matters of fact under inquiry; such statements are called oral (2) all documents including electronic records produced for the inspection of the Court, such statements are called 60. According to Tomlin’s Law Dictionary, Evidence is “the means from which an inference may logically be drawn as to the existence of a fact. It consists of proof by testimony of witnesses, on oath; or by writing or records.” 61. Bentham defines ‘evidence’ as “any matter of fact, the effect, tendency or design of which presented to mind, is to produce in the mind a persuasion concerning the existence of some other matter of fact- a persuasion either affirmative or disaffirmative of its existence. Of the two facts so connected, the latter may be distinguished as the principal fact, and the former as the evidentiary fact.” 62. According to Wigmore on Evidence, evidence represents “any knowable fact or group of facts, not a legal or a logical principle, considered with a view to its being offered before a legal tribunal for the purpose of producing a persuasion, positive or negative, on the part of the tribunal, as to the truth of a proposition, not of law, or of logic, on which the determination of the tribunal is to be asked.” 63. The provision and the above-mentioned definitions clearly suggest that it is an exhaustive definition. Wherever the words “means and include” are used, it is an indication of the fact that the definition ‘is a hard and fast definition’, and no other meaning can be assigned to the expression that is put down in the definition. It indicates an exhaustive explanation of the meaning which, for the purposes of the Act, must invariably be attached to these words or expression. (Vide: M/S. Mahalakshmi Oil Mills v. Stare of A.P. AIR 1989 SC 335; Punjab Land Development and
Reclamation Corporation Ltd. Chandigarh v. Presiding Officer, Labour Court, Chandigarh & Ors., (1990) 3 SCC 682; P. Kasilingam & Ors. v. P.S.G. collage of Technology & Ors, AIR 1995 SC 1395; Hamdard (Wakf) Laboratories v. Dy. Labour Commissioner & Ors., AIR 2008 SC 968; and Ponds India Ltd. (merged with H.L. Limited) v. Commissioner 64. In Feroze N. Dotivala v. P.M. Wadhwani & Ors, (2003) 1 SCC 433, dealing with a similar issue, this Court observed as under: “Generally, ordinary meaning is to be assigned to any word or phrase used or defined in a statute. Therefore, unless there is any vagueness or ambiguity, no occasion will arise to interpret the term in a manner which may add something to the meaning of the word which ordinarily does not so mean by the definition itself, more particularly, where it is a restrictive definition. Unless there are compelling reasons to do so, meaning of a restrictive and exhaustive definition would not be expanded or made extensive to embrace things which are strictly not within the meaning of the word as defined. 65. We, therefore proceed to examine the matter further on the premise that the definition of word “evidence” under the Evidence Act is 66. In Kalyan Kumar Gogoi v. Ashutosh Agnihotri & Anr., AIR 2011 SC 760, while dealing with the issue this Court held : “18. The word “evidence” is used in common parlance in three different senses: (a) as equivalent to relevant, (b) as equivalent to proof, and (c) as equivalent to the material, on the basis of which courts come to a conclusion about the existence or non-existence of disputed facts. Though, in the definition of the word “evidence” given in Section 3 of the Evidence Act one finds only oral and documentary evidence, this word is also used in phrases such as best
evidence, circumstantial evidence, corroborative evidence, evidence, hearsay evidence, indirect evidence, oral evidence, original evidence, presumptive evidence, primary evidence, real evidence, secondary evidence, substantive evidence, testimonial evidence, etc.” 67. In relation to a Civil Case, this court in Ameer Trading Corporation Ltd. v. Shapoorji Data Processing Ltd., AIR 2004 SC 355, held that the examination of a witness would include evidence-in- chief, cross- examination or re-examination. In Omkar Namdeo Jadhao & Ors v. Second Additional Sessions Judge Buldana & Anr., AIR 1997 SC 331; and Ram Swaroop & Ors. v. State of Rajasthan, AIR 2004 SC 2943, this Court held that statements recorded under Section 161 Cr.P.C. during the investigation are not evidence. Such statements can be used at the trial only for contradictions or omissions when the witness is examined in the (See also: Podda Narayana & Ors. v. State of A.P., AIR 1975 SC 1252; Sat Paul v. Delhi Administration, AIR 1976 SC 294; and State (Delhi Administration) v. Laxman Kumar & Ors., AIR 1986 SC 250). 68. In Lok Ram v. Nihal Singh & Anr., AIR 2006 SC 1892, it was held that it is evident that a person, even though had initially been named in the FIR as an accused, but not charge-sheeted, can also be added as an accused to face the trial. The trial court can take such a step to add such persons as accused only on the basis of evidence adduced before it and not on the basis of materials available in the charge- sheet or the case diary, because such materials contained in the charge-sheet or the case diary do not constitute evidence. 69. The majority view of the Constitution Bench in Ramnarayan Mor & Anr. v. The State of Maharashtra, AIR 1964 SC 949 has been as under: “9. It was urged in the alternative by counsel for the
appellants that even if the expression “evidence” may include documents, such documents would only be those which are duly proved at the enquiry for commitment, because what may be used in a trial, civil or criminal, to support the judgment of a Court is evidence duly proved according to law. But by the Evidence Act which applies to the trial of all criminal cases, the expression “evidence” is defined in Section 3 as meaning and including all statements which the Court permits or requires to be made before it by witnesses, in relation to matters of fact under enquiry and documents produced for the inspection of the Court. There is no restriction in this definition to documents which are duly proved by evidence.” (Emphasis 70. Similarly, this Court in Sunil Mehta & Anr. v. State of Gujarat & Anr., JT 2013 (3) SC 328, held that “It is trite that evidence within the meaning of the Evidence Act and so also within the meaning of Section 244 of the Cr.P.C. is what is recorded in the manner stipulated under Section 138 in the case of oral evidence. Documentary evidence would similarly be evidence only if the documents are proved in the manner recognised and provided for under the Evidence Act unless of course a statutory provision makes the document admissible as evidence without any formal proof 71. In Guriya @ Tabassum Tauquir & Ors. v. State of Bihar & Anr., AIR 2008 SC 95, this Court held that in exercise of the powers under Section 319 Cr.P.C., the court can add a new accused only on the basis of evidence adduced before it and not on the basis of materials available in the charge sheet or the case diary. “11. On a plain reading of sub-section (1) of Section 319 there can be no doubt that it must appear from the evidence tendered in the course of any inquiry or trial that any person not being the accused has committed any offence for which he could be tried together with the accused. This power (under Section 319(1)), it seems clear to us, can be exercised only if it so appears from the
evidence at the trial and not otherwise. Therefore, this sub-section contemplates existence of some evidence appearing in the course of trial wherefrom the court can prima facie conclude that the person not arraigned before it is also involved in the commission of the crime for which he can be tried with those already named by the police. Even a person who has earlier been discharged would fall within the sweep of the power conferred by S. 319 of the Code. Therefore, stricto sensu, Section 319 of the Code cannot be invoked in a case like the present one where no evidence has been led at a trial wherefrom it can be said that the appellants appear to have been involved in the commission of the crime along with those already sent up for trial by the prosecution. 12. But then it must be conceded that Section 319 covers the post-cognizance stage where in the course of an inquiry or trial the involvement or complicity of a person or persons not named by the investigating agency has surfaced which necessitates the exercise of the discretionary power conferred by the said provision…..” 73. A similar view has been taken by this Court in Raj Kishore Prasad (Supra), wherein it was held that in order to apply Section 319 Cr.P.C., it is essential that the need to proceed against the person other than the accused appearing to be guilty of offence arises only on evidence recorded in the course of an inquiry or trial. 74. In Lal Suraj @ Suraj Singh & Anr. v. State of Jharkhand, (2009) 2 SCC 696, a two-Judge Bench of this Court held that “a court framing a charge would have before it all the materials on record which were required to be proved by the prosecution. In a case where, however, the court exercises its jurisdiction under Section 319 Cr.P.C., the power has to be exercised on the basis of the fresh evidence brought before the court. There lies a fine but clear distinction.” 75. A similar view has been reiterated by this Court in Rajendra Singh v.
State of U.P. & Anr., AIR 2007 SC 2786, observing that court should not exercise the power under Section 319 Cr.P.C. on the basis of materials available in the charge-sheet or the case diary, because such materials contained in the charge-sheet or the case diary do not constitute evidence. The word ‘evidence’ in Section 319 Cr.P.C. contemplates the evidence of witnesses given in the court. 76. Ordinarily, it is only after the charges are framed that the stage of recording of evidence is reached. A bare perusal of Section 227 Cr.P.C. would show that the legislature has used the terms “record of the case” and the “documents submitted therewith”. It is in this context that the word ‘evidence’ as appearing in Section 319 Cr.P.C. has to be read and understood. The material collected at the stage of investigation can at best be used for a limited purpose as provided under Section 157 of the Evidence Act i.e. to corroborate or contradict the statements of the witnesses recorded before the court. Therefore, for the exercise of power under Section 319 Cr.P.C., the use of word `evidence’ means material that has come before the court during an inquiry or trial by it and not otherwise. If from the evidence led in the trial the court is of the opinion that a person not accused before it has also committed the offence, it may summon such person under Section 319 Cr.P.C. 77. With respect to documentary evidence, it is sufficient, as can be seen from a bare perusal of Section 3 of the Evidence Act as well as the decision of the Constitution Bench, that a document is required to be produced and proved according to law to be called evidence. Whether such evidence is relevant, irrelevant, admissible or inadmissible, is a matter of trial. 78. It is, therefore, clear that the word “evidence” in Section 319 Cr.P.C. means only such evidence as is made before the court, in relation to statements, and as produced before the court, in relation to documents. It
is only such evidence that can be taken into account by the Magistrate or the Court to decide whether power under Section 319 Cr.P.C. is to be exercised and not on the basis of material collected during investigation. 79. The inquiry by the court is neither attributable to the investigation nor the prosecution, but by the court itself for collecting information to draw back a curtain that hides something material. It is the duty of the court to do so and therefore the power to perform this duty is provided under the 80. The unveiling of facts other than the material collected during investigation before the magistrate or court before trial actually commences is part of the process of inquiry. Such facts when recorded during trial are evidence. It is evidence only on the basis whereof trial can be held, but can the same definition be extended for any other material collected during inquiry by the magistrate or court for the purpose of 81. An inquiry can be conducted by the magistrate or court at any stage during the proceedings before the court. This power is preserved with the court and has to be read and understood accordingly. The outcome of any such exercise should not be an impediment in the speedy trial of the case. Though the facts so received by the magistrate or the court may not be evidence, yet it is some material that makes things clear and unfolds concealed or deliberately suppressed material that may facilitate the trial. In the context of Section 319 Cr.P.C. it is an information of complicity. Such material therefore, can be used even though not an evidence in stricto sensuo, but an information on record collected by the court during inquiry itself, as a prima facie satisfaction for exercising the powers as presently involved. 82. This pre-trial stage is a stage where no adjudication on the evidence of the offences involved takes place and therefore, after the material alongwith the charge-sheet has been brought before the court, the same can be inquired into in order to effectively proceed with framing of charges. After the charges are framed, the prosecution is asked to lead evidence and till that is done, there is no evidence available in the strict
legal sense of Section 3 of the Evidence Act. The actual trial of the offence by bringing the accused before the court has still not begun. What is available is the material that has been submitted before the court along with the charge-sheet. In such situation, the court only has the preparatory material that has been placed before the court for its consideration in order to proceed with the trial by framing of charges. 83. It is, therefore, not any material that can be utilised, rather it is that material after cognizance is taken by a court, that is available to it while making an inquiry into or trying an offence, that the court can utilize or take into consideration for supporting reasons to summon any person on the basis of evidence adduced before the Court, who may be on the basis of such material, treated to be an accomplice in the commission of the offence. The inference that can be drawn is that material which is not exactly evidence recorded before the court, but is a material collected by the court, can be utilised to corroborate evidence already recorded for the purpose of summoning any other person, other than the accused. This would harmonise such material with the word ‘evidence’ as material that would be supportive in nature to facilitate the exposition of any other accomplice whose complicity in the offence may have either been suppressed or escaped the notice of the court. 84. The word “evidence” therefore has to be understood in its wider sense both at the stage of trial and, as discussed earlier, even at the stage of inquiry, as used under Section 319 Cr.P.C. The court, therefore, should be understood to have the power to proceed against any person after summoning him on the basis of any such material as brought forth before it. The duty and obligation of the court becomes more onerous to invoke such powers cautiously on such material after evidence has been led during trial. 85. In view of the discussion made and the conclusion drawn hereinabove, the answer to the aforesaid question posed is that apart from evidence recorded during trial, any material that has been received by the court
after cognizance is taken and before the trial commences, can be utilised only for corroboration and to support the evidence recorded by the court to invoke the power under Section 319 Cr.P.C. The ‘evidence’ is thus, limited to the evidence recorded during trial.” 12. The proposition of law culled out by the Hon’ble Apex Court itself makes it clear that u/s 319 Cr.P.C. discretion has been bestowed upon the Magistrate to exercise the powers while looking into the facts and the circumstances of a particular case before it while according degree of satisfaction so imperative for invocation of the powers u/s 319 Cr.P.C. The Hon’ble Apex Court has repeatedly cautioned the Courts to exercise the powers under section 319 Cr.P.C. in such a manner that it does not permit an accused to walk away free on the strength of any lacuna attributed by the Investigating Officer. In nutshell, it can be very well said that once the Magistrate finds that there was sufficient material available on record before it to summon a person in the trial which is proposed to be undertaken then the powers u/s 319 Cr.P.C. are to be invoked. 13. Nonetheless, the powers under section 319 Cr.P.C. to summon those persons who are not named in the charge sheet to appear and face trial is unquestionable as the very object of engrafting section 319 Cr.P.C. is that to allow a person who deserves to be tried not to go scot-free. 14. The stage which is contemplated under section 319 Cr.P.C. 1973 is a stage before the conclusion of the trial and thus, only one conclusion can be drawn that the Magistrate must be prima facie of the opinion that there are sufficient material and cause for summoning the culprit who is either not named in the FIR or if named, he has not been charge sheeted or discharged. 15. The issue can also be seen from another point of angle that during the course of the inquiry into, or trial of, an offence, it appears from the evidence that any person not being accused has committed the offence or he
has not been charge sheeted but there are sufficient material available on record which has not been taken into consideration by the Investigating Officer then the Magistrate in exercise of powers can always summon him in that regard. Sub section (1) of section 319 Cr.P.C. has consciously used the word “during the course of any inquiry into, or trial of” meaning thereby that the powers can be exercised under section 319 Cr.P.C. when there are certain material available on record during the course of inquiry or trial. 16. I have heard the submission of learned counsel for the parties, as well as perused the records. The issue with regard to the exercise of the powers under Section 319 of CrPC are no more res integra, as in view of the judgment so cited hereinabove in the body of the present revision, an irresistible conclusion stands drawn that while exercising the powers under Section 319 CrPC, the courts have to not only form a subjective opinion in order to initiate proceedings, but it should be satisfied that the evidence available to it is more than prima facie. Applying the said principles of law, as culled out in the present judgment, the present case is to be decided. 17. This Court finds that in the FIR so sought to be lodged by the complainant, who happens to be the brother of the deceased, revisionists herein arrayed as accused and more so, in the statement so recorded under Section 161 and 164 CrPC, names of the revisionists find its presence. Nonetheless, in the statement of PW’s- 1, 2 and 3, the name of the revisionists also finds place and thus the Court was within its jurisdiction and powers to have summoned the revisionist. So far as the argument so sought to be raised by learned counsel for the revisionists with regard to the fact that they have not committed the offence and the confessional statement of one of the co-accused, who was though not named in the FIR, but against whom, charge sheet was submitted is a matter of defence, which will be available to the revisionists at the time, when the trial gets commence. Accordingly with the net analysis of the factual and legal proposition, this
Court finds its inability to subscribe with the argument so raised by the revisionist. 18. Learned counsel for the revisionists has argued that a suitable direction be issued for consideration of the claim of the revisionists for grant of bail. 19. This Court finds that an appropriate remedy is always available to the revisionists which they can take recourse to and raise all contentions in that regard. 20. This Court has no reason to disbelieve that the same will be decided with most expedition after considering each and every aspect of the matter. 21. Resultantly, the present revision is dismissed and consigned to record. 22. No order as to costs.
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The Allahabad High Court recently clarified a law called Section 319 of the Code of Criminal Procedure (CrPC). This rule lets a court order people to appear and stand trial. This can happen even if their names are not on the official list of accused persons, known as the charge sheet. But this only applies in certain situations.
Justice Vikas Budhwar, speaking for the court, explained why Section 319 CrPC was created. Its main goal is to prevent any person who should face trial from escaping without punishment.
Under Section 319 CrPC, a court has the power to act against other individuals who appear to be guilty of a crime. This can happen while an investigation or a trial for that crime is already underway.
In simpler terms, Section 319 CrPC gives the trial court the power to include someone not named in the charge sheet. This happens if evidence of their involvement comes up during the trial or investigation.
In this case, the High Court emphasized that a judge should use Section 319 CrPC's powers. This applies once the judge finds enough evidence to order someone to appear in an upcoming trial.
The Court further stated that Section 319 CrPC can be used any time before a trial ends. The judge must have an initial strong belief that there is enough evidence and reason to summon a guilty person. This person might not have been named in the first police report (FIR). Or, if named, they were not officially accused or were previously released.
Basically, the court was reviewing a request from Rameshwar and another person. They were challenging an order from a local judge in Mahoba. That judge had ordered them to appear under Section 319 CrPC for a serious crime: causing death but not murder (punishable under Section 304 of the Indian Penal Code).
Rameshwar and the other person argued that the order to summon them was against the law. They claimed they had not committed the crime. They also said there was no initial evidence or reason to call them to trial.
On the other hand, the government lawyer supported the trial court's order. He argued that Rameshwar and the other person were clearly named in the initial police report. Their names also appeared in witness statements. He believed there was enough proof in the court records to use Section 319 CrPC.
The Court noted that the original law for Section 319 CrPC uses the words: "if it appears from the evidence during an inquiry or trial." This means the judge must be satisfied based on the evidence before using these powers.
However, the Court also said that how much certainty the judge needs can differ in each case. The proof required should be more than just initial evidence, especially when formal accusations (charges) are being prepared.
So, it is quite clear that if a judge finds enough evidence to call a person to an upcoming trial, then the powers of Section 319 CrPC must be used.
Looking at the details of this specific case, the Court found that Rameshwar and the other person were named as defendants in the first police report. This report was filed by the dead person's brother. Their names also came up in official statements taken by police or a judge (under Sections 161 and 164 CrPC).
The Court also noticed that their names appeared in witness statements. Because of this, the Court added, it had the legal right and authority to order Rameshwar and the other person to appear.
The Court then addressed the argument made by the lawyers for Rameshwar and the other person. Their lawyers claimed their clients had not committed the crime and referred to another accused person's statement admitting guilt. The Court stated that these points are part of their defense. They can use these arguments when the actual trial begins. With this, the Court rejected their request to review the order.
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tition (Civil) Nos. 63 & 449 of 1986 etc. (Under Article 32 of the Constitution of India) A.K. Ganguli, A. Sharan and G.S. Chatterjee for the Petitioners. Sodhi for the Respondents. This is a batch of petitions under article 32 of the Constitution filed on behalf of Matriculate Junior Basic Trained Teachers in Government Schools placed in Category B, Group II in 1090 terms of paragraph 3 of the State Government Circular dated July 23, 1957 who have been continuously and unrelentlessly struggling to get the benefit of higher grade of pay on their improving or acquiring higher qualification viz. B.A., B.T./B.A., B.Ed./Matric with JST/ Gyani or Prabhakar, as per the terms thereof, and the persistent refusal of the State Government to adhere to the terms of the said Circular mainly on the ground that such teachers on their improving or acquiring higher qualifications during the course of their service would not automatically be placed in different grades commensurate with their academic qualifications unless they had the professional qualification of requisite experience of a post carried in the higher grade irrespective of the number of posts available in the department in that category. It is asserted that the aforesaid Circular was couched in somewhat ambiguous language and has resulted in different interpretations and it was never the intention of the Government to undertake the continuing unintended heavy financial burden that had arisen because of the faulty drafting of the Circular. It is common ground that by the aforesaid Circular dated July 23, 1957 the State Government directed revision of the existing pay scales of various categories of subordinate offices including Teachers in the Education Department. Paragraph 3 thereof provided for revision of pay scales of Teachers and placed them into two distinct categories, namely, Category A and Category B and inter alia laid down the requirement of academic qualifications with respect to each. The relevant part of paragraph 3 reads as follows: "3. Teachers in the Education Department: It has been decided that all teachers according to their qualifications should be placed in the following two broad categories: CATEGORY 'A ' B.A./B.Sc/B.Com/B.Sc. (Agriculture)/and B.T./Diploma in Physical Education/Diploma in Senior Basic Training. CATEGORY 'B ' Group I Matrics with Basic Training (including Junior Teachers) Group II Junior School Teachers (including Assistant Mistresses with B.A./Inter/Matric plus J.A.V. Training). " 1091 It is quite evident that the revision of pay of Teachers was based on the principle of linking pay to qualification. It would not be out of place to mention that the Kothari Commission constituted by the State Government of Punjab considered in great detail the scales of pay of Teachers. The Commission strongly expressed the view that the scales of pay of Teachers should be linked to educational qualifications. Accepting the recommendations of the Kothari Commission, the State Government of Haryana in 1968 directed further revision of scales of pay of Teachers working in Government Schools w.e.f. December 1, 1967. On more occasions than one, this Court had to intervene on behalf of these unfortunate Teachers for the redressal of the wrong done to them by denial of higher scales of pay on their improving or acquiring higher academic qualifications and issued directions for extending the benefit of paragraph 3 of the Circular to them. Despite the repeated directions, the State Government has been adamant in not complying with such directions on one pretext or another. In State of Punjab & Anr. vs Kirpal Singh Bhatia & Ors., ; this Court upheld the judgment of the Punjab & Haryana High Court in Union of India & Ors. vs Kirpal Singh Bhatia & Ors., directing that Teachers holding B.A., B.T./B.A. qualifications would be entitled to the higher scale of pay. The Court construed the aforesaid Circular as falling within the ambit of r. 10 of the Punjab Educational Services Class III School Cadre Rules, 1955 as to the entitlement of higher scales of pay and held that it had the effect of fixing the scale of pay on the basis of academic qualifications. It was accordingly held that Teachers who possessed the degree of B.T. or the equivalent on May 1,1957 would be entitled to scales of pay commensurate with such higher qualification, and as to the Teachers who acquired such higher qualification thereafter, they would be entitled to their revised scale of pay w.e.f. the date they passed the examination. It categorically repelled the contention on behalf of the Government that there could be no automatic revision of the scales of pay dependent upon the higher qualifications and unequivocally held that Teachers holding B.A., B.T./B.A., B.Ed. qualifications became entitled to the revised scales of pay according to Category A w.e.f. the date they passed the examination in terms of paragraph 3 of the Circular. In Labh Singh Garcha & Ors. vs State of Punjab & Anr. No. 1810/76 decided on July 20, 1976), Chinnappa Reddy, J. speaking for himself and Surinder Singh, J. allowed the writ petition filed by 1092 JBT Teachers falling in Category B who claimed the benefit of higher scales of pay as done in the case of Graduate Teachers in Categroy A pursuant to the High Court 's decree in Kirpal Singh Bhatia 's case. The Court found that the action of the Government in denying to the JBT Teachers who had acquired or improved their educational qualification, the benefit of the higher scales of pay, was per se discriminatory and accordingly issued a direction to the State Government to release to them the revised scales of pay admissible to them in terms of paragraph 3 of the Circular. The State Government carried an appeal to this Court. In State of Punjab & Ors. vs Labh Singh Garcha & Ors., (C.A. Nos. 926 27/77 decided on August 7, 1979) this Court held that the matter was squarely covered by the decision of this Court in Kirpal Singh Bhatia 's case and observed that 'no new point arises ' and accordingly dismissed the appeal. The State Government having failed to carry out the directions issued, the JBT Teachers with higher qualifications were constrained to move the High Court for contempt but it declined to interfere. Aggrieved, the Teachers came up in appeal. At the hearing of Avtar Singh vs Manmohan Singh & Anr., (C.A. 3790/83 decided on September 14, 1984), the Court indicated that the view taken by the High Court did not commend to it and wanted learned counsel for the State Government to ascertain the attitude of the Government. At his request, the matter was adjourned. At the resumed hearing, he signified the willingness of the State Government to comply with the directions given by this Court. The Court accordingly set aside the judgment of the High Court and directed the State Government to implement the order passed in Labh Singh Garcha 's case within three months, holding that the appellants and other petitioners in the High Court and Teachers similarly situate i.e. JBT Teachers with higher qualifications, were entitled to the benefit of paragraph 3 of the Circular. It pointed out that the Director of public Instructions (Schools), Punjab by her affidavit dated February 5, 1980 had unconditionally agreed to implement the same without any reservation. As regards such Teachers who had not approached the Court but were similarly situate, the Court directed that they must make an application for seeking benefit of the aforesaid Circular. By a clarificatory order dated February 21, 1985, the Court clarified that every Teacher entitled to the benefit of the earlier order may make an application within six weeks from that date. It however made a direction to the following effect: 1093 "In the application the teacher should strive as best she/he could to set out his claim as directed herein. The Director may verify the claim with reference to record he may have and the eligibility for relief. But if the claim is of a teacher who was a petitioner in this Court or in the High Court, eligibility enquiry is impermissible, only amount of claim may be verified. The Director of Education shall process all the applications received by him in the manner he thinks fit but he must make the payment within three months from the date of the receipt of the application." Emphasis supplied In compliance therewith the Director of Public Instructions (Schools), Punjab by order dated 30th June, 1986 accorded sanction to make payment of arrears of pay according to Teachers belonging to Category B Group I, to 3,600 JBT Teachers falling in Category B Group II who had improved their educational qualifications and acquired degrees in B.A., B.T./B.A., B.Ed. etc., but denied similar relief to other 6,000 Teachers falling in Category B Group II i.e. the petitioners, on the ground that they did not have the requisite professional training of JST/JAV and therefore not entitled to the higher grade. The impugned order proceeds on the premise that eligibility for the claim for JST grade which was a higher grade, did not depend upon acquiring a higher educational qualification of B.A., B.T. etc. but also to having the requisite professional training i.e. JST/JAV training and further that a higher grade was only allowed to the then existing JST Teachers which was a diminishing cadre and since recruitment to that cadre had been stopped, there was no question of any entitlement of such Teachers to acquiring the necessary professional training. In other words, the Government has adopted the stand that the right of the JBT Teachers belonging to Category B Group II to the higher scale admissible to Teachers placed in Category B Group I could not simply be based on their educational qualification. In support of these petitions Shri A.K. Ganguly, learned counsel appearing for the petitioners, with infinite care took us through all the orders referred to above and rightly submitted that the State Government having given an undertaking in Avtar Singh 's case that they are prepared to carry out the directions made by the High Court, they are bound to grant the benefit of paragraph 3 of the Circular to all the Teachers belonging to Category B Group II entitled to the higher grade of pay on their acquiring or improving their qualification, as 1094 from the respective dates of their passing the examination. He further submitted that it was not open to the Government on the pretext of verification of claims to confine the relief to some of the teachers and deny the same to the others who were all similarly situate, recruited in the same manner and appointed as Matriculate JBT Teachers and had improved their qualifications by acquiring degrees in B.A., B.T. etc. and the so called professional training i.e. JST/JAV could not be made a condition pre requisite to the grant of higher pay. In reply Shri R.S. Sodhi, learned counsel for the State Government, with his usual fairness accepted that the Government was bound by the undertaking given in Avtar Singh 's case but contended that even so, the petitioners were not entitled to such higher pay as they did not stand the eligibility test on verification of their claims merely on their acquiring higher educational qualification. He pointed out that according to paragraph 3 of the Circular, all Teachers according to their qualifications were placed into two broad categories for purposes of revision of pay, Category A consisting of B.A/B.Sc/B.Com/B.Sc (Agriculture) and BT, and Category B consisting of 4 groups of whom Group I was 'Matrics with basic training (including JBT) '. There were three scales of pay in Category B Lower Rs.60 120, Middle Rs.120 175 and Upper Rs. By way of incentive, it was directed that posts falling in these grounds would be in the following proportion Group I, Lower Scale 85%, Middle Scale 15%. 15% of Teachers in this group had to be straightway promoted to the Middle Scale by selection based on seniority and merit, while the rest were given the Lower Scale. The scale of Rs.60 120 was later revised to Rs.125 300, that of Rs. 120 175 to Rs.150 300 and that of Rs.140 200 to Rs.480 880 w.e.f. 1st November, 1966, 16th July, 1975 and 1st January, 1978. In contrast, Junior Secondary Trained/Junior Anglo Vernacular Teachers with JST/JAV teachers training qualifications were placed in Category B Group II and their pay scale was not revised. The then existing incumbents in this category were allowed to retain their existing pay scale of Rs.80 250 which was subsequently revised from time to time as per conditions of their service. As a diminishing cadre, they were therefore carried on a protected pay scale of B.A., B.T. Teachers viz. According to the learned counsel, the question before the Court is whether JBT Teachers placed in Category B Group II have to be given the benefit of the pay scale of Rs.620 1200. This, he says, cannot be done as these Teachers were not entitled to initial scale of Rs.80 250 meant only for Junior Secondary Trained/Junior Anglo Vernacular Teachers with JST/JAV training qualification i.e. Teachers governed by the protected category. At the hearing 1095 we directed the State Government to clarify its stand on the eligibilitytest of Category B Group II Teachers to higher pay. The Director of Public Instructions (Schools), Pubjab and the Deputy Director (School Admn), Office of the Director of Public Instructions have accordingly filed their additional affidavits dated 10th November, 1986 and 9th March, 1987. The petitioners have also placed on record their written submissions in answer to these additional affidavit. The controversy is now limited to the question whether JBT Teachers falling under Category B Group II are not entitled to the higher pay merely on their acquiring higher educational qualification of B.A. etc. but that gaining professional experience of JST/JAV training was essential. That must turn on the relevant clause in paragraph 3 relating to them which may be extracted below: "Category 'B ' Group II Junior School Teachers (including Assistant Mistresses with B.R./Inter/Matric plus J.A.V. Training). " As a matter of plain construction, we are quite clear in our mind that Graduate Teachers form a class by themselves and cannot be subjected to the further requirement of having JST/JAV training. The words 'plus JAV training ' clearly qualify the word 'Matric ' and relate only to Matriculate JBT Teachers. Such a classification for revision of pay satisfies the touchstone of article 14 and would render the action of the State Government in seeking to discriminate between Graduate Teachers with JST/JAV training and Graduate Teachers with or without such training, impermissible as the attempt is to create a class within a class without any rational basis. We must accordingly uphold contention of the petitioners that they are entitled to higher pay on acquiring or improving their academic qualification. It is regrettable that despite clear pronouncements made by this Court as well as the High Court in a long line of decisions starting with Kirpal Singh Bhatia 's case, there is no redressal of the wrong done to JBT Teachers belonging to Category B Group II although they had acquired B.A., B.T./B.A., B.Ed. qualifications. Quite recently, in Chaman Lal & Ors. vs State of Haryana, , Chinnappa Reddy, J. has considered the question in some depth. The learned Judge repelled the contention of the State Government of Haryana based on its order dated 5th September, 1979 which was sought to be interpreted to mean that the Teachers who had acquired the B.T. or B.Ed. qualification subsequent to 1st December, 1096 1967, the date on which the 1968 order came into force, and before 5th September, 1979, would be entitled to the higher grade but w.e.f. 5th September, 1979 only and that those who acquired the qualification subsequent to that date would not be entitled to the higher grade. According to the High Court in that case, the 1968 order did away with the principle of the 1957 order that Teachers who acquired B.T. or B.Ed. qualification should get the higher grade and that a concession was shown in 1979 enabling the Teachers who acquired the B.T. or B.Ed. qualification between 1968 and 1979 to get the higher scale from 1979. This Court held that the view taken by the High Court could not be sustained and observed: "The principle that pay should be linked to qualification was accepted by the Punjab Government in 1957 and when Kirpal Singh Bhatia case was argued in the High Court and in the Supreme Court there was not the slightest whisper that the principle had been departed from in the 1968 order. In fact the 1968 order expressly stated that the government had accepted the Kothari Commission 's report in regard to scales of pay and as already pointed out by us the main feature of the Kothari Commission 's report in regard to pay was the linking of pay to qualification. That was apparently the reason why no such argument was advanced in Kirpal Singh Bhatia case. Even subsequently when several writ petitions were disposed of by the High Court of Punjab and Haryana and when the government issued consequential orders, it was never suggested that the 1968 order was a retraction from the principle of qualification linked pay. " The Learned Judge then said: "The 1968 order must be read in the light of the 1957 order and the report of the Kothari Commission which was accepted. If so read there can be no doubt that the government never intended to retract from the principle that teachers acquiring the BT or BEd would be entitled to the higher grade with effect from the respective dates of their acquiring that qualification. The 1979 order was indeed superfluous. There was no need for any special sanction for the grant of Master 's grade to unadjusted JBT teachers who had passed BA, BEd. That was already the position when obtained both as a result of the 1957 and 1968 orders 1097 and the several judgments of the court. We do not think that the Punjab and Haryana High Court was justified in departing from the rule in the judgment under appeal. The rule had been well established and consistently acted upon. Nor was it open to the government to act upon the principle in some cases and depart from it in other cases. " The result therefore is that the writ petitions succeed and are allowed with costs. We direct the respondents to give to the petitioners who are Teachers placed in Category B Group II, the higher scale of pay admissible to Teachers in Category B Group I, they having acquired the qualification of B.A., B.T./B.A., B.Ed. etc., with effect from the respective dates of their acquiring the qualification. Petitions allowed.
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The state government, in a letter from July 23, 1957, told the Education Department to change the pay for different types of staff, including teachers. Paragraph 3 of this letter said that teachers' pay should be changed and divided them into two groups: Category A and Category B. Each category had different requirements for education. Category B was divided even further into two groups: Group I included teachers with a high school diploma and basic training (like junior teachers). Group II included junior school teachers (like assistant teachers with a bachelor's degree, some college, or a high school diploma plus JAV training). The court often helped teachers who got better educations but were denied higher pay. It ordered the government to give them the benefits of paragraph 3 from the letter. Following a court order in the case of Avtar Singh vs Manmohan Singh, the Director of Public Instructions (Schools) approved paying back wages to teachers in Category B Group I. This also included 3600 JBT teachers in Category B Group II who got their bachelor's degrees or other higher degrees. However, about 6,000 other teachers in Category B Group II were denied this benefit because they didn't have the required professional training of JST/JAV. The government said they weren't eligible for the higher pay. In petitions to the court, the teachers with high school diplomas and basic training in Category B, Group II of the 1957 letter argued that the government had to give them higher pay when they improved their education. They said the government couldn't only give the benefit to some teachers while denying it to others who were in the same situation, had the same training, and had improved their education by getting degrees. They also argued that professional training (JST/JAV) shouldn't be a requirement for higher pay. The state government argued against these petitions. It said that teachers shouldn't get higher pay just for getting more education. They had to pass an "eligibility test" after the government checked their qualifications. The government stated that according to the 1957 letter, teachers were placed into two categories for pay changes based on their qualifications. Category A included those with bachelor's degrees or other advanced degrees. Category B Group I was for those with a high school diploma and basic training. The main question was whether JBT teachers in Category B Group II were entitled to higher pay just for getting a bachelor's degree, or if they also needed professional experience like JST/JAV training. The Court ruled in favor of the teachers, stating that: 1. Teachers with bachelor's degrees are a distinct group and shouldn't be required to have JST/JAV training. The words "plus JAV training" only apply to teachers with a high school diploma and JBT training. It's unfair to treat graduate teachers differently based on whether they have JST/JAV training. The government can't create different groups within the same group without a good reason. 2. It's unfortunate that the government hasn't fixed the problem for JBT teachers in Category B Group II who got bachelor's degrees, even though the courts have made it clear in many cases that they should. 3. The teachers in Category B Group II are entitled to higher pay when they improve their education. The government was ordered to give them the higher pay scale that teachers in Category B Group I receive, starting from the date they earned their higher degrees. The court referred to previous cases: State of Punjab & Anr. vs Kirpal Singh Bhatia & Ors., [1976] 1 SCR 529; State of Punjab & Ors. vs Labh Singh Garcha & Ors., (C.A. Nos. 926 27/77 decided on August 7, 1979); and Avtar Singh vs Manmohan Singh & Anr., (C.A. No. 3790/83 decided on September 14, 1984).
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317 & 318 of 1950. Appeals by special leave from the judgment and order dated the 29th June 1955 of the Labour Appellate Tribunal of India at Calcutta in Appeals Nos. 61 and 81 of 1954. N. C. Chatterjee, section N. Mukherjee and B. N. Ghose, for the appellants in C. A. No. 317 of 56 and respondent No. 1 in C. A. No. 318 of 56. No. No. 317 of 56. These are two appeals by special leave against the same decision of the Labour Appellate Tribunal of India in a dispute between Messrs. Shalimar Works Ltd., Howrah (hereinafter called the company) and its workmen represented by two unions (hereinafter called the workmen). Appeal No. 317 is by the company while appeal No. 318 is by the workmen. We shall dispose them of by one judgment. There was a dispute between the company and its workmen on a number of matters and it was referred to the Sixth Industrial Tribunal for adjudication by the Government of West Bengal. We shall first deal with the question of profit sharing bonus. It appears that the company had a profit sharing bonus scheme in force on the following lines. It provided that after making certain deductions, if the remaining profit was between Rs. 1,50,000 and Rs. 1,99,999, the workmen would be entitled to quarter of a month 's average basic pay as bonus, When the 152 remaining profit was between Rs. 2 00 lakhs and Rs. 2,49,999, the bonus went up to half of a month 's average basic pay. When the remaining profit was between Rs. 2,50,000 and Rs. 2,99,999, the bonus was to be three quarters of a month 's average basic pay and when the remaining profit was Rs. 3 lacs or more the bonus was to equal one month 's basic pay. No bonus was to be paid if the profit was less than Rs. There were provisions that the full bonus would be paid to a workmen who had attended 275 days in a year (inclusive of holidays and leave with pay) while those with less attendance were to be paid proportionately with the condition that if the attendance of any workman was less than 100 days he would be entitled to no bonus. The workmen wanted this scheme to be revised and the main revision they desired was that the bonus should begin with a profit of Rs. 25,000 after the usual deductions when it would be one week 's wages and should go on increasing till it came to three months ' wages for profit above Rs. 1 lakh and upto Rs. 3 lakhs; thereafter it should increase further at the rate of 21 days ' wages for each lakh over 3 lakhs. This was opposed by the company, though the company agreed to a change in the quantum of bonus when profit after deductions was Rs. 3 lakhs or above. In the scheme in force, the bonus was equal to one month 's basic pay when the profit was Rs. 3 lakhs or above, with no further increase whatsoever be the profits. The company agreed to revise this term and suggested that when profit was (i)between Rs. 3 lakhs to Rs. 4 lakhs, bonus should be four weeks ' wages; (ii) above Rs. 4 lakhs upto Rs. 5 lakhs, bonus should be five weeks ' wages. (iii)above Rs. 5 lakhs, it should be six weeks 'wages The Industrial Tribunal did not accept fully the contentions of either party in this connection, though it varied the scheme in force in certain particulars. After the variation the scheme was as below 153 For remaining profit after the usual deductions (i)from Rs.80,000 to bonus at the rate of one Rs.1,99,999, week 's average basic pay; (ii) from Rs.2 00 lakhs to bonus at the rate of half Rs. 2,49,999, of a month 's average basic pay; (iii) from Rs.2 50 lakhs to bonus at the rate of three Rs. 2 99,999, quarters of a month 's average basic.pay; (iv) from Rs. 3 00 lakhs to bonus at the rate of four Rs. 4 00 lakhs, weeks ' average basic pay; (v) from above bonus at the rate of six Rs.4 00 lakhs up weeks ' average basic toRs. 5 00 lakhs pay ; and (vi) from above bonus at the rate of two Rs. 5 00 lakhs, months ' average basic pay. It also held that bonus for the years 1951 and 1952 should be paid at the existing rates while revised rates should be applied from the year 1953 onwards. Both parties appealed to the Labour Appellate Tribunal against this revision. The company contended that no greater revision than what it had agreed to should have been ordered. In the workmen 's appeal it was contended that the scheme put forward on their behalf should have been accepted. They further contended that the condition of minimum attendance for 100 days should not have been laid down and that the bonus for the years 1951 and 1952 should have been awarded at the revised rates. The Appellate Tribunal saw no reason to interfere with the award of the Industrial Tribunal in this respect and dismissed the appeals with one modification,, namely, it added that if in any year it was found 154 that the bonus worked out according to the award of the Industrial Tribunal was less than profit bonus, calculated according to the Full Bench formula evolved in the Mill Owners ' Association, Bombay vs The Rashtriya Mill Mazdoor Sangh, Bombay (1), the workmen would be entitled to bonus under the formula; otherwise they would get bonus under the scheme as modified by the Industrial Tribunal., In the appeals before us, the company has attacked the revision ordered by the Industrial Tribunal, which was upheld by the Appellate Tribunal, as also the condition added by the latter; while the workmen have attacked the scale fixed by the Industrial Tribunal as also the order of payment of bonus for the years 1951 and 1952, according to the scheme in force before the revision by the Industrial Tribunal, and the conditions as to attendance. Learned counsel for the parties, however, agreed before us that the revision made by the Industrial Tribunal was acceptable to both the parties and that the condition laid down by the Appellate Tribunal that where the bonus according to the scheme is less than the bonus worked out according to the Full Bench formula that formula should be applied, should be deleted. In view of this agreed statement, we delete the condition laid down by the Appellate Tribunal and order that bonus should be paid in accordance with the scheme as revised by the Industrial Tribunal. Learned counsel for the workmen, however, urged that the condition as to minimum attendance of 100 days for entitlement to any bonus at all and of minimum attendance of 275 days for entitlement to full bonus was arbitrary and should be set aside. This condition has been accepted by both the Tribunals and appears reasonable and we see no reason to interfere. It was further contended that bonus for the years 1951 and 1952 should have been ordered to be paid according to the revised scheme. This contention was also negatived by the two Tribunals and we see no reason to differ from them. The two appeals therefore with respect to bonus are dismissed subject to the modification given above. (1) 155 We now come to the question relating to the term in the reference as to the reinstatement of 250 old workmen. The company as well as the workmen were parties to the disputes which was pending before that tribunal. While that adjudication was pending the workmen suddenly pressed certain demands upon the company for immediate solution without awaiting the award of the tribunal, even though the demands so put forward were under adjudication. Consequently, the workmen who had come to work on March 23,1948, started a sit down strike after they had entered the company 's premises. This strike continued from March 23 to 27, and it was on March 27 that the workmen were ejected from the premises by the police according to the case of the company or were induced to leave the premises by the police according to the case of the workmen. Another notice was given by the company on April 6, 1948, in which it was notified that all those who had resorted to illegal strike from March 23, 1948, would be deemed to have been discharged from that date. Thereafter no work was done till May 15, 1948. On that date the company gave a notice that if sufficient suitable men applied for employment on or before May 19, the works would be opened on a limited scale from May 20. It seems, however, that nothing came out of this notice. Eventually on July 5, the company gave another notice to the effect that the works would reopen on July 6, 1948, and all old employees could apply, and if reengaged their past services would 156 be counted and their conditions of service would be as awarded by the Major Engineering Tribunal, which, it seems, had given its award in the meantime. It was also said in the notice that upto July 21, the company would only consider engagement of former employees and no fresh labour would be recruited till that date. Thereafter the majority of the old workmen applied for being retaken in service and everyone who applied upto July 21 was reengaged. Thereafter the company refused to reengage the old employees, a few of whom are said to have applied in November and December, 1948, August, 1951, February, 1952 and January, 1953. He wrote to the company in that connection and it replied that the workmen had been discharged for having taken part in an illegal strike and it could not see its way to reemploy them. For a long time nothing seems to have happened thereafter till we come to October 7, 1952, when the first reference was made with respect to the reinstatement of 250 old workmen. Niyogi. That gentleman went on retirement before he could dispose of the reference and consequently another reference was made on November 18, 1953 to the present tribunal consisting of Shri M.L. Chakraborty. No list of 250 workmen was sent to the Tribunal about whom it was to consider the question of reinstatement. No list of these workmen was filed even before the Industrial Tribunal during the adjudication proceedings: It was only after the arguments on behalf of the company were over on December 14,1953, that a list of names was filed before the Industrial Tribunal. This list consisted of 220 persons only though the reference was with respect to 250. As has been pointed out by the Appellate Tribunal, it was a carelessly prepared list in which some names were repeated. In spite of this, the Industrial Tribunal ordered reinstatement without specifying who were to be reinstated; it really 157 did not know who were the persons to be reinstated. What it did was to order the company in order that identity of the workmen to be reinstated might be established to give a general notice on its notice board notifying the strikers to come and join their duties on a fixed date and to reinstate whichever striker applied within the time allowed. The Appellate Tribunal was of the view that " no award could be so loosely or vaguely made ". It further went on to consider whether identity could in any manner be fixed. In this connection it relied on the remarks made by the company (which had, however, objected to the production of the list at that late stage) on this list under orders of the Indust rial Tribunal. It found that 100 out of them had withdrawn their provident fund. It, therefore, held that so far as these 100 were concerned, they accepted the order of discharge because of the with. drawal of the provident fund and no further relief could be granted to them. As for the remaining fifteen workmen, it pointed out that they had not withdrawn their provident fund. It, therefore, ordered these fifteen workmen to be reinstated. Finally, it ordered that no compensation could be allowed to the workmen for the period between their discharge and their reinstatement because of the delay on their part in asking for redress. The reason which impelled the Appellate Tribunal to order reinstatement was that the notice of discharge dated April 6, 1948, was not served on the workmen individually and though the notice of July 5, 1948, inviting the former workmen to come and join the company was given wide publicity, it was also not served on the workmen individually. According to the Appellate Tribunal, " the net result was that there was defective communication of notice of discharge to the workmen and the notice offering reinstatement was not also sufficiently published to enable it to hold 158 that the defect was cured ". As to the sit down strike itself, both the Tribunals were of the view that the strike was the result of pre concerted action and there was no justification for it when the matter was pending before a tribunal for adjudication. The plea of the workmen that the strike resulted spontaneously because of the insult offered by the manager to a deputation of the workmen on March 23 was disbelieved by both the Tribunals. The main contention on behalf of the company in this connection is that when both the Tribunals had found the sit down strike unjustified, they should have held that the company was entitled to discharge the workmen, in the particular circumstances of this case. It is also urged that the discharge took place in April, 1948 and the company reopened in July, 1948; the reference of the matter more than four years after without the list of the workmen said to have been discharged, was not proper. On the other hand it has been urged on behalf of the workmen that as a, dispute was pending between the company and its workmen, the company could not discharge the workmen without obtaining permission of the tribunal under section 33 of the , and inasmuch as the notice of discharge of April 6, 1948, was given without obtaining the sanction of the tribunal before whom the dispute was then pending, it was a breach of section 33 and therefore the order of discharge being in breach of law the workmen were entitled to reinstatement. The remedy for such a, breach is provided in section 33 A and it can be availed of by an individual workman. If therefore it was felt by the workmen who were discharged on April 6, 1948, that there was breach of section 33 by the company, they should have applied individually or collectively to the tribunal under section 33 A. None of them did this. It is true that some kind of letter was written to the Assistant (1) 159 Labour Commissioner in November, 1949, but that was also very late and nothing seems to have happened thereafter for almost another three years, till the first reference was made on October 7, 1952. It is true that there is no limitation prescribed for reference of disputes to an industrial tribunal; even so it is only reasonable that disputes should be referred as soon as possible after they have arisen and after conciliation proceedings have failed, particularly so when disputes relate to discharge of workmen wholesale, as in this case. The industry has to carry on and if for any, reason there has been a wholesale discharge of workmen and closure of the industry followed by its reopening and fresh recruitment of labour, it is necessary that a dispute regarding reinstatement of a large number of workmen should be referred for adjudication within a reasonable time. We are of opinion that in this particular case the dispute was not referred for adjudication within a reasonable time as it was sent to the Industrial Tribunal more than four years after even reemployment of most of the old workmen. We have also pointed out that it was open to the workmen themselves even individually to apply under section 33 A in this case; but neither that was done by the workmen nor was the matter referred for adjudication within a reasonable time. In these circumstances, we are of opinion that the tribunal would be justified in refusing the relief of reinstatement to avoid dislocation of the industry and that is the correct order to make. In addition, the reference in this case was vague inasmuch as the names of 250 workmen to be reinstated were not sent to the Industrial Tribunal and no list of these men was given to it till practically after the whole proceeding was over. Even the list then supplied was so bad that the Industrial Tribunal did not think it worthwhile to act upon it, and directed the company to give a notice to the strikers to ask for re employment within a certain time. This the company had already done on July 5, 1948. That notice had gained con siderable publicity, for the majority of the workmen did appear thereafter for re employment by July 21. The defect, in the order of discharge of April 6, due to permission not having been obtained under section 33 can in the circumstances of this case be ignored on the ground that the workmen who did not rejoin in July 1948, were not interested in reinstatement: firstly, on account of the circumstances in which that order came to be made after an illegal and unjustified sit down strike, secondly, because the workmen in their turn did not avail themselves of the remedy under section 33 A which. was open to them, and thirdly, because the reference was made after an unreasonable length of time and in a vague manner. We are therefore of opinion that the Appellate Tribunal should not have ordered the reinstatement of even the fifteen workmen in the circumstances as their case was exactly the same as the case of the hundred workmen, except in the matter of the withdrawal of the provident fund. After the application for special leave was allowed this Court made an order on September 26, 1955, that seven days ' wages every month should be paid by the company to the fifteen workmen who had been ordered to be reinstated. Of the remaining seven, two, according to the learned counsel for the company, have obtained other jobs while one is said to be a member of Parliament. The company was prepared to reinstate, out of human considerations, the other four, though, it contends that legally and rightly so it is not bound to reinstate any one of these fifteen workmen. The appeal of the company must therefore be allowed with respect to the remaining eleven workmen who have been ordered to be reinstated by the Appellate Tribunal. The order of the Appellate Tribunal will stand with respect to the four workmen named above in 161 view of the company 's willingness to take them back. The appeal of the workmen on the question of reinstatment fails and is hereby dismissed. We may, however, make it clear that payment made pursuant to the order of this Court will not in any event be refundable or adjustable towards the future wages of those workmen who will be reinstated by the company. Both the company and the workmen have raised other points in their respective grounds of appeal; but as they have not been pressed before us we need not say anything with respect to them. In these circumstances we are of opinion that both the parties will bear their own costs of this Court. Appeal No. Appeal No.
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On March 23, 1948, while some issues were being decided, the workers demanded immediate solutions from the company without waiting for the court's decision. The company said no to these demands, and the workers then started an illegal sit-down strike (where they stayed at work but refused to do their jobs). The company then closed the workplace for an unknown amount of time. They announced that all workers who participated in the illegal strike were fired as of that day. On July 5, the company said that the workplace would reopen on July 6, and all former employees could apply to be rehired by July 21. Most of the former workers applied to be rehired. The company rehired everyone who applied by July 21, but not those who applied later. On November 18, 1953, the government asked the court to order the company to rehire 250 former workers who had not been rehired. The government did not send a list of the 250 workers to the court. A list wasn't even filed during the court hearings. After the company finished making its arguments, the workers filed a poorly made list of 220 people on December 14, 1953. The court ordered the company to rehire workers, but didn't say which ones. It told the company to post a general notice telling the striking workers to come back to work by a certain date and to rehire those who applied on time. On appeal, a higher labor court only upheld the order to rehire 15 workers. The court decided that there was no good reason to order the company to rehire any of the workers. The government's request was too unclear and made after too much time had passed. It's important for disputes to be brought to court quickly after they happen, especially after talks to resolve the issues fail. This is especially true when many workers are fired and new workers are hired. Even though the workers were fired while a dispute was ongoing, which broke Section 33 of the law, the workers should have used Section 33A of the Act to address this. But they didn't. This mistake in how the workers were fired can be overlooked in this case because of the illegal strike, the failure to use Section 33A, and the long delay and unclear nature of the government's request. All of this suggests that the workers were not really interested in being rehired.
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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Bhuvan Goel ...Petitioner(s) Versus Punjab and Haryana High Court, Sector-1, Chandigarh through its Registrar and another. ...Respondent(s) CORAM: HON'BLE MR. JUSTICE SHEEL NAGU, CHIEF JUSTICE HON'BLE MR. JUSTICE SUDHIR SINGH Present:- Mr. Nayandeep Rana, Advocate, for the petitioner. Mr. Sanjeev Sharma, Senior Advocate, with Ms. Shubreet Kaur Saron, Advocate, for respondent - High Court. Mr. Balvinder Sangwan, Advocate, for respondent - HPSC. **** SHEEL NAGU, C.J. (ORAL) 1. The petitioner, who is an aspirant for appointment as Civil Judge (Entry Level) having applied pursuant to Advertisement No. 1/2024 dated 01.01.2024 (Annexure P-1) issued by the Haryana Public Service Commission, is aggrieved that despite having secured 513.50 marks out of 900 marks in the written (main) examination, petitioner was awarded marks, but could secure as low as 29.75 marks out of 200 marks in viva-voce. 2. The ground that has been taken in support of non-appointment is that, petitioner despite doing his best in the interview could not succeed. 3. Learned counsel for the petitioner has placed reliance on a decision of the Constitution Bench of Apex Court in Ajay Hasia and others Vs Khalid Mujib Sehravardi and others, (1981) 1 Supreme Court Cases 722 1 of 11 Neutral Citation No:=2025:PHHC:001738-DB -2- CWP-32436-2024 (O&M) (Annexure P-4). The relevant paragraphs 17, 18, 19 and 20 of the said decision are reproduced as under:-
"18. The second ground of challenge questioned the validity of viva voce examination as a permissible test for selection of candidates for admissions to a college. The contention of the petitioners under this ground of challenge was that viva voce examination does not afford a proper criterion for assessment of the suitability of the candidates for admission and it is a highly subjective and impressionistic test where the result is likely to be influenced by many uncertain and imponderable factors such as predilections and prejudices of the interviewer, his attitudes and approaches, his preconceived notions and idiosyncrasies and it is also capable of abuse because it leaves scope for discrimination, manipulation and nepotism which can remain undetected under the cover of an interview and moreover it is not possible to assess the capacity and calibre of a candidate in the course of an interview lasting only for a few minutes and, therefore, selections made on the basis of oral interview must be regarded as arbitrary and hence violative of Article 14. Now this criticism cannot be said to be wholly unfounded and it reflects a point of view which has certainly some validity. We may quote the following passage from the book on Public Administration in Theory and Practice by M.P. Sharma which voices a far and balanced criticism of the oral interview method:
"The oral test or the interview has been much criticised on the ground of its subjectivity and uncertainty. Different interviewers have their own notions of good personality. For some, it consists more in attractive physical appearance and dress rather than anything else, and with them the breezy and shiny type of candidate scores highly while the rough uncut diamonds may go unappreciated. The atmosphere of the interview is artificial and prevents some candidates from appearing at their best. Its duration is short, the few questions of the hit-or-miss type, which are put, may fail to reveal the real worth of the candidate. It has been said that God takes a whole lifetime to judge a man's worth while interviewers have to do it in a quarter of an hour. Even at its best, the common sort of interview reveals but the superficial aspects of the candidate's personality like appearance, speaking power, and general address. Deeper traits of leadership, tact, forcefulness, etc. go largely undetected. The interview is often in the nature of desultory conversation. Marking differs greatly from examiner to examiner. An analysis of the interview results show that the marks awarded to candidates who competed more than once for the same service vary surprisingly. All this shows that there is a great element of chance in the interview test. This becomes a serious matter when the marks assigned to oral test constitute a high proportion of the total marks in the competition." Ol Glenn Stahl points out in his book on Public Personnel Administration that there are three disadvantages from which the oral test method suffers, namely, "(1) the difficulty of developing valid and reliable oral tests; (2) the difficulty of securing a reviewable record on an oral test; and (3) public suspicion of the oral test as a channel for the exertion of political influence" and we may add, other corrupt, 2 of 11 Neutral Citation No:=2025:PHHC:001738-DB -3- CWP-32436-2024 (O&M) nepotistic or extraneous considerations. The learned author then proceeds to add in a highly perceptive and critical passage:
"The oral examination has failed in the past in direct proportion to the extent of its misuse. It is a delicate instrument and, in inexpert hands, a dangerous one. The first condition of its successful use is the full recognition of its limitations. One of the most prolific sources of error in the oral test has been the failure on the part of examiners to understand the nature of evidence and to discriminate between that which was relevant, material and reliable and that which was not. It also must be remembered that the best oral interview provides opportunity for analysis of only a very small part of a person's total behaviour. Generalizations from a single interview regarding an individual's total personality pattern have been proved repeatedly to be wrong." But, despite all this criticism, the oral interview method continues to be very much in vogue as a supplementary test for assessing the suitability of candidates wherever test of personal traits is considered essential. Its relevance as a test for determining suitability based on personal characteristics has been recognised in a number of decisions of this Court which are binding upon us. In the first case on the point which came before this Court, namely, R. Chitralekha v. State of Mysore [AIR 1964 SC 1823 : (1964) 6 SCR 368] this Court pointed out-- "In the field of education there are divergent views as regards the mode of testing the capacity and calibre of students in the matter of admissions to colleges. Orthodox educationists stand by the marks obtained by a student in the annual examination. The modern trend of opinion insists upon other additional tests, such as interview, performance in extracurricular activities, personality test, psychiatric tests etc. Obviously we are not in a position to judge which method is preferable or which test is the correct one.... The scheme of selection, however, perfect it may be on paper, may be abused in practice. That it is capable of abuse is not a ground for quashing it. So long as the order lays down relevant objective criteria and entrusts the business of selection to qualified persons, this Court cannot obviously have any say in the matter."
and on this view refused to hold the oral interview test as irrelevant or arbitrary. It was also pointed out by this Court in A. Peeriakaruppan v. State of Tamil Nadu [(1971) 1 SCC 38 : (1971) 2 SCR 430] (SCC p. 44, para 13): "In most cases, the first impression need not necessarily be the best impression. But under the existing conditions, we are unable to accede to the contentions of the petitioners that the system of interview as in vogue in this country is so defective as to make it useless." It is therefore not possible to accept the contentions of the petitioners that the oral interview test is so defective that selecting candidates for admission on the basis of oral interview in addition to written test must be regarded as arbitrary. The oral interview test is undoubtedly not a very satisfactory test for assessing and evaluating the capacity and calibre of candidates, but in the absence of any better test for measuring personal characteristics and traits, the oral interview test must, at the present stage, be regarded as not irrational or irrelevant though it is subjective and 3 of 11 Neutral Citation No:=2025:PHHC:001738-DB -4- CWP-32436-2024 (O&M) based on first impression, its result is influenced by many uncertain factors and it is capable of abuse. We would, however, like to point out that in the matter of admission to college or even in the matter of public employment, the oral interview test as presently held should not be relied upon as an exclusive test, but it may be resorted to only as an additional or supplementary test and, moreover, great care must be taken to see that persons who are appointed to conduct the oral interview test are men of high integrity, calibre and qualification.
19. So far as the third ground of challenge is concerned, we do not think it can be dismissed as unsubstantial. The argument of the petitioners under this head of challenge was that even if oral interview may be regarded in principle as a valid test for selection of candidates for admission to a college, it was in the present case arbitrary and unreasonable since the marks allocated for the oral interview were very much on the higher side as compared with the marks allocated for the written test. The marks allocated for the oral interview were 50 as against 100 allocated for the written test, so that the marks allocated for the oral interview came to 33 1/3 per cent of the total number of marks taken into account for the purpose of making the selection. This, contended the petitioners, was beyond all reasonable proportion and rendered the selection of the candidates arbitrary and viola-live of the equality clause of the Constitution. Now there can be no doubt that, having regard to the drawbacks and deficiencies in the oral interview test and the conditions prevailing in the country, particularly when there is deterioration in moral values and corruption and nepotism are very much on the increase, allocation of a high percentage of marks for the oral interview as compared to the marks allocated for the written test, cannot be accepted by the court as free from the vice of arbitrariness. It may be pointed out that even in Peeriakaruppan case [(1971) 1 SCC 38 : (1971) 2 SCR 430] , where 75 marks out of a total of 275 marks were allocated for the oral interview, this Court observed that the marks allocated for interview were on the high side. This Court also observed in Nishi Maghu case [(1980) 4 SCC 95] :
"Reserving 50 marks for interview out of a total of 150... does seem excessive, especially when the time spent was not more than 4 minutes on each candidate." There can be no doubt that allocating 33 1/3 per cent of the total marks for oral interview is plainly arbitrary and unreasonable. It is significant to note that even for selection of candidates for the Indian Administrative Service, the Indian Foreign Service and the Indian Police Service, where the personality of the candidate and his personal characteristics and traits are extremely relevant for the purpose of selection, the marks allocated for oral interview are 250 as against 1800 marks for the written examination, constituting only 12.2 per cent of the total marks taken into consideration for the purpose of making the selection. We must, therefore, regard the allocation of as high a percentage as 33 1/3 of the total marks for the oral interview as, infecting the admission procedure with the vice of arbitrariness and selection of candidates made on the basis of such admission procedure cannot be sustained. But we do not think we would be justified in the exercise of our discretion in setting aside the selections made for the academic year 1979-80 after the lapse of a period of about 18 months, since to do so would be to cause immense hardship to those students in whose case the validity of the selection cannot otherwise be questioned and who have nearly completed three semesters and, moreover, even if the 4 of 11 Neutral Citation No:=2025:PHHC:001738-DB -5- CWP-32436-2024 (O&M) petitioners are ultimately found to be deserving of selection on the application of the proper test, it would not be possible to restore them to the position as if they were admitted for the academic year 1979-80, which has run out long since. It is true there is an allegation of mala fides against the Committee which interviewed the candidates and we may concede that if this allegation were established, we might have been inclined to interfere with the selections even after the lapse of a period of 18 months, because the writ petitions were filed as early as October-November 1979 and merely because the court could not take up the hearing of the writ petitions for such a long time should be no ground for denying relief to the petitioners, if they are otherwise so entitled. But we do not think that on the material placed before us we can sustain the allegation of mala fides against the Committee. It is true, and this is a rather disturbing feature of the present cases, that a large number of successfull candidates succeeded in obtaining admission to the college by virtue of very high marks obtained by them at the viva voce examination tilted the balance in their favour, though the marks secured by them at the qualifying examination were much less than those obtained by the petitioners and even in the written test, they had fared much worse than the petitioners. It is clear from the chart submitted to us on behalf of the petitioners that the marks awarded at the interview are by and large in inverse proportion to the marks obtained by the candidates at the qualifying examination and are also, in a large number of cases, not commensurate with the marks obtained in the written test. The chart does create a strong suspicion in our mind that the marks awarded at the viva voce examination might have been manipulated with a view to favouring the candidates who ultimately came to be selected, but suspicion cannot take the place of proof and we cannot hold the plea of mala fides to be established. We need much more cogent material before we can hold that the Committee deliberately manipulated the marks at the viva voce examination with a view to favouring certain candidates as against the petitioners. We cannot, however, fail to mention that this is a matter which requires to be looked into very carefully and not only the State Government, but also the Central Government which is equally responsible for the proper running of the College, must take care to see that proper persons are appointed on the interviewing committee and there is no executive interference with their decision-making process. We may also caution the authorities that though, in the present case, for reasons which we have already given we are not interfering with the selection for the academic year 1979-80, the selections made for the subsequent academic years would run the risk of invalidation if such a high percentage of marks is allocated for the oral interview. We are of the view that, under the existing circumstances, allocation of more than 15 per cent of the total marks for the oral interview would be arbitrary and unreasonable and would be liable to be struck down as constitutionally invalid.
20. The petitioners, arguing under the last ground of challenge, urged that the oral interview as conducted in the present case was a mere pretence or farce, as it did not last for more than 2 or 3 minutes per candidate on an average and the questions which were asked were formal questions relating to parentage and residence of the candidate and hardly any question was asked which had relevance to assessment of the suitability of the candidate with reference to any of the four factors required to be considered by the Committee. When the time 5 of 11 Neutral Citation No:=2025:PHHC:001738-DB -6- CWP-32436-2024 (O&M) spent on each candidate was not more than 2 or 3 minutes on an average, contended the petitioners, how could the suitability of the candidate be assessed on a consideration of the relevant factors by holding such an interview and how could the Committee possibly judge the merit of the candidate with reference to these factors when no questions bearing on these factors were asked to the candidate. Now there can be no doubt that if the interview did not take more than 2 or 3 minutes on an average and the questions asked had no bearing on the factors required to be taken into account, the oral interview test would be vitiated, because it would be impossible in such an interview to assess the merit of a candidate with reference to these factors. This allegation of the petitioners has been denied in the affidavit in reply filed by H.L. Chowdhury on behalf of the College and it has been stated that each candidate was interviewed for 6 to 8 minutes and "only the relevant questions on the aforesaid subjects were asked". If this statement of H.L. Chowdhury is correct, we cannot find much fault with the oral interview test held by the Committee. But we do not think we can act on this statement made by H.L. Chowdhury, because there is nothing to show that he was present at the interviews and none of the three Committee members has come forward to make an affidavit denying the allegation of the petitioners and stating that each candidate was interviewed for 6 to 8 minutes and only the relevant questions were asked. We must therefore, proceed on the basis that the interview of each candidate did not last for more than 2 or 3 minutes on an average and hardly any questions were asked having bearing on the relevant factors. If that be so, the oral interview test must be held to be vitiated and the selection made on the basis of such test must be held to be arbitrary. We are, however, not inclined for reasons already given, to set aside the selection made for the academic year 1979-80, though we may caution the State Government and the Society that for the future academic years, selections may be made on the basis of observations made by us in this judgment lest they might run the risk of being struck down. We may point out that, in our opinion, if the marks allocated for the oral interview do not exceed 15 per cent of the total marks and the candidates are properly interviewed and relevant questions are asked with a view to assessing their suitability with reference to the factors required to be taken into consideration, the oral interview test would satisfy the criterion of reasonableness and non-arbitrariness. We think that it would also be desirable if the interview of the candidates is tape-recorded, for in that event there will be contemporaneous evidence to show what were the questions asked to the candidates by the interviewing committee and what were the answers given and that will eliminate a lot of unnecessary controversy besides acting as a check on the possible arbitrariness of the interviewing committee."
Further reliance is placed on the order dated 05.12.2023 passed by the Apex Court in Civil Appeal No. 6353/2023 titled Aalma Vs Delhi High Court (Annexure P-6). 4. A bare perusal of decision of Apex Court in Ajay Hasia and others Vs Khalid Mujib Sehravardi and others (supra) reveals that the same 6 of 11 Neutral Citation No:=2025:PHHC:001738-DB -7- CWP-32436-2024 (O&M) related to admission to professional course of Engineering and not Judicial Service. 5. As regards the order dated 05.12.2023 passed by the Apex Court in Aalma Vs Delhi High Court (supra), the Apex Court therein exercised its extra-ordinary jurisdiction under Article 142 of the Constitution of India to extend benefit to the appellant concerned. 6. This Court is also of the opinion that the petitioner entered the process of recruitment with open eyes and was well aware of the passing marks being 50 per cent aggregate of the written as well as viva-voce and, therefore, it cannot be said that the petitioner was taken by surprise or the rules of the game were changed after the game had begun. Thus, the principle of estoppel shall operate against an unsuccessful candidate. 6.1 In this regard, learned senior counsel for respondent No. 1 has relied upon a recent decision of Apex Court in Tajvir Singh Sodhi and others Vs State of Jammu and Kashmir and others, 2023 SCC Online SC 344. The relevant paragraph 29 of the said decision is reproduced for ready reference and convenience:-
"29. It was averred that persons who participated in the selection process and interview cannot challenge the same upon being unsuccessful since they do not have a cause to challenge the same and a writ petition filed by them is not maintainable, vide Madan Lal; Anupal Singh v. State of Uttar Pradesh, (2020) 2 SCC 173; Sadananda Halo and Mohd. Mustafa. Reliance was also placed on D. Sarojakumari v. R. Helen Thilakom, (2017) 9 SCC 478. That in the present case, none of the writ petitioners was selected on merit and they were not even on the waiting list, therefore, the writ petitions filed by them were not maintainable on the ground of the same being devoid of any locus." 7. So far as the expectation of a candidate is concerned, this Court has no manner of doubt that every candidate does his best, but that alone cannot be a good reason to interfere if a candidate fails to secure marks as per his or her expectations. 7 of 11 Neutral Citation No:=2025:PHHC:001738-DB -8- CWP-32436-2024 (O&M) 8. It was only because the petitioner secured 29.75 marks out of 200 marks in the viva-voce that relegated him below the 50 percent aggregate marks and, therefore, this Court is afraid that the petitioner cannot be helped. 9. Moreover, in matters of recruitment to services, interference to the process of recruitment when otherwise conducted in a transparent, fair and reasonable manner with no allegation of malafides cannot be gone into in the limited power of judicial review of this Court under Article 226 of the Constitution of India.
10. Recruitment to judicial service is not akin to recruitment to any civil post under the State or UOI. The unique nature of duties and powers attached to a judicial office compels the recruiting agency to adopt mode of selection which is understandably distinct. Emphasis upon viva-voce to a little more extent than other recruitments, is necessary to ensure, that persons of very high level of integrity, aptitude, character and merit, adorn the judicial offices. Whether a candidate has an aptitude, inclination and character to become a judge, cannot alone be determined by written test. Therefore, a little higher percentage of marks for viva-voce than 15% (as stipulated by Apex Court in Ajay Hasia [supra]) in recruitment to judicial offices is understandable. This Court is bolstered in its view by verdict of Apex Court in Lila Dhar Vs State of Rajasthan and others (1981) 4 Supreme Court Cases 159 relevant extracts of which are reproduced below:- "6. Thus, the written examination assesses the man's intellect and the interview test the man himself and "the twain shall meet" for a proper selection. If both written examination and interview test are to be essential features of proper selection, the question may arise as to the weight to be attached respectively to them. In the case of admission to a college, for instance, where the candidate's personality is yet to develop and it is too early to identify the personal qualities for which greater importance may have to be attached in later life, greater weight has per force to be given to performance in the written examination. The importance to be attached to the interview-test must be minimal. That was what was decided by this Court in Periakaruppan v. State of Tamil Nadu [(1971) 1 SCC 38 : (1971) 2 SCR 430] , Ajay Hasia v. Khalid Mujib Sehravardi [(1981) 1 SCC 722; 8 of 11 Neutral Citation No:=2025:PHHC:001738-DB -9- CWP-32436-2024 (O&M)
1981 SCC (L&S) 258 : AIR 1981 SC 487] and other cases. On the other hand, in the case of services to which recruitment has necessarily to be made from persons of mature personality, interview test may be the only way, subject to basic and essential academic and professional requirements being satisfied. To subject such persons to a written examination may yield unfruitful and negative results, apart from its being an act of cruelty to those persons. There are, of course, many services to which recruitment is made from younger candidates whose personalities are on the threshold of development and who show signs of great promise, and the discerning may in an interview-test, catch a glimpse of the future personality. In the case of such services, where sound selection must combine academic ability with personality promise, some weight has to be given, though not much too great a weight, to the interview-test. There cannot be any rule of thumb regarding the precise weight to be given. It must vary from service to service according to the requirements of the service, the minimum qualifications prescribed, the age group from which the selection is to be made, the body to which the task of holding the interview-test is proposed to be entrusted and a host of other factors. It is a matter for determination by experts. It is a matter for research. It is not for courts to pronounce upon it unless exaggerated weight has been given with proven or obvious oblique motives. The Kothari Committee also suggested that in view of the obvious importance of the subject, it may be examined in detail by the Research Unit of the Union Public Service Commission.
7. In this background, let us now examine the situation presented by the Rajasthan Rules. The Rajasthan Judicial Service Rules have been made by the Governor of Rajasthan in consultation with the High Court of Rajasthan and the Rajasthan Public Service Commission. The High Court may be expected to know the precise requirements of the judicial service of the State and the calibre of the available source- material, while the Public Service Commission is an expert body thoroughly conversant with recruitment policies and selection methods. Both the High Court and the Public Service Commission are independent bodies, outside executive control, occupying special positions and enjoying special status under the Constitution. Neither is an outside agency. Both are well-acquainted with the particular needs of their State and the people. If the Governor, in consultation with the High Court and the Public Service Commission of the State makes rules stipulating seventy-five per cent of the marks for the written examination and twenty-five per cent for the interview-test, on what basis can a court say that twenty-five per cent for the interview-test is on the high side? It must not also be forgotten that the interview test is generally conducted and was, in the present case, conducted by a body consisting of a Judge of the High Court, the Chairman and a Member of the Public Service Commission and a special invitee expert. There can surely be no legitimate grievance or hint of arbitrariness against this body. Yet another factor worthy of consideration is that the candidates expected to offer themselves for selection are not raw graduates freshly out of college but are persons who have already received a certain amount of professional training. The source- material is such that some weightage must be given to the interview- test and can it possibly be said that twenty-five per cent of the total marks is an exaggerated weightage. We may add here that it has been made clear by the Chairman, Rajasthan Public Service Commission on 9 of 11 Neutral Citation No:=2025:PHHC:001738-DB -10- CWP-32436-2024 (O&M) whose behalf a counter-affidavit has been filed before us that the marks obtained by the candidates at the written examination were not made available to the members of the Interview Board either before or at the time of the interview. We are unhesitatingly of the view that the selection cannot be struck down on the ground that more than due weightage was given to the interview-test."
In Abhimeet Sinha and others Vs High Court of Judicature at Patna and others (2024) 7 Supreme Court Cases 262 it was held as under:- "78. The recruitment procedure should not only test the candidate's intellect but also their personality, for appointment to posts in the higher judiciary. The writ petitioners have placed great reliance on the judgment in Ajay Hasia [Ajay Hasia v. Khalid Mujib Sehravardi, (1981) 1 SCC 722 : 1981 SCC (L&S) 258] wherein it is canvassed that providing for more than 15% of the total marks for interview, is arbitrary and constitutionally invalid. In Ajay Hasia [Ajay Hasia v. Khalid Mujib Sehravardi, (1981) 1 SCC 722 : 1981 SCC (L&S) 258] the challenge was to the validity of admissions made to the Regional Engineering College for the academic year 1979-1980. Out of 150 total marks, 50 marks were earmarked for interview. Commenting on the validity of viva voce as a permissible test, the Court observed thus : (SCC p. 743, para 18) "18. ... But, despite all this criticism, the oral interview method continues to be very much in vogue as a supplementary test for assessing the suitability of candidates wherever test of personal traits is considered essential. Its relevance as a test for determining suitability based on personal characteristics has been recognised in a number of decisions of this Court which are binding upon us." 79. x x x x x x x x x x
80. It was ultimately concluded that providing for as high a percentage as 33.5% for the interview segment, was infecting the admission procedure with the vice of arbitrariness. For the facts of the present case, the writ petitioners' contention on violation of the aforementioned dictum in Ajay Hasia [Ajay Hasia v. Khalid Mujib Sehravardi, (1981) 1 SCC 722 : 1981 SCC (L&S) 258] is adequately answered in Lila Dhar [Lila Dhar v. State of Rajasthan, (1981) 4 SCC 159 : 1981 SCC (L&S) 588] where the three-Judge Bench considered the issue of selection of Munsifs for Rajasthan Judicial Service. The selection was to be made through written examination as well as interview where 25% marks were earmarked for the viva voce segment. Distinguishing the judgment in Ajay Hasia [Ajay Hasia v. Khalid Mujib Sehravardi, (1981) 1 SCC 722 : 1981 SCC (L&S) 258] which was in the context of college admissions, the Court in Lila Dhar [Lila Dhar v. State of Rajasthan, (1981) 4 SCC 159 : 1981 SCC (L&S) 588] pertinently opined as under : (Lila Dhar case [Lila Dhar v. State of Rajasthan, (1981) 4 SCC 159 : 1981 SCC (L&S) 588] , SCC p. 167, para 9) "9. ... The observations of the Court were made, primarily, in connection with the problem of admission to colleges, where, naturally, academic performance must be given prime importance. The words 10 of 11 Neutral Citation No:=2025:PHHC:001738-DB -11- CWP-32436-2024 (O&M) "or even in the matter of public employment" occurring in the first extracted passage and the reference to the marks allocated for the interview test in the Indian Administrative Service examination were not intended to lay down any wide, general rule that the same principle that applied in the matter of admission to colleges also applied in the matter of recruitment to public services. The observation relating to public employment was per incuriam since the matter did not fall for the consideration of the Court in that case. Nor do we think that the Court intended any wide construction of their observation. As already observed by us the weight to be given to the interview-test should depend on the requirement of the service to which recruitment is made, the source material available for recruitment, the composition of the Interview Board and several like factors. Ordinarily recruitment to public services is regulated by rules made under the proviso to Article 309 of the Constitution and we would be usurping a function which is not ours, if we try to redetermine the appropriate method of selection and the relative weight to be attached to the various tests."
81. The above opinion in Lila Dhar [Lila Dhar v. State of Rajasthan, (1981) 4 SCC 159 : 1981 SCC (L&S) 588] makes it clear that the ratio in Ajay Hasia [Ajay Hasia v. Khalid Mujib Sehravardi, (1981) 1 SCC 722 : 1981 SCC (L&S) 258] , in the context of college admission, may not have much bearing on recruitment for judicial vacancies where oral interviews play an important role to test the personality and calibre of the aspirant to judicial posts." 11. In light of the above, the inference to be drawn is that it is valid to exceed the 15% limit for viva-voce as the broader purpose of evaluating candidate's suit
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The Punjab and Haryana High Court looked at a legal request from a person who was not hired as a Civil Judge. He failed the exam by 6.75 marks. Two judges, Sheel Nagu, CJ., and Sudhir Singh, J., rejected his request. They decided that the applicant knew the rules of the hiring process and the passing scores from the very beginning. So, the court said he couldn't complain about the rules later because he had agreed to them at the start. The court also said it was fine to give the oral interview (viva voce) more than 15% of the total score. This is because choosing someone for a judge's job requires a more detailed way to check if they are suitable.
The applicant was hoping to become a judge. He applied for a beginner Civil Judge job after seeing an announcement from the Haryana Public Service Commission, which handles government hiring. He was upset because even though he scored 513.50 marks out of 900 in the written exam and 29.75 marks out of 200 in the oral interview, he still failed the exam. He needed 550 marks to pass but only got 543.25, missing it by 6.75 marks. Because of this, he filed his legal request with the court.
The Court believed that the applicant knew the rules of the hiring process from the start. He was aware that he needed to get 50% of the total marks from both the written exam and the oral interview combined. So, he couldn't say he was surprised or that the rules changed after the exam began. Because of this, the legal idea called "estoppel" applied to him. This means you cannot challenge something you agreed to earlier. The Court also said that even though every candidate tries their best, that's not a good enough reason for the court to get involved if someone doesn't get the score they hoped for. The Court pointed out that the applicant failed only because he got a low score in the oral interview (29.75 out of 200). This kept him from reaching the total 50% needed from both parts of the exam. Therefore, the Court decided not to help the applicant.
The Court also said that when it comes to hiring people for government jobs, it cannot interfere with the hiring process. This is true if the process was done clearly, fairly, and reasonably, and if there are no claims of bad intentions or dishonesty. The court's power to check if government actions are legal (called "judicial review") is limited by Article 226 of the Constitution.
The Court said that hiring judges is not like hiring for other regular government jobs. A judge's job has special duties and powers, so the group hiring them must use a different way to pick candidates. It's important to give a bit more weight to the oral interview than in other hiring processes. This helps make sure that people with great honesty, natural ability, good character, and talent become judges. A written test alone cannot show if a person has the right skills, desire, and character to be a judge. Because of this, the Court added that it made sense to require a percentage of marks for the oral interview that was a little higher than 15% when hiring judges. The Supreme Court had set the 15% rule in an older case called Ajay Hasia v. Khalid Mujib Sehravardi. The Court also referred to another case, Lila Dhar v. State of Rajasthan, to support its decision.
Because of all these reasons, the Court decided it was okay to go over the 15% limit for the oral interview. This is because judging if someone is truly right for a judge's job needs a more detailed assessment. So, strictly sticking to the 15% limit was not required in these kinds of cases. Based on all these points, the Court rejected the legal request.
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Verma for the Respondents. The first question is whether the exclusion of the jurisdiction of the High Court under Articles 226 and 227 of the Constitution in service matters specified in section 218of the Administrative Tribu nals Act, 1985 (hereinafter referred to as the impugned Act) and the vesting of exclusive jurisdiction in such service matters in the Administrative Tribunal to be constituted under the impugend Act, subject to an exception in favour of the jurisdiction of this Court under Articles 32 and 136, is unconstitutional and void and in any event, even if the first question be answered against the petitioners and in favour of 441 the Government, the second question required to be consid ered is, whether the composition of the Administrative Tribunal and the mode of appointment of Chairman, Vice Chairmen and members have the effect of introducing a con stitutional infirmity invalidating the provisions of the impugned Act. I agreed with the answers given to these questions in the judgment of Ranganath Misra, J. I would articulate my reasons as follows: It is now well settled as a result of the decision of this Court in Minerva Mills Ltd. & Others vs Union of India and Ors. ; that judicial review is a basic and essential feature of the Constitution and no law passed by Parliament in exercise of its constituent power can abrogate it or take it away. If the power of judicial review is abrogated or taken away the Constitution will cease to be what it is. It is a limited Government which we have under the Constitution and both the executive and the legislature have to act within the limits of the power conferred upon them under the Con stitution. It is also a basic principle of the rule of law which permeates every provision of the Constitution and which forms its very core and essence that the exercise of power by the executive or any other authority must not only be conditioned by the Constitution but also be in 442 accordance with law and it is the judiciary which has to ensure that the law is observed and there is compliance with the requirements of law on the part of the executive and other authorities. If by a Constitutional amendment, the power of judi cial review is taken away and it is provided that the validity of any law made by the legislature shall not be liable to be called in question on any ground, even if it is outside the legislative competence of the legislature or is violative of any fundamental rights, it would be nothing short of subver sion of the Constitution, for it would make a mockery of the distribution of legislative powers between the Union and the States and render the fundamental rights meaningless and futile. So also if a constitutional amendment is made which has the effect of taking away the power of judicial review and providing that no amendment made in the Constitution shall be liable to be.questioned on any ground, even if such amendment is violative of the basic structure and, therefore, outside the amendatory power of Parliament, it would be making Parliament sole judge of the consti tutional validity of what it has done and that would, in effect and substance, nullify the limitation on the amending power of Parliament and affect the basic structure of the Consti tution. 443 It is undoubtedly true that my judgment in Minerva Mills Ltd. case (supra) was a minority judgment but so far as this aspect is concerned, the majority Judges also took the same view and held that judicial review is a basic and essential feature of the Constitution and it cannot be abrogated without affecting the basic structure of the Constitution and it is equally clear from the same decision that though judicial review cannot be altogether abrogated by Parliament by amending the Constitution in exercise of its constituent power, Parliament can certainly, without in any way violat ing the basic structure doctrine, set up effective alterna tive institutional mechanisms or arrangements for judicial review. The basic and essential feature of judicial review cannot be dispensed with but it would be within the compe tence of Parliament to amend the Constitution so as to substitute in place of the High Court, another alternative institutional mechanism or arrangement for judicial review, provided it is no less efficacious than the High Court. Therefore, if any constitutional amendment made by Parlia ment takes away from the High Court the power of judicial review in any particular area and vests it in any other institutional mechanism or authority, it would not be viola tive of the basic structure doctrine, so long as the essen tial condition is fulfilled, namely that the alternative institutional mechanism or authority set up by the parlia mentary amendment is no less effective than the High Court. Here, in the present case, the impugned Act has been enacted by Parliament in exercise of the power conferred by clause (1) of Article 323A which was introduced in the Constitution by Constitution (42nd Amendemnt) Act, 1976. The exclusion of the jurisdiction of the High Court under Articles 226 and 227 by any law made by Parliament under clause (1 ) of Article 323A is, there fore, specifically authorised by the constitutional amend ment enacted in clause (2) (d) of that Article. It is dear from the discussion in the preceding paragraph that this constitutional amendment authorising exclusion of the juris diction of the High Court under Articles 226 and 227 postu lates for its validity that the law made under clause (1) of Article 323A excluding the jurisdiction of the High Court under Articles 226 and 227 must provide for an effective alternative institutional mechanism or authority for judi cial review. If this constitutional amendment were to permit a law made under clause (1) of Article 323A to exclude the jurisdiction of the High Court under Articles 226 and 227 without setting up an effective alternative 444 institutional mechanism or arrangement for judicial review, it would be violative of the basic structure doctrine and hence outside the constituent power of Parliament. It must, therefore, be read as implicit in this constitutional amend ment that the law excluding the jurisdiction of the High Court under Articles 226 and 227 permissible under it must not leave a void but it must set up another effective insti tutional mechanism or authority and vest the power of judi cial review in it. Consequently, the impugned Act excluding the jurisdiction of the High Court under Articles 226 and 227 in respect of service matters and vesting such jurisdic tion in the Administrative Tribunal can pass the test of constitutionality as being within the ambit and coverage of clause (2) (d) of Article 323A, only if it can be shown that the Administrative Tribunal set up under the impugned Act is equally efficacious as the High Court, so far as the power of judicial review over service matter is concerned. It is necessary to bear in mind that service matters which are removed from the jurisdiction of the High Court under Articles 226 and 227 of the Constitution and entrusted to the Administrative Tribunal set up under the impugned Act for adjudication involve questions of interpretation and applicability of Articles 14, 15, 16 and 311 in quite a large number of cases. That is the reason why at the time of the preliminary hearing of these writ petitions we insisted that every bench of the Administrative Tribunal should consist of one judicial member and one administrative member and there should be no preponderance of administrative members on any bench. Now section 6 provides that the Chairman of the Administrative Tribunal should be or should have been a Judge of the High Court or he should have for at least two years held office of Vice Chairman or he should have for at least two years held the post of 445 Secretary to the Government of India or any other post under the Central or State Government carrying a scale of pay which is not less than that of a Secretary to the Government of India. I entirely agree with Ranganath Misra, J. that the Chairman of the Administrative Tribunal should be or should have been a Judge of a High Court or he should have for at least two years held office as Vice Chairman. If he has held office as Vice Chairman for a period of at least two years he would have gathered sufficient experience and also within such period of two years, acquired reasonable familiarity with the constitutional and legal questions involved in service matters, But substituting the Chief Justice of a High Court by a Chairman of the Administrative Tribunal who has merely held the post of a Secretary to the Government and who has no legal or judicial experience would not only fail to inspire confidence in the public mind but would also render the Administrative Tribunal a much less effective and efficacious mechanism than the,High Court. I am, therefore, of the view, in agree ment with Ranganath Misra, J. that clause (c) of section 6 (1) must be struck down as invalid. It may be noted that since the Administrative Tribunal has been created in substitution of the High Court, the Vice Chairman of the Administrative Tribunal would be in the position of a High Court Judge and if a District Judge or an advocate qualified to be a Judge of the High Court, is eligible to be a High Court Judge, there is no reason why he should not equally be eligible to be a Vice Chairman of the Administrative Tribunal. I would therefore suggest that a District Judge or an Advocate who is qualified to be a Judge of the High Court should be regarded as eligible for being Vice Chairman of the Administrative Tribunal and unless an amendment to that effect is carried out on or before 31st March, 1987, the impugned Act would have to be declared to be invalid, because the provision in regard to composition of the Administrative Tribunal cannot be severed from the other provisions contained in the impugned Act. So far as the appointment of judi cial members of the Administrative Tribunal is concerned, there is a provision introduced in the impugned Act by way of amendment that the judicial members shall be appointed by the Government concerned in consultation with the Chief Justice of India. Obviously no exception can be taken to this provision, because even so far as Judges of the High Court are concerned, their appointment is required to be made by the President inter alia in consultation with the Chief Justice of India. The result is that it is left to the absolute unfettered discretion of the Government to appoint such person or persons as it likes as Chairman, Vice Chairman and administrative members of the Administra tive Tribunal. Now it may be noted that almost all cases in regard to service matters which come before the Administra tive Tribunal would be against the Government or any of its officers and it would not at all be conducive to judicial independence to leave unfettered and unrestricted discretion in the executive to appoint the Chairman, Vice Chairmen and administrative members, if a judicial member or an adminis trative member is looking forward to promotion as Vice Chairman or Chairman, he would have to depend on the good will and favourable stance of the executive and that would be likely to affect the independence and impartiality of the members of the Tribunal. The administrative members would also be likely to carry a sense of obligation to the executive for having been appointed members of the Administrative Tribunal and that would have a tendency to impair the independence and objectivity of the members of the Tribunal. There can be no doubt that the power of appointment and promotion vested in the executive can have prejudicial effect on the 447 independence of the Chairman, Vice Chairmen and members of the Administrative Tribunal, if such power is absolute and unfettered. That is the reason why in case of appointment of High Court Judges, the power of appointment vested in the executive is not an absolute unfettered power but it is hedged in by a wholesome check and safeguard and the President cannot make an appointment of a High Court Judge without consultation with the Chief Justice of the High Court and the Chief Justice of India and a healthy convention has grown up that no appointment would be made by the Government which is not approved by the Chief Justice of India. This check or safe guard is totally absent in the case of appointment of the Chairman, Vice Chairmen and administrative members of the Administrative Tribunal and the possibility cannot be ruled out indeed the litigating public would certainly carry a feeling that the decisionmaking process of the Chairman, Vice Chairmen and members of the Administrative Tribunal might be likely to be affected by reason of dependence on the executive for appointment and promotion. Obviously, therefore if the Adminis trative Tribunal is created in substitution of the High Court and the jurisdiction of the High Court under Articles 226 and 227 is taken away and vested in the Administrative Tribunal, the same independence from possibility of execu tive pressure or influence must also be ensured to the Chairman, Vice Chairmen and members of the Administrative Tribunal. There is also another alternative which may be adopted by the Government for making appointments of Chairman, Vice Chairmen and mem bers and that may be by setting up a High Powered Selection Committee headed by the Chief Justice of India or a sitting Judge of the Supreme Court or concerned High Court nominated by the Chief Justice of 448 India. Otherwise, it will be outside the scope of the power conferred on Parliament under Article 323 A. I would, however hasten to add that this judgment will operate only prospectively and will not invalidate appointments already made to the Administrative Tribunal. But if any appointments of Vice Chairmen or administrative members are to be made hereafter, the same shall be made by the Government in accordance with either of the aforesaid two modes of ap pointment. I may also add that if the Administrative Tribunal is to be an equally effective and efficacious substitution for the High Court on the basis of which alone the impugned Act can be sustained, there must be a permanent or if there is not sufficient work, then a Circuit Bench of the Administrative Tribunal at every place where there is a seat of the High Court. In exercise of power vested under Section 1(3) of the Act, the Central Government ap pointed 1.11.1985 as the date from which the Act would come into force. On 31.10. Learned Attorney General on behalf of the Central Government assured the Court that early steps would be taken to amend the law so as to save the jurisdiction under Article 32, remove other minor anomalies and set up a bench of the Tribunal at the seat of every High Court. Most of the original grounds of attack thus do not survive and the contentions that were canvassed at the hearing by the counsel appearing for different parties are these (1) Judicial review is a fundamental aspect of the basic structure of our Constitution and bar of the jurisdiction of the High Court under Articles 226 and 227 as contained in Section 28 of the Act cannot be sustained; (2) Even if the bar of jurisdiction is upheld, the Tribunal being a substitute of the High Court, its constitution and set up should be such that it would in fact function as such substitute and become an institution in which the parties could repose faith and trust; (3) Benches of the Tribunal should not only be established at the seat of every High Court but should be available at every place where the High Courts have permanent benches; (4) So far as Tribunals set up or to be set up by the Central or the State Govern ments are concerned, they should have no jurisdiction in respect of employees of the Supreme Court or members of the subordinate judiciary and employees working in such estab lishments inasmuch as exercise of jurisdiction of the Tribunal would interfere with the control absolutely vested in 450 the respective High Courts in regard to the judicial and other subordinate officers under Article 235 of the Constitution. I am of the view that if there is one feature of our Constitution which, more than any other, is basic and fundamental to the maintenance of democracy and the rule of law, it is the power of judicial review and it is unquestionably, to my mind, part of the basic structure of the Constitution. Of course, when 1 say this I should not be taken to suggest that, however effective alternative institutional mechanisms or arrangements for judicial review cannot be made by Parliament. Article 32 was described by Dr. Ambedkar in course of the debate in the Constituent Assembly as the 'soul ' and 'heart ' of the Constitution and it is in recognition of this position that though Article 323A(2)(d) authorised exclusion of jurisdiction under Article 32 and the original Act had in Section 28 provided for it, by amendment jurisdiction under Article 32 has been left untouched. As early as 1969, a Committee was set up by the Central Government under the chairmanship of Mr. Justice Shah of this Court to make recommendations suggesting ways and means for effective, expeditious and satisfactory disposal of matters relating to service disputes of Government servants as it Was found that a sizable portion of pending litigations related to this category. Thus it is possible to set up an alternative institution in place of the High Court for providing judicial review. So far as the Chair man is concerned, sub section (1) requires that he should be or have been (a) a Judge of a High Court; or (b) has for at least two years, held office as Vice Chairman; or (c) has, for at least two years, held the post of a Secretary to the Government of India or any other post under the Central or a State Government carrying a scale of pay which is not less than that of a Secretary to the Government of India. Sub section (2) prescribing the qualification for Vice Chairman provides that he should be or have been (a) a Judge of a High Court; or (b) for at least two years, held the post of a Secretary to the Government of India or any other post under the Central or a State Gov ernment carrying a scale of pay which is not less than that of a Secretary to the Govern ment of India; or (bb) for at least five years, held the post of an Additional 455 Secretary to Government of India or any other post carrying equivalent pay; or (c) for a period of not less than three years held office as a judicial member of an Admin istrative Tribunal. We agree that a Vice Chairman with these qualifications and experience of two years may be considered for appointment as Chairman but in order that the Tribunal may be acceptable to the liti gants who are themselves members of the various services, section 6(1)(c) should be omitted. We do not want to say anything about Vice Chairman and members dealt with in sub sections (2), (3) or (3A) because so far as their selection is concerned, we are of the view that such selection when it is not of a sitting Judge or retired Judge of a High Court should be done by a high powered committee with a sitting Judge of the Supreme Court to be nominated by the Chief Justice of India as its Chairman. Section 8 of the Act prescribes the term of office and provides that the term for Chairman, Vice Chairman or mem bers shall be of five years from the date on which he enters upon his office or until he attains the age of 65 in the case of Chairman or Vice Chairman and 62 in the case of member, whichever is earlier. Those who come to be Chair man, Vice Chairman or members resign appointments, if any, held by them before joining the Tribunal and, as such, there would be no scope for their return to the place or places from where they come. At the hearing, learned Attorney General referred to the case of a member of the Public Service Commission who is appointed for a term and even suffers the disqualification in the matter of further employment.
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They must be or have been a judge of a High Court, or have been a Vice Chairman for at least two years, or have been a Secretary to the Government of India for at least two years. Subsection (2) says that a Vice Chairman should be or have been a judge of a High Court, or have been a Secretary to the Government of India for at least two years, or have been an Additional Secretary to the Government of India for at least five years, or have worked as a Judicial Member of an Administrative Tribunal for at least three years. They argued that section 28 of the law, which said that the High Court couldn't hear these cases under articles 226 and 227, was against the Constitution. They also said that the way the Chairman, Vice Chairman, and Members were chosen was not allowed under article 323 A. So, the Chairman of the Tribunal should be similar to the Chief Justice (head judge) of a High Court. It is important that the Chairman has been a Judge of the High Court or has been a Vice Chairman for at least two years. 1.1 Judicial review (the power of courts to decide if a law is constitutional) is a basic part of the Constitution. [441 B, Minerva Mills Ltd. & Ors. 1.2 Clause (2)(d) of article 323 A allows Parliament to make a law that says the High Court cannot hear cases under articles 226 and 227. But if this change to the Constitution allowed a law to take away the High Court's power without creating a good replacement system for judicial review, it would violate the basic structure of the Constitution. So, the change to the Constitution must mean that any law that takes away the High Court's power must create another system that is just as good and gives it the power of judicial review. [443 F, H, 44 A B] 2.1 A judicial tribunal that is meant to replace the High Court needs legal training and experience. [445 D, 444 D] 2.2 The Chairman of the Administrative Tribunal should be or should have been a Judge of a High Court, or should have been a Vice Chairman for at least two years. Replacing the Chief Justice of a High Court with a Chairman of the Administrative Tribunal who has only been a Secretary to the Government of India and doesn't have legal experience would not give the public confidence. So, a District Judge or a lawyer who is qualified to be a Judge of the High Court should be able to be a Vice Chairman of the Administrative Tribunal. Unless this is changed by March 31, 1987, the law will have to be declared invalid because the part about who can be on the Administrative Tribunal cannot be separated from the rest of the law. A, 445 G, 446 B] 4.1 Under the law, the government has the only power to choose the Chairman, Vice Chairman, and Administrative Members. But there is no such check in the case of choosing the Chairman, Vice Chairman, and Administrative Members of the Administrative Tribunal. If the Tribunal is created to replace the High Court and the High Court's power under articles 226 and 227 is given to the Tribunal, then the Chairman, Vice Chairman, and Members of the Tribunal must also be protected from pressure from the government. [446 D, 447 D, B, E] 4.2 So, the government should only choose the Chairman, Vice Chairman, and Administrative Members after asking the Chief Justice of India. Or, a special committee led by the Chief Justice of India or a Judge of the Supreme Court or High Court chosen by the Chief Justice of India could be set up to choose these people. But this new system must be a good replacement for the High Court in every way, so that it is effective and capable of upholding the constitutional rules in Articles 14, 15, and 16 of the Constitution. [453 B, 454 C, 453 E] 2.2 The Tribunal under the law is meant to be a replacement for the High Court, not just an addition to it. 3.1 The Chairman of the Tribunal should be similar to the Chief Justice of a High Court. In order for the Tribunal to be accepted by the people who use it (government employees), section 6(1)(c) of the law, which says that a Secretary to the Government of India can also be the Chairman, should be removed. [455 D F] 3.2 The selection of Vice Chairman and Members, when it is not a sitting Judge or retired Judge of a High Court, should be done by a special committee with a sitting Judge of the Supreme Court, chosen by the Chief Justice of India, as its head. It is not good for the person chosen for the job or for the system.
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IN THE HIGH COURT OF DELHI AT NEW DELHI STATE BANK OF INDIA versus M/S. P. P. JEWELLERS PRIVATE LIMITED DHARMESH SHARMA, J. 1. This common judgment shall adjudicate upon the aforementioned two writ petitions, which raise a common question of law and facts and can be conveniently heard and disposed of together. FACTUAL MATRIX: 2. The petitioner, State Bank of India, is a body corporate constituted under the State Bank of India Act, 1955, having its Corporate Centre at State Bank Bhawan, Madame Cama Road, Nariman Point, Mumbai, and a Local Head Office at 11, Parliament Street, New Delhi, while the respondent, M/s. P.P. Jewellers Pvt. Ltd. is a company incorporated under the Companies Act, 1956, with its registered office at P.P. Tower, H-5, Netaji Subhash Place, Pitampura, New Delhi. 3. Briefly stated, the respondent availed various loan facilities from the petitioner Bank and its erstwhile subsidiaries for financial assistance towards its projects. To secure these facilities, the petitioner issued multiple sanction letters including those dated 15.03.2013 and 31.03.2014, and various security documents were executed by the respondent including charges created on the entire assets and current assets of the respondent on 28.08.2013 and 31.12.2014, supported by personal Guarantee Deeds executed by the Directors of the Respondent on multiple dates, corporate Guarantee executed by M/s Veekay Exim Pvt. Ltd., letters of acknowledgment regarding guarantees and mortgage of immovable properties with respect to the properties located in Delhi and New Delhi.
4. It is brought on the record that the respondent's loan account became irregular and overdue on 31.03.2016, leading to its classification as an NPA 1 by the petitioner Bank. Consequently, a demand notice under Section 13(2) of the SARFAESI Act 2, was issued on 08.09.2016 to the respondent and its guarantors, recalling the outstanding dues. Subsequent thereto, the respondent proposed an OTS 3, which was duly accepted on 15.01.2018 for an amount of Rs. 145 crores against the loan facilities availed by the PP Jewellers group through its three accounts i.e., M/s PP Jewellers Private Limited (respondent), PP Jewellers (Delhi) and PP Jewellers (Exports). However, due to non-compliance on the part of the respondent and its guarantors, the OTS was cancelled on 19.03.2019, after partial payments amounting to Rs. 29,60,99,920/- were received. 1 Non-Performing Asset Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, One-Time Settlement 5. Thereafter, the petitioner Bank issued another demand notice on 19.08.2019 under Section 13(2) of the SARFAESI Act and called upon the corporate guarantor and personal guarantors of the respondent to repay the outstanding dues. In light of the defaults, on 04.05.2022, the petitioner Bank filed an application under Section 14 of the SARFAESI Act, before the learned Chief Metropolitan Magistrate, North-West District Rohini Courts, Delhi ["CMM"], seeking possession of the mortgaged immovable property situated at Plot No. 4, Block C-8, Rana Pratap Bagh, Delhi. Meanwhile, on 16.05.2022, the respondent submitted another OTS proposal for settlement of its dues for Rs. 96 Crores.
6. The aforementioned application was listed for physical verification of documents on 04.06.2022. However, in view of the absence of any representative on behalf of the petitioner Bank, owing to the authorized officer being on leave from 02.06.2022 to 04.06.2022, no appearance was entered before the learned CMM. Consequently, the learned CMM dismissed the said application for non-prosecution. Furthermore, the learned CMM recorded certain adverse observations against the Petitioner Bank, indicating a lack of diligence in enforcing security and suggesting possible collusion with the Respondent. 7. Aggrieved by the aforesaid adverse remarks, the petitioner Bank promptly filed fresh applications under Section 14 of the SARFAESI Act, bearing Ct. Case No. 5846/ 2022 & 5847/2022, which were duly allowed by the learned CMM vide order dated 29.06.2022, directing a Court-Appointed Receiver to take possession of the secured asset. Subsequently, the petitioner Bank approved the respondent's OTS proposal vide letter dated 30.11.2022. However, as of 30.09.2023, being the last date of the OTS period, the petitioner Bank has received only Rs. 34 Crores against the agreed sum of Rs. 96 Crores. 8. The grievance of the petitioner Bank is that notwithstanding the favourable order dated 29.06.2022, the adverse remarks recorded in the order dated 04.06.2022 continue to cause irreparable harm to the petitioner Bank's reputation and interests. In view thereof, the petitioner Bank has preferred the present writ petitions, seeking the expungement of the said remarks made by the learned CMM, North-West District, Rohini Courts, Delhi, in Ct. Case No. 5105/2022 & 5106/2022. In furtherance of the aforementioned proceedings, the petitioner Bank also filed an application bearing C.M. APPL.29207/2024 in the connected petitions, seeking an ex-parte interim stay on the operation of the impugned order dated 04.06.2022. LEGAL SUBMISSIONS ADVANCED AT THE BAR:
9. Learned counsel for the petitioner contended that the adverse remarks made by the learned CMM, in the order dated 04.06.2022, were beyond the jurisdictional scope of proceedings under Section 14 of the SARFAESI Act. It is urged that the exercise of powers under Section 14, is a ministerial function rather than a quasi-judicial or adjudicatory role. Therefore, the impugned remarks, being extraneous to the scope of the proceedings, are without jurisdiction. It is urged that the impugned remarks have not only caused irreparable reputational harm to the petitioner, a nationalized bank, but are also being improperly relied upon in unrelated proceedings, thereby obstructing the recovery of public funds. 10. In his submissions, learned counsel for the petitioner Bank has referred to the decision in the case R.D. Jain & Co. v. Capital First Ltd. 4, wherein it was held: "25. As observed and held by this Court in NKGSB Coop. Bank Ltd. v. Subir Chakravarty, (2022) 10 SCC 286 : (2023) 1 SCC (Cri) 157, the step taken by the CMM/DM while taking possession of the secured assets and documents relating thereto is purely ministerial. Such an act may be performed by the CMM/DM personally or through any subordinate officer, including an Advocate Commissioner, who is deemed an officer of the court. Section 14 does not necessitate the CMM/DM to personally take possession of the secured assets. Hence, while disposing of an application under Section 14 of the SARFAESI Act, no element of quasi-judicial function or independent application of mind is required. The Magistrate is only required to verify the correctness of the information furnished in the application and nothing more."
11. The learned Senior Counsels appearing for the interveners, namely M/s Purnima Associates Pvt. Ltd/ intervenor No. 1, which claims to maintain a substantial 14.07% shareholding in the respondent/ PP Jewellers company and M/s LR Builders Pvt. Ltd./ intervenor No. 2, contend that the petition filed by the petitioner Bank before the Rohini District Courts was collusive and orchestrated in concert with Mr. Kamal Gupta, a principal borrower. It stated that the petitioner 4 (2023) 1 SCC 675, Bank has not only misrepresented facts and concealed material information in the matter but also intentionally failed to implead the interveners as parties. 12. It is asserted that while the petitioner Bank initiated proceedings under the IBC5 against the respondent, it simultaneously made representations indicating an ongoing settlement process. Furthermore, a purported OTS was entered into between the petitioner Bank and Mr. Kamal Gupta, and by an order dated 09.01.2023 passed by the NCLT 6, liberty was expressly granted to the petitioner Bank to revive the IBC proceedings against the respondent upon default of the OTS terms. However, despite the admitted non-payment of the settlement amount, the bank has not revived the IBC proceedings, thereby rendering the present petition mala fide.
13. It is further alleged that the petitioner Bank has misrepresented its possession of the property situated at A-13, CC Colony, measuring 300 square yards, opposite Rana Pratap Bagh, New Delhi, as photographic evidence submitted before the Court establishes that the property remains in the possession of Mr. Kamal Gupta and his family. It has been brought to the fore that the present writ petitions are misconceived and constitute an abuse of the legal process, as the cause of action raised by the petitioner is already sub judice and pending adjudication before the Division Bench of this Court in L.P.A. No. 236 5 Insolvency and Bankruptcy Code, 2016 6 National Company Law Tribunal of 2024. The said L.P.A. arises from. CM APPL. 15066/2024, filed by L.R. Builders Pvt. Ltd. in Writ Petition No. WP(C) 3158 of 2024. In these circumstances, the filing of the present petition not only amounts to an abuse of process but also risks creating inconsistencies and complications in the adjudication of the L.P.A. filed by the petitioner itself. 14. Learned counsel for the interveners has placed reliance on State of Jammu and Kashmir v. R.K. Zalpuri 7, wherein it was held that a party cannot invoke the Court's extraordinary and equitable jurisdiction at its convenience after an undue delay. It is also pointed out that the present petitions constitute an attempt to circumvent the orders passed by this Court vide order dated 20.02.2024 in CONT.CAS(C) 649/2022 and order dated 19.03.2024 in CONT.CAS(C) 1058/2023 which took judicial note of the fact that despite interim protective orders passed by the Learned DRT, the securities created by the borrowers in favour of the Bank have been illegally dissipated or alienated. The existence of collusion is further substantiated by the registration of FIR No. 106/2022 dated 26.08.2022 under Sections 409 and 120-B of the Indian Penal Code, 1860, against the bank officials and Mr. Kamal Gupta.
15. Significantly, the bank officials filed Writ Petition WP(Crl) No. 2152/2022 seeking quashing of the said FIR. In the course of those proceedings, pursuant to the directions of this Court, the Delhi Police 7 (2015) 15 SCC 602 has submitted three ATRs 8, which unequivocally indicate that the bank officials and Mr. Kamal Gupta were acting in collusion. The reports further disclose that the stocks were siphoned off by PPJPL 9 in connivance with the bank officials, who wilfully ignored these actions. Lastly, it is urged that the alleged collusion between the petitioner Bank and a loan defaulter necessitates an investigation by the CBI10 and the CVC11. 16. In rejoinder, learned counsel for the petitioner Bank submits that Intervenor No. 1 and Intervenor No. 2, represented by Mr. Rahul Gupta, son of Mr. Kamal Gupta (a Director of the respondent), have no privity with the petitioner Bank or any legitimate connection to the present proceedings. Intervenor No. 1 lacks any legal standing concerning the petitioner Bank, while Intervenor No. 2 is merely a corporate guarantor for M/s P.P. Jewellers (Delhi), a partnership firm, which is entirely unrelated to the subject matter of the present Writ Petition. Furthermore, the loan account of M/s P.P. Jewellers (Delhi) has already been settled and closed, as recorded in the order dated 29.11.2024, passed by the Division Bench of this Court in LPA 963/2024. 17. It was further contended that the aforementioned facts unequivocally establish that Intervenor No. 1 and Intervenor No. 2 have no connection with either the respondent or the issues under 8 Action Taken Reports 9 PP Jewelers Pvt. Ltd.
10 Central Bureau of Investigation 11 Central Vigilance Commission consideration in the present writ petition. As such, the intervention application is nothing more than a vexatious and frivolous attempt to initiate baseless litigation with the sole intention of harassing the petitioner Bank. It is urged that the applicants have no direct or indirect link with the impugned order dated 04.06.2022 or with the loan facility availed by the respondent. Moreover, the relief sought in the present application pertains to a third entity, namely P.P. Jewellers Retail Private Limited, which has no relevance whatsoever to the subject matter of the present writ petition. ANALYSIS AND DECISION: 18. I have given my thoughtful consideration to the submissions advanced by the learned counsels for the parties at the Bar. I have gone through the digitized record of the present case including the case law cited at the Bar. 19. This is a luxury litigation which is being pursued by the petitioner Bank challenging an innocuous order of the learned CMM, which in no way causes it any irreparable loss of reputation or loss of face. It would be expedient to reproduce the order dated 04.06.2022 passed by the leaned CMM, which goes as under: "04.06.2022 Present: Ld. Counsel for the complainant. Submissions heard. Record perused. Some more time is sought by the counsel for the complainant to produce the original documents on the ground that today also original could not be produced as the concerned person is on leave. This is the third date to produce the original documents but today also adjournment is sought. Perusal of record shows that the present application U/s 14 of Sarfaesi Act was filed on 06.05.2022 and on that day Ld. Counsel for the complainant sought adjournment to produce the original documents. Thereafter, the matter was fixed for 19.05.2022 and on that date Ld. Counsel for the complainant and Ld. Counsel for the respondent have also appeared and both sought adjournment on the ground that some settlement talks were going on between the parties but when the Ld. Counsel was directed to file an application in writing then in writing the ground was taken that the title deed could not be retrieved and therefore, at request today's date was granted.
Today also, Ld. Counsel for the complainant appeared and sought adjournment on the ground that due to personal exigency the AGM/AR in the present matter is on short leave w.e.f. 02.06.2022. Copy of email placed on record. The same is perused which reflects that the concerned person is on short leave but whether he is on leave today or not is not mentioned and neither it is mentioned that whether the title deeds have been retrieved or not. Perusal of record further reveals that in the present matter around Rs.31,41,89,328.33/- of public money is involved and the applicant bank is just taking dates on one ground or another most probably in connivance with the respondents which is clear from the fact that the respondents knew about the date in the present case and appeared on the last date of hearing and appeared today also. The conduct of the bank is not appreciable in the present case as they are not serious to attach/take the possession of the secured asset against which they have disbursed such a huge loan involving public money and it is clear that the applicant bank is hand in glove with the respondent, hence, they are lingering on the matter and providing opportunity to the respondent to sell the secured asset and flee away and thereafter the public money would not be recovered due to the conduct of the applicant bank. Keeping in view the conduct of the applicant bank no further opportunity can be granted as it will give further opportunity to the bank official to manipulate and raise illegal demands from the respondent on account of this pending application which the respondents are happy to oblige, hence, the present application is hereby dismissed for non prosecution. Further, in view of the above mentioned facts and circumstances I am constrained to send the copy of this order to the Chairman, State Bank of India through Main Branch of State Bank of India, Dblock, 11, Sansad Marg Road, Parliament Street, Delhi110001 near Jantar Mantar and Governor, Reserve Bank of India at 6, Sansad Marg, New Delhi110001 for kind information/appropriate action under intimation to this court through ACP, Subhash Place, Delhi, so that the bank officials should not delay such type of cases where huge public money is involved File be consigned to record room after due compliance."
20. A careful perusal of the aforesaid order would show that learned CMM was concerned that a huge amount of public money was involved and unnecessary adjournments were being sought and it was in the said context that castigating the concerned official of the bank, the matter was referred to the Chairman, State of Bank of India to take action against the erring bank officials. Indeed, the exercise of jurisdiction under Section 14 of the SARFAESI Act is ministerial in nature but then, as decided by this Court in the case of R.D. Jain & Co. v. Capital First Ltd (supra), the Magistrate is only required to verify the correctness of the information furnished in the application and proceed in terms of the procedure prescribed. It appears that there was shown no alacrity on the part of the bank in satisfying the learned CMM about the correctness of the information furnished and the measures that were being taken to pursue the recovery of loan amount in right earnest. It is not the law that the learned CMM should be sitting like a silent spectator in Court and allow any party under the SARFAESI Act to abuse the process of law, given the fact that there is a huge pendency of cases in the Court. It is evident that petitioner Bank was not diligently pursing its remedies. 21. Having said that, this Court does not wish to delve into the merits of the pleas that have been taken on behalf of the interveners. Their only anxiety seems to be that since the bank officials are delaying the recovery of their loan amount from the respondent No.1, eventually the liability to repay the loan would fall on their shoulders in case the secured assets are allowed to be pilfered away by the petitioner Bank without any timely checks. 22. In summary, the present litigation is ill-conceived and palpably suffering from inordinate delay and barred by laches for having been filed after almost two years of arising of the cause of action. 23. In view of the foregoing discussion, the present writ petitions are dismissed. 24. The pending applications also stand disposed of accordingly. DHARMESH SHARMA, J. MARCH 11, 2025 Sadiq
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The State Bank of India (SBI) went to the Delhi High Court. They asked the court to remove some harsh comments made by a judge called the Chief Metropolitan Magistrate (CMM). These comments were made during a legal process related to a law called the SARFAESI Act, which helps banks recover loans. SBI argued that the judge's comments went too far beyond what he was allowed to say in that type of case, and that the comments hurt SBI's reputation. However, the judge in the High Court, Justice Dharmesh Sharma, rejected SBI's request. He said that SBI's lawsuit was not well-thought-out and was filed much too late, nearly two years after the problem first happened. SBI filed these requests after some delay. This all started after a company called P.P. Jewellers Pvt. Ltd. (the respondent) couldn't repay its loans to SBI. Their loan account was then labeled a 'Non-Performing Asset' (NPA), which means it's a loan that's not being paid back. P.P. Jewellers had taken many loans from SBI, which were backed by agreements and security, like putting up their property or personal promises to pay. Because they stopped paying, SBI sent official notices under the SARFAESI Act, asking for the money back. Later, P.P. Jewellers offered to pay back a smaller amount in one go, called a One-Time Settlement (OTS), and SBI agreed. But P.P. Jewellers didn't follow through, so the deal was canceled. Even after many tries to get the money back, including starting new legal steps under the SARFAESI Act, the CMM judge rejected SBI's request on June 4, 2022. The CMM judge made comments that suggested SBI hadn't tried hard enough to collect the money and might even have been working secretly with P.P. Jewellers. These comments from the CMM judge's order were the main reason SBI went to the High Court.
SBI argued that the comments made by the CMM judge went beyond what he was allowed to do in a Section 14 process under the SARFAESI Act. SBI said this process is only about checking facts and paperwork, not about deciding if someone acted correctly. The bank claimed that these comments had seriously damaged its reputation and were wrongly being used in other legal cases. SBI referred to past court decisions to support its claim that a judge's job in a Section 14 case is only to check if the information provided is correct, not to judge how people behaved. SBI also denied that it was working secretly with P.P. Jewellers and insisted that the harsh comments had no real legal reason. Other parties, like the company's owners and those who had guaranteed the loans (called intervenors), also spoke up. They claimed that SBI was secretly working with P.P. Jewellers to arrange a special deal for the main borrower. They said SBI had lied about facts and had not included them in important legal proceedings. These intervenors argued that SBI hadn't acted fairly or honestly, especially since the One-Time Settlement deal was agreed upon but not fully carried out. They also pointed to other ongoing legal fights, including a police complaint (FIR) filed against bank officials, suggesting that SBI had handled the loan recovery badly or dishonestly. The High Court pointed out that the CMM judge made his comments because he was worried that SBI hadn't been careful enough in trying to get back public money. The High Court agreed that the Section 14 process under the SARFAESI Act is mainly about checking facts. However, it stressed that judges are not just observers; they must make sure all legal steps are followed correctly. The Court noted that SBI had indeed failed to act quickly in trying to get its money back and had asked for many delays without good reasons. Also, the Court chose not to look into the claims that SBI was working secretly with P.P. Jewellers. But it did say that SBI's actions didn't make the court feel confident about how the bank was trying to recover the loan. The High Court also rejected SBI's argument that the harsh comments had caused permanent damage. It noted that SBI waited a long time to file this lawsuit, which showed that even SBI didn't see the issue as urgent.
Finally, the High Court rejected SBI's requests. It ruled that the lawsuit was not well-planned and was filed too late. The Court decided that SBI waiting a long time to challenge the CMM judge's harsh comments was not fair. It viewed the CMM judge's comments, even though they were strong, as simply showing real worries about how SBI had acted. The High Court concluded that it had no reason to step in or change anything, and all other related requests were handled as a result.
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IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA CWP No. 3659 of 2025 Date of Decision: 15.05.2025 _______________________________________________________ Indira Daroch .......Petitioner Versus State of Himachal Pradesh & others ... Respondents ______________________________________________________ Coram:
Hon'ble Mr. Justice Sandeep Sharma, Judge. Whether approved for reporting? 1 Yes.
For the Petitioner: Mr. Arun Kaushal, Advocate. For the Respondents: Mr. Anup Rattan, Advocate General with Mr. Rajan Kahol, Mr. Vishal Panwar and Mr. B.C.Verma, Additional Advocate Generals and Mr. Ravi Chauhan, Deputy Advocate General.
_______________________________________________________ Sandeep Sharma, Judge(oral):
Petitioner herein has approached this Court with a prayer to quash notification dated 20.09.2024 vide which application filed by her for premature retirement was accepted and further to quash the notification dated 14.11.2024, whereby representation of the petitioner for withdrawal of application for premature retirement was rejected by the competent authority.
2. Precisely, the facts of the case as emerge from the record are that petitioner applied for premature retirement vide application dated 08.08.2024, which request of her was accepted and Whether the reporters of the local papers may be allowed to see the judgment? accordingly vide notification dated 20.09.2024, petitioner was ordered to be retired w.e.f. 05.11.2024(AN). However, before petitioner could retire in terms of notification dated 20.09.2024, she made representation to the respondent for withdrawal of notice for premature retirement vide letter dated 14.10.2024. Since aforesaid request made by the petitioner was not considered, she approached this Court in the instant proceedings, praying therein for following reliefs:-
"i) That the impugned notification dated 20.09.2024 (Annexure P-2) and order dated 14.11.2024 (Annexure P-4) may kindly be quashed and set aside;
ii) That respondents may kindly be directed to reinstate the petitioner to the post of Principal (College Cadre)."
3. Precisely, the grouse of the petitioner as has been highlighted in the petition and further canvassed by learned counsel for the petitioner, is that since petitioner had represented for withdrawal of notice of premature retirement prior to her actual retirement on 05.11.2024, there was no occasion for the competent authority to reject such application, rather it ought to have accepted the same in terms of Rule 43(6) of CCS (Pension) Rules, 2021.
4. To the contrary, Mr. Rajan Kahol, learned Additional Advocate General states that though vide notification dated 20.09.2024 petitioner was ordered to be retired w.e.f.05.11.2024 (AN), but since her request for premature retirement was accepted vide notification dated 20.09.2024, subsequent representation dated 14.10.2024 for withdrawal of notice for premature retirement was rightly not considered by the respondents. While referring to communication dated 14.11.2024 (Annexure P-4), issued under the signatures of Additional Secretary (Education) to the Government of Himachal Pradesh, Mr. Rajan Kahol, learned Additional Advocate General, vehemently argued that since there is no provision in the Department of Personnel, Government of Himachal Pradesh notification No. Per (AP-S)-A (3)-3/2019, dated 19.01.2022(Himachal Pradesh Civil Services (Premature Retirement) Rules, 2022), allowing such request for withdrawal, therefore, her request for withdrawal of notification dated 20.09.2024 has been rightly rejected.
5. I have heard learned counsel for the parties and gone through the record carefully.
6. True, it is that bare perusal of the pleadings adduced on record reveals that petitioner herein, who was initially appointed as Lecturer in the month of October, 1993 and subsequently retired from the post of Principal, submitted an application on 08.08.2024, thereby giving three months notice for premature retirement from the post of Principal of Government Degree College, Kandaghat, District Solan, due to her ailment and bad health and such request of her was duly accepted by the department by issuing notification dated 20.09.2024, whereby Department, while accepting the request for premature retirement of the petitioner, ordered retirement of the petitioner w.e.f.5.11.2024, but it is also not in dispute that before petitioner's superannuation on 5.11.2024, she submitted an application dated 14.10.2024, praying therein for withdrawal of notice of premature retirement and also withdrawal of notification dated 20.09.2024 on account of the fact that her health had improved and was fit to continue the service.
7. At this stage, it would be profitable to reproduce Rule 43(6) of CCS (Pension) Rules,2021 herein below:-
"(6) Government servant, who has elected to retire under this rule and has given the necessary notice to that effect to the appointing authority, shall be precluded from withdrawing his notice except with the specific approval of such authority."
8. Careful perusal of aforesaid rule clearly reveals that government servant, who decides to retire under aforesaid rule and gives notice to that effect to the appointing authority shall be precluded from withdrawing his notice expect with the specific approval of such authority. Though bare reading of aforesaid rules debars an employee from withdrawing notice for retirement, but with the specific approval of competent authority, he/she can do the same.
9. In the instant case, petitioner after having submitted application for premature retirement submitted representation vide letter dated 14.10.2024 to the competent authority, praying therein for withdrawal of notice, which ultimately came to be rejected vide notification dated 14.11.2024 on the ground that prior to submission of afore application, petitioner stood retired w.e.f. 05.11.2024 by issuance of notification dated 20.09.2024. No doubt, vide notification dated 20.09.2024, petitioner was ordered to be retired w.e.f. 05.11.2024, but it is not in dispute that before petitioner could retire w.e.f.05.11.2024 pursuant to notification dated 20.09.2024, she represented for withdrawal of notice for premature retirement vide letter dated 14.10.2024. If it is so, there was no occasion, if any, for competent authority to reject the prayer made on behalf of the petitioner for withdrawal of her resignation. Otherwise, Rule 43(6) of CCS (Pension) Rules,2021 nowhere puts embargo to the competent authority to accept prayer, if any, made on behalf of the employee for withdrawal of notice, rather competent authority taking note of peculiar facts and circumstances can always accept the prayer made on behalf of the employee concerned for withdrawal of notice for retirement. Aforesaid rule though precludes an employee from withdrawing notice, but vests appointing authority with power to consider the same.
10. The issue of withdrawal of notice of voluntary retirement came up before Hon'ble Apex Court in Balram Gupta v. Union of India and another, 1987 (Supp) SCC 228. In the case before Their Lordships, appellant Balram Gupta gave notice of voluntary retirement on 24.12.1980, which was accepted on 20.1.1981. The notice period was with effect from 1.1.1981, but on 20.1.1981, said appellant withdrew his notice. Their Lordships held the actual date of retirement is the material date and not the date of acceptance. It was held by Hon'ble Apex Court that the appointing authority has no discretion to refuse withdrawal if the request is made before the notice period lapses and before retirement has actually taken effect. The employee "cannot be treated as functus officio during the notice period. While allowing the appeal with costs, Hon'ble Apex Court held as under:
"We hold further that there has been compliance with the guidelines because the appellant has indicated that there was a change in the circumstances, namely, the persistent and personal requests from the staff members and relations which changed his attitude towards continuing in Government service and induced the appellant to withdraw the notice. In the modern and uncertain age it is very difficult to arrange one's future with any amount of certainty, a certain amount of flexibility is required, and if such flexibility does not jeopardize Government or administration, administration should be graceful enough to respond and acknowledge the flexibility of human mind and attitude and allow the appellant to withdraw his letter of retirement in the facts and circumstances of this case. Much complications which had arisen could have been thus avoided by such graceful attitude. The court cannot but condemn circuitous ways "to ease out" uncomfortable employees. As a model employer the government must conduct itself with high probity and candour with its employees."
11. In State of Haryana & Anr. v. S.N. Sharma (1996) 6 SCC 409, Their Lordships, where, in similar circumstances, the employee withdrew the notice after its acceptance but before actual date of retirement, held that acceptance per se does not extinguish service; the decisive moment is the employee's actual superannuation. Hence, the authority's "acceptance" does not give it an overriding discretion to insist on retirement. It was held that till the employee stands relieved, withdrawal must ordinarily be allowed unless "employer shows overwhelming public-interest prejudice. Similar view has been expressed by Hon'ble Apex Court in Power Finance Corporation Ltd. v. Pramod Kumar Bhatia (1997) 4 SCC 280, Punjab National Bank v. P.K. Mittal (2003) 4 SCC 610 and Punjab National Bank v. Phoolpati (2016) 4 SCC 315.
12. A perusal of aforesaid judgments shows that the date of actual retirement is the key factor and not the date of acceptance of notice. It is further held that if there is a change in circumstance after submission of notice of withdrawal, competent authority, while considering request for withdrawal of notice for retirement, should exercise such discretion judiciously. It is held that the appointing authority has no discretion to refuse withdrawal if the request is made before the notice period lapses and before retirement has actually taken effect. The employee "cannot be treated as functus officio during the notice period.
13. Another aspect of the matter is that while exercising discretionary power, authority must record its reasons. Reasons reassure that discretion has been exercised by the decision maker on relevant grounds and by disregarding extraneous considerations. (See: M/S Kranti Asso. Pvt. Ltd. & Anr v. Masood Ahmed Khan & Ors).
14. In the case at hand, perusal of Annexure P-4 shows that the authority concerned has not recorded any reasons for exercising its discretion while considering the application of the petitioner for withdrawal of notice of premature retirement. Petitioner has explained the circumstances under which she changed her mind i.e. her health and therefore, competent authority ought to have given due consideration to attending facts and circumstances. Though a plea has been taken by the respondents that the premature retirement of the petitioner is governed by the Himachal Pradesh Civil Services (Premature Retirement) Rules, 2022, which do not provide for withdrawal of a notice for retirement, but same also do not bar the appointing authority from reconsidering the matter on an application of employee for withdrawal of notice for premature retirement. Otherwise, this Court is of the view that rule 43(6) of CCS (Pension) Rules, 1972 is applicable here.
15. Consequently, in view of the detailed discussion made hereinabove as well as law taken into consideration, this Court finds merit in the present petition and accordingly, same is allowed. The impugned notification dated 20.09.2024(Annexure P-2) and order dated 14.11.2024 (Annexure P-4) are quashed and set-aside and representation filed vide letter 14.10.2024 is allowed as a result of thereof, respondents are directed to permit the petitioner to re-join the service from the date she had tendered request for withdrawal of resignation. Since petitioner never worked w.e.f. 05.11.2022 till her joining, she shall not be entitled to any monetary benefits but certainly such period shall be counted for the purpose of her seniority. The petitioner shall be treated to be in continuous service from 5.11.2024, with all consequential benefits, except actual monetary benefits for the period w.e.f. 5.11.2024 till her joining back. Pending applications, if any, also stand disposed of.
(Sandeep Sharma), Judge May 15, 2025 (shankar)
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The Himachal Pradesh High Court heard a legal case filed by the Principal of a government college in Solan. She was challenging a decision that rejected her request to cancel her early retirement. A single judge, Justice Sandeep Sharma, ruled in her favor. The judge stated that the employer cannot refuse an employee's request to take back their early retirement notice if the request is made before the notice period ends and before the retirement actually happens. Because of this, the Court ordered the employers to let the Principal return to her job from the day she asked to cancel her retirement.
The Principal had asked to retire early because she was not well. Her request was approved, and an official notice was sent saying she would retire. But before her retirement officially started, she told her employer that her health had gotten better and she wanted to keep working. She asked to take back her retirement notice. When her employer said no to this, she filed the legal case with the court.
The Court looked closely at a specific rule, Rule 43(6) of the Central Civil Services (Pension) Rules, 2021. This rule says that a government employee who decides to retire and gives notice can only take back that notice if their employer gives special permission. However, the Court also referred to an older case and stressed that the important date is when the retirement actually begins, not when the notice was first accepted. If an employee's situation changes after they give notice, the employer, when deciding if they can take it back, should make a fair and wise decision. The Court emphasized that the employer cannot refuse the request if it's made before the notice period ends and before the retirement officially starts. During the notice period, the employee is still fully employed and holds their position. The Court also noticed that the employer did not write down any reasons for their decision when they rejected the Principal's request.
The Principal had clearly explained why she changed her mind, saying her health was better. Because of this, the Court believed the employer should have carefully considered her specific situation. The Court referred to a previous legal case to support this idea.
The employer had argued that the Principal's early retirement was covered by different rules, the Himachal Pradesh Civil Services (Premature Retirement) Rules, 2022. These specific rules do not mention if someone can take back a retirement notice. However, the Court rejected this argument. The Court said that even if those rules don't cover it, it doesn't mean the employer cannot reconsider the matter when an employee asks to cancel their early retirement notice. The Court decided that Rule 43(6) from the Central Civil Services (Pension) Rules was the correct rule to apply here.
Therefore, the Court ruled in favor of the Principal. This canceled her retirement notice and the decision to reject her request. The Court ordered the employers to allow the Principal to return to work from the date she originally asked to cancel her retirement. Since the Principal did not work during the period from her early retirement request until she rejoined, she will not receive pay for that time. However, this period will still count towards her seniority (how long she has worked) and other related benefits.
[Indira Daroch v. State of Himachal Pradesh, CWP No. 3659 of 2025, decided on 15-05-2025] *Judgment by Justice Sandeep Sharma Advocates who appeared in this case: For the petitioner: Arun Kaushal For the respondent: Advocate General Anup Rattan, Additional Advocate General Rajan Kahol, Additional Advocate General Vishal Panwar, Additional Advocate General B.C. Verma, and Deputy Advocate General Ravi Chauhan
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In the High Court of Punjab and Haryana, at Chandigarh Vuenow Infotech Pvt. Ltd. ... Petitioner(s) Versus Union of India and Another ... Respondent(s) AND Vuenow Infotech Pvt. Ltd. ... Petitioner(s) Versus Directorate of Enforcement, Jalandhar Zonal Office, Punjab and Another ... Respondent(s) Reserved On: 19.12.2024 Pronounced On: 17.01.2025 CORAM: Hon'ble Mr. Justice Sheel Nagu, Chief Justice. Hon'ble Mr. Justice Anil Kshetarpal. Present: Mr. Chetan Mittal and Mr. Bipin Ghai, Senior Advocates with Mr. Akshay Kumar Dahiya, Mr. Arun Khatri, Mr. Mayank Aggarwal and Mr. Nikhil Ghai, Advocates for the petitioner(s). Mr. Satya Pal Jain, Additional Solicitor General of India with Mr. Premjit Sinh Hundal, Senior Panel Counsel for Union of India. Anil Kshetarpal, J. 1. Factual Background 1.1 With the consent of the learned counsel representing the parties, 2025.01.20 14:21 two connected writ petitions i.e. 30014 and 32476 of 2024 shall stand Civil Writ Petition No. 30014 of 2024 (O&M) And 2 Civil Writ Petition No. 32476 of 2024 (O&M) disposed of by this common order.
1.2 In Civil Writ Petition No. 30014 of 2024, the petitioner (company) seeks direction to the Enforcement Department (ED) to produce all the records as regards purported inquiry being conducted under the Foreign Exchange Management Act, 1999 (hereinafter referred to as "the 1999 Act"), the read down and/or read into Section 37 of the 1999 Act in tandem, sync and harmony with Section 132 of the Income Tax Act, 1961 (hereinafter referred to as "the 1961 Act") and to also hold that the powers of search, seizure etc. vested in the 1999 Act are circumscribed, confined and limited to the contravention referred to Section 13 of the 1999 Act. Certain other connected reliefs have also been sought. 1.3 In Civil Writ Petition No. 32476 of 2024, the quashing of ECIR/JLZO/26/24, especially the search and seizure proceedings conducted by the ED on 26.11.2024 and the quashing of the illegal act of freezing of the bank account of the petitioner company have been sought. 1.4 In order to comprehend the issues involved in the present case, the relevant facts, in brief, are required to be noticed. The ED initiated inquiries/investigation under the 1999 Act in respect of the group companies, namely Ms/ Vuenow Infotech Pvt. Ltd. (M/s VIPL), M/s Vuenow Marketing Services Ltd. (M/s VMSL), M/s Zebyte Infotech Pvt. Ltd. (M/s ZIPL) and M/s Zebyte Rental Planet Pvt. Ltd. (M/s ZRPPL). Initial inquiries/investigations reveal that the above mentioned entities received foreign inward remittance. It was found from the financial statements that the aforesaid foreign inward remittances have not been 2025.01.20 14:21 declared by VIPL and VMSL in the financial year 2021-22 and 2022-23.
Civil Writ Petition No. 30014 of 2024 (O&M) And 3 Civil Writ Petition No. 32476 of 2024 (O&M) Similarly, the GSTR-I return of M/s ZRPPL was analyzed for the relevant period i.e. from February 2023 to July 2023 and it was found that M/s ZRPPL has not mentioned any export of service in their statutory GSTR-I return. Through discreet inquiry, it was found that M/s ZRPPL has shown nine export invoices valuing ₹8,75,97,027.80 during the month of August 2024. It appeared that there has been contravention of the 1999 Act which led to the competent authority to form an opinion on the basis of the aforesaid information. Thereafter, the ED conducted searches under Section 37 of the 1999 Act read with Section 32 of the 1961 Act. The amount lying in certain bank accounts was also freezed as the 1999 Act violations were suspected. There was a direction to debit freeze for a temporary period of 15 days with respect to certain accounts held by the petitioner company and others in order to protect the Indian Economy from a serious harm. 1.5 The promoters and major shareholders/directors of the companies were issued summons on 30.10.2024 and 19.11.2024 in order to offer them an opportunity of being heard and proceed with the investigation, however, none of the aforesaid persons joined the investigation. 1.6 Presently, the direction issued to bank for debit freeze of the bank accounts of the petitioner company under the provisions of the 1999 Act have turned ineffective since 02.12.2024 because the order of debit freeze has been lapsed and never extended. On 19.11.2024, the officials relating to the companies have been requested to join for monitoring the extraction of data from the digital devices recovered and seized during the search operation, however, none of them joined. Thereupon, the petitioner 2025.01.20 14:21 filed Civil Writ Petition No. 30014 of 2024. Civil Writ Petition No. 30014 of 2024 (O&M) And 4 Civil Writ Petition No. 32476 of 2024 (O&M) 1.7 During the course of inquiries, it was revealed that these
companies have effected a huge banking transactions amongst themselves. It was also revealed that these companies have dishonestly induced around 25000 individuals/investors to invest in cloud particles by selling them non- existent and insubstantial particles and have, therefore, cheated and breached the trust of various investors and have also suspected criminal offence under the provisions of Bhartiya Nagrik Suraksha Sanhita, 2023 (hereinafter referred to as "the BNSS") which are the scheduled offences under the Prevention of Money Laundering Act, 2002 (hereinafter referred to as "the 2002 Act").
1.8 On sharing of the information, FIR No. 463 dated 21.11.2024, was registered at Police Station Sector 58, Gautam Budh Nagar (Noida), under Section 318(4), 61(2), 316(2) of the BNSS. The investigation and searches further revealed that the companies are offering customers the investment opportunities to buy data center assets or cloud particles (servers) through sale and lease back model whereby once a customer buys a data center asset or cloud particle, it will immediately lease back on the long term basis by M/s VMSL marketing affiliates such as M/s ZIPL, M/s ZRPPL for a minimum guaranteed rent. It was revealed that the total storage capacity of currently active servers at Mota Data Center is 553 TB out of which only 1.9 TB space is presently consumed and the storage capacity of 551.1 TB is available or empty. The consumed 1.9 TB data pertains to Test Open Stat cloud data and no data pertaining to any customer is available in these working servers. As many as 1119 servers at the premises were not 2025.01.20 14:21 connected with any power source (active) and therefore, these servers were Civil Writ Petition No. 30014 of 2024 (O&M) And 5 Civil Writ Petition No. 32476 of 2024 (O&M) not in working condition. It was found that a show cause notice has been issued by SGST raising a demand for inadmissible ITC taken by M/s ZRPPL by purchasing goods/services from google suppliers. The total invoice value of such purchase transaction is ₹66,23,58,209/-. During the course of inquiry, the balance sheets pertaining to M/s VMSL found that the company has received an amount of ₹5,33,38,06,158/- for the period from 2016-17 to 2022-23.
1.9 It has been revealed from entries in the HDFC and ICICI banks that M/s VMSL has received a total sum of ₹2236.07 crores which is suspected to have been received from the individuals/investors in lieu of sale of cloud particles/storage space. It has further been observed that M/s VMSL has sold the cloud particles to the individuals/investors way beyond their actual capacity as it has total active server capacity of 2701 cloud particles or 2701 TB of cloud space, whereas they have sold particles 1029294 TB (as per MCA data) or 542274 TB (as per bank account credits). 1.10 Ultimately, it is suspected that M/s ZIPL or M/s ZRPPL instead of receiving rental amount from the customers, is receiving money from M/s VIPL which is subsequently being paid to the investors in the form of rent. In summary, the money collected from the new individuals/investors is being rotated and paid to them as monthly assured rental income. As per the statement of Nitin Srivastava, assured rentals to the previous individuals/investors were being paid from the investments received from the new investors. It is suspected that a fraudulent investment scheme where returns are paid to the previous investors using the capital from the new 2025.01.20 14:21 investors rather than the profits earned by the operation is being carried out. Civil Writ Petition No. 30014 of 2024 (O&M) And 6 Civil Writ Petition No. 32476 of 2024 (O&M) After the registration of FIR, an ECIR bearing No. ECIR/JLZO/26/2024 dated 25.11.2024 was recorded for investigation under the provisions of the 2002 Act. The preliminary investigation revealed that more than 25000 gullible investors have been sold data particles which had resulted in proceeds to the tune of ₹2236.07 crores which may further increase during the course of investigation.
1.11 During the search proceedings, the various incriminating documents were recovered and seized which revealed that 67 bank accounts relating to the said group of companies and the other related entities were used for rotating the money and hence, the accounts were ordered to be freezed under Section 17(1A) of the 2002 Act. For further investigation, the summons were sent to the major shareholders/promoters on 30.10.2024 and 19.11.2024 for recording their statements were issued but none of them joined investigation. 2. Arguments Put Forth by the learned counsel representing the parties 2.1 Heard the learned counsel representing the parties, at length and with their able assistance, perused the paper-book. 2.2 The learned counsels representing the petitioners submit that while carrying out search and seizure, the ED has not followed the procedure and no prior notice before conducting search and seizure was issued to the petitioner company. It is further submitted that no intimation notice or opportunity was given to the petitioner to explain their position and seizure memos failed to disclose the reasons behind the search and seizure. The DEEPAK KUMAR BHARDWAJlearned counsel representing the petitioners relies upon the judgment passed Civil Writ Petition No. 30014 of 2024 (O&M) And 7 Civil Writ Petition No. 32476 of 2024 (O&M) in Opto Circuits (India) Limited v. Axis Bank (2021) 6 SCC 707, Arvind Kejriwal v. Directorate Enforcement (2024) SCConline SC 1703 and Radha Krishan Industries v. State of Himachal Pradesh (2021) 6 SCC 771 and contends that this Court should not only quash the ECIR but also grant declaration that the search and seizure was illegal. It was also contended that the reasons to believe which are sine qua non for initiating proceedings have not been disclosed in the search and seizure memos.
2.3 Per contra, the learned counsel representing the ED contends that the investigation is in progress and the matter is required to be placed before the Adjudicating Authority within a period of 30 days from such attachment as per Section 5(5) of the 2002 Act. It is submitted that the petitioner would have an opportunity to represent and explain its position. It has further been disclosed that the petitioner and its sister concerns have been indulging in forum shopping as they have filed various petitions in different High Courts as a petition has been filed in the Allahabad High Court for quashing the FIR and the sister concern of the petitioner, namely M/s Zebyte Infotech has filed a petition i.e. Writ Petition (Civil) No. 15400 of 2024 in the Delhi High Court. The promoters/major stockholders of the petitioner company have not come forward to join the investigation. 3. Analysis and Discussion 3.1 Though the jurisdiction under Article 226 of the Constitution of India is plenary, however, there are self imposed limitations which are required to be followed before exercising the power of judicial review. Ordinarily, interference at the stage of investigation carried out by the law 2025.01.20 14:21 enforcement agencies is not advisable because the law enforcement Civil Writ Petition No. 30014 of 2024 (O&M) And 8 Civil Writ Petition No. 32476 of 2024 (O&M) investigation techniques include coercive as well as covert techniques. 3.2 The method of search and seizure is coercive as it is used to carry out the investigation/inquiry into the affairs if violation of a statutory provision is suspected. The search and seizure is a well known tool in the investigation which enables the law enforcement agencies to come to a conclusion. Though the Constitutional Courts are the sentinels of justice, however, this power is required to be exercised with due care and caution and interference at the stage of investigation is made in rare and exceptional cases.
3.3 As far as Civil Writ Petition No. 30014 of 2024 is concerned, the petitioner, in substance, wants this Court to call for all the records with respect to the purported inquiry being carried out under the 1999 Act. The principles of reading down or reading into a statutory provision are interpretive tools that must be applied based on specific facts and circumstances of the present case. They cannot be invoked as abstract propositions of law. It simply means that these interpretation tools are to be used only to ensure that law is interpreted in a manner that aligns with its intent and purpose. In substance, the petitioner claims that the prior notice before conducting search and seizure has not been issued to the petitioner. Section 37 of the 1999 Act does not envisage any prior notice before conducting the search and seizure. The ED under Section 37(1) and (2) of the 1999 Act is entitled to take up for investigation the contravention referred to in Section 13. Whereas Section 37(3) of the 1999 Act authorizes the officers to exercise the like powers which are conferred on the income 2025.01.20 14:21 tax authorities under the Income Tax Act, 1961. Section 13 of the 1999 Act Civil Writ Petition No. 30014 of 2024 (O&M) And 9 Civil Writ Petition No. 32476 of 2024 (O&M) provides for the imposition of penalties upon any person who contravenes any provision of this Act, or contravenes any rule, regulation, notification or direction. As per Section 13(1A) of the 1999 Act if any person is found to have acquired any foreign exchange, foreign security or immovable property, situated outside India, of the aggregate value exceeding the threshold prescribed under the proviso to sub-section (1) of section 37A, penalty to the extent of three times the sum involved in the contravention and confiscation of the value equivalent is permissible. 3.4 Similarly, under Section 5 of the 2002 Act the attachment of the property involved in money laundering is permissible where the Director or any other officer not below the rank of Deputy Director authorized by the Director for the purposes of this section, has reasons to believe, on the basis of material in his possession, that any person is in possession of any proceeds of crime and such proceeds of crime are likely to be concealed, transferred or dealt with in any manner. Section 17 of the 2002 Act enables the Director or any other officer not below the rank of Deputy Director authorized by the Director to conduct search and seizure if on the basis of an information in his possession, the competent authority has a reason to believe that any person has committed any act which constitutes money- laundering or is in possession of any proceeds of crime involved in money- laundering or is in possession of any property related to crime. Section 17 also does not provide for a prior notice before conducting search and seizure. 3.5 It is evident that while carrying out search, proper information was supplied to the petitioner. Moreover, the petitioner has not attached the The petitioner has attached the search and seizure memos and Civil Writ Petition No. 30014 of 2024 (O&M) And 10 Civil Writ Petition No. 32476 of 2024 (O&M) freezing orders sent by the ED to the various banks. In the freezing orders, it has been stated that the Assistant Director, Unit-III(2) ED has reasons to believe from the documents in his possession that the proceeds of crime might have been diverted to the above said bank account maintained with that particular bank. Moreover, as already noticed, these orders were passed on 26.11.2024, whereas on the date when the arguments are heard, 30 days are yet to be completed.
3.6 As regards the requirement of reasons to believe, this Court in Dilbagh Singh @ Dilbag Sandhu v. Union of India and Others (Civil Writ Petition No. 22688 of 2024) has held that in para 287 of the Vijay Madanlal Choudhary & others v. Union of India & others 2022 SCC Online SC 929, the Supreme Court has held that the authorized officer can order provisional attachment only upon recording satisfaction regarding two requirements. The officer has to form his opinion and provide written reasons for such belief, which must be based on material in his possession rather than on mere assumptions. The judgment passed in Radha Krishan Industries's case (supra) was also considered and explained. 3.7 As already noticed, Section 5 (5) of the 2002 Act mandates the ED to file a complaint stating the facts of such attachment before the Adjudicating Authority within a period of 30 days. The Adjudicating Authority is entitled to adjudicate the matter on receipt of a complaint. Before the Adjudicating Authority all the stakeholders are entitled to participate and explain their position. The Adjudicating Authority is required to decide the matter in a time bound manner. Against the final 2025.01.20 14:21 order of confirmation of attachment, the appeal is maintainable before the Civil Writ Petition No. 30014 of 2024 (O&M) And 11 Civil Writ Petition No. 32476 of 2024 (O&M) Appellate Tribunal. Once the 2002 Act itself provides for sufficient safeguards, it is not found appropriate for this Court to interfere at this stage. 4. Decision 4.1 Keeping in view the aforesaid discussion, the writ petitions are disposed of with the liberty to the petitioners to present their case before the Adjudicating Authority under the 1999 Act as well as the 2002 Act. 4.2 The miscellaneous application(s) pending, if any, in both the writ petitions shall stand disposed of.
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The Punjab and Haryana High Court looked at two legal requests made by Vuenow Infotech Pvt. Ltd. (called VIPL). VIPL wanted the Enforcement Department (ED), a government agency that investigates financial crimes, to show all records related to an ongoing investigation against VIPL. This investigation was being done under laws like the Foreign Exchange Management Act of 1999 (FEMA) and the Income Tax Act of 1961 (IT Act). VIPL also asked the court to cancel the initial case document (called an ECIR), stop any searches and seizures, and unfreeze VIPL's bank accounts. A panel of two judges at the High Court decided it was not the right time for the court to get involved. Instead, they allowed VIPL to present their case to a special decision-making body, known as the Adjudicating Authority, under both FEMA and another law called the Prevention of Money Laundering Act (PMLA). The ED began an investigation under FEMA against four companies: VIPL, Vuenow Marketing Services Ltd. (VMSL), Zebyte Infotech Pvt. Ltd. (ZIPL), and Zebyte Rental Planet Pvt. Ltd. (ZRPPL). Early findings showed that these companies received money from other countries, but VIPL and VMSL did not report these funds. Similarly, ZRPPL did not mention exporting any services in their regular reports, even though an investigation found that ZRPPL had nine export invoices worth ₹875 crores that broke FEMA rules. It was also discovered that these companies had many large bank transactions with each other. They had also allegedly tricked about 25,000 individuals or investors into putting money into computer servers (also called cloud particles). This was done through a 'sale and leaseback' plan, where an investor would buy a server and then immediately lease it back to VMSL for a guaranteed minimum payment. VMSL supposedly received ₹2236.07 Crores from selling these servers. However, VMSL reportedly sold far more servers than they actually had – they sold between 5 to 10 lakh servers when they only had 2,701 active ones. This suggested that a dishonest investment scheme was operating, where older investors were paid with money from new investors, rather than from actual profits made by the business.
Following these discoveries, a police report (called an FIR) was officially filed under specific sections of a new criminal law, the Bhartiya Nagarik Suraksha Sanhita, 2023. Also, a formal case document (an ECIR) was filed under the Prevention of Money Laundering Act of 2002 (PMLA). The ED carried out an initial investigation based on FEMA and the IT Act. As a result, some bank accounts were frozen because of claims that FEMA rules had been broken. Instructions were also given to stop money from being taken out of certain bank accounts belonging to VIPL and others. On top of this, even though official notices were sent asking the main owners and managers of the companies to appear for questioning, none of them showed up for the investigation. The High Court explained that even though it has broad powers under Article 226 of the Constitution to review government actions, it also has rules it sets for itself. The court usually believes it should not get involved while an investigation is still happening. This is because law enforcement agencies use both forceful and secret methods during their investigations. Searching homes and taking property (search and seizure) is one example of a forceful method. The Court stated that while constitutional courts are the guardians of fairness, they must use this power with great care. Getting involved during an investigation is something they only do in very unusual or special cases. VIPL argued that they did not receive any warning before the search and seizure took place. However, the Court pointed out that Section 37 of FEMA does not require giving notice before carrying out a search and seizure. Under FEMA, the ED is allowed to investigate financial rule violations mentioned in Section 13. Also, Section 37(3) gives the ED powers similar to those held by income tax authorities under the IT Act. Similarly, Section 17 of PMLA also does not require any prior notice. The Court noted that it was clear VIPL *did* receive proper information when the search was happening. The orders sent to banks to freeze accounts, which VIPL had referred to, clearly stated that the ED had reasons to believe, based on documents it had, that money from illegal activities might have been moved into those bank accounts.
Regarding the need for the ED to have good reasons to believe something before taking action under Section 5 of PMLA, the Court referred to an earlier Supreme Court case called Dilbagh Singh v. Union of India. In that case, referring to another important decision (Vijay Madanlal Choudhary v. Union of India), the Supreme Court had ruled that an authorized officer can temporarily take control of property only if they write down their satisfaction based on two key conditions. The officer must form their own opinion and provide written reasons for this belief, based on actual evidence they possess, not just guesses. The Court also pointed out that Section 5(5) of PMLA requires the ED to file a formal complaint within 30 days with the special decision-making body (the Adjudicating Authority), explaining why they temporarily took control of property involved in money laundering. Once this complaint is received, the Authority must make a decision without delay. After that, if someone disagrees with the final decision to confirm the taking of property, they can appeal to a higher court called the Appellate Tribunal. The Court concluded that because the PMLA law itself offers enough protections, it was not the right time for the court to step in. Therefore, the legal requests were closed. However, VIPL was still allowed to present their case to the Adjudicating Authority under both FEMA and PMLA.
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Civil Appeal No. 881 of 1974 From the Judgment and order dated 25.7.1973 of the Andhra Pradesh High Court in Writ Petition No . 3950 of 1971. K. Raj. Choudhary for the Appellant. V.C. Mahajan, C.V.S. Rao and R.P. Srivastava for the Respondents. The Judgment of the Court was delivered by VENKATACHALIAH, J. This appeal, by Special Leave, by the Andhra Pradesh State Electricity Board a corporation and constituted under The Electricity (Supply) Act, 1948 arises out of the Judgment and order dated, 25.7.1973, of the Andhra Pradesh High Court in Writ Petition No. 3950 of 1971 on its file, rejecting appellant 's challenge to certain proceedings for the recovery of insurance premia respecting the appellant 's undertaking under the Emergency Risks (Factories) Insurance Act 1962 ( 'Act ') culminating in the appellate order, dated, 12.5.1971 of the Central Government under Section 11(3) of the Act affirming, in turn, that dated, 15.10.1969 of the Director of Emergency Risks Insurance Schemes determining the balance of the premia payable at Rs.47,59,109.00. The scheme under the Act which came into force on 1.1.1963 lapsed with the termination of the emergency on 10.1.1968. The legislation was to meet the need to provide for expeditious rehabilitation of industrial undertakings in the event of damage in times of war and the Central Government, accordingly, undertook to insure the factories against such war risks and to indemnify the owners in respect of loss and damage caused by enemy action, so that, there might be an expeditious industrial rehabilitation so vital in national interests. Sub section 3 of the Act envisages the promulgation and effectuation of the Emergency Risks (Factories) Insurance Scheme, mandating a compulsory insurance of factories against war risks and the payment of premia in terms of and in accordance with the scheme. The Director of the Emergency Risks Insurance Scheme caused a show cause notice, dated 28.11.1968 to be issued to the appellant calling upon it as to why the balance of premia for the 219 relevant periods should not be fixed at Rs.47,59,109.00 as against a much smaller sum indicated by appellant as its liability in that behalf. The cause shown by the appellant by its representation, dated, 24.1.1969 against the proposed addition not having commended itself to the Director, the latter, by his order dated 15.10.1969 over ruling objections of the appellant, determined that a sum of Rs.47,59,109.00 was due and recoverable from the appellant by way of balance of premia. Against this determination, appellant carried up, under Section 11(3) of the Act, an appeal before the Central Government. The Central Government, after affording an opportunity to the appellant of being heard and on a consideration of the merits, dismissed the appeal by its order dated, 12.5.1971. The legality of the proceedings so culminating in the said appellate order was assailed in the Writ Petition before the High Court. We have heard Shri K. Rajendra Choudhary, learned counsel for the appellant and Shri V.C. Mahajan, learned senior counsel for the Union of India, respondent in the appeal. The contentions urged by Shri Choudhary in support of the appeal are substantially on the lines of those raised and urged before the High Court. They admit of being formulated thus: (a) That the Distribution and Transmission lines cannot be said to fall within the concept of 'Factory ' and in quantifying the extent and value of the insurable property, the High Court fell into an error in including the value of the "Distribution and Transmission lines" (b) That in ascertaining the value of the insurable property, depreciation had had to be granted under the relevant provisions of the Income Tax Act 1922 and that the limiting of the depreciation to that under the relevant schedules to The Electricity (Supply) Act 1943 was erroneous. (c) That the 'Act ' was itself a piece of temporary legislation which lapsed on 10.1.1968 and that the proceedings by the Director initiated, as they have come to be, pursuant to show cause notice dated, 28.11.1968 subsequent to the date of expiry of the statute itself, was without the authority of law. 220 (d) That substantial portions of the insurable properties came to vest in the Appellant Board on dates subsequent to 1.11.1963 and that the appellant, in respect of those assets was not liable to premia as appellant had not become the legal owner of those assets. We shall now proceed to examine the merits of these contentions seriatim . Re: Contention (a) The argument is that The "Distribution and Transmission Lines" did not constitute 'Factory ' and therefore their value was not includible in the concept of 'insurable property ' under the 'Act '. The fallacy in this argument lies in that it overlooks the definition of the words "property insurable under this Act" and also the specific language of Section 17(1) of the Act. The argument also over looks the express provisions of the statutory 'scheme ' put into operation. Section 2(1) of the 'Act ' which defines "property insurable under the Act", inter alia, enables the inclusion of "Such other plant machinery or material as may be specified in the Scheme also. " That apart, Section 17(1) of the 'Act ' enables the Central Government, by notification, to declare that provisions of the 'Act ' and of the "scheme" promulgated thereunder shall apply to insuring of the various classes of assets specified in clauses (a) to (d) of that section. Clause (d) of Sub section ( 1) of Section 17 refers to: " . The whole or a specified part of the distribution and transmission systems, sub stations, switch houses, and transformer houses of electric supply undertakings generally or specified electric undertaking The 'scheme ' prepared and promulgated by Notification S.O. 3947 which came into force with effect from 1.1.1963, provides, among other things, that the whole of the "Distribution and Transmission Systems," "sub stations", "switch houses", "transformer houses" etc. shall constitute "insurable property" and that the 'Act ' and the scheme shall be applied to them. 221 6. It is, thus, clear that the inhibitions of the limited import of the expression 'Factory ' do not limit the identity of the 'insurable property ' which will have to be ascertained and determined in accordance with the provisions of the scheme. The view of the High Court is, in our opinion, fully justified. There is no merit in this contention. Contention (a) is, accordingly, held against the appellant. Re: Contention (b) In determining the value of the insurable property, the scheme, by its clause 7, envisages due allowance for the depreciation being made. The question is whether depreciation allowed in accordance with the schedules to the , in preference to the rates of depreciation provided for in the Indian Income Tax Act, 1922 claimed by the appellant, is incorrect in principle. The High Court noticed that the provisions of the , related to the electricity undertakings themselves and that, further, appellant had itself made up its books in regard to valuation of various properties, assets etc. adopting the depreciation based on the provisions of the . The argument of Shri Rajendra Choudhary, learned counsel, is that where two alternative bases for the determination of the depreciation were available, appellant was entitled to opt for the more beneficial and less disadvantageous of the two. There is again a fallacy in this approach. The 'Act ' or the 'Scheme ' does not specify any bases for the computation of depreciation. It would appear that there were some administrative instructions to the effect that wherever the matter was governed by specific statutory provisions, those provisions be applied and wherever statutory provisions regulating the matter were not available, then, the provisions of the Income Tax Act be taken into account. These instructions have no statutory force. But even to the extent they go, it was not as if two alternative methods were open. Indeed, the two methods were mutually exclusive and not alternative. That apart, the provisions as to depreciation in a taxing law like the Income Tax Act contain elements of incentives and are also informed by considerations of policy of the tax and do not reflect purely economic criteria relevant to the determination of the depreciation. The High Court, on the point, held: ". When once it is found that the Electricity Board (Supply) Act itself provides a formula for working out the 222 allowance of depreciation and the Electricity Board has been adopting that formula and writing down the allowance of depreciation in its books we fail to see how, if that method is taken into account it can be said to be inconsistent with clause 7 of the Insurance Scheme. Both the Tribunals therefore in our opinion, rightly accepted that as the allowance for depreciation and permitted the same. The contention that the statutory depreciation should have been disregarded and instead the depreciation worked out under the Income Tax Act should have been made applicable has no force, because no rule or provision of law sustains any such contention . " There is no error in principle committed by the High Court in applying the principles contained in the schedules to the . We do not find legal support for the insistence by the appellant on the adoption of the standards of depreciation contained in the provisions of Income Tax Act, 1922. The finding of the High Court in this behalf does not also call for interference. Contention (b) is also, accordingly, answered against the appellant. Re: Contention (c) The assumption basic to the argument is that the 'Act ' is a temporary statute which expired by efflux of time on 10.1.1968 and that the proceedings subsequently commenced on 29.11.1968 were without jurisdiction. Section 6 of the general clauses Act is held in applicable to a case of expiry of a temporary statute on the view that Section 6 is attracted wherever there is a repeal and that the case of expiry of a statute by efflux of time is not a case of repeal. Whatever be the principles of construction of temporary statutes and the effect on the rights and obligations under them of the expiry of the statute itself, the 'Act ' in the present case contains specific provisions preserving the rights and obligations. The 'Act ' invokes the provisions of Section 6 of the General Clauses Act. The matter is placed beyond controversy by the pronouncement of this court in Amadalavalasa Cooperative Agricultural & Industrial Society Ltd. & Anr. vs Union of India & Anr. , (See ; at 738). ". Therefore, if under section 5 of the 'Factories Act ' or under section 7 of the 'Goods Act ', the liability to pay the premia on full insurable value was incurred before the expiry 223 of the Act, section 6 of the General Clauses Act would enable the ascertainment of the extent of liability for the evaded premia by an officer who was authorised when the Act was in force or by an officer authorised after the expiry of the Act. The principle behind section 6 of the General Clauses Act is that all the provisions of the Acts would continue in force for purposes of enforcing the liability incurred when the Acts were in force and any investigation, legal proceeding, remedy, may be instituted, continued or enforced as if the Acts had not expired . " Contention (c) is, accordingly, also held and answered against the appellant. Re: Contention (d) The argument is that though the Appellant Board was constituted on 1.4.1959, the properties of the erstwhile electricity undertaking of the State Government were transferred to and became the property of the Appellant Board by notifications issued on various dates subsequent to 1.11.1963 and that, accordingly, during the relevant periods during which the legal ownership of the property did not vest in the appellant, it was not liable for the premia. It is relevant to mention here that the period for which the demands were raised was between 1.1.1963 and 10. 1.1968. Appellant 's contention in this behalf was repelled in the statutory appeal on the ground that though formally the notifications came to be issued on various dates subsequent to 1.4.1959, the assets had in fact been transferred to and were acknowledged and treated by the appellant as its own in its Balance Sheets. Before the authorities, it would appear, this point had not been seriously disputed by the appellant. In a letter dated, 24.1.1969, the Secretary of the Appellant Board wrote to the Director. ". We may mention that we are accepting your stand that the properties transferred to the Board by the Government become the properties of the Board as and from the dates of original transfer . " The Director in his order, dated, 15.10.1969 observed: 224 ". The assets had in fact been transferred by the State Government to the Board from the 1st April, 1959 and the same had been shown as their own assets by the Board is their balance sheets since then. If for certain reasons the State Government issued the notifications long after the expiry of the two months period i.e., on 5.10.1964, 28.10.1966 and 14.12.1966, etc. it was only a sort of formality, particularly in view of the fact that the said notifications, referred to the assets as having been transferred to the Board as on 1.4.1959. The Board correctly became owner of such assets right from 1.4.1959. This point was conceded by the Board in its letter, dated, 24th January, 1969 and was also not pressed in the discussions that I had with them on the 26th and 27th July, 1969. (underlining supplied) In view of this nothing survives of contention (d) either. It is accordingly held against the appellant. In the result, for the foregoing reasons, this appeal fails and is dismissed. In the circumstances of the case, the parties are, how ever, left to bear and pay their own costs in the appeal. R.S.S. Appeal dismissed.
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The Emergency Risks (Factories) Insurance Act, passed in 1962, was made to help factories quickly recover if they were damaged during a war. The government decided to insure factories against risks related to war. This law created the Emergency Risks (Factories) Insurance Scheme. This meant factories had to get insurance against war risks and pay a set amount of money for it. The person in charge of the Emergency Risks Insurance Scheme told the appellant (the factory owner) they could explain why they shouldn't have to pay. After this, the person in charge said the appellant still owed about 4.7 million rupees in unpaid insurance payments. The appellant appealed to the Central Government, but they lost. The appellant then went to the High Court of Andhra Pradesh, saying the decision was wrong. The High Court disagreed with the appellant. So, the appellant is now appealing that decision. The appellant argued that: (1) power lines are not part of a "factory" and shouldn't be included as something that needs insurance; (2) the value of the property being insured should take into account depreciation (loss of value over time) as calculated under the Income Tax Act; and (3) the law was only meant to be temporary, so a notice sent in late 1968 was not valid because the law had already expired in early 1968. The court said the appeal was denied, and that: (1) The definition of "factory" doesn't limit what can be considered "insurable property." The government can decide that the insurance applies to things like power lines. The rules of the insurance program say that power lines are "insurable property" and that the law applies to them. (2) The rules about depreciation in tax laws are there to encourage certain behaviors and are based on tax policy, not just economic factors. In this case, the High Court found that the Electricity (Supply) Act already had a way to calculate depreciation, and the appellant was already using that method. So, it was okay to use that standard for depreciation. (3) Even if the law was temporary, this specific law has rules that keep the rights and responsibilities in place. It uses section 6 of the General Clauses Act, which says that all parts of laws stay in effect to enforce any responsibilities that were created while the laws were in place. Any investigations, legal actions, or ways to fix a problem can still be used as if the laws were still active. The court referred to a previous case, Amadalavalasa Cooperative Agricultural & Industrial Society Ltd. vs Union of India.
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vil Appeal Nos. 4397 98 of 1989 etc. From the Judgment and Order dated 30.11.1988 of the Central Administrative Tribunal at New Delhi in O.A. Nos. 838 of 87 and 1502 of 1987. 606 K. Sibal, Additional Solicitor General, A. Subba Rao, C.V.S. Rao and M.S. Ganesh for the appellants. Respondent No. 1 in person. D.K. Garg, R.P. Oberoi and D.B. Vohra for the respondents. The judgment of the Court was delivered by R.M. SAHAI, J. Seniority in services is usually irksome. But the nature of dispute amongst officers in Class 'A ' of Indian Defence Estates Service, who were promoted from Class 'B ' of Military and Cantonment service where they were working as Assistant Military Estates Officers (AMEO) and Assistant Military F. states Officers (Technical) (AMEOT), is slightly, unusually. That is why apart from correctness or otherwise of directions issued by the Tribunal (Central Administrative Tribunal, New Delhi) for re determining seniority one of the issues debated was if this Court in exercise of its powers under Article 136 of the Constitution of India should interfere with orders of Tribunal if sub stantial justice has been done between parties. To this may be added, yet, another, namely, if the Union of India should have approached this Court by way of Special Leave Petition not for sake of justice or injustice, legality or illegality of any provision but because it may have to pay few thou sands, may be few lakhs more. But, first, manner of appointment of two group of offi cers and rules by which they were governed from time to time may be noticed as even though initially posts of both AMEO and AMEOT were sanctioned and created by the President in 1962 and they were governed for some time by different set of rules but were brought in common stream in 1976 and were promoted in Class 'A ' before fresh rules were enforced in 1983 and 1985, yet entire thrust of attack to justify dif ferential treatment to AMEOT was rounded on difference in method of their selection. AMEOS were included in Class II of Military Land and Cantonment Service (Class I and II) Rules, 1951 for the first time in 1964. Relevant amendment by notification issued in 1964 was incorporated in 1951 Rules when it was amended in 1968. Amended Rule 4(v)(c) read as under: "Class II of the Service shall consist of Executive Officers Class II, Assistant Military Estates Officers and such other posts, as may, by order of the Government be declared to be included in Class II cadre of the Service." 607 Manner of appointment to this class was provided by Rule 5(b) which is extracted below: "(b) Appointment to Class II Cadre of the Service shall be made in the following manner, namely: (1) upto 20% of vacancies in Class II, by promotion from among the serving Class III staff of the Military Lands and Cantonments Service having service and educational qualifi cations specified in sub rules (c) and (e); (2) upto 20% of vacancies by direct recruitment made by a selection from among serving employees of Cantonment Boards having service and educational qualifications specified in sub rules (d) and (e); (3) the remaining vacancies from among the candidates who qualify at the Examination and are recommended by the Com mission but who fail to secure Class I appointment in any of the Central Services. 'Provided that (i) for a period of five years commencing from the 29th January, 1966, 30 per cent of the permanent vacancies to be filled by direct recruitment in any year shall be reserved for being filled in by the Emer gency Commissioned Officers of the Armed Forces of the Union who were commissioned on or after the 1st November, 1962, and who were released at any time thereafter." In 1981 service known as Military Lands and Cantonment Service (Group A) was constituted. 75% of the substantive vacancies, in this Group 'A ', junior scale, were to be filed by direct competition and 25% by promotion from a panel prepared on the basis of selection on merit in ratio 1:1 from amongst Cantonment Executive Officer Group 'B ' and Assistant Military Estates Officer Service (Group B) who had not rendered less than 3 years regular service. AMEO (Technical) on the other hand were officers who were released from Engineering Service of Army after 1962. Since there was increase in work load and they were to be absorbed as well they were appointed on recommendation of UPSC (Union Public Service Commission) in 1964 and 1965 against posts which were created from time to time by the Military Land and Cantonments Department as is clear 608 from various orders issued in 1963, 1967 and 1970 which have been extracted in the order of Tribunal to demonstrate that the Director, Military Lands and Cantonment, Ministry of Defence, issued letters conveying the sanction of the Presi dent to the creation of various posts in the Military Lands & Cantonment Service which included Assistant Military Estates Officers (Technical). Although the appointment letter issued to each officer mentioned that the post was temporary yet each was appointed on probation of two years. The word "Technical" appears to have been added because they were engineers. Otherwise there was neither difference in pay nor in work as the AMEOT were appointed to work as AMEO as well. AMEOT were thus qualified persons holding rank in Army. To say that they were lesser in merit than AMEO, only, because they had not appeared in competitive examination was being uncharitable to them. To misfortune of AMEOT they were neither included in the Class II cadre of 1951 Rules nor any other rule was applied to them. Presumably because of method of recruitment. All the same it was very unsatisfactory that posts of AMEOT were being created and selections made in pursuance of advertise ment issued by the UPSC yet they were not being provided any statutory basis. Realising this rules were framed under Article 309 in 1968, but these rules again did not provide for promotions, seniority etc. However, the anomoly was finally removed, when officers appointed prior to 1967 or under 1968 Rules as AMEOT were included in Class II of 1951 Rules by amending Rule 3 in 1976 which read as under: "3. The Service shall be constituted by officers appointed (i) in accordance with these rules; (ii) in accordance with the Military Lands and Cantonments Service (Assistant Military Estates Officers Technical) Recruitment Rules, 1968; and (iii) in consultation with the Commission, as Assistant Military Estates Officer (Technical), prior to the 1st January, 1967. " Thus from this date officers appointed as AMEOT either under the 1968 Rules or prior to it became members of Mili tary Lands and Cantonment Service (MLC) to whom 1951 Rules applied. On that there is no dispute. But what about 1964 to 1976? Should they be 609 deemed to have served under no rules as claimed by AMEOS and strangely even by Union, or they were governed by Central Civil Services (Temporary)Rules 1965 (CCS Rules). And if so what was its effect on their promotion and seniority. For this one of the appointment letter issued to AMEOT contain ing terms and conditions is extracted below: MEMORANDUM Subject: Recruitment to the post of Assistant Military Estate Officer (Technical) Military/Lands & Cantonments Service. On the recommendation of the Union Public Service Commission, the President is pleaded to offer Shri Mahandra Pal Singh, a temporary post of Assistant Military (Estate Officer Technical) in the Military Lands & Cantonment Serv ice Under Ministry of Defence. xxx xxx xxx The terms and conditions of appointment are as follows: (i) The post is temporary. In the event of its becoming permanent his claim for permanent absorption will be Consid ered in accordance with the rules in force. (ii) He will be on probation for a period of two years from the date of appointment which may be extended at the discre tion of the competent authority. Failure to complete the period of probation to the satisfaction of the competent authority will render him liable to discharge from service or reversion to his parent department in case he is holding a permanent posts. XXX XXX XXX (iv) The appointment may be terminated at any time on one month 's notice given by either side, viz., the appointee or the appointing authority, without assigning any reasons, or by reverting the individual to his parent department, in case he is holding a lien. The appointing authority, howev er, reserves the right of terminating the services of the appointee forthwith or before the expiry of the stipulated 610 period of notice by making payment to him of a sum equi . valent to the pay and allowance for the period of notice or the unexpired portion thereof. (v) He will be subject to conditions of service as applica ble to temporary civilian Government servants paid from Defence Services Estimates in accordance with the orders issued by Govt. of India from time to time. He will be subject to Field Service Liability Rule, 1957. " What stands out Clearly from it is that they were appointed in Military Lands and Cantonment Service (MLC) under Minis try of Defence. That is clear from the order creating the posts from time to time. Letter dated 27th April, 1963 is extracted below: "To The Director, Military Lands & Cantts. New Delhi. Subject: Establishment of the New Eastern Command Sanction of Staff. Sir, Consequent on the establishment of the New Eastern Command and re organisation of the existing Eastern Command into Central Command, I am directed to convey the sanction of the President to the creation of the following posts in the Military Lands and Cantts. Services: 1. Director, Military Lands & Cannts. Asstt. Director, ML & C. 1 3. Military Estates Officer (Bihar & Orissa) 1 4. Asstt. Estates Officer, (Technical Class II) 2" Therefore it is too late to claim that they were not ap pointed to Military Land and Cantonment Service under Minis try of Defence. Was their status effected or nature of employment altered because 611 Central Civil Service (Temporary service) 1965 Rules applied to them. These rules applied to 'service under the Govern ment of India in the Ministry of Defence . paid out of the Defence Service Estimates '. Purpose of the rule was not to create a cadre or grade of temporary employees but to provide statutory basis to employees of different depart ments mentioned in it and accord them a quasi permanent status if they fulfilled the requirements mentioned in Rule 3. Seniority, promotion etc. were to be governed by the rules under which the temporary employee was appointed. Therefore, seniority of an employee and its determination depended on service in the cadre to which he belonged or to which he was appointed. That the AMEOT were appointed to MLC service cannot be disputed. Nor it can be disputed that they were appointed to posts which were created by the President and its sanction was conveyed by the Director of MLC. The only shortcoming was that there was no declaration that these posts were included in Class II Cadre. That also stood removed in 1976. Since it included every AMEOT whether appointed under 1968 Rules or even prior to it all those AMEOT who were appointed in 1964 or 1965 also become member of service to whom 1951 Rules applied. Automatic consequence of it was that seniori ty of AMEOT was to be determined under Rule 11 of 1951 Rules on length of regular service in the cadre. That is what the tribunal held. And rightly. Whether service rendered by the respondents between 1964 to 1976 was regular or it could be deemed to be regular as held by the Tribunal is different. Assuming, the Tribunal committed error in applying 1951 Rules to service of AMEOT prior to 1976, does it call for any interference? Is the order not just and fair? Effect of Tribunal 's order is that it cured the injustice perpetrated due to absence of exercise of power by the Government under Rule 4(v)(c) of 1951 Rules as it stood amended since 1964. Substantial justice being one of the guidelines for exercise of power by this Court the order is not liable to interfer ence. What is baffling is filing of the SLP by Union Govern ment. Not because of any injustice to AMEO as that has been taken care of by Tribunal by protecting all those who are working but because if it works out seniority of AMEOT from back date it may have to pay substantial amount and creation of superanuary posts may further entail cost. Justice is alert to differences and sensitive to discrimination. It cannot be measured in terms of money. A government of a welfare state has gruelling task of being fair and just and so justice 612 oriented in its approach and outlook. Mere rectification of its mistakes or omissions by Courts and Tribunals should not prompt parties or it to approach this Court by Special Leave merely for taking a chance or to protect some vested inter est except for sake of justice or for laying down law for benefit of Court and its guidance. Neither was in this case. Injustice to respondents is apparent as admittedly these officers were promoted in Class 'A ' in 1978 and are working since then uninterruptedly yet when review DPC were held in pursuance of the judgment given by Allahabad High Court and seniority list was published in 1987, they were ignored as they were working as ad hoc resulting in pushing up AMEOS who were junior to them. AMEOs were granted seniority from the date of appointment in MLC service whereas similar benefit was denied to AMEOT as they were working as ad hoc. To remove this irritant Tribunal directed that they shall be deemed to be holding regular posts. Officers working since 1964 without any flaw could not be treated as ad hoc. In any case once review DPCs were held it was incumbent on it to include these persons and if necessary to evaluate their services or get it evaluated by appropriate authority regu larise them and then determine seniority. But in ignoring them in 1987 even when they had become member of MLC service was arbitrary and unjustified. Two other objections one about delay and other about nonjoinder raised, again, by Union Govt. may be examined. As regards former suffice it to say that the occasion to ap proach Tribunal arose when seniority of respondents was disturbed and panels recommended in 1972 and 1979 were redrawn in 1987 and seniority were refixed in Group 'B ' with effect from March 1968. Therefore objection of claim being slate or belated cannot be accepted. Nor there is any sub stance in defect due to non joinder of parties. Objection stands answered by the ratio in Col. D.D. Joshi & Others vs Union of India & Others, ; ; where it was held that it was not necessary to implead all parties if chal lenge was to validity of rule. As regards Ranga Reddy & Others vs State of Andhra Pradesh., relied on behalf of the appellant in support of the submis sion that the order passed by the Tribunal was vitiated in the absence of interested parties cannot be accepted as some of those officers who were directly affected or were immedi ately likely to be effected got themselves impleaded before the Tribunal. Therefore, the defect, if any, stood removed. Moreover the Tribunal protected interests of all 613 these persons who were working at present by directing that they shall not be disturbed. Non impleadment of these who may be effected in future could not render the petition vulnerable. In the result both the appeals fail and are dismissed. The respondents shall be entitled to costs from Union of India. Y. Lal Appeals dismissed.
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This case is about a disagreement over who is more senior among officers in Class 'A' of the Indian Defence Estate Service. Class 'A' includes officers who were promoted from two different groups: Assistant Military Estate Officers and Assistant Military Estate Officers (Technical). Both groups came from Class 'B' of the Military and Cantonment Service. The way these two groups of officers were chosen and appointed was different. Assistant Military Estate Officers were promoted from lower-level staff (Class III) within the Military Lands and Cantonments Service. Assistant Military Estate Officers (Technical) were chosen by the Union Public Service Commission from engineers who had left the Army after 1962. However, both groups did the same kind of work. Assistant Military Estate Officers were officially included in Class II of the Military Land and Cantonment Service rules in 1964. This was done through an official announcement and added to the rules in 1968. But Assistant Military Estate Officers (Technical) weren't officially included until 1976, and no other rules were applied to them before that. This means the selection and appointment of Assistant Military Estate Officers (Technical) wasn't based on any official rules before 1976. To fix this, Assistant Military Estate Officers (Technical) were added to Class II of the rules in 1976. From this date, officers appointed as Assistant Military Estate Officers (Technical), either under the 1968 rules or before, became members of the Military Land and Cantonment Service, and the 1951 rules applied to them. But there was no rule made to account for the time they worked between 1964 and 1976. This affected their seniority and chances for promotion. The Union (representing the government) argued that the service during this earlier period should be considered temporary. The officers who were affected disagreed and filed a petition with the Central Administrative Tribunal (a court for government employee issues). The Tribunal agreed with the officers. It ruled that their seniority should be decided based on how long they had been working regularly in their position, according to Rule 11 of the 1951 rules. The Tribunal ordered the Union to recalculate the officers' seniority. The Union of India then appealed this decision. The Court dismissed the appeal, stating that an employee's seniority depends on their time in the position they hold or were appointed to. The Tribunal's decision corrected an unfair situation that was caused by the government not using its power properly under Rule 4(v)(c) of the 1951 rules, as they were changed in 1964. Because the Court wants to ensure justice is done, it decided not to interfere with the Tribunal's order. Justice means being aware of differences and sensitive to unfairness. It's not just about money. The government has a responsibility to be fair and just in its decisions. Courts and Tribunals are there to fix mistakes. People shouldn't bring cases to the Court just to take a chance or protect their own interests, unless it's for the sake of justice or to clarify the law for future cases. Assistant Military Estate Officers were granted seniority from their appointment date in the Military Land and Cantonment service, but Assistant Military Estate Officers (Technical) were denied this benefit because they were considered to be working temporarily. To fix this issue, the Tribunal said that they should be considered to have held regular positions. Officers who had been working since 1964 without any problems should not be treated as temporary employees. Once review committees were held, the Union should have included these officers, evaluated their service, and made them permanent before deciding seniority. Ignoring them in 1987, even after they had become members of the Military Land and Cantonment service, was unfair. Col. D.D. Joshi and Ors. vs Union of India and Ors. ; ; Ranga Reddy and Ors. vs State of Andhra Pradesh,
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Appeal No. 897 of 1964. 887 Appeal by special leave from the judgment and order dated November 14, 1961 of the Allahabad High Court in Civil Revi sion No. 686 of 1953. Bishan Narain and M. I. Khowaja, for the appellant. Niren De. Addl. Solicitor General, M. V. Goswami and Yogeshawr Parshad, for the respondent. The Judgment of the Court was delivered by Bhargava, J. The respondent firm, K. B. Bass & Co., instituted a suit on 13th April, 1951, for rendition of accounts against the appellant firm, Messrs Hulas Rai Baij Nath, alleging that the appellant was the commission agent of the respondent and that the accounts between respondent as the principal and appellant as the agent had not been settled since the dealings be an in the year 1941 onwards. Tentatively, a sum of Rs. 2,100/ was claimed in the plaint. In the written statement filed on behalf of the appellant, the suit was contested on various grounds; but for the purposes of this appeal, we need mention the pleas taken in only two paragraphs 8 and I 1. In paragraph 8, it was pleaded that one Lala Shiva Charan, a partner of the respondent firm, had come with a Munim in the month of Agahan last and account. ,; were fully explained to him as worked out upto Kartik Sudi 15. Sambat 2007. In that statement of account, a sum of Rs. 10,677 14 3 was found due to the appellant from the respondent and the representatives of the respondent asked for two months ' time for making the payment of the amount found due. It was thus urged that there was no occasion for rendition of accounts and the plaintiff 's suit was not fit to proceed according to law. In paragraph I 1, the appellant pleaded that "if, in the opinion of the court, the court has jurisdiction to try the suit and it is necessary to tender the accounts, it is equitable that a decree for the amount which may be found due to the contesting defendant, after rendition of accounts, together with costs and interest be passed in favour of the contesting defendant, after necessary court fee being realized from the defendant. " A number of issues were framed and the case was taken up for recording of evidence on several dates of hearing. Some of the issues were even given up during the 'trial. Ultimately, on 5th May, 1953, after a considerable amount of evidence had been recorded, an application was presented on behalf of the plaintiff respondent, for withdrawal of the suit. The round given for withdrawal was that the respondent firm was in the charge of one Bhagwat Charan who had colluded with the appellant and litigation was going on between the respondent and Bhagwat Charan for effecting partition of the business. Consequently, it was difficult to prosecute the suit, No prayer was made for permission to file a fresh suit. The appellant filed an application objecting to this application for with. L9Sup. CI/67 13 888 drawal. The main ground taken for contesting this application for withdrawal was that, in a suit of this nature, it is permissible to pass a decree in favour of the defendant if, on accounting, something is found due to him against the plaintiff, and it followed that, if the defendant paid court fee on 'the amount which was found due to him from the plaintiff, his position became that of ,A plaintiff himself and he became entitled to have 'the accounting done and to obtain a decree. It was urged that the plaintiff 's game in withdrawing the suit after protracted duration and considerable expenditure on the part of the defendant was to defeat this right of the defendant. The trial Court held that the right of the plaintiff in this suit to withdraw under 0. 23, r. 1 of the Code of Civil Procedure was inherent and such a right could be exercised at any time before judgment. All 'that the defendant could claim was an order for costs in his favour. The Court, therefore, dismissed the suit, awarding costs of the suit to the appellant. The appellant filed a revision in 'the High Court of Allahabad against this order, with a prayer that the High Court may set aside the order of the trial Court and remand the suit for trial according to law. The High Court dismissed the application for revision; and the appellant has now come tip to this Court in 'this appeal by special leave. The short question that, in these circumstances, falls for decision is whether the respondent was entitled to withdraw from the suit and have it dismissed by the application dated 5th May, 1953 at the stage when issues had been framed and some evidence had been recorded, but no preliminary decree for rendition of accounts had yet been passed. The language of 0.23, r. 1. sub r. (I ), C.P.C., gives an unqualified right to a plaintiff to withdraw from a suit and, if no permission to file a fresh suit is , ought under sub r. (2) of that Rule, the plaintiff becomes liable for such costs as the Court may award and becomes precluded from instituting any fresh suit in respect of that subject matter under sub r. (3) of that Rule. There is no provision in the Code of Civil Procedure which requires the Court to refuse permission .to withdraw the suit in such circumstances and to compel tile plaintiff to proceed with it. It is, of course, possible that different considerations may arise where a set off may have been claimed under 0. 8 C.P.C., or a counterclaim may have been filed, if permissible by the procedural law applicable to the proceedings governing the suit. In the present case. the pleadings in paragraphs 8 and II of the written statement. mentioned above, clearly did not amount to a claim for set off. Further, there could be no counterclaim, because no provision is shown under which a counter claim could have been filed in the trial Court in such a. suit. There is also the circumstance that the application for withdrawal was moved at a stage when no preliminary decree had been passed for rendition of account and, in fact, the appellant 889 was still contending that there could be no rendition of accounts in the suit, because accounts had already been settled. Even in para 11, the only claim put forward was that, in case the Court found it necessary to direct rendition of accounts and any amount is found due to the appellant, a decree may be passed in favour of the appellant for that amount. In this paragraph also, the right claimed by the appellant was a contingent right which did not exist at the time when the written statement was filed. Even if it be assumed that the appellant could have claimed a decree for the amount found due to him after rendition of accounts, no Such right can possibly be held to exist before the Court passed preliminary decree for rendition of accounts. It is to be noted that in the case of a suit between principal and agent, it is the principal alone who has normally the right to claim rendition of accounts from the agent. The agent cannot ordinarily claim a decree for rendition of accounts from the principal and, in fact, in the suit, the appellant, who was the agent of the respondent, did not claim any rendition of accounts from the respondent. In 'these circumstances; at the stage of withdrawal of the suit, no vested right in favour of the appellant had come into existence and there was no ground on which the Court could refuse to allow withdrawal of the suit. It is unnecessary for us to express ,my opinion as to whether a Court is bound to allow withdrawal of a suit to a plaintiff after some vested right may have accrued in the suit in favour of the defendant. On the facts of this case. it is clear that the right of the plaintiff to withdraw the suit not at all affected by any vested right existing in favour of the appellant and, consequently, the order passed by the trial Court was perfectly justified. On behalf of the appellant, reliance was placed on the views expressed by a Division Bench of the Madras High Court in Seethai Achi vs Meyappa Chettiar and Others (1), where the Court held: "Ordinarily, when the Court finds no impediment to the dismissal of a suit after the announcement of the withdrawal of theclaim by the plaintiff, it will simply say that the suit is dismissed as the plaintiff has withdrawn from it. An order as to costs will also be passed. But several exceptions have been recognised to this general rule. ]n suits, for partition, if a preliminary. decree is passed declaring and defining the shares of the several parties, the suit will not be dismissed by reason of any subsequent withdrawal by the plaintiff, for the obvious reason that the rights declared in favour of the defendants under the preliminary decree would be rendered nugatory if the suit should simply be dismissed. So also in partnership suits and suits for 890 accounts, where the defendants too may be entitled to some reliefs in their favour as a result of the settlement of accounts, the withdrawal of the suit by the plaintiff cannot end in the mere dismissal of the suit. " We do not think, as urged by learned counsel, that the learned Judges of the Madras High Court were laying down the principle that, in a suit for accounts, a defendant is always entitled to relief in his favour and that the withdrawal of such a suit by the plaintiff cannot be permitted to terminate the suit. In the context in which that Court expressed its opinion about suits for accounts, it clearly intended to lay down that the dismissal of the suit on plaintiff 's withdrawal is not to be necessarily permitted, if the defendant has become entitled to a relief in his favour. But such it right, if at all, can in no circumstances be held to accrue before a preliminary decree for rendition of accounts is passed. In fact, in mentioning suits for partition and suits for accounts, the Court was keeping in view the circumstance mentioned in the earlier sentence which envisaged that a preliminary decree had already been passed defining rights of parties. In any case, we do not think that any defendant in a suit for rendition of accounts can insist that the plaintiff must be compelled to proceed with the suit at such a stage as the one at which the respondent in the present case applied for withdrawal of the suit. The appeal, therefore, fails and is dismissed with costs.
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In a lawsuit about providing financial records, the person being sued (the defendant) argued that the accounts were already settled. He said the person suing (the plaintiff) owed him money, so there was no need to provide records. He also said that if the court decided records *were* needed, the defendant should get a court order for the money owed to him, plus costs and interest, after he paid the required court fees. Even though the court hadn't made an initial decision that records needed to be provided, the defendant was still arguing that they weren't necessary. The plaintiff then asked to drop the lawsuit. The defendant disagreed. He claimed that in this type of lawsuit, he was now in the position of a plaintiff. He felt he had the right to have the accounting done and get a court order. He argued that letting the plaintiff drop the case after so long would take away that right. The trial court allowed the plaintiff to drop the case, and the High Court agreed. The defendant appealed, but the higher court *HELD*: At the point when the plaintiff wanted to drop the lawsuit, the defendant didn't have a guaranteed right to a court order. There was no reason to stop the plaintiff from dropping the case. The rules of civil procedure don't say that a court must refuse permission to drop a lawsuit in these situations or force the plaintiff to continue. Things might be different if the defendant had made a claim to reduce what he owed (a "set off") or filed a separate claim against the plaintiff (a "counter claim"). In this case, the defendant's arguments weren't a claim for a "set off". Even if we assume the defendant could have received a court order for money owed after providing records, he couldn't have that right until the court made an initial decision that records needed to be provided. In a case between a boss (principal) and an employee (agent), usually only the boss has the right to demand financial records from the employee. The employee can't usually demand records from the boss. In this case, the defendant (the agent) didn't ask the plaintiff (the boss) to provide any records. [888F H] 889B D] Seethai Achi vs Meyappa Chettiar and Others, A.I.R. 1934 Mad, 337. was used as a reference.
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Civil Appeal No. 1794 (NL) of 1977. 22 From the award dated 23.3.1977 of the Industrial Tribunal, Maharashtra, Bombay in Reference (I.D.) No. 307 of 1968. K.K. Venugopal, Rameshwar Nath and Ravinder Nath, for the Appellant. M.K. Ramamurthi, A.D. Sastri and Mrs. Urmia Sirur, for the Respondent. Shardul section Shroff and H.S. Parihar for the interveners. The Judgment of the Court was delivered by GUPTA J. This is an appeal by special leave from an award made by the Industrial Tribunal, Bombay, on December 9, 1976 in Reference No. 307 of 1968 directing reinstatement of 12 workmen dismissed by the appellant, Firestone Tyre and Rubber Company of India Private Limited. The appellant company carries on the business of manufacturing tyres, tubes and several other products in Bombay. Disputes arose between the management and the workmen employed in the company 's tyre curing department leading to a strike by these workmen from March 3, 1967. This strike was called off on May 15, 1967, according to workmen on certain assurances given by the Commissioner of Labour. The case of the management is that even after the workmen resumed work, they adopted a deliberate 'go slow ' policy resulting in fall in production. On September 14, 1967 the management put up a notice asking the workmen to desist from continuing with the go slow tactics. The notice however had no effect and from October 4, 1967 the workmen working in the tyre curing department again went on a strike. Between October 27 and 31, 1967 the management issued chargesheets to 102 workmen alleging that they had resorted to wilful go slow. The chargesheets issued were in identical language and they read as follows: "You are charged with the following act of misconduct under the Company 's certified standing order No. 24 (C), viz. 'Wilful slowing down in performance of work or abetment, or instigation thereof. ' 23 You have wilfully slowed down in performance of work as per particulars given below: " The particulars were then mentioned. Three inquiry officers were appointed to inquire into the charges. Almost all the workmen refrained from participating in the inquiries; the 12 workmen concerned in this appeal also remained absent. The inquiry officers found the workmen guilty of adopting wilful go slow tactics. The management accepted the findings of the inquiry officers and dismissed the workmen other than those who were 'protected workmen ' as defined in the explanation to section 33 (3) (b) of the . The management also decided to dismiss the protected workmen. As a reference concerning an earlier dispute (Reference No. 406 of 1967) was pending before the Tribunal, applications were made section 33 (2) (b) of the for approval of the action of the management in dismissing the workmen and under section 33 (3) (b) for permission to dismiss the protected workmen. It appears that subsequently, on April 17, 1968 the parties reached a settlement. The more important terms of the settlement were: (1) The Firestone Tyre Employees Union agreed to withdraw the strike. (2) The dispute relating to the dismissal of 101 workmen (one of the workmen concerned having died in the meantime) was to be referred for adjudication by a joint application made by the parties under section 10 (2) of the . (3) 77 of the dismissed workmen were to be re employed on temporary basis till the disposal of the adjudication by the Industrial Tribunal. (4) The remaining 25 workmen, including the 12 we are concerned within this appeal, were not to be taken back but the management would pay to them 50 per cent of their basic wages and dearness allowance from the date of the retirement till the disposal of the adjudication by the Tribunal. 24 As agreed a joint application by the parties was made on which the Deputy Commissioner of Labour, Bombay, under section 10(2) of the (Reference No. 307 of 1968) referred to the Industrial Tribunal, Bombay, the disputes between the parties relating to the demands detailed in the schedule to the order of reference. Two distinct matters are mentioned in paragraphs 1 and 2 of the schedule. The second matter mentioned in paragraph 2 does not survive for consideration. The first paragraph which is divided into two parts, (A) and (B) reads as follows: "SCHEDULE 1(A): The workmen listed at Serial Nos. 1 to 25 of 'Schedule I ' [which contains names of the 12 workmen concerned in this case] hereto should be reinstated in their former employment with continuity of service and other benefits and should be paid full wages, dearness allowance and other allowances from the date of dismissal of each of the workmen till each is so reinstated without any condition attached to such payment. (B): The workmen listed at Serial Nos. 26 to 101 of 'Schedule I ' hereto who are at present re employed on a temporary basis should be granted reinstatement in their employment from the date of dismissal of each and should be granted continuity of service and other benefits and also should be paid full wages, dearness allowance and other allowances from the date of dismissal of each till each was reemployed, without any condition being attached to such payment." During the pendency of the reference all the 76 workmen covered by paragraph 1 (B) of the Schedule who had been taken back on temporary basis were made permanent as a result of settlements reached between these workmen and the management. On behalf of 33 out of 76 of these workmen, the union entered into a settlement with the management, the remaining workmen of this group individually entered into settlements with the management. The period during which the workmen were absent from duty was treated as leave without pay and continuity of their service was maintained. 25 The Union representing the aforesaid 33 workmen, and the remaining workmen out of this group of 76 individually, withdrew demand No. 1 (B) in view of the settlements entered into by and between these workmen and the management. By an award dated January 10, 1973 the Tribunal disposed of demand No. 1 (B) as not pressed. In the meantime 13 out of the 25 workmen covered by demand 1 (A) also reached a settlement with the management and withdrew the dispute relating to them; the terms of settlement were that these workmen would submit their resignations and be paid one month 's basic wages and dearness allowance for each year of service along with gratuity, leave wages, provident fund and the balance bonus due to them. They were also to retain the wages for one month paid to them when they were dismissed. The dispute on which the impugned award was made was thus restricted to demand No. 1 (A) concerning 12 workmen only out of 25. The Tribunal by its award dated December 9, 1976 directed the appellant company to reinstate the 12 workmen named against serial Nos. 2, 3, 5, 7, 8, 10, 11, 13, 18, 22, 23, 25 of Schedule I to the order of reference with continuity of service and full wages, dearness and other allowances. On the question of back wages, the matter was left to be decided later on evidence. The dismissal of these workmen was set aside on the following findings: 1. The inquiry held by the management was vitiated because, (a) chargesheets had not been served and notice of inquiry not given to 2 out of 12 workmen; (b) 2 out of the 3 inquiry officers were biased; (c) some of the workmen were not furnished with copies of certain documents relied on by the inquiry officers; and, (d) the chargesheets served on the workmen did not contain necessary particulars regarding the go slow tactics adopted by each of them. All the 101 workmen had been found guilty of go slow but 76 of them were reinstated on a permanent basis and the remaining 25 workmen were denied the same 26 treatment for no good reason. The management was thus guilty of discrimination and unfair labour practice. We will take the finding of discrimination first as this is the ground on which the 12 workmen were straightaway ordered to be reinstated. The Tribunal having found that the inquiries held against the workmen had not been proper noted that it was well settled that in such a situation the employer should be given an opportunity to adduce evidence before the Tribunal in support of the action taken by them, but proceeded to hold that in view of the other finding that the 12 workmen had been unfairly discriminated against, they were entitled to reinstatement and therefore no useful purpose would be served by permitting the management to adduce evidence seeking to justify the dismissal of the workmen on the ground of misconduct. It was contended on behalf of the appellant that the Tribunal had no jurisdiction to address itself to the question of discrimination. Section 10 (4) of the lays down: "Where in an order referring an industrial dispute to a Labour Court, Tribunal or National Tribunal under this section or in a subsequent order, the appropriate Government has specified the points of dispute for adjudication, the Labour Court or Tribunal or National Tribunal as the case may be, shall confine its adjudication to those points and matters incidental thereto". In this case the points of dispute were specified in the schedule to the order of reference, and the Tribunal was therefore required to confine its adjudication to those points and matters that were incidental to them. From a reading of demands 1(A) and 1(B) as a whole it is clear that the demand for reinstatement in respect of both groups of workmen as made arises on the alleged invalidity of the action taken by the management in dismissing these workmen. The issue of unfair labour practice or discrimination by reason of subsequent reinstatement on a permanent basis of some and not all the 25 workmen was not a matter referred to the Tribunal for adjudication, nor it can be said to be in any way connected with or incidental to the right of reinstatement claimed by the 101 workmen from the date of their dismissal. The fairness of subsequent absorption of some workmen is a matter quite irrelevant for judging the validity of the earlier dismissal of these workmen along with others; it is an entirely separate and independent question. The Tribunal 27 also did not frame an issue on the alleged discrimination. That being so, we think the Tribunal travelled outside its jurisdiction in recording a finding of unfair labour practice and discrimination. We find no reason to disturb the finding that the inquiry held was not proper. The Tribunal has found that the chargesheets issued were vague as they did not disclose the relevant material on which the charges were based. It was contended on behalf of the Union on the basis of this finding that no useful purpose would be served by remitting the case to the Tribunal. It is settled law now that when no inquiry has been held or the inquiry held has not been proper, the Tribunal has jurisdiction to allow the management to lead evidence to justify the action taken. The contention is that the charge sheets being vague, the Tribunal would not be in a position to decide what evidence to let in, and, therefore, sending the matter back to the Tribunal would only be an idle formality. It is not possible to accept this contention. Normally an inquiry by the management starts by issuing a charge sheet to the workmen proposed to be discharged or dismissed. In a case where the chargesheet is vague, it must be held that there has been no proper inquiry. In M/s. Bharat Sugar Mills Ltd. vs Shri Jai Singh and others,(1) this Court held: "But the mere fact that no inquiry has been held or that the inquiry has not been properly conducted cannot absolve the Tribunal of its duty to decide whether the case that the workman has been guilty of the alleged misconduct has been made out. The proper way for performing this duty where there has not been a proper inquiry by the management is for the Tribunal to take evidence of both sides in respect of the alleged misconduct". Whether in a case, as the one before us, where it is found that proper charge sheets had not been served on the workmen, the Tribunal can ask the parties to lead evidence to enable the Tribunal to decide the dispute between them is directly covered by an authority of this Court. In Management of Ritz Theatre (P) Ltd. vs Its Workmen, (2) Gajendragadkar J. (as he then was) speaking for the Court said: ". . if it appears that the departmental enquiry held by the employer is not fair in the sense that proper charge 28 had not been served on the employee or proper or full opportunity had not been given to the employee to meet the charge, or the enquiry has been affected by other grave irregularities vitiating it, then the position would be that the Tribunal would be entitled to deal with the merits of the dispute as to the dismissal of the employee for itself. The same result follows if no enquiry has been held at all. In other words, where the Tribunal is dealing with a dispute relating to the dismissal of an industrial employee, if it is satisfied that no enquiry has been held or the enquiry which has been held is not proper or fair or that the findings recorded by the Enquiry Officer are perverse, the whole issue is at large before the Tribunal. This position also is well settled". In view of the well settled legal position, the order directing reinstatement of the 12 workmen without a consideration of the merits of the case cannot be sustained. We therefore remit the case to the Industrial Tribunal to decide the dispute concerning the demand specified in paragraph 1(A) of the Schedule to the order of Reference after giving the parties concerned an opportunity to lead evidence in support of their respective cases. The appeal is allowed to the extent indicated above, this Court by order dated August 2, 1977 had directed the appellant to pay the costs of the appeal to the respondents in any event. The respondents will be also entitled to retain the sums of money paid to them by the appellant under orders of this Court. V.D.K. Appeal allowed.
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The company made tires, tubes, and other things in Bombay. Workers in the tire curing department slowed down their work on purpose, which caused less stuff to be made. On September 14, 1967, the company told the workers to stop slowing down. But the workers didn't listen, and on October 4, 1967, the workers in the tire curing department went on strike. Between October 27 and 31, 1967, the company accused 102 workers of slowing down on purpose. The workers didn't participate in the investigations done by the people in charge, and the reports were bad for the workers. The company agreed with the investigation reports and fired the workers, except for those who were "protected workers" (workers with special protections). The company asked for permission to fire the "protected workers." Since there was already a disagreement being decided by the Tribunal (a type of court), the company also asked for approval to fire the workers. Later, on April 17, 1968, the two sides made an agreement. The agreement said the strike would end, the argument about firing the workers would be decided by the Tribunal, and 76 of the fired workers would be rehired until the Tribunal made a decision. The demand in part 1 (A) was about 25 workers who weren't rehired. The demand in part 1 (B) was about the 76 workers who were temporarily rehired. After another agreement, all 76 workers in part 1 (B) were rehired permanently. The demand in part 1 (B) was dropped on January 10, 1973. By then, 13 of the 25 workers in part 1 (A) had also made an agreement with the company and dropped their part of the argument. So, the award (decision) was only about the demand in part 1 (A) about the 12 workers out of the original 25. On December 9, 1976, the Tribunal ordered the company to rehire these 12 workers. They said the company didn't have a good reason to treat them differently from the 76 other workers, and that the company was being unfair. The company appealed this decision. The Court allowed part of the appeal and sent the case back to the Tribunal. The Court said: 1. The Tribunal went too far by saying the company was being unfair and discriminating. In this case, the disagreements were listed in the order, and the Tribunal should have only decided those disagreements and things related to them. Looking at demands 1 (A) and 1 (B), it's clear that the demand to rehire both groups of workers was based on the idea that the company was wrong to fire them in the first place. The issue of unfair treatment or discrimination because some, but not all, of the 25 workers were rehired wasn't something the Tribunal was asked to decide. It also wasn't related to the right of the 101 workers to be rehired from the day they were fired. Whether some workers were later rehired fairly is not important for deciding if the original firing of all the workers was valid. It's a completely separate issue. The Tribunal also didn't ask a question about the alleged discrimination. 2. It's already been decided that if there was no investigation, or if the investigation wasn't done right, the Tribunal can let the company provide evidence to justify their actions. Usually, the company starts an investigation by sending a charge sheet (a list of accusations) to the workers they might fire. If the charge sheet is not clear, then it means there was no proper investigation. In this case, since the Tribunal found that the workers didn't get a proper charge sheet, the Tribunal could ask both sides to provide evidence so they could decide the case fairly. The order to rehire the 12 workers without looking at the facts of the case is not valid.
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1830 32 of 1981. (Under Article 32 of the Constitution of India). U.R. Lalit, V.N. Ganpule, A.B. Lal and Ms. Punam Kumari for the Petitioners. V.C. Mahajan, Ms. A Subhashini, P.H. Parekh, A.S. Bhasme and A.M. Khanwilkar for the Respondents. The Judgment of the Court was delivered by OJHA, J. The petitioners in these petitions under Arti cle 32 of the Constitution hold land within the city of Sholapur in the State of Maharashtra. According to the petitioners development plan has been sanctioned with regard to land situated m the city of Sholapur including the peti tioners ' land under the Maharashtra Regional and Town plan ning Act, 1976 (hereinafter referred to as the Maharashtra Act No. 37 of 1966) and some land of the petitioners was re served for public purpose under that Act. The Urban Land (Ceiling & Regulation) Act, 1976 (hereinafter referred to as the Act was brought into force on 28th February, 1976 and proceedings for acquisition of vacant land in excess of the ceiling limit placed under the Act were initiated against the petitioners. These writ petitions have been filed for the following reliefs: (a) It may be declared that the Urban Ceiling Act does not apply to lands reserved for a public purpose under the Maharashtra Regional Town Planning Act, 1966: (b)The proceedings for determination of ceil ing be declared void and quashed so far as the lands are reserved for public purpose; 619 (c) The State Government be restrained from taking any action under Section 10(3) of the Ceiling Act; (d) The final statement under Section 9 of the Ceiling Act be amended suitably; (e) A Writ of Mandamus or in the nature of Mandamus be issued restraining the State Government or its agents from acquiring and/or taking possession of final plots Nos. 26, 22, 42, 28A and 44A/1; (f) Sections 10, 11 and 23 of the Ceiling Act be declared ultra vires of Articles 14 and 31 of the Constitution; (g) Any other order and/or direction as this Hon 'ble Court may deem fit, be passed. It has been pointed out by the learned counsel for the petitioners that Section 125 of the Maharashtra Act No. 37 of 1966 contemplates, inter alia, that any land required, reserved or designated in a development plan for a public purpose shall be deemed to be land needed for a public purpose within the meaning of the Land Acquisition Act, 1894 whereas Section 126 thereof contains the procedure for acquisition of land required for public purposes. According to learned counsel if land is acquired as contemplated by Sections 125 and 126 aforesaid, the provisions of the Land Acquisition Act shall apply to the acquisition of the said land with the modification that the market value of the land shall be computed as contemplated by sub section (3) of Section 126 whereas if the land was acquired under the Act, compensation payable would be much less as contemplated by Section 11 of the Act and that too with a ceiling of two lakhs of rupees as provided by sub section (6) thereof. It has been urged that it is left to the sweet will of the authorities concerned to acquire land either under Sections 125 and 126 of the Maharashtra Act No. 37 of 1966 or under the provisions of Section 10 of the Act and that since in the event of proceedings for acquisition being taken under Section 10 of the Act as is sought to be done in the case of the petitioners the compensation payable would be far less than the compensation payable if the acquisition is made under the Maharashtra Act No. 37 of 1966, discrimination under Article 14 of the Constitution was writ large, and in this view of the matter the petitioners are entitled to the reliefs claimed in these writ petitions. Having heard learned counsel for the parties, we are of the 620 opinion that none of the reliefs prayed for in the writ petitions can be granted to the petitioners. At the very outset, it may be pointed out that the Act has been placed in the 9th Schedule to the Constitution at SI. No. 132 and consequently comes under the protective umbrella of Article 31 B of the Constitution. In Maharao Sahib Shri Bheem Singh vs Union of India and others, [1985] Suppl. 1 S.C.R. Page 862 it has been held by a Constitution Bench of this Court that the Act is constitutionally valid save and except Section 27(1) to the extent mentioned in the judgment. With regard to sub section (6) of Section 11, it has specifically been held at page 879 of the Report that this sub section which provides that compensation payable under Section 11 shall in no case exceed two lakhs of rupees is valid. The amount thus payable is not illusory and the provision is not confiscatory. Rupees two lakhs are not like a earthing even if the excess land may be a fortune. In this connection, it may be pointed out that it has not been urged by the learned counsel for the petitioners that the provisions of the Act which have been impugned in the present writ petitions in any way damage or destroy a basic or essential feature of the Constitution or its basic structure. No statutory provi sion either in the Act or even in the Maharashtra Act No. 37 of 1966 has been brought to our notice excluding the opera tion of the Act with regard to lands reserved for public purpose under the Maharashtra Act No. 37 of 1966. On the other hand, there is a specific overriding provision in Section 42 of the Act which provides that the provisions of this Act shall have effect notwithstanding anything incon sistent therewith in any other law for the time being in force or any custom usage or agreement or decree or order of a Court, Tribunal or other authority. It is in this view of the matter that we are of the opinion that none of the relief prayed for in the present writ petitions can be granted. What has, however, been urged by the learned counsel for the petitioners is that notwithstanding the specific relief (f) referred to above, the petitioners are really not chal lenging the validity of Sections 10, 11 & 23 of the Act but they are challenging the action which is being taken with regard to the petitioners ' land on the ground that it is discriminatory. We find no substance in this submission either. In Union of India etc. vs Valluri Basavaiah Chaucer etc. , [1979] 3 S.C.R. Page 802 it was pointed out by a Constitution Bench of this Court that the primary object and the purpose of the Act as the long title and preamble show, is to provide for the imposition of a ceiling on vacant land in urban agglomerations, for the acquisition of such land in excess of the ceiling limit to regulate the construction of 621 buildings on such land and for matters connected therewith, with a view to preventing the concentration of urban land in the hands of a few persons and speculation and profiteering therein, and with a view to bringing about an equitable distribution of land in urban agglomerations to subserve the common good, in furtherance of the Directive Principles of Article 39(b) and (c). That this was the object and the purpose of the Act has been reiterated in a recent decision of this Court in State of Gujarat & others vs Parshottamdas Ramdas Patel & Others, [1988] 1 S.C.R. Page 997. It is in this background that the submission of learned counsel for the petitioners about discrimination in the matter of implementation or taking action under the Act has to be considered. While elaborating this argument of dis crimination it was pointed out by learned counsel for the petitioners that if land belonging to 'A ' and 'B ' within an urban agglomeration is reserved for a public purpose under development scheme and 'A ' is holding land within ceiling area whereas 'B ' holds land in excess of such ceiling area, 'A ' will get compensation under the Maharashtra Act No. 37 of 1966 whereas 'B ' will get compensation under the Ceiling Act and the basis and method of compensation will drastical ly vary. In support of this submission reliance was placed on a decision of this Court in Nagpur Improvement Trust & Another vs Vithal Rao & Others, [1973] 3 S.C.R. Page 39. In that case land was sought to be acquired under the Nagpur Improvement Trust Act. In a petition under Articles 226 and 227 of the Constitution the validity of the Nagpur Improvement Trust Act was challenged inter alia on the ground that the said Act was in violation of Article 14 of the Constitution inasmuch as it empowered the acquisition of lands at prices lower than those which could have been payable if they had been acquired under the Land Acquisition Act. The writ petition was allowed by the High Court and it was held that paragraphs 10(2) and 10(3) in so far as they added a new clause 3(a) to section 23 and a proviso to sub section (2) of section 23 of the Land Acquisition Act, 1894 were ultra vires as violating the guarantee of Article 14 of the Constitution. Suffice it to say, so far as this submission is con cerned that the land to the extent which falls within the ceiling area stands in a class different from the land which is in excess of the ceiling area and is liable to be de clared surplus to give effect to the purpose and object of the Act. ' What is the purpose and object of the Act has already been noticed earlier. Further unlike the Nagpur Improvement Trust Act, 1936 the validity whereof was 'chal lenged in the case of Vithal Rao 622 (supra), the Act has been placed in the 9th Schedule. As a result thereof the Act comes within the protective umbrella of Article 31 B of the Constitution which was not available to the Nagpur Improvement Trust Act. The decision in the case of Vithal Rao (supra) came up for consideration before a Constitution Bench of this Court with reference to Bombay Town Planning Act, 1954 in Prakash Chand Amichand Shah vs State of Gujarat and others, [1986] 1 S.C.C. Page 581. It was held: "In order to appreciate the contentions of the appellant it is necessary to look at the object of the legislation in question as a whole. The object of the Act is not just acquiring a bit of land here or a bit of land there for some public purpose. It consists of several activities which have as their ulti mate object the orderly development of an urban area. It envisages the preparation of a development plan, allocation of land for various private and public uses, preparation of a Town Planning Scheme and making provi sions for future development of the area in question. The various aspects of a Town Plan ning Scheme have already been set out. On the final Town Planning Scheme coming into force under Section 53F of the Act there is an automatic vesting of all lands required by the local authority. It is not a case where the provisions of the Land Acquisition Act, 1894 have to be set in motion either by the Collec tor or by the Government. " It was further held: "The provision under consideration in the above decision corresponds to Section 11 and to Section 84 of the Act, which we are now considering. Section 59 of the Nagpur Improve ment Trust Act, 1936 provided that the Trust might, with the previous sanction of the State Government acquire land under the provisions of the Land Acquisition Act, 1894 as modified by the provisions of the said Act for carrying out any of the purposes of the said Act. But the provisions which are questioned before us are of a different pattern altogether. They deal with the preparation of a scheme for the development of the land. On the final scheme coming into force the lands affected by the scheme which are needed for the local authori ty for purposes of the scheme automatically vest in the local authority. There is 623 no need to set in motion the provisions of the Land Acquisition Act, 1894 either as it is or as modified in the case of acquisition under Section 11 or Section 84 of the Act. Then the Town Planning Officer is authorised to deter mine whether any reconstituted plot can be given to a person whose land is affected by the scheme. Under Section 51(3) of the Act the final scheme as sanctioned by the Government has the same effect as if it were enacted in the Act. The scheme has to be read as part of the Act. Under Section 53 of the Act all rights of the private owners in the original plots would determine and certain consequen tial rights in favour of the owners would arise therefrom. If in the scheme, reconsti tuted or final plots are allotted to them they become owners of such final plots subject to the rights settled by the Town Planning Offi cer in the final scheme. In some cases the original plot of an owner might completely be allotted to the local authority for a public purpose. Such private owner may be paid compensation or a reconstituted plot in some other place. It may be a smaller or a bigger plot. It may be that in some cases it may not be possible to allot a final plot at all. Sections 67 to 71 of the Act provide for cer tain financial adjustments regarding payment of money to the local authority or to the owners of the original plots. The development and planning carried out under the Act is pri marily for the benefit of public. The local authority is under an obligation to function according to the Act. The local authority has to bear a part of the expenses of development. It is in one sense a package deal. The pro ceedings relating to the scheme are not like acquisition proceedings under the Land Acqui sition Act, 1894. Nor are the provisions of the Land Acquisition Act, 1894 made applicable either without or with modifications as in the case of the Nagpur Improvement Trust Act, 1936. We do not understand the decision in Nagpur Improvement Trust case as laying down generally that wherever land is taken away by the government under a separate statute com pensation should be paid under the Land Acqui sition Act, 1894 only and if there is any difference between the compensation payable under the Land Acquisition Act, 1894 and the compensation payable under the statute con cerned the acquisition under the statute would be discriminatory. That case is distinguisha ble from the present case. " 624 In the instant case also the purpose and object of the Act being entirely different from just acquiring a bit of land here or a bit of land there for some public purpose, and the Act being a serf contained Code having an overriding provision in Section 42, the decision in the case of Vithal Rao (supra) is wholly inapplicable in so far as acquisition of surplus land under the Act is concerned. It was also urged that if one person holds land in excess of ceiling area and the excess therein is reserved for a public purpose under the development scheme there will still be discriminatory results if the land in excess of ceiling is reserved for different purposes. According to learned counsel if the purpose of reservation is construc tion of buildings the land will be given compensation under the Ceiling Act whereas when the purpose of reservation is parks, gardens etc. compensation would be given under the Maharashtra Act 37 of 1966. The result, according to learned counsel, is discriminatory. This submission again has appar ently no substance inasmuch as the provisions of the Ceiling Act are applicable with regard to vacant land and if for some fortuitous circumstances a particular category of land does not fail within the definition of vacant land the provisions with regard to vacant land can obviously not be applied to such land. Here again, the lands failing under the two categories constitute separate classes and cannot consequently be treated alike. Learned counsel for the petitioners also referred .to some other cases wherein a similar view, as in the case of Vithal Rao (supra), was taken but we do no consider it necessary to deal with those cases separately for the rea sons already stated above. With regard to the submission of learned counsel that the question as to whether a land reserved for public purpose under the Maharashtra Act No. 37 of 1966 should be acquired under that Act or under Section 10 of the Act has been left to the sweet will of the author ity concerned, we are of the opinion that it is not so. Once the land falls beyond the ceiling limit prescribed by the Act and is capable of being acquired as surplus land under Section 10 of the Act it would be wholly inappropriate to acquire the same very land or a portion thereof under the Maharashtra Act No. 37 of 1966 inasmuch as it would inter alia apparently result in misuse of public funds by granting higher compensation when the purpose of acquisition can be achieved on payment of the lesser amount of compensation prescribed in Section 11 of the Act. In the case of Parshottamdas Patel (supra), the State Government of Gujarat issued a notification under section 4(1) of the Land 625 Acquisition Act, 1894 stating that the lands of the respond ents were likely to be needed for the public purpose of providing housing accommodation for the employees of the Municipal Corporation. Subsequently, a notification under Section 6 of the said Act declaring that the aforesaid lands along with the other lands were needed for the said public purpose, was also made. In the meantime, the Act came into force and the respondents filed writ petitions contending inter alia that the acquisition proceedings under the Land Acquisition Act should be proceeded with and the acquisition proceedings to the extent it related to the surplus land under the ceiling law should be dropped. The writ petitions were allowed. Reversing the judgment of the High Court, this Court held: "The declaration made by the High Court in these cases that the land acquisition proceedings did not suffer from an infirmity which indirectly suggests that the proceedings should go on is again erroneous. It is open to the State Government to drop the land acquisi tion proceedings and to withdraw the lands from acquisition under section 48 of the Land Acquisition Act, 1894. We are informed that the State Government has in fact subsequently withdrawn these lands from acquisition. The proceedings under the Land Acquisition Act, 1894 cannot therefore have any beating on the question whether the lands in question are vacant lands or not for purposes of the ceil ing law contained in the Act. When the lands in question or bulk of them are likely to be acquired under the ceiling law by paying compensation as provided therein, it would not be proper to compel the Government to acquire them under the provisions of the Land Acquisi tion Act, 1894. As already stated the Act has the overriding effect on all other laws. " In view of the foregoings discussion, we find no merit in these writ petitions and they are accordingly dismissed. There shall, however, be no order as to costs. Petitions dismissed.
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The state government approved a development plan for Sholapur under the Maharashtra Regional and Town Planning Act of 1966. Even though the approval covered the petitioners' (people filing the case) land, some of their land was set aside for public use under that law. Later, the Urban Land (Ceiling & Regulation) Act of 1976 was passed. This law put a limit on how much land someone could own in a city. The government started taking land that was over the limit. The petitioners went to court to fight this. They argued that the Urban Ceiling Act shouldn't apply to land already set aside for public use under the Town Planning Act. They wanted the court to stop the government from taking their land. They also said that certain parts (sections 10, 11, and 23) of the Ceiling Act were unconstitutional because they violated Articles 14 (equality before the law) and 31 (right to property) of the Constitution. They asked the court to order the government not to take their land under the Ceiling Act. The court rejected the petitioners' requests. 1.1. The Ceiling Act is listed in the Ninth Schedule of the Constitution. This means it's protected by Article 31B of the Constitution. 1.2. The petitioners didn't argue that the Ceiling Act damaged any basic part of the Constitution. Also, neither the Ceiling Act nor the Town Planning Act says that the Ceiling Act doesn't apply to land set aside for public use under the Town Planning Act. The court used a previous case, *Maharao Sahib Shri Bheem Singh vs Union of India*, to support its decision. The main goal of the Ceiling Act is to limit how much vacant land someone can own in cities. The government can take extra land to control building construction and stop people from unfairly profiting from land. The aim is to distribute land more fairly and help the common good, as stated in Articles 39(b) and (c) of the Constitution. Land within the allowed limit is treated differently from land over the limit. Land over the limit can be taken by the government to achieve the goals of the Ceiling Act. In this case, the purpose of the Ceiling Act is different from just taking small pieces of land for public use. The Ceiling Act is a complete law with overriding power, as stated in Section 42. If land is over the limit and can be taken under Section 10, it wouldn't be right to take the same land under the Town Planning Act. This could waste public money by paying more for the land when it could be taken for less under the Ceiling Act (Section 11). The court used previous cases, *Union of India etc. vs Valluri Basavaiah Chowdhary etc.* and *State of Gujarat & Others vs Parshottamdas Ramdas Patel & Others*, to support its decision. The court distinguished this case from *Nagar Improvement Dust & Another vs Vithal Rao & Others* and referred to *Prakash Chand Amichand Shah vs State of Gujarat and others*. 3. The petitioners claimed that there would be unfair treatment. They said that if the land was for buildings, they'd be paid under the Ceiling Act. But if it was for parks, they'd be paid under the Town Planning Act. The court disagreed. The Ceiling Act applies to vacant land. If a piece of land isn't considered vacant land, then the Ceiling Act doesn't apply. The two types of land are different and can't be treated the same.
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Special Leave Petition (Criminal) No. 408 of 1978. From the Judgment and order dated 22 11 1973 of the Bombay High Court in Criminal Appeal No. The facts, more flabbergasting than fantasy, present themselves in this Special Leave Petition. 'The offence is bizarre, the 196 offender perplexing, the sentence incredibly indiscreet at the Sessions Court stage but reasonably just at the High Court level and, to cap it all the delay in seeking leave from this Court is doubly shocking be cause it is inordinate and implicates the prison administration. A miniaturised version of the prosecution, which has culminated in the conviction, is all that is necessary in view of the ultimate order we propose to make. The petitioner, a Reader in the Saurashtra University, claims to be a Ph. D. Of Karnataka University, although there is a controversy as to this high academic qualification being a fabrication. In the present case we are not concerned with it directly. A degree hungry community like ours offers a happy hunting ground for professionals in the fine art of fabricating academic distinctions. The Sessions court tried the petitioner and held as proved beyond reasonable doubt that the petitioner was guilty of the grave offences charged, namely, under sections 417 read with 511 I.P.C. After having rendered this draconian verdict against a person who was a Reader in a University and claimed to be M.Sc., Ph. D., around 30 years old and coming from a middle class family beyond economic compulsions to make a living by criminal means, the court swerved towards a soft sentence of simple imprisonment till the rising of the court and some fine. We are scandalized by this soft justice syndrome vis a vis white collar offenders. However, two appeals were carried to the High Court, one by the petitioner against his conviction and the other by The State against the naive sentence. The present petition for special leave to appeal is against this heavy sentence. The High Court 's judgment was pronounced in November 1973 but the Special Leave Petition has been made well over four years later. To start with the petitioner complained that the High Court granted a copy of the judgment of 1973 only in 1978, a further probe disclosed that a free copy had been sent promptly by the High Court, meant for thc applicant, to the Superintendent. The Prison Superintendent on The other hand, would have us believe that a clerk of his office did deliver it to the prisoner but took it back for the purpose of enclosing L it with a mercy petition to the Governor for remission of sentence. The fact remains that prisoners are situationally at the mercy of the prison 'brass ' but their right to appeal, which is part of the constitutional process to resist illegal deprivation of liberty, is in peril, if district jail officials ' ipse dixit that copies have been served is to pass muster without a title of prisoner 's acknowledgment. What is more, there is no statutory provision for free legal serives to a prisoner, in absence of which, a right of appeal for the legal illiterates is nugatory and therefore, a negation of that fair legal procedure which is implicit in article 21 of the Constitution, as made explicit by this Court in Maneka Gandhi(1). Having narrated the necessary facts which project the two profound but neglected problems of criminal jurisprudence we should have proceeded to discuss the merits of the evidence to decide whether leave should be granted to this petitioner. Indeed, although the court had assigned a lawyer to render free legal service to the petitioner and argue the case on his behalf, Dr. Hoskot decided to dispense with legal assistance and argued on his own. Nevertheless this Court has laid down certain fundamental principles governing its jurisdiction when special leave is sought. The recent pronouncement of a Bench of This Court, through the Learned Chief Justice, settles with clarity the decisive jurisdictional guideline. We quote: "In view of the concurrent findings of the Sessions Court and the High Court on the principal issues arising in the case we see no justification for granting special leave for a reconsideration of the question as regards the guilt of the petitioners. There is hardly a case, civil or criminal, which does not raise some question of law or the other. But no question of law of general public importance is involved in these petitions. It is time that it was realised that the jurisdiction of this Court to grant special leave to appeal can be invoked only in very exceptional circumstances. (1) [Ujjagar Singh & Anr. No observations made by us should be understood as affecting the petitioner 's plea in any other criminal case he may be facing. The Sessions Court. He has no previous conviction . He has a good family background. His father was a Deputy Collector and Magistrate in the Mysore State. He is not a person with a criminal tenancy. which may he a liability to the society. If, on the other hand, mercy is shown to him at this stage of his first impact with justice, then it is probable that he may be reclaimed as a good citizen who call harness his talent for desirable activities. In view. (emphasis added) It is surprising that the Public Prosecutor has consented, on behalf of the State, to this unsocial softness to an anti social offender on conviction for grave charges. Does the Administration sternly view white collar offenders, or abet them by agreeing to award of token punishment, making elaborate trials mere tremendous trifles ? The trial judge has confused between correctional approach to prison treatment and nominal punishment verging on decriminalisation of serious social offences. This Court has explained the correctional strategy of punishment in Giasuddin 's case(1). Suggestions are often made that in order that the lower Magistracy may realise the seriousness of some of the social and economic offences, some method should be evolved of making the judiciary conscious of the grave damage caused to the country 's economy and health by such anti social crimes. The frequency and emphasis with which these suggestions have been made, and the support which they have received from very high officers has caused some anxiety to us. It is of utmost importance that all State instrumentalities involved in the investigation, prosecution and trial of these offences must be oriented to the philosophy which treats these economic Offence as a source or grave challenge to the material wealth of the nation. We hope we shall not be misunderstood if we suggest that even the holding of periodical meetings on sentencing may be beneficial, not in the context of economic offences only, but in the evolution of a rational and consistent policy of sentencing. Experience of England is, by now, familiar to those interested in the subject. Such workshops could, for example, be attended by all Special Judges or other officers concerned with economic offences. Freedom is what freedom does, and here we go straight to article 21 of the Constitution, where the guarantee of personal liberty is phrased with superb amplitude: article 21: Protection of life and personal liberty: No person shall be deprived of his life or personal liberty except according to procedure established by law. prescribed by law before a person can be deprived of his personal liberty or that the procedure must satisfy certain requisites in the sense that it must be fair and reasonable ? This indeed was conceded by the learned Attorney General who with his usual candour frankly (1) [1978] 1 SCC 248 at 277, 281 and 284 14 520 SCI/78 202 stated that it was not possible for him to contend that any procedure howsoever arbitrary, oppressive or unjust may be prescribed by the law." as philosophically, is an essential element of equality or nonarbitrariness pervades Article 14 like a brooding omnipresence and the procedure contemplated by Article 21 must answer the test of reasonableness in order to be in conformity with Article 14. It must be "right and just and fair and not arbitrary, fanciful or oppressive; otherwise it would be no procedure at all and the requirement of Article '21 would not be satisfied. Any procedure which permits impairment of the constitutional right to go abroad without giving reasonable opportunity to show cause can not but be condemned as unfair an(3 unjust and hence, there is in the present case clear infringement of the requirement of Article 21". Procedure which deals with the modalities of regulating; restricting or even rejecting a fundamental right falling with in Article 21 has to be fair, not foolish, carefully designed to effectuate, not to subvert, the substantive right itself. What is fundamental is life and liberty. 203 of its exercise. Procedural safeguards are the indispensable essence of liberty. In India, because of poverty and illiteracy, the people are unable to protect and defend their rights; observance of fundamental rights is not regarded as good politics and their transgression as bad politics. To sum up, 'procedure ' in Article 21 means fair, not formal procedure. '` one component of fair procedure is natural justice. Ill short, a first appeal from the Sessions Court to the High Court, as provided in the Criminal Procedure Code, manifests this value upheld in article 21. Pertinent to the point before us are two requirements: (1) service of a copy of the judgment to the prisoner in time to file all appeal and (ii) provision of free legal ser vices to a prisoner who is indigent or otherwise disabled from securing legal assistance where the ends of justice call for such service. Both these are State responsibilities under article 21. In the present case there is something dubious about the delivery of the copy of the judgment by the Jailor to the prisoner. We hope that Jail Manuals will be updated to include the mandate, if there be any omission, and deviant jail officials punished. And courts, when prison sentence is imposed, will make available a copy of the judgment if he is straight marched into the prison. All the obligations we have specificated are necessarily implied in the right of appeal conferred by the Code read with the commitment to procedural fairness in article 21. Section 363 of the Cr. We say no more because we have condoned the delay in the present case although it is pathetic that for want of a copy of judgment the leave is sought after the sentence has been served out. The other ingredient of fair procedure to a prisoner, who has to seek his liberation through the court process is lawyer 's services. Judicial justice, with procedural intricacies, legal submissions and critical examination of evidence, leans upon professional expertise; and a failure of equal justice under the law is on the cards where such supportive skill is absent for one side. Free legal services to the needy is part of the English criminal justice system. And the American jurist, Prof. Vance of Yale, sounded sense for India too when he said(1): "What does it profit a poor and ignorant man that he is equal to his strong antagonist before the law if there is no one to inform him what the law is ? Black, J: there observed(2): "Not only those precedents but also reason and reflection require us to recognise that ill our adversary system of criminal justice, any person haled into court, who is too poor to hire a lawyer, cannot be assured a fair trial unless counsel is provided for him. (2) Processual Justice to the People (May, 1973) p. 69. are few defendants charged with crime who fail to hire the best lawyers they can get to prepare and present their defences. That government hires lawyers to prosecute and defendants who have the money hire lawyers to defend are the strongest indications cf the widespread belief that lawyers in criminal courts are necessities, not luxuries. The right of one charged with crime to counsel may not be deemed fundamental and essential to fair trials in some countries, but is in ours. From the very beginning, our state and national constitutions and laws have laid great emphasis on procedural and substantive safeguards designed to assure fair trials before impartial tribunals in which every defendant stands equal before the law. This noble idea cannot be realised if the poor man charged with crime has to face his accusers without a lawyer to assist him". The philosophy of legal aid as an inalienable element of fair procedure is evident from Mr. Justice Brennan 's(1) well known words: "Nothing rankles more in the human heart than a brooding sense of injustice. More recently, the U.S. Supreme Court, in Raymond Hamlin has extended this processual facet of Poverty Jurisprudence. Douglas, J. there explicated(2): "The right to be heard would be, in many cases, of little avail if it did not comprehend the right to be heard by counsel. If (1) Legal aid and Legal Education p. 94. 206 charged with crime, he is incapable, generally, of determining for himself whether the indictment is good or bad. He lacks both the skill and knowledge adequately to prepare his defense, even though he have a perfect one. Without it, though he be not guilty, he faces the danger of conviction because he does not know how to establish his innocence. If that be true of men of intelligence, how much more true is it of the ignorant and illiterate or those of feeble intellect. " The right of one charged with crime to counsel may not be deemed fundamental and essential to fair trials in some countries, but it is in ours. From the very beginning, our state and national constitutions and laws have laid great emphasis on procedural and substantive safeguards designed to assure fair trials before impartial tribunals in which every defendant stands equal before the law. This noble ideal cannot he realized if the poor man charged with crime has to face his accusers without a lawyer to assist him. 372 US at 344. 9 L Ed 2d at 805; , Both Powell and Gideon involved felonies. But their rationale has relevance to any criminal trial, where an accused is deprived of his liberty. The court should consider the probable sentence that will follow if a conviction is obtained. These, of course, would be the most difficult to anticipate. (Jon Richard Argersinger vs Raymond Hamlin ; 32L Ed 2d 530 at 535 36 and 554. (Emphasis added) The American Bar Association has upheld the fundamental premise that counsel should be provided in the criminal proceedings for offences punishable by loss of liberty, except those types of offences for which such punishment is not likely to be imposed. Thus in 207 America, strengthened by the Powell, Gideon and Hamlin cases, counsel for the accused in the more serious class of cases which threaten a person with imprisonment is regarded as an essential component of the administration of criminal justice and as part of procedural fair play. This is so without regard to the VIth amendment because lawyer participation is ordinarily an assurance that deprivation of liberty will not be in violation of procedure established by law. The Indian social legal milieu makes free legal service, at trial and higher levels. an imperative processual piece of criminal justice where deprivation of life or personal liberty hangs in the judicial balance. article 14(3) of the International Covenant on Civil and Political Rights guarantees to everyone: "the right to be tried in, his presence, and to defend himself in person or through legal assistance of his own choosing; to be informed, if he does not have legal assistance, of his right; and to have legal assistance assigned to him in any case where the interests of justice shall require, and without payment by him in any such case if he does not have sufficient means to pay for it. " Legal remedies, civil and criminal, are often beyond their physical and even financial reach unless legal aid is available within the prison as is provided in some States in India and in other countries. Without legal aid, petitions of appeal, applications for commutation or parole, bail motions and claims (1) Processual Justice to the people May, 1973, p. 34. There is a case for systematised and extensive assistance through legal aid lawyers to our prison population. The Central Government is evolving a comprehensive programme while many States already have fragmentary schemes. It needs no argument to drive home this point, now that Arts 39A, a fundamental constitutional directive, states: 39A. Equal Justice and free legal aid. The State shall secure that the operation of the legal system promotes justice, on a basis of equal opportunity, and shall, in particular, provide free legal aid, by suitable legislation or schemes or in any other way, to ensure that opportunities for securing justice are not denied to any citizen by reason of economic or other disabilities. This article is an interpretative tool for article 21. P. Code, and in other situations courts cannot be inert in the face of article 21 and 39A. We may follow up the import of Maneka Gandhi and crystallise the conclusion. Maneka Gandhi 's case has laid down that personal liberty cannot be cut out or cut down without fair legal procedure. Enough has been set out to establish that a prisoner, deprived of his freedom by court sentence but entitled to appeal against such verdict, can claim, as part of his protection under article 21 and as implied in his statutory right to appeal, the necessary concomitant of right to counsel to prepare and argue his appeal. If a prisoner sentenced to imprisonment, is virtually unable to exercise his constitutional and statutory right of appeal, inclusive of special leave to appeal, for want of legal assistance, there is implicit in the Court under article 142, read with articles 21, and 39A of the Constitution, power to assign counsel for such imprisoned individual for doing complete justice. This is a necessary incident of the right of appeal conferred by the Code and allowed by article 136 of the Constitution. Surely, the profession has a public commitment to the people but mere philanthropy of its members yields short mileage in the long run. Their services, 209 especially when they are on behalf of the State, must be paid for. Of course, the court may judge the situation and consider from all angles whether it is necessary for the ends of justice to make available legal aid in the particular case. In every country where free legal services are given it is not done in all cases but only where public justice suffers otherwise. Even so we uphold the right to counsel not in the permissive sense of article 22(1) and its wider amplitude but in the peremptory sense of article 21 confined to prison situations. While dismissing the Special Leave Petition we declare the legal position to put it beyond doubt: 1. In the event of any such copy being sent to the jail authorities for delivery to the prisoner, by the appellate, revisional or other court, the official concerned shall, with quick despatch, get it delivered to the sentence and obtain written acknowledgment thereof from him. Where the prisoner seeks to file an appeal or revision, every facility for exercise of that right shall be made available by the Jail Administration. Where the prisoner is disabled from engaging a lawyer, on reasonable grounds such as indigence or incommunicado situation, the Court shall, if the circumstances of the case, the gravity of the sentence, and the ends of justice so requires assign competent counsel of for the prisoner 's defence, provided the party does not object to that lawyer 5. These benign prescriptions operate by force of article 21 [strengthened by article 19(1)(d)] read with sub article (5) from the lowest to the highest court where deprivation of life and personal liberty is in substantial peril.
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According to section 363(1) of the Criminal Procedure Code, 1973, if someone is sentenced to jail, they must get a copy of the court's decision right away, for free. Section 363(2) says that if the person asks, they should get an official copy of the court's decision quickly. If the person can appeal the decision, they get the copy for free. If the High Court (a higher court) approves a death sentence, the person gets a free official copy of the decision right away, whether they ask for it or not. Section 387 of the Code says that these rules also apply to appeals heard by a Court of Sessions (a lower court) or a Chief Judicial Magistrate, as much as possible. Section 388 says that the High Court's decision on an appeal must be sent to the lower court. The lower court must then make orders that match the High Court's decision. They said that on December 10, 1973, they had asked the jail to get them a copy of the November 22, 1973, court decision. The jail received the copy from the High Court in March 1974, but never gave it to the person. This meant the person lost the chance to appeal and had to ask for special permission after getting another copy from the High Court. It stated: 1. Article 21 of the Constitution protects personal freedom with the words, "No person shall be deprived of his life or personal liberty except according to procedure established by law." These words are important for freedom and the courts. "Procedure established by law" means a fair and reasonable process that respects natural justice and community values, not unfair or cruel processes. One part of "fair procedure" is natural justice. Generally, a person should have at least one chance to appeal a criminal conviction, especially if it means a long time in jail. This is important for fair procedure and natural justice, except in special cases where the original court was a high-level panel. An initial appeal from the Sessions Court to the High Court, as allowed in the Criminal Procedure Code, shows this value protected in Article 21. Everything that helps the appeal is required, and anything that prevents it is unfair and unconstitutional. Even Article 19 may be related to Article 21, as shown in the Maneka Gandhi case. This case says that personal freedom cannot be taken away without fair legal procedure. Two important things are: (i) giving the person a copy of the court decision in time to appeal, and (ii) providing free legal help to a prisoner who can't afford it or is unable to get it themselves. These are the government's responsibilities under Article 21 and apply to further appeals as well. If a prisoner can't use their right to appeal because they don't have legal help, the Court has the power under Articles 142, 21, and 39A of the Constitution to assign a lawyer to help them "for doing complete justice." The person has a right to a lawyer, not just as allowed by Article 22(1), but as required by Article 21 in prison situations. If a prisoner wants to appeal, the jail must provide every opportunity for them to do so. (a) Courts must quickly provide a free copy of the court decision when sentencing someone to jail. If a copy is sent to the jail for the prisoner, the official must quickly give it to the prisoner and get their written confirmation. These actions are required as part of the right to appeal and the need for procedural fairness in Article 21. Section 363 of the Criminal Procedure Code is an important expression of Article 21 and must be followed. (b) The government that prosecuted the prisoner must pay the assigned lawyer an amount that the Court decides is fair. (c) These rules are enforced by Article 21, supported by Article 19(1)(d) read with sub-article (5), from the lowest to the highest court, where life and personal freedom are at risk. The Supreme Court is the highest court in India, so it pays special attention to people who represent themselves, to make sure they aren't at a disadvantage because they don't have a lawyer. In this case, the person preferred to argue their own case, even though the Court offered legal help. (a) The Supreme Court has established rules for when it will grant special permission to appeal under Article 136 of the Constitution. (b) The Court is concerned about light sentences for white-collar criminals. This harms social justice and hides the need for strong punishment. In this case, the trial judge confused the idea of prison treatment with giving a sentence that was too light for serious social offenses. While prison treatment is important, giving a weak sentence is not. A court that ignores the harm that economic crimes cause to society is not serving social justice.
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Appeal No. 754 of 1957. Appeal by special leave from the judgment, and order dated September 29, 1954, of the Deputy Custodian General, Evacuee Property, in Revision Petition No. 321 R/ADCG/53. Achhru Ram and K. L. Mehta, for the appellant. Bishan Narain, T.N. Sethia A. N. Arora and K. R. Choudhury, for respondent No. 1 1961. March 14. The Judgment of the Court was delivered by SUBBA RAO, J. This appeal by special leave is directed against the order of the Additional Deputy Custodian General of Evacuee Property, New Delhi, dated 'September 29, 1954, setting aside the order dated August 25, 1952 of the Additional Custodian, Rural, Jullundur, confirming that of the Deputy Commissioner, Ambala, dated May 12, 1951. The appellant belongs to a group of evacuees which may for convenience be described as Dhawan Group. Diwan Chaman Lal, respondent No. 1, was a displaced person from West Pakistan where he owned considerable properties. On September 1, 1949, in lieu of land left behind in Pakistan, he was allotted 152.9 acres of land in village Kharwan in Tehsil Jagadhri, District Ambala. The appellant and his 299 group also owned large extents of properties in West Pakistan. Each one of that group was allotted different extents of land in the same village. Before possession was taken by the allottees, two persons, namely, Hari Chand and Khilla Ram, filed applications dated November 14, 1949, and November 11, 1949, respectively for re allotment on the ground that the soil of the village was not of uniform quality and the allotment on the basis of blocks was not justified. The Additional Deputy Commissioner, Ambala, re commended the splitting of the land into four blocks and the said recommendation was accepted by the Director General, Rural Rehabilitation, by his order dated December 2, 1949. Thereupon the village was divided into four blocks and was re allotted. On account of the re allotment, the 1st respondent could not get his entire allotment in village Kharwan in one block and he was given instead land in different blocks and different villages. Aggrieved by this order, the first respondent filed a review application before the Deputy Commissioner, Ambala, on September 27, 1950, praying for the restoration of his original allotment made on September 1, 1949. The Deputy Commissioner, Ambala, rejected that application on May 12, 1951. Against that order the first respondent preferred a revision to the Additional Custodian, who dismissed the same on August 25, 1952. Against that order of dismissal, the first respondent filed a revision to the Custodian General on October 30, 1952. To that revision only the Custodian was made party; but the appellant and the members of his group were subsequently made parties by an order of the Deputy Custodian General dated August 25, 1953. Thereafter notices were issued to them. The appellant and others on their being made parties raised various contentions. The Deputy Custodian General cancelled the allotment made in favour of the Dhawan Group in respect of the excess area allotted to them and directed the land obtained by means of this cancellation to be utilised for the consolidation of the allotment of the first respondent in village Kharwan. He also gave further consequential directions. The present 300 appeal is preferred by Purshotam Lal Dhawan, a member of the Dhawan Group, against the said order. Learned counsel for the appellant raised before us the following two points: (1) The revision to the Deputy Custodian General was barred by time. (2) On the date when the allotment made to the appellant was cancelled, the Deputy Custodian General had no power to cancel the allotment. To appreciate the first contention some relevant dates may be given. The order of the Additional Custodian was passed on August 25, 1952. The said order was communicated to the first respondent on September 11, 1952. The revision was filed on October 10, 1952. On the date of the filing of the revision only the Deputy Custodian was made a party,, but later on the Dhawan Group was impleaded in the revision in October 1953. No application for excusing delay in preferring the revision against the said persons was made. It was contended before the Deputy Custodian General that the revision petition was barred by time against the Dhawan Group, but the Deputy Custodian General rejected that argument and disposed of the petition on merits. The first question for consideration is whether the revision was barred by limitation in so far as the Dhawan Group was concerned. Some of the relevant provisions regulating the power of revision of the Custodian General may be noticed. Section 27 of the Act says, "The Custodian General may at any time either on his own motion or on application made to him in this behalf call for the record of any proceedings in which any Custodian has passed an order for the purpose of satisfying himself as to the legality or propriety of any such order and may pass such order in relation thereto as he thinks fit". Under the proviso to that section, "the Custodian General shall not pass an order under the sub section prejudicial to any person without "giving him a reasonable opportunity of being heard. In exercise of the powers conferred by section 56 of theAct, the Central Government made the following rules among others: 301 Rule 31. (5) Any petition for revision when made to the Custodian General shall ordinarily be made within sixty days of the date of the order sought to be revised. The petition shall be presented in person or through a legal practitioner or a recognized agent or may be sent by registered post. The petition shall be accompanied by a copy of the order sought to be revised and also by a copy of the original order unless the Revising Authority dispenses with the production of any such copy. In contrast to the said provisions, rule 31(1) dealing with appeals says, "All appeals under the Act shall when they lie to the Custodian, be filed within thirty days of the date of the order appealed against and when they lie to the Custodian General, within sixty days of such date". Section 27 of the Act confers a plenary power of revision on the Custodian General and it empowers him to exercise his revisional powers either suo motu or on application made in that behalf at any time. The phrase "at any time" indicates that the power of the Custodian General is uncontrolled by any time factor, but only by the scope of the Act within which he functions. The Central Government cannot obviously make a rule unless section 56 of the Act confers on it an express power to impose a time fetter on the CustodianGeneral 's power. We do not find any such power conferred on the Central Government under section 56 of the Act. So the rule can only be read consistent with the power conferred on the Custodian General under section 27 of the Act. That must have been the reason why rule 31(5) does not prescribe any limitation on the Custodian General to exercise suo motu his revisional power. Even in the case of an application for revision filed before him it is said that ordinarily it shall be filed within sixty days. The use of the word "ordinarily" indicates that the period of sixty days is not a period of limitation but only a rule of guidance for the petitioners as well as for the CustodianGeneral. It is within the discretion of the CustodianGeneral to entertain revision petitions after sixty days, 302 but the rule indicates to him that the reasonable period for entertaining a revision is sixty days. The difference in the phraseology of sub rules (1) and (5) of rule 31 of the Rules also leads to the same conclusion, for in the matter of appeals a period of limitation of thirty days when made to the custodian and sixty days when it lies to the Custodian General is prescribed whereas no such rigid period has been laid down in the case of a revision. If rule 31(5) is so read, its provisions will not conflict with those of section 27 of the Act; and in that event they would be valid. The construction suggested by learned counsel for the appel lant may lend scope to the argument that the rule is ultra vires the statute, for when a section says that there is no time limit for entertaining a revision, section rule cannot say that it shall be filed within a particular time. The argument that the principle underlying section 5 of the Limitation Act applies to a petition for revision under section 27 of the Act has no force. Section 5 of the Limitation Act applies to an appeal for which a period of limitation is prescribed and it empowers the court to admit the appeal after the period of limitation, if the applicant satisfied it that he has sufficient reason for not preferring the appeal within the prescribed time. The principle thereunder cannot be made applicable to a revision petition under section 27 of the Act in respect of which no period of limitation is prescribed. At the same time we must make it clear that the powers of the Custodian General under section 27, read with rule 31(5), are not intended to be exercised arbitrarily. Being a judicial power, he shall exercise his discretion reasonably and it is for him to consider whether in a particular case he should entertain a revision beyond the period of sixty days stated in rule 31(5). In this case we cannot say that the Custodian General had acted perversely or unreasonably in entertaining the revision. The revision was filed in time. The Dhawan Group was made party at the subsequent stage as the Custodian General rightly thought that any order he would make in favour of the appellant might prejudice the Dhawan Group. After giving them a reasonable opportunity 303 of being heard within the meaning of the proviso to section 27(1) of the Act, he made the order. The CustodianGeneral, therefore, acted reasonably within his powers. This objection is overruled. The second contention of learned counsel for the appellant is that the Custodian General had no power to cancel an allotment made on or before July 22, 1952. Let us recapitulate the relevant facts. The original order of allotment was made in favour of the appellant 's group and of the first respondent on September 1, 1949. There *as re allotment on December 2,1949. There allotment was cancelled by the Deputy Custodian General by his order dated September 29, 1954. The question is whether the Deputy Custodian General can set aside the allotment made on December 2, 1949. The question raised falls to be decided on the relevant provisions of the Act and the rules made thereunder. Section 11 of the Act confers on the Custodian the power to cancel any allotment made by him, whether such allotment was made or entered into before or after the commencement of the Act. Rule 14 of the Rules narrates the grounds on which an allotment can be cancelled and also the procedure to be followed for cancelling such an allotment. If a custodian makes an order either cancelling or refusing to cancel an allotment, the Custodian General can, under section 27 of the Act, set aside that order, if he is satisfied that it is not legal or proper, and he may pass such order in relation thereto as he thinks fit. But it is said that rule 14(6) limits the power of the Custodian General in respect of allotments made under the Act. As the argument turns upon that rule, it would be convenient to read the material parts of it. Rule 14. (6) "Notwithstanding anything contained in this rule, the Custodian of Evacuee Property in the State of Punjab shall not exercise the power of cancelling any allotment of rural evacuee property on a quasi permanent basis, or varying the terms of any such allotment, except in the following circumstances:. . . . . . ). After narrating the circumstances, with which we are 304 not now concerned, the sub.rule contains a proviso which reads, "Provided further nothing in this sub rule shall apply to any application for revision, made under section 26 or section 27 of the Act, within the prescribed time, against an order passed by the lower authority on or before 22nd July, 1952. " Under this sub rule there is a ban on the exercise of the power of the Custodian to cancel an allotment of a rural evacuee property on a quasi permanent basis except under certain circumstances. his sub rule was substituted for the old sub rule by S.R.O. 1290 of July 22, 1952. A Custodian under the Act cannot set aside an allotment except under the.circumstances mentioned in the sub rule. But the second proviso to that sub rule lifts the ban in the case of an application made for revision under section 26 or section 27 of the Act. It may be mentioned that the words "or section 27" after the words "section 26" were added in the sub. rule on August 26, 1953 i.e., before the order of the Custodian General in the present case. Section 26 of the Act, as it then stood, conferred revisional jurisdiction on the Custodian, Additional Custodian or Authorized Deputy Custodian against the orders of subordinate officers. Section 27, as we have already noticed, confers a similar power of revision on the CustodianGeneral. By reason of the proviso, the CustodianGeneral can, in exercise of his powers under section 27 of the Act, cancel an allotment made by a lower authority on or before July 22, 1952. The only limitation on that power is that he must do so in a revision filed within the prescribed time. What is the prescribed time for a revision under section 27 of the Act? "Prescribed" has been defined in the Act to mean " prescribed by rules made under this Act". Rule 31(5) prescribes that a revision to the Custodian General shall ordinarily be made within sixty days of the order sought to be revised. In considering the first point, we have explained the scope of the rule and we have held that the said rule is only a rule of guidance and that in law a revision can be entertained at any time even after sixty days if the Custodian General in his discretion thinks fit to entertain it. The prescribed time in 305 the context of a revision to the Custodian General can only mean sixty days or such other time within which the Custodian General in his discretion thinks fit to entertain the revision. As the allotment in the present case was made before July 22, 1952, the Custodian General was within his rights in cancelling the same. Before we close, it is necessary to notice another contention raised by learned counsel for the respondents. The argument was that there was no allotment made in favour of the appellant and, therefore, there was no scope for invoking the provisions of rule 14 of the Rules. The basis of the argument is the following observations of the Deputy Custodian General in his order dated September 29, 1954: "The petitioner has rightly contended that the Dhawan Group had no verified claim for the allotment of this excess area and in spite of an opportunity afforded by me to them to produce the copies of their Parcha Claim, they have failed to do so. The reports of the Land Claims Officer dated 7th August 1952, and 11th August 1952, on pages 147 and 151 of the record, show that although the allotment had been made to Dhawan Group but a search had been made for their claims which were not traceable. On page 129 of the record, a report by the Department dated 21st August, 1952, shows that no order of allotment to Dhawan Group was forthcoming." These observation do not record a clear finding that there was no allotment in favour of the appellant. Indeed the factum of allotment to the appellant was never questioned throughout the proceedings. In the circumstances, we must dispose of this appeal on the basis that there was an allotment in favour of the appellant. This contention, is, therefore, rejected. No other point was raised before us. In the result, he appeal fails and is dismissed with costs. Appeal dismissed.
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Two people, the appellant and the respondent, who had moved from West Pakistan, were given land in the same village. Someone complained, and the first land assignment was canceled. The land was then assigned again. The respondent was unhappy with this cancellation. On September 27, 1950, he asked the Deputy Commissioner to review the decision and give him back the original land assignment. This request was denied on May 12, 1951. The respondent then asked the Additional Custodian to review the decision, but that was also denied on August 25, 1952. After that, the respondent asked the Custodian General to review the decision on October 30, 1952. The Custodian (official in charge) was included in this review. The appellant was added to the review by the Custodian General on August 25, 1953. After listening to everyone, the Custodian General canceled part of the land assignment that had been given to the appellant on September 29, 1954. The appellant argued: (i) that the request for review to the Custodian General was made too late, and (ii) that the Custodian General did not have the power to cancel the land assignment. The court decided that the review request was not too late. Rule 31(5) says that a review request to the Custodian General should "ordinarily be made within sixty days of the order sought to be revised." This rule is just a guideline, not a strict deadline. A review can still be considered even after sixty days if the Custodian General thinks it's appropriate. In this case, the review request was filed on time, but the appellant was only added to the case after the sixty-day period had passed. However, the court said that the Custodian General did not act unfairly or unreasonably by considering the review. The court also decided that the Custodian General had the power to cancel the land assignment made on December 2, 1949. Under rule 14(6), the Custodian could not cancel a land assignment after July 22, 1952, except in certain situations. However, the second part of rule 14(6) allowed the Custodian General, using his review powers under section 27 (a law), to cancel a land assignment made by a lower official on or before July 22, 1952.
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Appeal No. 647 of 1962. Appeal by special leave from the judgment and decree ,dated December 3, 1959 of the Patna High Court in Appeal from Appellate Decree No. 642 of 1957. section P. Varma, for the appellant. section P. Sinha, Shahzadi Mahiuddin and Shaukat Hussain.for the respondent. February 14, 1964. The Judgment of the Court was delivered by HIDAYATULLAH, J. This is an appeal by special leave against the judgment of the High Court of Patna reversing the concurrent judgments of the two courts below, and ordering the dismissal of the suit of the appellant. The appellant is Syed M. Karim, son of one Syed Aulad Ali and the respondent Mst. Bibi Sakina (defendant No.11) is transferee of the properties in dispute from Hakir Alam (defendant No. 2), son in law of Syed Aulad Ali. The appellant, in his turn, is a transferee of the same properties from his father Syed Aulad Ali. 782 The suit was brought for declaration of Title and con firmation of possession or in the alternative for delivery thereof against several defendants in respect of this and other properties. We are not concerned in this appeal with the other defendants or the other properties. This part of the appellant 's suit was based on the allegation that Syed Aulad Ali had purchased the suit properties on May 28, 1914 at a court sale, benami in the name of his son in law Hakir Alam. The reason for the benami purchase was that under the rules of the Darbhanga Raj where Syed Aulad Ali was employed, persons serving in certain capacities were prohibited from purchasing at court sales. The sale certi ficate was issued in the name of Hakir Alam who was then living with Syed Aulad Ali. On January 6, 1950, Syed Aulad Ali sold ;the property to his son the present appellant and Hakir Alam sold the property in his turn to Bibi Sakina and the present suit was filed for the above reliefs. In this appeal, it has been stressed by the appellant that the findings clearly establish the benami nature of the transaction of 1914. This is, perhaps, true but the appellant cannot avail himself of it. The appellant 's claim based upon the benami nature of the transaction cannot stand because section 66 of the Code of Civil Procedure bars it. That section provides that no suit shall be maintained against any person claiming title under a purchase certified by the Court on the ground that the purchase was made on behalf of the plaintiff or on behalf of someone through whom the plaintiff claims. Formerly, the opening words were, no suit shall be maintained against a certified purchaser. and the change was made to protect not only the certified purchaser but any person claiming title under a purchase certified by the Court. The protection is thus available not only against the real purchaser but also against anyone claiming through him. In the present case, the appellant as plaintiff was hit by the section and the defendants were protected by it, It is contended that the case falls within the second sub section under which a suit is possible at the instance of a third person who wishes to proceed against the property. though ' ostensibly sold to the certified purchaser, on tie ground that it is liable to satisfy a claim of such third person 783 against the real owner. Reliance is placed upon the transfer by Syed Aulad Ali in favour of the appellant which is described as a claim by the transferee against the real owner. The words of the second sub section refer to the claim of creditors and not to the claims of transferees. The latter are dealt with in first sub section, and if the meaning sought to be placed on the second sub section by the appellant were to be accepted, the entire policy of the law would be defeated by the real purchaser making a transfer to another and the first sub section would become almost a dead letter. In our opinion, such a construction cannot be accepted and the plaintiff 's suit must be held to be barred under section 66 of the Code. As an alternative, it was contended before us that the title of Hakir Alam was extinguished by long and uninterrupted adverse possession of Syed Aulad Ali and after him of the plaintiff. The High Court did not accept this case. Such a case is, of course, open to a plaintiff to make if his possession is disturbed. If the possession of the real owner ripens into title under the Limitation Act and he is dispossessed, he can sue to obtain possession,for he does not then rely on the benami nature of the transaction. But the alternative claim must be clearly made andproved. The High Court held that the plea of adverse possession was not raised in the suit and reversed the decision of the two courts below. The plea of adverse possession is raised here. Reliance is placed before us on Sukan vs Krishanand(1) and Sri Bhagwan Singh and others vs Ram Basi and others(1) to sumit that such a plea is not necessary and alternatively, that if a plea is required, what can be considered a proper plea. But these two cases can hardly help the appellant. No doubt, the plaint sets out the fact that after the purchase by Syed Aulad Ali, benami in the name of his son in law Hakir Alam Ali continued in possession of the property but it does not say that this possession was at any time adverse to that of the certified purchaser. Hakir Alam was the son in law of Syed Aulad Ali and was living with him. There is no (1) I.L.R. 32 Pat. (2) A.I.R. 1957 Pat. 784 suggestion that Syed Aulad Ali ever aserted any hostile title against him or that a dispute with regard to ownership and possession had ever arisen. Adverse possession must be adequate in continuity, in publicity and extent and a plea is required at the least to show when possession becomes adverse so that the starting point of limitation against the party affected can be found. There is no evidence here when possession became adverse, if it at all did, and a mere suggestion in the relief clause that there was an uninter rupted possession for "several 12 years" or that the plaintiff had acquired "an absolute title" was not enough to raise such a plea. Long possession is not necessarily adverse possession and the prayer clause is not a substitute for a plea. The cited cases need hardly be considered, because each case must be determined upon the allegations in the plaint in that case. It is sufficient to point out that in Bishun Dayal vs Kesho Prasad and another [A.T.R. , the Judicial Committee did not accept an alternative case based on possession after purchase without a proper plea. Reading the plaint as a whole, we agree with the High Court that a case based on possession after the purchase was not stated in the plaint and the decision of the High Court in the circumstances of this case was therefore proper. The appeal fails and is dismissed with costs. Appeal dismissed.
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K, the person appealing the case, said he owned certain property. He said he bought it from A, who had secretly bought it using H's name (a "benami" transaction). Then, H sold the property to S, the person K is fighting against in court (the respondent). The court decided: (i) Section 66 of the Code of Civil Procedure protects not just the person who officially bought the property at auction, but also anyone who gets the property from them. Section 66 prevents K from claiming the property. The second part of that section talks about claims from people who are owed money, not people who received the property. The first part covers people who received the property. (ii) If the real owner of the property holds it long enough to gain legal ownership under the Limitation Act (law about time limits), and then someone takes the property from them, they can sue to get it back. But, they can't rely on the secret nature of the original purchase. The claim must be clearly stated and proven. To claim adverse possession (taking ownership by openly possessing property), the possession must be continuous, well-known, and cover enough of the property. The person claiming adverse possession needs to show when their possession became adverse so the court can determine the starting point for calculating the time limit against the original owner. Sukan vs Krishnand, Sri Bhagwan Singh vs Ram Basi Kuer, and Bishun Dayal vs Kesho Prastid were referenced.
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10 to 16. After protected correspondence with the 811 authorities of the Education Department Raja Ram Kumar Bhargava president of the Society by his letter dated Novem ber 26, 1941 (Exhibit C B 6) informed the Inspector of Schools Lucknow that he has given away the premises occupied by the school free of rent which may be considered his permanent contribution to the cause of the school. The members of the Committee of Management felt obliged to the Raja for his charitable disposition in donat ing the building to the school, accordingly, they unanimous ly passed a resolution expressing their gratitude to the Raja and they further resolved to change the name of the institution as the "Bishun Narain Anglo Vernacular School" to perpetuate the memory of late Bishun Narain Bhargava, the father of Raja Ram Kumar Bhargava. Thereafter Raja Ram Kumar Bhargava did not realise rent from the school and he allowed the school to occupy the building and the open land attached to it for the use of the school. Subsequently, the pri mary section of the institution was separated from the College section and it was given the name as "Bishun Narain Basic School" This school has been occupying the property in dispute, however, the school and the college both were managed by committee of management of which Raja Ram Kumar Bhargava continued to be the President till 1961 and there after his wife Rani Lila Bhargava became the President, which office she continued to occupy since then. The Bank released the property under a written agreement dated 27th June, 1961 and in pursuance thereof Raja Ram Kumar Bhargava along with his three minor sons executed a Sale Deed on 27th June, 1961 transferring the property in dispute occupied by the school along with other property to Ram Sarup Gupta, the plaintiff appellant. Subsequently under the order of the trial court the members of the committee of the management of the Bishun Narain Basic School were also impleaded as defendants 11 to 17. On the pleading of the parties the trial court framed 8 issues and the parties produced evidence in support of their case. The trial court recorded findings that the property in dispute belonged to the joint family of which Raja Ram Kumar Bhargava as Karta. Raja Ram Kumar Bhargava had donated the property in dispute to the school, but no title passed to the school or to any of the defendants as the property being immovable could not be transferred except under a registered deed. The trial court recorded findings that Raja Ram Kumar Bhargava had given away the property to the school as his permanent contribution but in the absence of registered deed the transaction amounted to a license only and since the defendants had made permanent constructions on the premises in suit, the license was irrevocable under section 60(b) of the (hereinafter referred to as the Act). The trial court 813 further held that Raja Ram Kumar Bhargava himself had no power in law to revoke the license, consequently the plain tiff being transferee from him could not acquire any better right, therefore he was not entitled to revoke the license or to obtain possession of the property. Verma, J. took a contrary view, according to him the defendants had failed to raise requisite plea that the license granted to them was irrevocable as contem plated by Section 60 (b) of the Act and they had further failed to produce any positive evidence to prove the terms and conditions of the license showing that the license was irrevocable. The learned Judge held that the defendants plea that they had made permanent constructions on the land in pursuance of the license incurring expenses, could not be considered as the defendants had failed to plead the neces sary facts in their written statement, the evidence produced by them could not be considered. Jha, J. as a result of which the trial court 's judgment was upheld and the appellant 's suit was dismissed. Kacker, learned counsel for the appellant contended that the trial court as well as the High Court both erred in holding that the license was irrevocable under section 60(b) of the Indian Easement Act. He urged that the defendants had failed to raise necessary pleadings on the question, no issue was framed and no evidence was produced by them. In the absence of requisite pleadings and issues it was not open to the trial court and the High Court to make out a new case for the defendants, holding the license irrevocable. Lalit, appearing on behalf of the defendant respondents supported the findings recorded by the trial court and the High Court and urged that both the courts have recorded findings of facts on appreciation of evidence on record that the license granted by Raja Ram Kumar Bhargava was irrevocable and that acting upon the license the school had made construction for the purposes of running the school and the license was irrevocable. The question which falls for consideration is whether the respondents in their written statement have raised the necessary pleading that the license was irrevocable as contemplated by Section 60(b) of the Act and, if so, is there any evidence on record to support that plea. It is well settled that in the absence of pleading, evidence, if any, produced by the parties cannot be considered. It is also equally settled that no party should be permitted to travel beyond its pleading and that all necessary and mate rial facts should be pleaded by the party in support of the case set up by it. Once it is found that in spite of deficiency in the pleadings parties knew the case and they proceeded to trial on those issues by producing evidence, in that event it would not be open to a party to raise the question of absence of pleadings in appeal. In Bhagwati Prasad vs Shri Chandramaul, a Constitution Bench of this Court considering this question observed: "If a plea is not specifically made and yet it is covered by an issue by implication, and the parties knew that the said plea 815 was involved in the trial, then the mere fact that the plea was not expressly taken in the pleadings would not necessarily disentitle a party from relying upon if it is satisfactori ly proved by evidence. If it appears that the parties did not know that the matter was in issue at the trial and one of them has had no opportunity to lead evidence in respect of it, that undoubtedly would be a different matter. Before we examine the pleas raised by the defendants in their written statement it is necessary to keep in mind that the plaintiff himself stated in paragraph 4 of the plaint that the property in dispute has been in occupation of the school as licensee under the permission of Raja Ram Kumar Bhargava erstwhile owner of the property. In paragraph 18 of their written statement they pleaded that the license was coupled with a grant and in any case it was a permanent and irrevocable license in favour of the school and the same could not be revoked by the plaintiff. The pleadings so raised make it apparently 816 clear that the defendants had raised a specific plea that the license was coupled with grant, it was a permanent and irrevocable license and in pursuance of the licence the licensee had carried out work of permanent character incur ring expenses for the advancement of the purpose for which the license had been granted. The issues so framed in volved the question of irrevocability of the license under both the clauses (a) and (b) of the Section 60 of the Act. The plaintiff went to trial knowing fully well that defend ants claim was that the license was irrevocable, on the ground that they had made permanent constructions and in curred expenses in pursuance of the license granted for the purpose of school. The plaintiff knew the case he had to meet, and for that purpose he produced Raja Ram Kumar Bhar gava in evidence in support his plea that the license was a simple license and it was not irrevocable as pleaded by the defendants. Mr. Kacker, then contended that mere execution of work of a permanent character and incurring expenses by the licensee is not sufficient to make the license irrevocable instead licensee must plead and prove by positive evidence that the licensee "acting upon the license", executed work of a permanent character and incurred expenses in its execu tion. The defendants tailed to raise any such plea before the trial court that they had executed the work of permanent character and incurred expenses "acting upon the license" and they further failed to produce any evidence in support thereof. He urged that by making constructions and incurring expenses a licensee could not make the license irrevocable as the law requires that constructions, if any, and expenses incurred thereon must be shown to have been made "acting upon the license". Similar grievance had been raised by the appellant before the High Court on the ground on absence of requisite pleadings with regard to the respondents ' claim for the license being irrevocable under section 60 (b) of the Act. License as defined by Section 52 of the Act means grant of permission, by a person to the other, a right to do or continue to do, in or upon, the immovable property of the grantor, something which would, in the absence of such right, be unlawful. Section 60 provides that a license may be revoked by the grantor unless; (a) it is coupled with a transfer of property and such transfer is in force; (b) the licensee, acting upon the license, has executed a work of permanent character and incurred expenses in the execution. Section 63 and 64 deal with license 's right on revocation of the license to have a reasonable time to leave the property and remove the goods which he may have placed on the property and the licensee is further entitled to compensation if the license was granted for consideration and the license was terminated without any fault of his own. These provisions indicate that a license is revocable at the will of the grantor and the revocation may be expressed or implied. Section 60 enumerates the conditions under which a license is irrevocable. Firstly, the license is irrevocable if it is coupled with transfer of property and such right is enforced and secondly, if the licensee acting upon the license exe cutes work of permanent character and incurs expenses in execution. There may be a case where the grantor of the license may enter into agreement with the licensee making the license irrevocable, even though, none of the two clauses 818 as specified under section 60 are fulfilled. (as he then was) in Dominion of India vs Sohan Lal, AIR 1950 EP 40. the purpose for which the license is granted coupled with the conduct of the parties and the circum stances which may have let to the grant of the license. In their pleadings the defendants had invoked the pro tection of both the clauses of Section 60 of the Act, first ly, they pleaded that the license was coupled with the transfer of property inasmuch as the school had been realis ing rent from third parties who were permitted to use a portion of the land. The trial court as well as the High Court both rejected the respondents ' claim of license being irrevocable under section 60(a) of the Act. But reading the entire written statement one cannot escape the conclusion that the defendants had raised the plea that Raja Ram Kumar Bhargava the grantor of the license had granted license for running the school in the building and for using the open land for 819 the purpose of school and in pursuance of the license, so granted, the school had executed work of permanent character and incurred expenses in making the same. Substance of the pleading was clear that defendants had raised a specific plea that the school had in pursuance of the license executed work of permanent character and in curred expenses in execution and that no objection was raised by the licensor therefore the license was irrevoca ble. The license had been granted to the school for the purpose of running school and imparting education to the students, the license was not merely in respect of building alone but it was also in respect of open land attached to the building. Additional accommodation was required to provide class rooms for the students which was an integral part of the purpose for which the license had been granted and the school carried out works on the open land which was appurtenant to the main building, with the knowledge of the licensor as has been found by the trial court and the High Court. The result is that the respondents "acting upon the license" had executed works by incurring expenses which rendered the license irrevocable. Raja Ram Kumar Bhargava who was examined as a witness on behalf of the plaintiff admitted in his testimony that he continued to be the president of the school since 1938 to 1961 and thereafter his wife has continued to be the president, it is therefore difficult to believe that he had no knowledge of the constructions. No doubt Raja Ram Kumar made attempts to support the plaintiff 's case by saying that he had not given the property to the school permanently but the trial court and the High Court both have discarded his testimony and we find no good reason to take a different view. These observations do not support the appellant on the other hand they show that if a man executes work of permanent character and incurs expense on the property of other person under a license he may have done so "acting upon the license". On the rejection of both the pleas the plaintiff appellant therein raised a further plea that he was protected under section 60(b) of the as he had executed works of permanent character on the land incurring heavy expenses. While rejecting the appellant 's submissions the Court observed that even assum ing that the appellant had executed work of a permanent character on the land it could not be said that he had done so "acting upon the license" as required by Section 60(b) of the Easements Act. The decision has no application to the facts of the present case as admittedly the school was a licensee and in that capacity it executed works of a permanent character, by incurring expenses and this plea was raised at the initial stage before the trial court. 821 Reference was made to a number of decisions of the High Court in support of the proposition that a license is irrev ocable under section 60(b) of the Act only if three condi tions are fulfilled, namely, (i) the licensee executed work of a permanent character, (ii) he did so acting upon the license, and (iii) he incurred expenses in doing so. The onus of proving these facts lie upon the licensee and in the absence of any evidence on these questions the license could not be irrevocable under section 60(b) of the Act. 17, Karan Singh vs Budh Sen, AIR 1938 All. The respondents placed reliance on the deci sions of Lahore High Court had Oudh High Court in Jagat Singh and others vs District Board Amritsar, AIR 1940 Lahore 18 and Thakur Prasad vs J. Thomkinson, AIR 1927 Oudh 206. In these decisions the Court held that where a license was granted to a school in respect of a land, and in pursuance thereof the licensee constructed work of permanent character on the land, the license was irrevocable under section 60(b) of the . In our view the Court rightly held that where license is granted for the purpose of run ning school without reserving any right to revoke the li cense and if the licensee erected works of permanent nature, the grantor of license is not entitled to recover land, as the execution of work was for the purpose of school and it falls within the expression "acting upon the license". Raja Ram Kumar Bhargava was the President of the Society which was running the Narhi Middle School, but it was not recognised by the Education Department of the State of U.P. B 16) show that a meeting of the Managing Committee was held on that day president over by Raja Ram Kumar Bhargava and in that meeting the Managing Committee expressed its deep sense of appreciation and grateful thanks to Raja Ram Kumar Bhargava for donating the building to the school for procuring the recognition to the school from the U.P. These facts and circumstances point out the terms and conditions of the license, that the school was permitted to occupy and enjoy the land permanently for the purpose of education. The appellant 's submission that Raja Ram Kumar Bhargava being Karta of joint family could not create a permanent license in favour of the school without the consent of other co sharers, tO the detriment of his minor sons, is devoid of any merit. No co sharer or member of the joint family ever raised any objection to the donation of the property to the school by Raja Ram Kumar Bhargava nor they 823 raised any objection at any stage of construction of the additional buildings by the school. Moreover title in the property was not transferred to the school instead a permanent license was granted, in which every member of the joint family, must have been interested, as the school perpetuated the memory of the common ancestor Shri Bishun Narain Bhargava father of Raja Ram Kumar Bhargava. In view of the above discussion we are of the opinion that the pleadings, evidence and the circumstances available on record, have fully established that Raja Ram Kumar Bhar gava had granted license to the school in respect of the building and the land attached to it for the purpose of imparting education and the school in furtherance of that purpose constructed additional buildings and it further incurred expenses in carrying out modification and extensive repairs in the existing buildings during the period, Raja Ram Kumar Bhargava continued to be the President of the Managing Committee of the school. That being so, Raja Ram Kumar Bhargava could not revoke the license or evict the school and the appellant being transferee from him could not and did not acquire any better right. The appellant there fore has no right to revoke the license or to evict the school, so long the school continues to carry on the purpose for which the license was granted. Before concluding, we would like to observe that the appellant purchased the property in dispute from Raja Ram Kumar Bhargava for valuable consideration and he continues to be the owner of the 824 property, his desire to get the possession of the property is quite natural but at the same time we cannot shut our eyes to the hard reality that Raja Ram Kumar Bhargava erst while owner of the property had granted an irrevocable license in favour of the school. On 27th June 1961 when Raja Ram Kumar Bhargava executed the sale deed in appellant 's favour the property in dispute was in possession of the school under an irrevocable license. The appellant should have known that the institution was occupying the property and it was rendering public service in imparting education to the students and it would be difficult to get possession, in spite of that, the appellant purchased the property. The school has been occupying the property since 1939 and it has made permanent constructions without any demur from any quarter, in this situation it is not possible to grant any relief to the appellant.
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To get the school approved, the President of the Society, who owned the property, wrote a letter on November 26, 1941, saying he was letting the school use the property for free. The person who gave the land, or his family, didn't object to this construction. They also said they had spent money to build permanent structures, so they had the right to stay there permanently. The trial court disagreed with the plaintiff. The court said that because there was no deed, the person who gave the land still owned it and could sell it to the plaintiff. The trial court also said that under a local law (U.P. Act III of 1947), the school couldn't have the property assigned to it because it wasn't vacant. The court agreed that the land was given to the school as a permanent gift, but without a registered deed, it was just a permission to use the land (license). Since the school had built permanent structures, the permission couldn't be taken back under Section 60(b) of a law. Because the person who gave the land couldn't legally take back the permission, the plaintiff couldn't either. So, the plaintiff couldn't get the property back. They said the school's permission to use the land was permanent, and the plaintiff couldn't get any help from the court. They argued that the trial court and the High Court were wrong to say the permission was permanent under Section 60(b) of the Indian Easement Act. They said the school hadn't properly argued this point, and there was no evidence to support it. The plaintiff also said that the person who gave the land couldn't give away the property permanently because he was just the manager of the joint family. They said the permission was permanent because the school had built structures while using the permission, and they had presented enough evidence to support their claims. If permission is given to run a school without saying it can be taken back, and the school builds permanent structures, the person who gave the permission can't get the land back. If someone allows another person to build on their land for the purpose of the permission given, they can't later change their mind and take back the permission, unless there was a prior agreement saying otherwise. This rule is in Section 60(b) of the law. In this case, all three conditions are met: (1) the school built a permanent structure, (ii) they did so because of the permission given, and (iii) they spent money doing it. 3.1 A license, as explained in section 52 of the Easements Act, is when someone gives another person the right to do something on their property that would normally be illegal. 3.2 Section 60 of the Act lists when a license can't be taken back. First, if the license is connected to a property transfer, it can't be taken back. According to Section 62, a license can be taken back by the person who gave it, unless stated otherwise. 3.3 The people involved can agree, either in writing or verbally, that a license that can normally be taken back can't be taken back. In that case, the details of the license can be understood from why the license was given and how the people involved acted. 3.4 The school was given permission to use the building and the land around it to run the school and teach students. The school needed more space and built on the open land, and the person who gave the permission knew about it. 3.6 The evidence shows that the person who gave the property gave the school permission to use the building and land to teach students. Because of this, the person who gave the license couldn't take it back or force the school out. The plaintiff, who bought the property from him, doesn't have any more rights than he did. So, the plaintiff can't take back the license or force the school out, as long as the school continues to use the property for the purpose it was given. Sometimes, arguments are worded in a way that doesn't perfectly follow the law. In that case, the court should try to understand the main point of the arguments and decide the issue. The court shouldn't focus too much on the form of the arguments, but instead consider the overall meaning. 4.2 When someone claims that arguments are missing, the court should focus on whether the parties understood the case and the issues. In this case, the plaintiff knew the case he had to defend against. He even brought the person who gave the land as a witness to support his claim that the license was simple and could be taken back, as opposed to being permanent as the school argued.
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Appeal No. 271 of 1956. Appeal from the judgment and order dated August 2, 1955, of the former Nagpur High Court in Misc. Petition No. 249 of 1955. M. Adhikari, Advocate General for the State of Madhya Pradesh, B. K. B. Naidu and I. N. Shroff, for the appellants. R. Patnaik, for the respondent. October 3. This appeal with a certificate issued by the Nagpur High Court under article 132(1) of the Constitution raises a question about the validity of the Central Provinces and Berar Goondas 972 Act X of 1946 as amended by Madhya Pradesh Act XLIX of 1950. It appears that against the respondent Baldeo Prasad the State of Madhya Pradesh, appellant 1, passed an order on June 16, 1955, under section 4 A of the Act. Subsequently the District Magistrate, Chhindwara, appellant 2, passed another order dated June 22, 1955, communicating to the respondent the first externment order passed against him. The respondent then filed 'a writ petition in the High Court (No. 249 of 1955) under article 226 challenging the validity of the said orders, inter alia, on the ground that the Act under which the said orders were passed was itself ultra vires. The appellants disputed the respondent 's contention about the vires of the Act. The High Court, however, has upheld the respondent 's plea and has held that sections 4 and 4 A of the Act are invalid, and since the two sections contain the main operative provisions of the Act, according to the High Court, the whole Act became invalid. It is the correctness of this conclusion which is challenged before us by the appellants. It would be convenient at this stage to refer briefly to the scheme of the Act and its relevant provisions. The Act was passed in 1946 and came into force on September 7, 1946. It was subsequently amended and the amended Act came into force on November 24, 1950. As the preamble shows the Act was passed because it was thought expedient to provide for the control of goondas and for their removal in certain circumstances from one place to another. Section 2 defines a goonda as meaning a hooligan, rough or a vagabond and as including a, person who is dangerous to public peace or tranquillity. It would thus be seen that the definition of the word " goonda " is an inclusive definition, and it includes even persons who may not be hooligans, roughs or vagabonds if they are otherwise dangerous to public peace or tranquillity. Section 3(1) empowers the State Government to issue a proclamation that disturbed conditions exist or are likely to arise in the areas specified in such proclama tions if the State Government is satisfied that public peace or tranquillity in any area is disturbed or is 973 likely to be disturbed. The area in respect of which a proclamation is thus issued is described in the Act as the proclaimed area. Section 3(2) limits the operation of the proclamation to three months from its date and provides that it may be renewed by notification from time to time for a period of three months at a time. The first step to be taken in enforcing the operative provisions of the Act thus is that a proclamation has to be issued specifying the proclaimed areas, and the limitation on the power of the State Government to issue such a proclamation is that the proclamation can be issued only after it is satisfied as required by section 3(1), and its life will not be longer than three months at a stretch. During the period the proclamation of emergency issued or renewed under Section 3 is in operation, the District Magistrate having jurisdiction in or in any part of the proclaimed area, if satisfied that there are reasonable grounds for believing that the presence, movements or acts of any goonda in the proclaimed area is prejudicial to the interests of the general public or that a reasonable suspicion exists that any goonda is committing or is likely to commit acts calculated to disturb the public peace or tranquillity may make an order (i) directing such goonda to notify his residence and any change of or absence from such residence during the term specified and to report his movements in such manner and to such authority as may be specified ; (ii) directing that he shall not remain in the proclaimed area within his jurisdiction or any specified part thereof and shall not enter such area; and (iii) directing him so to conduct himself during the period specified as the District Magistrate shall deem necessary in the interests of public order: Provided that no order under clause (ii) which directs the exclusion of any goonda from a place in which he ordinarily resides shall be made except with the previous approval of the State Government: Provided further that no such order shall be 124 974 made directing exclusion of any goonda from the district in which he ordinarily resides. (2) No order under sub section (1) shall be made by a District Magistrate in respect of a goonda without giving to such goonda a copy of the grounds on which the order is proposed to be made and without giving an opportunity to be heard : Provided that where the District Magistrate is of opinion that it is necessary to make an order without any delay he may for reasons to be recorded in writing, make the order and shall, as soon as may be within ten days from the date on which the order is served on the goonda concerned, give such goonda a copy of the grounds and an opportunity to be heard. (3) After hearing the goonda, the District Magistrate may cancel or modify the order as he thinks fit. " This section confers on the District Magistrate jurisdiction to make an order against a goonda if there are reasonable grounds for believing that his presence, movements or acts in any proclaimed area is likely to be prejudicial to the interests of the general public, or it there is a reasonable suspicion that a goonda is committing or is likely to commit prejudicial acts. Sub clauses (i), (ii) and (iii) indicate the nature of the directions and the extent of the restrictions which can be placed upon a goonda by an order passed under section 4. Sub section (2) requires the District Magistrate to give the goonda a copy of the grounds on which an order is proposed to be made, and to give him an opportunity to be heard why such an order should not be passed against him. After hearing the goonda the District Magistrate may under sub section (3) either cancel or modify the order as he thinks fit. Section 4 A reads thus: " (1) Where the District Magistrate considers that with a view to maintain the peace and tranquillity of the proclaimed area in his district it is necessary to direct a goonda to remove himself outside the district in which the proclaimed area is comprised or 975 to require him to reside or remain in any place or within any area outside such district, the District Magistrate may, after giving the goonda an opportunity as required by sub section (2) of Section 4 forward to the State Government a report together with connected papers with a recommendation in that behalf (2) On receipt of such report the State Government may, if it is satisfied that the recommendation made by the District Magistrate is in the interests of the general public, make an order directing such goonda (a) that except in so far as he may be permitted by the provisions of the order, or by such authority or person as may be specified therein, he shall not remain in any such area or place in Madhya Pradesh as may be specified in the order; (b) to reside or remain in such place or within such area in Madhya Pradesh as may be specified in the order and if he is not already there to proceed to that place or area within such time as may by specified in the order : Provided that no order shall be made directing the exclusion or removal from the State of any person ordinarily resident in the State." Thus an order more stringent in character can be passed under this section. The safeguard provided by the section, however, is that the District Magistrate is required to give the goonda an opportunity to be heard and further required to make a report to the State Government and forward to the State Government papers connected with the recommendation which the District Magistrate makes. Sub section (2) of section 4 A then requires the State Government to consider the matter and empowers it to make an order either under cl. (b) of the said sub section. The proviso to this section lays down that Do order shall be made by which the goonda would be excluded or removed from the State where he ordinarily resides. It gives a goonda aggrieved by an order made against him, inter alia, under section 4 or section 4 A to make a representation to the State Government within the 976 time prescribed, and it requires the State Government to consider the representation and make such orders thereon as it may deem fit. At this stage it would be material to state the relevant facts leading to the writ petition filed by the respondent. Appellant 1 issued a proclamation under section 3 on August 10, 1954, specifying the limits of Police Stations Parasia and Jamai and Chhindwara Town as proclaimed area. This proclamation was renewed in November, 1954 and February, 1955. Thereafter on May 9, 1955, appellant 1 issued afresh proclamation specifying the whole of the Chhindwara District as the proclaimed area. This proclamation was to remain in force till August 8, 1955. Whilst the second proclamation was in force the second appellant received reports from the District Superintendent of Police, Chhindwara, against the respondent, and he ordered the issue of a notice to him to show cause why action should not be taken against him under section 4; this notice required the respondent to appear before the second appellant on April 29, 1955. The respondent, though served, did not appear before the second appellant. Thereupon the second appellant sent a report to appellant 1 on April 30, 1955, and submitted the case against him with a draft order for the approval of the said appellant under the first pro viso to section 4(1). In the meantime the third notification was issued by appellant 1. The second appellant then issued a fresh notice against the respondent under section 4 on May 24, 1955. The respondent appeared in person on May 30, 1955, and was given time to file his written statement which he did on June 4, 1955. The case was then fixed for hearing on June 22, 1955. Meanwhile the State Government passed an order on June 16, 1955, directing that the respondent shall, except in so far as he may be permitted by the second appellant from time to time, not remain in any place in Chhindwara District. This order was to remain in force until August 8, 1955. On June 22, 1955, the second appellant communicated the said order to the respondent and directed him to leave the District 977 before 10 a. m. on June 23, 1955. The respondent appealed to appellant 1 to cancel the order passed against him. The first appellant treated the appeal as a representation made by the respondent under section 6 and rejected it on July 9, 1955. A day before this order was passed the respondent filed his writ petition in the High Court from which the present appeal, arises. The respondent challenged the validity of the Act on the ground that it invades his fundamental rights under article 19(1)(d) and (e) and as such it becomes invalid having regard to the provisions of article 13 of the Constitution. This plea has been upheld by the High Court. On behalf of the appellants the learned Advocate General of Madhya Pradesh contends that the High Court was in error in coming to the conclusion that the restrictions imposed by the Act did not attract the provisions of article 19(5). The legislative competence of the State Legislature to pass the Act cannot be disputed. There can also be no doubt that the State Legislature would be competent to pass an act protecting the interests of the general public against the commission of prejudicial acts which disturb public peace and order. Section 3 of the Act indicates that it is only where the public peace or tranquillity is threatened in any 'given area of the State that the State Government is authorised to issue a proclamation, and as we have already noticed, it is in respect of such proclaimed areas and for the limited duration prescribed by section 3(2) that orders can be passed against goondas whose prejudicial activities add to the disturbance in the proclaimed areas. This position is not seriously disputed. The argument against the validity of the Act is, however, based on one serious infirmity in section 4 and 978 s.4 A which contain the operative provisions of the Act. It is clear that section 4 contemplates preventive action being taken provided two conditions are satisfied ; first, that the presence, movements or acts of any person sought to be proceeded against should appear to the District Magis trate to be prejudicial to the interests of the general public, or that a reasonable suspicion should exist that such a person is committing or is likely to commit acts calculated to disturb public peace or tranquillity ; and second that the person concerned must be a goonda. It would thus be clear that it is only where prejudicial acts can be attributed to a goonda that section 4 can come into operation. That clearly means that the primary condition precedent for taking action under section 4 is that the person against whom action is proposed to be taken is a goonda; and it is precisely in regard to this condition that the section suffers from a serious infirmity. The section does not provide that the District Magistrate must first come to a decision that the person against whom he proposes to take action is a goonda, and gives him no guidance or assistance in the said matter. It is true that under section 4 a goonda is entitled to have an opportunity to be heard after he is given a copy of the grounds on which the order is proposed to be made against him; but there is no doubt that all that the goonda is entitled to show in response to the notice is to challenge the correctness of the grounds alleged against him. The enquiry does not contemplate an investigation into the question as to whether a person is a goonda or not. The position, therefore, is that the District Magistrate can proceed against a person without being required to come to a formal decision as to whether the said person is a goonda or not; and in any event no opportunity is intended to be given to the person to show 979 that he is not a goonda. The failure of the section to make a provision in that behalf undoubtedly constitutes a serious infirmity in its scheme. Incidentally it would also be relevant to point out that the definition of the word " goonda " affords no assistance in deciding which citizen can be put under that category. After all it must be borne in mind that the Act authorises the District Magistrate to deprive a citizen of his fundamental right under article 19(1)(d) and (e), and though the object of the Act and its purpose would undoubtedly attract the provisions of article 19(5) care must always be taken in passing such acts that they provide sufficient safeguards against casual, capri cious or even malicious exercise of the powers conferred by them. It is well known that the relevant provisions of the Act are initially put in motion against a person at a lower level than the District Magistrate, and so it is always necessary that sufficient safeguards should be provided by the Act to protect the fundamental rights of innocent citizens and to save them from unnecessary harassment. That is why we think the definition of the word " goonda " should have given necessary assistance to the District Magistrate in deciding whether a particular citizen falls under the category of goonda or not; that is another infirmity in the Act. Having regard to the two infirmities in sections 4, 4 A respectively we do not think it would be possible to accede to the argument of the learned Advocate General that the operative portion of the Act can fall under article 19(5) of the Constitution. The person against whom action can be taken under the Act is not entitled to know the source of the information received by the District Magistrate; be is only told about his prejudicial activities on which the satisfaction of the District Magistrate is based that action 980 should be taken against him under section 4 or section 4 A. In such a case it is absolutely essential that the Act must clearly indicate by a proper definition or otherwise when and under what circumstances a person can be called a goonda, and it must impose an obligation on the District Magistrate to apply his mind to the question as to whether the person against whom complaints are received is such a goonda or not. Where a statute empowers the specified authorities to take preventive action against the citizens it is essential that it should expressly make it a part of the duty of the said authorities to satisfy themselves about the existence of what the statute regards as conditions precedent to the exercise of the said authority. If the statute is silent in respect of one of such conditions precedent it undoubtedly constitutes a serious infirmity which would inevitably take it out of the provisions of article 19(5). That is the view taken by the High Court and we see no reason to differ from it. In this connection we may refer to the corresponding Bombay statute the material provisions of which have been examined and upheld by this Court. It would be (1) ; (2) ; (3) ; 981 noticed that the relevant provisions in the latter Act the validity of which has been upheld by this Court indicate how the mischief apprehended from the activities of undesirable characters can be effectively checked by making clear and specific provisions in that behalf, and how even in meeting the challenge to public peace and order sufficient safeguards can be included in the statute for the protection of innocent ' citizens. It is not clear whether the opportunity to be heard which is provided for by section 4(2) would include an opportunity to the person concerned to lead evidence. Such an opportunity has, however, been provided by section 59(1) of the Bombay Act of 1951. As we have already mentioned there can be no doubt that the purpose and object of the Act are above reproach and that it is the duty of the State Legislature to ensure that public peace and tranquillity is not disturbed by the prejudicial activities of criminals and undesirable characters in society. That, however, cannot help the appellants ' case because, as we have indicated, the infirmities in the operative sections of the Act are so serious that it would be impossible to hold that the Act is saved under article 19(5) of the Constitution. There is no doubt that if the operative sections are invalid the whole Act must fall. In the result the order passed by the High Court is confirmed and the appeal is dismissed with costs.
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The government of Madhya Pradesh told the respondent (the person involved in the case) to leave the district of Chhindwara. This order was based on a law called the Central Provinces and Berar Goondas Act, which was made in 1946 and changed in 1950. The law said Chhindwara was a "proclaimed area." The District Magistrate (a local government official) also told the respondent about the order. The respondent argued that the orders were wrong under Article 226 of the Constitution. He said the law violated his basic rights to move freely and live anywhere in India, as stated in Article 19(1)(d) and (e) of the Constitution. Because of this violation, he claimed the law was invalid under Article 13 of the Constitution. The High Court (a state-level court) agreed that sections 4 and 4A of the law were not valid. They were the main parts of the law, so the court decided that the whole law was invalid. The court said that when a law allows the government to take action against people to prevent them from doing something, it must clearly say that the government officials have to be sure certain conditions are met before they take action. If the law doesn't say that officials have to check these conditions first, it violates Article 19(5) of the Constitution, which protects people's rights. Sections 4 and 4A of the law were supposed to apply to "goondas" (troublemakers). But the law didn't require the District Magistrate to first decide if the person was actually a goonda. The law also didn't give any instructions on how to decide if someone was a goonda, or give the person a chance to prove they weren't a goonda. The law's definition of a goonda was broad and didn't give clear rules for deciding who fit the definition. The court mentioned previous cases, including Gurbachan Singh vs The State of Bombay, Bhagubhai Dullabhabhai Bhandari vs The District ' Magistrate, Thana, and Hari Khenu Gawali vs The Deputy Commissioner of Police, Bombay. Even though the goal of the law was good and might have been allowed under Article 19(5) of the Constitution, the law didn't have enough safeguards to protect people's basic rights. Because the main parts of the law were invalid, the entire law had to be struck down.
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3003 of 1988. From the Judgment and Order dated 8/9th April, 1986 of the Central Administrative Tribunal, New Delhi in R.A. No. AND Civil Appeal No. 889 of 1988. From the Judgment and Order dated 29.10.86 and 5.11.1986 in the Central Administrative Tribunal, Ahmedabad in O.A. No. 103 of 1986. No. 3003 of 1988. No. 889 of 1988. The special leave petition and the appeal by two Central Government servants raise an interesting point of construction of a service Rule whether a Disciplinary Authority can, under Sub Rule (vi) of Rule 11 of the Central Civil Service (Classification, Control and Appeal) Rules, 1965, (Rules for short), impose the penalty of reduction on a Government Servant, recruited directly to a particular post, to a post lower than that to which he was so recruited; and if such a reduction is permissible, whether the reduction could only be to a post from which under the relevant Recruitment Rules promotion to the one to which the Government servant was directly recruited. PG NO 549 The petition and appeal are directed against the orders dated 8/9 4 1986 of the Central Administrative Tribunal, Delhi, and the order dated 29.10.1986 of the Central Administrative Tribunal, Gujarat, respectively, affirming the orders of the Disciplinary Authorities imposing on the petitioner and the appellant the penalty of reduction in rank to post lower than the one to which both of them were initially recruited. There is a divergence of judicial opinion amongst the High Courts on the point: The Division Benches of the Orissa and Karnataka High Courts have held that such a reduction in rank is not possible at all. [See: Babaji Charan Rout vs State of Orissa and Ors., [1982] 1 SLJ 496; Shivalingaswamy vs State of Karnataka, [1985] ILR Kar. However, the Madras, Andhra Pradesh and Allahabad High Courts have held that there is no limitation on the power to impose such a penalty. [See: Gopal Rao vs C.l.T., ; Mahendra Kumar vs Union of India, [1984] 1 All India Ser. Srinivasa Sastry vs Comptroller & Auditor General of India, and the one taken by the Central Administrative Tribunal in the case from which the Special Leave Petition arises, that such a reduction in rank is permissible provided that promotion from the post to which the Government servant is reduced to the post from which he was so reduced is permissible, or, as it has been put, the post to which the Government servant is reduced is "in the line of promotion" and is a "feeder service". Both the cases are taken up for final hearing, heard and disposed of by this common Judgment. SLP (C) 9506 of 1986 is by a certain Nyadar Singh, the unsuccessful petitioner before the Central Administrative Tribunal, New Delhi, and is directed against that the Tribunal 's order No. 1747/80) dated PG NO 550 28th February, 1986, rejecting his challenge to the order dated 4th Sept., 1976, of the disciplinary authority imposing a penalty of `reduction in rank ' reducing the petitioner from the post of Assistant Locust Warning Officer to which he was recruited directly on 31.10.1960 and confirmed on 27.12.1971 to that of Junior Technical Assistant pursuant to certain disciplinary proceedings held against him. The statutory appeal before the appellate authority was, dismissed on 24.4.1979. Thereafter he filed a writ petition before the Delhi High Court which, after the coming into force of the Central Administrative Tribunal Act, 1985, stood transferred to and was disposed of by the Central Administrative Tribunal, New Delhi, by its order dated 28.2.1986, now under appeal. Civil Appeal No. OA 103 of 1986 dated 29.10.1986 of the Central Administrative Tribunal, Ahmedabad, rejecting appellant 's challenge to the legality and correctness of the order dated 15.5.1988 of the Post Master General who in modification of the earlier orders imposing a penalty of compulsory retirement on him, substituted in its place the order imposing the penalty of `reduction in rank ' to the post of Lower Division Clerk pursuant to the findings recorded against the appellant on the charge of accepting illegal gratification. He was reduced to the lower post of Lower Division Clerk until he was found fit after a period of five years from 15.5.1986. However, the appellant 's seniority on re promotion was directed to be fixed at what it would have been, without the reduction. Bali, learned counse] for the appellant Nyadar Singh and Shri K.M.K. Nair, learned counsel for the appellant Ninama; and Shri Kuldip Singh, learned Additional Solicitor General for the respondents in both the appeals. Rule 11 of the `Rules ' enumerates the penalties which may for good and sufficient reasons be imposed on a PG NO 551 Government servant. (vi) reduction to a lower time scale of pay, grade, post or Service which shall ordinarily be a bar to the promotion of the Government servant to the time scale of pay, grade, post or Service from which he was reduced, with or without further directions regarding conditions of the restoration to that grade, or post or Service from which the Government servant was reduced and his seniority and pay on such restoration to that grade, post or Service;" According to the contention of the appellants ' learned counsel, the appellants were, as a result of the imposition of the penalty, reduced in rank to a post lower than the one to which they were initially recruited, which on a proper construction of the Rule, is not permissible. Learned counsel relied upon the decision of this Court in Hussain Sasan Sahed Kaldgi vs State of Maharashtra, Shri Kuldip Singh, Additional Solicitor General, however, contended that this limitation which may be appropriate in the case of a `reversion ' which, as the very concept implies, could not be to a post which the Government servant did not earlier hold, is inappropriate in a case of reduction in rank imposed as a penalty. Reduction in rank, according to learned Additional Solicitor General, has a wider import than `reversion ' and there is no reason why the power to impose this penalty which is permissible on the plain language of the Rule be whittled down by any other consideration. In Article 311(2) the penalty of "reduction in rank" is classed along with 'dismissal ' and 'removal ' for the reason that the penalty of reduction in rank has the effect of removing a Government servant from a class or grade or category of post to a lessor class or grade or category. Though the Government servant is retained in service, however, as a result of the penalty he is removed from the post held by him either temporarily or permanently and retained in service in a lesser post. Though reduction in rank, in one sense, might connote the idea of reversion from a higher post to a lower post, all reversions from a higher post are not necessarily reductions in rank. The submission of the learned Additional Solicitor General in substance, is that while 'reversion ' envisages that the lower post to which the Government servant is reverted should necessarily to amongst those earlier held by him and from which he had come on promotion, the idea of reversion being a mere antonym of promotion the importing of such a limitation into a case of "reduction in rank" imposed as a penalty would be doing, violence of the express statutory language and an unwarranted fettering of the power of the disciplinary authority. Such a construction would create more difficulties than It might appear to solve and become counter productive in the sense that even where the disciplinary authority, desires to retain a Government servant in service, though not in the same post but in a lower one, the Authority would be rendered helpless by such a construction being place of in the Rule. PG NO 553 The argument in favour of this construction of the Rule is stated by by a learned Single Judge in Gopal Rao 's case (supra) thus: ". ln effect, what the learned counsel says is that there is no difference between the order of reversion and an order of reduction in rank, that it is well established that reversion can be only to a post which a person held earlier and that reduction also can only be to a post or class of service which the person occupied at any time before. In my view, the expression "reduction in rank" covers a wider field than reversion to a lower post. But the word "reduction" has no such limitation and therefore, reduction in rank extends even to a rank which the officer concerned never held. Similar view has been taken by a learned Single Judge of the the Andhra Pradesh High Court in Mahendra Kumar vs Union of India and Anr., [1985] 1 SLR [8] : ". The Central Civil Service (Classification, Control and Appeal) Rules provide for several penalties which can be imposed for good and sufficient reasons. One of the major penalties contemplated by Rule II is "reduction to a lower . ", and I see m, reason why this penalty cannot be imposed upon a person who, on the date of imposition of penalty, is continuing in the same post to which he was appointed by direct recruitment. This is not a case of reversion of a Government servant to his substantive post for want of vacancy or otherwise, but this is a case of reduction by way of punishment. No decision has also been brought to my notice supporting this contention It must, however, be observed that in the above case the High Court upheld the challenge of the appellant that there was no misconduct at all. PG NO 554 7. The opposite view is taken by the Orissa High Court in Babaji Charan Rout vs State of Orissa and Ors., [1982] 1 All India SLJ 496 and by a Division Bench of the Karnataka High Court in Shivalingaswamy v: State ot Karnataka, [l985] ILR Kar. It will lead to most unreasonable results if a person directly recruited to a post is reduced to a post which he never came to hold in service. That is not the scheme of the CCA Rules and therefore we have no hesitation in holding that the Deputy Commissioner had no competence to impose the penalty of reducing the appellant to the post of Daftar band Attender when in fact he entered service only as Village Accountant. The third view of the matter which while holding such a reduction is permissible, but subject to the post to which the Government servant is reduced being one from which promotion to the post from which reduction is effected is permissible, is to be found in Srinivasa Sastry 's, case (supra) where Rama Jois, J. of the Karnataka High Court held: ". It is no doubt true that normally penalty of 'reduction in rank ' is imposed only so as to bring down a civil servant to a lower time scale, grade, service or post, held earlier by him before promotion and not below the post, grade, service, or time scale to which a civil servant was directly recruited, and it appears, that it is also PG NO 555 reasonable to do so. The learned counsel, however, could not substantiate the point with reference to the rule which empowered the disciplinary authority to impose the penalty of reduction in rank as it does not make any such differentiation . This is also the view taken by the Tribunal in the first of the appeals now before us. In the light of the aforesaid discussion we find that rule 11 (vi) of the Central Civil Services (Classification, Control and Appeal) Rules, 1965, on its true construction permits reduction in rank in the case of a direct recruit if the post to which he is reduced is in the line of promotion i.e. is a feeder service . But as against this judicial opinion in Srinivasa Sastry 's case, the learned Judge, as auther, [See 'Services under the State ': Indian Law Institute, page 220] expressed the view: "Therefore, it is reasonable to take the view that a civil servant earns promotion by exhibiting his merit and ability and suffers reduction in rank instead of removal or dismissal for misconduct or inefficiency during his service in the higher post unless he is unworthy of being retained in the service and that the word 'reduction in rank ' is used in Article 311 in this sense. It appears that the punishment by way of reduction in rank can be inflicted only against a civil servant who held a lower post and who has been promoted to the higher post; . The meaning to be given to a particular statutory language depends on the evaluation of a number of interpretative criteria. Even the statutory language apparently free from the sins of semantic ambiguity might not, in the context of the purpose, connote or convey its lexicographic thrust; but would acquire a different shade or colour imparted to it by the variations of the interpretation criteria. it is necessary for the interpreter to assess the respective weights of the relevant interpretative factors and determine which of the opposing constructions they favour on balance . "We may speak of the factors tending in a certain direction as a bundle of factors. "We find that one bundle of factors favours one of the opposing constructions of the enactment. PG NO 557 10. As to whether a person initially recruited to a higher time scale, grade or service or post can be reduced by way of punishment, to a post in a lower time scale, grade, service or post which he never held before, the statutory language authorises the imposition of penalty does not, it is true, by itself impose any limitations. The question is whether the interpretative factors, relevant to the provision, impart aNy such limitation. On a consideration of the relevant factors to which we will presently refer we must hold that they do. Though the idea of reduction may not be fully equivalent with 'reversion ', there are certain assumptions basic to service law which bring in the limitations of the latter on the former. The penalty of reduction in rank of a Government servant initially recruited to a higher time scale, grade, service or post to a lower time scale, grade, service or post virtually amounts to his removal from the higher post and the substitution of his recruitment to lower post, affecting the policy of recruitment itself. though in a different context, brought about by the order of the statutory authority, the Court of appeals understood the process as a dismissal from the higher post and reappointment to the Iower post. Rigby. If we could see any point in this action upon which there might be a possibility of his succeeding, we should be most anxious to give him the opportunity . There are, therefore, certain considerations of policy that might militate against such a wide meaning to be given to the power. The power should, of course, be available to reduce a civil servant to any lower time scale, grade, service or post from which he had subsequently earned his promotion. To illustrate, could a Doctor be reduced in rank to the post of a Compounder, or an Engineer to the post of a Fitter, or a Teacher in a High School to the post of a Peon, or a Scientific Officer to the post of a ministerial officer, in the absence of any provision in the rules for the consideration of the case of the civil servant concerned, for promotion from the latter category to the former category? It appears to me that on a fair and proper construction of rule II (vi) of the Rules, the condition precedent for the exercise of power under that rule by way of imposing penalty of reduction in rank to a lower post is, that the higher post from which the concerned civil servant is sought to be reduced must be a promotional post in relation to the lower post to which he is sought to be reduced . [See at 516]. " The argument that the rule enables a reduction in rank to a post lower than the one to which the civil servant was initially recruited for a specified period and also enables restoration of the Government servant to the original post, with the restoration of seniority as well, and that, therefore, there is nothing anomalous about the matter, does not, in our opinion, wholly answer the problem. It is at best one of the criteria supporting a plausible view of the matter. The other implications of the effect of the reduction as a fresh induction into a lower grade, service or post not at any time earlier held by the Government servant remain unanswered. Then again, there is an inherent anomaly of a person recruited to the higher grade or class of post being asked to work in a lower grade which in certain conceivable cases might require different qualifications. It might be contended that these anomalies PG NO 559 Could well be avoided by a judicious choice of the penalty in a given fact situation and that these considerations are more matters to be taken into account in tailoring out the penalty than those limiting the scope of the punitive power itself. His suit for the declaration that the purported reversion was illegal and void was decreed by the trial court, but was dismissed by the High Court in appeal. As rightly pointed out by the learned Additional Solicitor General, the case dealt with the scope and limitations of the process of 'reversion ' and is of no assistance in deciding the point under consideration. The point now is as to what orders are to be made in these appeals. As these penalties cannot be sustained in the view we take of the rule, in the normal course the penalties imposed would require to be set aside and the disciplinary authority directed to re consider which other penalty which it would now choose to impose. But, we are of the opinion that it would be somewhat unfair that at this distance of time the matters are re opened. We think, having regard to all the circumstances of the cases the orders that commend themselves appropriate in the two cases are in terms following: (i) In the first of the appeals, appellant Nyadar Singh, has, after the period of the reduction in rank has spent itself out, been restored to the original position. It would, therefore, be sufficient to set aside the penalty imposed on him and direct that the period of service in the PG NO 560 reduced post be treated as service in the post held by him prior to imposition of the penalty, subject to the condition, however, that the appellant shall not be entitled to any difference of salary for and during the period of reduction. In view of this, we think that the proceedings taken against him should come to an end and there is no need to remit the matter to the Disciplinary Authority for selection and imposition of a fresh penalty. (ii) In the case of M.J. Ninama the penalty of reduction in rank is set aside and he shall be restored to the post which he held before the imposition of the penalty. However, for the period, if any, served by him in the lower post pursuant to the penalty imposed on him, he shall not be entitled to the difference of salary. It will also not be necessary to remit his case for fresh consideration of the choice of the penalty having regard to the lapse of time. Appeals disposed of.
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Nyadar Singh and M.J. Ninama were punished in separate cases. They were "reduced in rank," meaning they were moved to a lower position than the one they were first hired for. The Central Administrative Tribunals (special courts for government worker issues) said no to the appeals from Singh and Ninama. They had challenged the orders that punished them. Singh and Ninama argued that their punishment lowered them to jobs below their initial hiring level. They said this went against Rule 11 of the Central Civil Services Rules from 1965. They believed this rule didn't allow such a severe demotion. The government's lawyer argued that the rule limiting demotions only applied to "reversions" (returning to a previous role). He said "reduction in rank" was a broader penalty. He said there was no reason to limit this penalty since the rule clearly allowed it. The court made the following decisions: (1) The meaning of legal language depends on many things. Words alone can be tricky to interpret. Generally, legal principles work together, not separately. We shouldn't consider whether a different law would be fairer. The result of a law doesn't change its words, but it can help us understand what the law means. (2) "Rank" in "reduction in rank" refers to the levels in the government job system. This is important for Article 311(2) (a section of law related to civil servants). It doesn't just mean how long someone has worked in the same job level. (3) Reducing a government worker from a higher-level job to a lower-level one is like firing them from the higher job and rehiring them for the lower one. This affects the hiring process itself. The worker might not even have the skills needed for the lower job, even if it's not necessarily a harder job. (4) Rule 11 should be understood with general legal principles. "Reduction" in the rule shouldn't be interpreted in the broadest way possible. Several previous court cases were mentioned. Some were agreed with (approved), and some were disagreed with (overruled). Other cases were simply brought up for reference (referred to).
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vil Appeal Nos. 54 to 56 of 1975. From the Judgment and Order dated 29.6.1973 of the Kerala High Court in A.S. Nos. 603,604 and 605 of 1969. N. Sudhakaran for the Appellants. K.V. Viswanathan, K.R. Nambiar and T.T. Kunhikannan for the Respondents. The Judgment of the Court was delivered by K. RAMASWAMY, J. These appeals by special leave are directed against the judgment and decrees of Kerala High Court in A.S. Nos. 603,604 and 605 of 1969 dated June 29, 1973 confirming the award and decrees of the Civil Court in L.A.O.P. No. 413 etc. of 1964 and 370 and 405 of 1966 dated January 16, 1969. The notification under section 4(1) of the Land Acquisition Act 1894 (for short 'the Act ') was pub lished in the gazette on October 25, 1960 acquiring an ancient Chalai Anicut together with embarkments sluices, culverts etc. by six notifications. This ancient Chalai Anicut originally belonged to Arumughom Pillai. On his demise it devolved on his four sons Venkatachalam Pillai, Vishwanathan Pillai, Pasupathy Pillai and Subhapathy Pillai by intestate succession as coparceners. By partition deed exhibit B 23 dated December 22, 1954, the four brothers parti tioned certain properties but kept in common acquired Chalai Anicut under the management of the eldest brother Venkata chalam Pillai. Pursuant to the notice issued under section 9(3) and 10 of the Act, Venkatacha 468 lam filed his objections making reference therein to the partition deed No. 2437 of 1954 in the Registrar 's office, Palghat and that each of the brothers had 1/4 share in the Anicut and irrigation system. After the award made by the Land Acquisition Officer compensation was made to all the brothers at 1/4th share each. Venkatachalam sought six references under section 18 as he was dissatisfied with the awards made by the Land Acquisition Officer. The Civil Court enhanced in all to a sum of Rs.52,009.40 p. The State filed no appeal against the enhancement of the compensation. The Civil Court granted an award of 1/4 share thereof to Venka tachalam Pillai with solatium at 15 per cent and interest thereon at 4 per cent and did not award the balance amount to the appellants in their respective shares on the ground that they did not jointly ask for reference but only one alone asked for. The two brothers asked for reference for two awards only and the last one did not ask for reference of any award. On appeals, the High Court confirmed the award and decrees of the Civil Court. Thus these three appeals at their behest. Common question of law arises in these appeals and hence they are disposed of by a common judgment. The sole question for decision is whether in a reference Sought for by one of the co owners whether the other co owners who did not expressly seek reference, are entitled to enhanced compensation pro rata as per their shares. It is not in dispute that under the partition deed, the four brothers as coparceners kept in common the acquired property and Venkatachalam was in management thereof and each are entitled to 1/4 share in the ancient Anicut and the irriga tion system. It is also undisputed that total enhanced compensation is Rs.52,009.40 p. Therein all the four broth ers including the appellant are entitled to 1/4 share each. In the reference application made by the Venkatachalam indisputably he mentioned that the acquired property be longed to him and his other brothers and the compensation awarded by the Land Acquisition Officer was inadequate and very low. It was also stated that they Should get an en hanced amount at the figure specified in the reference application. Undoubted he stated therein that he is entitled to 1/4 share. What he stated thereby was that of his enti tlement of 1/4 share of the total enhanced compensation and obviously, after the reference on par with his three broth ers, he is entitled to receive compensation at 1/4 share. The Courts below disallowed the payment to the appellants on the ground that there is no mention in the 469 claim petition of the partition deed; that they are the co owners and that there is no averment that the Venkatachalam was seeking reference under section 18 on his behalf and on behalf of his other three brothers. As regards the first two grounds are concerned they are palpably incorrect. It is seen that an express averment was made in the objections filed pursuant to notice under section 9(3) and 10 and also in his reference application under section 18 of the Act, that there was prior partition and each of the brothers are entitled to 1/4th share and that they are dissatisfied with the award of the Collector. Undoubtedly there is no express averment in the reference application under section 18 that he is seeking a reference on his behalf and on behalf of his three brothers. It is contended by the counsel for the State that the pleadings are to be strictly construed and that as the reference was sought for only by Venkatachalam of all the six awards the other three brothers are not entitled to any share in the enhanced compensation. In support thereof it is also further contended that Viswanathan and Pasupathy had only asked for reference in respect of two awards and Sabhapathy Pillai made no request for reference against any of the six awards made by the Collector. It is true that Viswanathan and Pasupathy made such request in respect of two awards and Sabhapathy did not make any request for reference against any of the awards. But what would be the consequence in law is the question. It is surprising that the State having acquired the property of a citizen would take technical objections regarding the entitlement of the claim. The State certainly is right and entitled to resist claim for enhancement and lead evidence in rebuttal to prove the prevailing price as on the date of notification and ask the court to determine the correct market value of the lands acquired compulsorily under the Act. But as regards the persons entitled to receive compensation are concerned it has no role to play. It is for the claimants inter se to lay the claim for compensation and the court would examine and award the compensation to the rightful person. As seen in the objections pursuant to the notice under section 9(3) and 10, Venkatchalam made necessary averments that himself and his brothers had 1/4 share in the Anicut and irrigation system pursuant to the partition deed referred to therein. In his reference application under section 18 also he 470 reiterated the same and stated that the amount awarded by the Collector was in adequate and that they were dissatis fied with it and that they are entitled to more. It is settled law that one of the co owners can file a suit and recover the property against strangers and the decree would enure to all the co owners. It is equally settled law that no co owner has a definite right, title and interest in any particular item or a portion thereof. On the other hand he has right, title and interest in every part and parcel of the joint property or coparcenery under Hindu Law by all the coparceners. In Kanta Goel vs B.P. Pathak & Ors,. 12, this Court upheld an application by one of the co owners for eviction of a tenant for personal occupation of the co owners as being maintainable The same view was reiterated in Sri Ram Pasricha vs Jagannath & Ors., [1977]1 S.C.R. 395 and Pal Singh vs Sunder Singh (dead) by Lrs. & Ors. , ; A co owner is as much an owner of the entire property as a sole owner of the property. It is not correct to say that a co owner 's property was not its own. He owns several parts of the composite property along with others and it cannot be said that he is only a part owner or a fractional owner in the property. That position will undergo a change only when partition takes place and division was effected by metes and bounds. Therefore, a co owner of the property is an owner of the property acquired but 'entitled to receive compensation pro rata. The State would plead no waiver nor omission by other co owners to seek reference nor disentitle them to an award to the extent of their legal entitlement when in law they are entitled to. Since the acquired property being the ancestral coparcenary and continued to be kept in common among the brothers and the income derived therein was being shared in proportion of their shares by all the brothers it remained as joint property. As co owners everyone is entitled to 1/4 share therein. It was also laid by this Court in a recent judgment in Ram Kumar & Ors. vs Union of India & Ors. , ; that it is the duty of the Collector to send full infor mation of the survey numbers under acquisition to the court and make reference under section 18 and failure thereof is illegal. The same ratio would apply to the facts in this case as well. When one of. the co owner or coparceners made a statement in his reference application that himself and his brothers 471 are dissatisfied with the award made by the Collector and that they are entitled to higher compensation, it would be clear that he was making a request, though not expressly stated so but by necessary implication that he was acting on his behalf and on behalf of his other co owners or coparcen ers and was seeking a reference on behalf of other co owners as well. What was acquired was their totality of right, title and interest in the acquired property and when the reference was made in respect thereof under section 18 they are equally entitled to receive compensation pro rata as per their shares. The courts below committed manifest error in refusing to pass an award and payment thereof to the appel lants merely on the ground that there was no mention in this regard in the reference application or two of them sought reference in respect of two awards and the last one made no attempt in their behalf. The claimants are entitled to payment of the enhanced award by the Civil Court pro rata of their 1/4 share each with 15 per cent solatium and 4 per cent interest as awarded by the Civil Court. The appeals are accordingly allowed with costs of this Court. R.P. Appeals allowed.
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Three brothers and their oldest brother made a deal in 1954 to divide their family's property. They agreed to keep some of the inherited land together, and the oldest brother would manage it. The government wanted to buy this land. They announced this plan on January 15, 1967, following the rules of the Land Acquisition Act of 1894. The oldest brother objected to the government's offer. He used the 1954 agreement to show that each of the four brothers owned 1/4 of the land. Eventually, the government paid all four brothers, giving each 1/4 of the total payment. The oldest brother was not happy with the amount, so he asked the court to review six different parts of the payment. He did this under section 18 of the Land Acquisition Act. The court decided the brothers should get more money. They gave the oldest brother 1/4 of the extra money, plus extra payments called "solatium" and interest. However, the court didn't give the other three brothers their share of the extra money. They said the brothers didn't ask for the review together. Two of the other brothers asked for a review of two of the payments. The last brother didn't ask for any review at all. The High Court agreed with the lower court's decision. The three brothers who didn't get the extra money appealed to the Supreme Court. The question was: If one brother asks for a review under section 18 of the Land Acquisition Act, are the other brothers also entitled to more money, even if they didn't ask for the review themselves? The Supreme Court said yes. 1.1 The Supreme Court said the lower courts were wrong to not give the three brothers their share of the extra money. The brothers should each get 1/4 of the extra money, plus the "solatium" (15%) and interest (4%) that the lower court awarded. 1.2 The Court agreed that the 1954 agreement showed the four brothers kept the land together, and the oldest brother managed it. They shared the income from the land. So, it was still joint property, and each brother owned 1/4. 1.3 When the oldest brother asked for the review, he said the land belonged to him and his brothers. He said they were all unhappy with the government's offer and deserved more money. The Court said this meant he was asking for the review on behalf of all his brothers, even if he didn't say it directly. The government was buying everyone's rights to the land. So, when the review happened, everyone was entitled to their fair share of the money. 2.1 One brother can sue someone to get the property back, and the result helps all the brothers. A brother who owns part of the land is entitled to their share of the payment. 2.2 Each brother owns the whole property as much as if they were the only owner. It's not right to say a brother's property isn't really his. He owns parts of the whole property along with his brothers, and he's not just a partial owner. 2.3 No brother has a specific claim to one part of the property. Instead, each brother has a right to every part of the joint property, according to Hindu Law. The Court mentioned other cases, like Kanta Goel vs B.P. Pathak & Ors., Sri Ram Pasricha vs Jagannath & Ors., and Pal Singh vs Sunder Singh. The Court was surprised that the government, after taking someone's property, would make legal arguments to avoid paying them fairly. The government can argue about how much the land is worth. But it shouldn't interfere with who gets the payment. It's up to the brothers to claim their share, and the Court will decide who gets what.
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l Leave Petition (Civil) No. 890 of 1964. Petition for special leave to appeal to the Supreme Court from the judgment and decree dated December 16, 1963 of the Rajasthan High Court in Civil First Appeal No., 54 of 1956. Mukat Behari Lal Bhargava, Zalim Singh, Meeratwal and Naunit Lal, for the petitioner M. C. Setalvad, and I. N. Shroff, for the respondent. The Judgment of the Court was delivered by Shah, J. The petitioner applies for special leave to appeal under article 136 of the Constitution, against the judgment of the High Court of Rajasthan dated December 16, 1963 in Civil First Appeal No. 54 of 1956 on two grounds (1) that the judgment of the High Court involves a claim or question respecting property of not less than Rs. 20,000 in value, and the High Court erred in refusing a certificate under article 133(1) (b) of the Constitution; and (2) that the case is otherwise fit for appeal to the Supreme Court. The material facts bearing on the plea raised are these. The petitioner commenced on July 2, 1951 in the Court of the Subordinate Judge, First Class, Ajmer an action against the respondents claiming a decree for Rs. 10,665 and for rendition of accounts in respect of the balance of sale proceeds of 104 bales of cotton purchased by him through the agency of the respondents. The petitioner claimed that 104 bales of cotton purchased by him were sold by the respondents as his agents on May 14, 1948 for Rs. 27,267/13/6 and without settling the account the respondents delivered towards that amount a demand draft for Rs. 11,000 which was encashed and four cheques of the aggregate value of Rs. 13,000 which because of lack of arrangement with the respondents ' bankers were not encashed, and the petitioner on that account was entitled to receive from the respondents Rs. 10,665 being the amount due on the foot of dishonoured cheques and interest thereon at the rate of 6% per annum between July 2, 1947 to July 1, 1951, less Rs. 4,000 subsequently received by him. The petitioner also claimed a decree for the balance of the price. 753 after giving credit for commission, dalali and godown charges incurred by the respondents as his agents and as he was not in a "position to know" the amounts due to or disbursed by the respondents, he claimed a decree for rendition of account. The subject matter of the suit was, therefore, a claim for Rs. 10,665 due to the petitioner on a cause of action arising on cheques dishonoured and a claim for the balance of the price due as may be ascertained on taking accounts. The trial Court passed a decree directing that account be taken for ascertaining the amount due in respect of the entire transaction of 104 bales and for taking accounts appointed a Commissioner. The High Court of Rajasthan reversed the decree passed by the Trial Court and dismissed the suit, holding that the transactions in respect of which the claim was made by the petitioner were those of an unregistered firm constituted by the petitioner and another person named Duli Chand and the suit was barred because the firm was not registered. An application filed by the petitioner for certificate under article 133 of the Constitution was rejected by the High Court. The judgment of the High Court proceeds entirely upon appre ciation of evidence and on the findings recorded the petitioner 's suit must stand dismissed. But counsel for the petitioner urged that the judgment of the High Court directly involves a claim or question respecting property of value not less than Rs. 20,000 and he was entitled as a matter of right to a certificate from the High Court under article 133(1) (b) of the Constitution. This argument is sought to be presented in two ways. It is urged in the first instance that the judgment of the High Court involves a question relating to the right of the petitioner respecting 104 bales of cotton belonging to him and sold by the respondents for an amount exceeding Rs. 27,000. Secondly, it is urged that pursuant to the order of the Trial Court a Commissioner was appointed and the Commissioner reported that Rs. 12,089/14/6 with interest at the rate of 6% per annum from May 14, 1948 were due to the petitioner and as the amount due to the petitioner on that footing was not less than Rs. 20,000 at the date of the decree of the High Court, the judgment of the High Court involved a claim respecting property of that amount or value. In our view the contention raised by the petitioner under either head has no substance. It is conceded, and in our judgment counsel is right in so conceding, that the petitioner could not seek a certificate under cl. (a) 754 of article 133(1). The claim in the court of first instance did not Teach Rs. 20,000 and one of the conditions for a certificate under that clause being absent, the claim could not be maintained. To attract the application of article 133(1) (b) it is essential that there must be omitting from consideration other conditions not material a judgment involving directly or indirectly some claim or question respecting property of an amount or value not less that Rs.20,000. The variation in the language used in cls. (a) and (b) of article 133 pointedly highlights the conditions which attract the application of the two clauses. Under cl. (a) what is decisive is the amount or value of the subject matter in the court of first instance and "still in dispute" in appeal to the Supreme Court: under cl. (b) it is the amount or value of the property respecting which a claim or question is involved in the judgment sought to be appealed from. The expression "property" is not defined in the Code, but having regard to the use of the expression "amount" it would apparently include money. But the property respecting which the claim or question arises must be property in addition to or other than the subject matter of the dispute. If in a proposed appeal there is no claim or question raised respecting property other than the subject matter, cl. (a) will apply : if there is involved in the appeal a claim or question respecting property of an amount or value not less than Rs. 20,000 in addition to or other than the subject matter of the dispute cl. (b) will apply. In the present case the subject matter in dispute was a claim for money. A part of that claim was definite and the rest was to be ascertained on taking accounts. The judgment did not involve any claim or question relating to property in addition to or other than the subject matter in dispute of the value of Rs. 20,000. It was admitted by the petitioner in his plaint that the bales of cotton were sold by the respondents as his agents. The right of the respondents to sell the bales was not in dispute. what was challenged was the right of the respondents to retain the price received by them. It cannot be said that a judgment dealing with a claim to money alleged to be due from an agent for price of property belonging to the principal sold by the agent either directly or indirectly involves a claim or question respecting property which is sold. Nor does the alternative ground assist the petitioner. It is true that by his petition the petitioner claims restoration of the decree of the Trial Court, and by adding interest at the rate of 6% per annum to the petitioner 's claim as awarded under the report 755 of the Commissioner, the claim of the petitioner on appeal exceeds Rs. 20,000. But this is still the subject matter in dispute : the Judgment does not involve any claim or question respecting property in addition to or other than the subject matter of the suit. The petition therefore fails and is dismissed with costs. Petition dismissed.
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The person making the request (the petitioner) started a case in the lower court. They wanted the court to order the other side to pay them about 10,665 rupees. They also wanted the court to figure out exactly how much money they were owed from sales the other side made as their agents. The first court agreed and said someone should figure out how much money was owed. They appointed a person (a Commissioner) to do this. But when the case went to a higher court (the High Court), that court disagreed. They overturned the first court's decision and ended the case. The person who started the case asked the High Court for permission to appeal to a higher court under a specific rule (article 133). The High Court said no. Then, this person asked for special permission to appeal under another rule (article 136). They argued that the High Court's decision involved a claim about property worth more than 20,000 rupees. Because of this, they said they should automatically get permission to appeal under the first rule (article 133(1)(b)). The court DECIDED: Under rule (a), the important thing is how much the case was worth in the first court and how much is "still in dispute" when appealing to the highest court (the Supreme Court). Under rule (b), it's about the amount or value of the property that the claim or question in the court's decision is about. The word "property" isn't clearly defined, but it probably includes money because the rule also uses the word "amount." The property the claim is about must be something extra, besides just what the case is mainly about. If the appeal doesn't raise any questions about property other than the main issue, then rule (a) applies. But if the appeal involves a claim about property worth at least 20,000 rupees, in addition to the main issue, then rule (b) applies. In this case, the original claim in the first court was less than 20,000 rupees. So, permission to appeal couldn't be granted under rule 133(1)(a). The court also said that a decision about money allegedly owed by an agent for selling their boss's goods doesn't automatically involve a claim about the goods that were sold. Also, even though the person's claim on appeal, including interest, was over 20,000 rupees, that was still the main issue in the case. The court's decision didn't involve any claim about property besides the main issue. So, rule 133(1)(b) also didn't apply.
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No. Goswami, S.K. Bhattacharya, C.V.S. Rao Ms. K.K. Manglam, L. R. Singh, Vikas Singh, Yunus Malik, B.B. Singh Ms. Vimal Sinha and Ms Kumud L. Das for the Respondents. Leave granted. He had field a petition in the nature of a public interest litigation under Article 226 of the Constitution of India before the High Court of Patna praying for a writ of quo warranto challenging the appointment of respondent No. The High Court dismissed the writ petition. The total strength of the Public Service Commission being eleven [uncluding the Chairman] the appointment of the seventh member from the ' non service category, was violative of the proviso to article 316[1] of the Constitution which requires that as nearly as may be one half of the members shall be persons who have held office for at least ten years either under the Government of India or under a Government of the State. 6 from being appointed as a member of the, commission. In his counter affidavit, respondent No. 6 has stated among other or things, that he happens to be the son of a peon retired form the Railway We are informed by Shri Mukhoty, the learned counsel appearing for him 524 that he belongs to the backward community of barbers. He has been blind since the age of eight years. While he was appointed on 4th March, 1991, the writ petition was filed in the High Court on 14th January, 1992. The present writ petition was filed in the High Court 18 days after a copy of the representation was received by the Chairman, among others. It is his dispute with the Chairman who according to him is backed by the Chief Minister of the State which has led to the present writ petition. He has also stated that the Chief Minister in his press interview given to the local Urdu daily, viz., Qaumi Tanzeem and published on 27th March, 1992, had made his intentions public to move this Court against his ap pointment. According to him further, it was on account of his academic distinctions, and with the full knowledge that he was totally blind from childhood, that he was appointed as a Member of the Public Service Commission. He has also stated that his blindness never came in his way either in the pursuit of his studies or in his service as a teacher. In this connection, he points out that the only thing he cannot do is to assess the individual 's external personality on the basis of the candidates external appearance which is not a material requirement for the candidates for many posts. When the members of the interview board with non technical and non professional qualifications interview candidates for technical and professional posts, they do so with the aid and advice of the experts from the concerned departments. Hence, if he is required to depend upon the opinion of the other members of the interview board for the external appearance of the candidates, that is not a dependence of a kind which vitiates the assessment of the interview board as a whole. In any case, the dependence is not worse than the dependence of the members of the board on the opinion of the experts when they are not qualified to adjudge the candidates for posts requiring the relevant expertise. He has also stated that he has been authorised by the Secretary of the concerned department to swear the affidavit. The relevant portion of the affidavit reads as follows: "That the respondent State upon reconsideration of the entire matter under controversy feels that the words of the Constitution have to be interpreted in letter and spirit and any departure from the express words of the Constitution wherever such departure seems to be permissible under the Constitution should be done only for sound and good reasons. In the instant case, the departure with regard to appointment of members of the Bihar Public 526 Service Commission was made only because the proviso to Article 316 (1) of the Constitution is not mandatory. Accordingly, while appointment the respondent No. it is felt that the fact that proviso to Article 316(1) not being mandatory is by itself not a good ground for departing from the suggestion of the Constitution and accordingly, the appointment of respondent No. 6 as member of the State Public Service Commission cannot be justified. , At the time of appointment of respondent No. 6 as 'a member of the Bihar Public Service Commission he was the seventh nongovernment member when ' at that time there were only four government members in a 'total strength of eleven members in the B.P.S.C. 6, it is submitted that at the time of appointment of respondent No. 6,the aspect about his blindness was not specifically considered the same was stated in the Bio data of the respondent No. In this regard, it is submitted that the respondent No. 6 in his Bio data while praising his achievements had only stated that he is the first blind person to have been awarded Ph.D. ' There was no mention whether such blindness was subsequent to birth or whether such blindness was congenial There was also no details in the Bio data stating whether such blindness was complete or the some was partial, temporary, curable or not curable. the respondent No. 6 was not specifically considered by any of the Constitutional Authorities who are involved in the appointment of a member to the State Public Service Commission. After the appointment of the respondent of the respondent No. 6, it has come to the respondent No. [1] The Chairman 'and other members. of a Public Service Commission shall be appointed in the case of the Union Commission or a Joint Commission, by the President and in the case of a State Commission by the Government of the State: Provided that as nearly as may be one half of the members of every Public Service Commission shall be persons who at the dates, of their respective appointments have held, office for at least ten years, either under the igovernnient of India or under the Government of a State, and in, computing the said period of ten years any period before the commencement of this Constitution during which a person has held office under the Crown in India or under the Government of an Indian State shall be included. [1 A] x x x x x [2] A member of a Public Service Commission shall hold 528 office for a term of six years from the date on which he enters upon his office or until he attains, in the case of the Union Commission, the age of sixty five years, and in the case of State Commission or a Joint Commission, the age of sixty two years, whichever is earlier: Provided that [a] a member of a Public Service Commission may, by writing under his hand addressed, in 'he case of the Union Commission or a Joint Commission, to the President, and in the case of a State Commission, to the Governor of the State, resign his office; [b] a member of a Public Service Commission may, be removed from his office in the manner provided in clause (1) or clause (3) of Article 317. The proviso to Clause 11 of the Article requires that "as nearly as may be", one half of the members of the Commission shall be persons who on the dates of their respective appointments have held office for at least ten years either under the Government of India or under the Government of a State. The expression "as nearly as may be" itself suggest that the proportion of 50% of the service members is not exact but approximate and is meant not to be mandatory but directory. When the members are appointed, they are bound to differ in age, whether they belong to the service category 529 or the non service category. If it is insisted, as is done on behalf of the appellant, that the said requirement must be followed strictly at all times, it would be well nigh impossible to do so. Every time a member, whether belonging to the service or the non service category, retires, there should be available a suitable person from the same category to be appointed in his place. It is not always possible to make an advance list of persons of either category who are suitable for such appointments. The learned counsel appearing for the appellant, however, submitted that the expression "as nearly as may be one half ' has been used to convey that a fraction may be ignored if the total number of members cannot be exactly halved between service and non service categories. It can further hardly be suggested that the need to have 50% from the service category is of such paramount importance to the composition of the Commission that the breach of it at any particular point of time would defeat the very object of constituting the Commission. However the very fact that the Service Commission was not proposed to be constituted of the members from the service category exclusively also shows that the framers of the Constitution did not desire that the outlook of the service members alone should prevail while recruiting the personnel. It would, however, be naive to suggest on that account that the framers of the Constitution presumed to ensure that on all occasions there shall be an exact balance of views. It is certainly not expected of the members of such high ranking Constitutional body as the Public Service Commission. Hence, we are unable to subscribe to the view that the proviso to Article 316 [1] requiring that as nearly as may be one half of the members of the Public Service Commission shall be from service category leaves no option to the Appointing Authority under any circumstance whatever, to allow reduction of representation from that category and a breach of the said requirement by reason of appointment of a member from non service category vitiates such appointment or the duties performed by such appointee as a member of the Public Service Commission. According to him depending 531 upon the shortfall in the representation of the respective category the member to be appointed has to be either form the service or non service category as the case may be and that is an essential qualification for his appointment. The argument was that is an essential as in the present case, the representation of the service members of the Commission fell short of 50% then all persons to the appointed on the Commission till the said proposition was made up had to be from the service ctegory that being their necessary qualification. It is not possible to accept this contention for the simple reason that as pointed out earlier, it may be possible to get a suitable person either from service or non service category over a period of time and for want of suitable candidates from the concerned category, the vacancies on the Commission may remain unfilled during that period. The reasonable interpretation of the said proviso therefore is to treat it not as a strict rule to be enforced but as a binding gudeline to be followed in practice in spirit as far as possible and without deliberately flouting it, Hence it is not possible to hold that merely because at the time of appointment of respondent No. 6 there were four service members and six non service members he was disqualified for being appointed as the 7th member from the non service category. As has been pointed out earlier respondent no.6 been blind from his childhood. In spite of his blindness he acquired high educational qualifications and in fact at the time of his appointment he was an Associate Professor in the Patna University. He is an acknowledged scholar of English Although the Government has now come forward to disown any knowledge about his complete blindness from the childhood, with which we will deal instantly they must be presumed to have known the said infirmity and should be deemed to have formed the opinion that in spite of his blindness, he was fit to be a member of thel Commission. 6 in his affidavit to which we have already referred. Nothing concrete has also been brought on record to show that he has failed ot perform his duties as a member of the Commission efficiently because of his blindness. On the other hand as has been pointed out earlier the State Government itself had recommended him for 'Padmashree ' for his efficient discharge of the work as a member of the Commission and that too over a short span of few months. We are also in agreement with the contentin advanced on his behalf that 532 except the external appearance of the candidates appearing before him, he is able to ascertain the required merits or demerits of the Candidates, as do the other members of the Commission. What is futher necessary to note is that for selecting the candidates for almost all disciplines and departments, the experts from the concerned departments do sit in the Committees and the opinion of the experts ordinarily prevails in such appointments since the members of the Committees, who are the members of the Commission, do not have the expertise. This shows that all members of the Commission sitting on the interview Committees have also to be guided in their opinion by the experts. If respondent No. 6 has to take guidance only in the matter of external appearance of the candidates, all members of the Commission have to be guided by the experts with regard to the most vital equipment of the candidates, viz., the intellectual calibre and the proficiency of the candidates in the relevant subjects. 6 has to depend on the advice, opinion or guidance of the other members of the Committees and the Commission. 6 is unfit to carry on his duties as a member of the Commission because of his blindness. The attack, however, was sought to be strengthened by relying on the provisions of sub clause [c] of Clause [3] of Article 317 of the Constitution which provides for removal of a member of the Public Service Commission on the ground that he is, in the opinion of the President, unfit to continue in office by reason of infirmity of mind or body. The argument was that the blindness was infirmity of body and if it is a ground for removal from office, it is much more a disqualification for appointment and hence respondent No. 6 does not prevent him from discharging his duties expected of him, but in fact the services rendered by him as such member have been eulogised and commended for a National Award by no other than the State Government itself and the Chairman of the Commission who had the first hand knowledge of his functioning. This is apart from the fact that the Governor who appointed him on the advice of the Council of Ministers is presumed to have done so after satisfying himself that the loss of eye sight was not an infirmity which would impede him in the discharge of his duties. The infirmity of body or mind which is referred to in the sub clause, further must necessarily be such as has arisen after the appointment and not the one which existed at the time of the appointment unless of course, the Government was unaware of the same at the time of the appointment. A reading of the said affidavit leaves no doubt in our mind that it has been filed only to prejudice the case of respondent No. As is evident from the portions of the affidavit reproduced above, firstly, a case is sought to be made out there that respondent No.6 was appointed as the 'non Government member ' of the Commission only because the proviso of Article 316 11 is not mandatory. That may be so. But the affidavit then proceeds to state almost in relenting terms that although the said proviso is not mandatory, that by itself is not a good ground for departing from the "suggestion of the Constitution" and hence the appointment of respondent No. The record further does not show as to who had suggested his name to the Governor and whether the decision was taken by the Council of Ministers as a whole or by the Chief Minister or any of his colleagues alone and what advice was received or obtained by them, if at all, while making the appointment. But more breast beating of the Government is on the second issue viz, the blindness of respondent no.6 The affidavit states that at the time of the appointment "the aspect about his blindness was not specifically considered as the same was stated in the Bio data of the respondent No. It is then the case of the State Government that in the view of these facts the aspect above the blindness of the respondent No. 6 was not specifically considered by any of the Constituitonal authorities who are involved in the appointment of a member to state Public Service Commission". Since the affiant himself has brought into picture the "Constitutional Authorities who are involved in the appointment the aspect of the blindness of respondent no.6 was not specifically of a member to the State Public Service Commission and has Stated that considered by them, we cannot help observing that the affiant by making such statement as made the Constitution authorities look ridiculous and their functioning a mockery in the eyes of the public. No responsible public authority could have aware the that respondent No.6 was totally blindly from his childhood, when that made the client that none of the constitutional functionaries concerned was fact must have been widely known in the State and in all probability the extra ordinary abilities exhibited by him despite his blindness must have 535 been the main reason for his appointment as a member of the Public Service Commission. The affidavit further states that while conducting the interviews, members of the Commission have to visually interview each of the candidates to determine his suitability and after the appointment of respondent No. 6 "it has come to the notice of the respondent State that the blindness of the respondent No. It is necessary to remember in this ' connection that this affidavit has been filled on 23rd January 1993. Respondent No.6 had filed his affidavit on 7th October, 1992.In that affidavit, respondent No. He has also referred in his affidavit to the letter of 22nd October, 1991 of the State Government to the Union Home Ministry recommending him for,the award of "Padmashree" for his services as a Member of the Public Service Commission. In the face of the certificate and the Said recommendatory letter, it is difficult to understand the basis on which it is now stated in the affidavit that the blindness of respondent No.6 is hampering his work. 6 in his affidavit has alleged that he has since fallen 'but the respondent No. These events have not been in controverted. The High Court has referred to some of these events in paragraph 6 of its judgment. His P.A. has been replaced; 2. The service of the reader, who is to read to him documents and journals and other papers is not being provided to him and his services have been terminated; 4. 18,154 on account of telephone bill of the Chairman 's residence has been paid. 20th December and 31st December, 1991 and he is not aware when any other meeting has been held thereafter or not in as much as he has not been provided with any notice in respect of the same; 10. In the list of events accompanying his counter affidavit he has also referred to other incidents such as the attempted physical assault on him by the Chairman during a meeting of the Commission, the threats of physical liquidation administered from the telephonic line of the Chairman, the complaints made by him to the police, to the Chief Minister and to the 537 Governor etc. They only reinforce the conclusion that the belated claim of the State Government that the appointment of respondent No.6 is invalid and that his blindness hampers the discharge of his duties has its obvious roots in the strained relations between him on the one hand and the Chairman and the State Government on the other. 5,000 and Rs., 10,000 respectively.
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Article 316 of the Constitution says that about half of the members of the Public Service Commission should have worked in government jobs. 6, who is blind and a well-known English professor at Patna University, was chosen as the seventh member of the Bihar State Public Service Commission on March 4, 1991. 5, who was the head of the Commission, said that respondent No. 6 for the "Padamshree" award for his work as a member of the Public Service Commission. In the appeal, it was argued that choosing the seventh member from someone who had not worked for the government went against Article 316(1) of the Constitution. It was argued that "as nearly as may be one half" means that if the total number of members can't be divided exactly in half, then a small difference can be ignored. It was also argued that respondent No. 6 was blind before he was appointed and was not fit to be appointed because of his physical problem. The argument was that blindness is a physical problem, and if it could be used to remove someone from office under Article 317(3)(c), then it should also disqualify someone from being appointed. In a sworn statement from the state government on January 23, 1993, it was said that even though Article 316(1) was not a strict rule, that wasn't a good reason to ignore what the Constitution suggested. It was also said that when he was appointed, his blindness was not really considered because it was mentioned in his resume in a way that the people in charge didn't notice it when they recommended him for the job. The statement also said that when they interviewed candidates, the members of the Commission had to see each candidate to decide if they were suitable. After respondent No. 6 was appointed, the state government noticed that his blindness was making it hard for him to do his job effectively. 6 argued that he was chosen as a member of the Public Service Commission because of his academic achievements, and everyone knew he had been blind since childhood. He said that relying on the opinions of other members for this was not a problem for the interview board as a whole. He also said that he had complained to the President of India, the Governor of Bihar, and others about the misconduct of the Chairman of the Commission, and that was why this case was brought against him. Just because there were four members who had worked for the government and six who had not when respondent No. 6 was appointed, it doesn't mean he was not qualified to be the 7th member who had not worked for the government. The correct way to understand Article 316(1) of the Constitution, which says that about half of the members of the Public Service Commission should have worked for the government, is to see it as a guideline to be followed as much as possible, not as a strict rule. The phrase "as nearly as may be" means that the 50% proportion of members who have worked for the government is not exact, but approximate. Having 50% of members who have worked for the government is not so important that breaking the rule at any time would make the Commission fail. Also, when members are appointed, they will be different ages, whether they have worked for the government or not. It is not always possible to have a list of people who are suitable for the job from either group. Choosing a member who has not worked for the government, which breaks Article 316(1), does not mean that the appointment is invalid or that the appointee cannot do their job as a member of the Public Service Commission. 6 is not unfit to do his job as a member of the Commission because of his blindness. This means that all members of the Commission on the interview committees have to listen to the experts about the candidates' knowledge and skills. So, it is not a problem if respondent No. In this case, respondent No. In fact, the state government and the Chairman of the Commission, who knew his work firsthand, praised his work and recommended him for a national award. Also, the Governor, who appointed him on the advice of the Council of Ministers, must have been sure that his blindness would not stop him from doing his job. This fact must have been widely known in the State, and his achievements despite his blindness must have been the main reason why he was appointed to the Public Service Commission. 5, the Chairman of the Public Service Commission, on September 11, 1991, and the letter from the state government to the Union Home Ministry on October 22, 1991, have not been disputed by the Chairman and the state government. The appellant and the state government must pay the costs of the appeal to respondent No.
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vil Appeal No. 2080 (L) of 1977. Appeal by Certificate from the Judgment and Order dated 20.12.74 of the Calcutta High Court in Appeal No. Khera, M. Quamaruddin and Mrs. M. Quamaruddin for the Respondents. This appeal, by certificate granted under Article 133(1)(a) of the Constitution, is directed against judgment and order of the High Court of Judicature at Calcutta dated December 20, 1974, in Appeal No. There are about 300 flats in these mansions which have been let out to tenants. The appellant provides various facilities to its tenants in these flats, e.g. free supply of electricity, washing and cleaning of floors and lavato ries, lift service, electric repairs and replacing, sanitary repairs and replacing, etc., and for that purpose the appel lant employ over 50 persons, namely sweepers, plumbers, malis, lift man, durwans, pumpmen, electric and other mis tries, bill collectors and bearers, etc., in connection with these properties. 937 The appellant raised preliminary objections with regard to the validity of the reference before the Industrial Tribunal on the ground that the alleged dispute is not an industrial dispute and that the reference is barred by Section 19 of the (hereinafter referred to as 'the Act ') for the reason that in 1960 there was an Award on the basis of settlement made with the union, and the said Award has not been terminated by either of the parties and is still binding on the parties. The Industrial Tribunal, by its order dated August 24, 1968, overruled the said preliminary objections raised by the appellant and thereafter the Tribunal gave the Award dated March 3, 1969. The Industrial Tribunal awarded enhanced DA at the rate of Rs.60 per month (Rs.20 per 100 points) to the sweeper, bearer, helper, mali, mazdoor, lift man, head sweeper, durwan, pumpman, and as sistant electric mistry. DA at the , 'ate of Rs.54 per month (Rs. 18 per 100 points) was awarded to the plumber, raj mistry, head durwan, electric mistry and driver and bill collector. It was also directed that the said rates of DA would remain in force as long as the price index will remain between 600 to 800 points and if the price index goes up beyond 800 points the rate of DA will be revised according to the rates mentioned and if it goes below 600 points it also may be revised accordingly. With regard to gratuity the Industrial Tribunal pointed out that under the existing scheme gratuity is payable to every workmen after completion of three years continued, faithful and satisfactory service at the rate of 10 days consolidated salary for every com pleted year of service since the date of appointment. The Industrial Tribunal held that three years ' period was too short to make a workman entitled to gratuity and that "satisfactory" and "faithful" are vague terms. The Industri al Tribunal framed a scheme of gratuity whereunder after completion of six years of continuous service with the appellant every workmen on retirement or on death will get an amount of gratuity at the rate of 10 days ' consolidated salary for every completed year of service since the date of appointment and a workman who resigns voluntarily would also be entitled to get the gratuity at the same rate provided he completed 10 years of continuous service. The Industrial Tribunal also directed that if the termination of service is the result of misconduct which caused financial loss to the employer 938 that loss would first be compensated from the gratuity payable to employee and the balance, if any, should be paid to him. It was also directed that the services of the work men prior to 1950 would not be taken into consideration for the purpose of payment of gratuity. order dated August 24, 1968 and the Award dated March 7, 1969 given by the Industrial Tribunal were challenged. The said writ petition was heard by a learned single Judge, who by his judgment dated March 17 & 20, 1972, dismissed the said writ petition. Before the learned single Judge it was urged that the Award made by the Industrial Tribunal was without jurisdiction for the reason that the appellant does not carry on an "industry" as defined in the Act and that the dispute between the appellant and the workmen cannot come within the ambit of industrial dispute, and also. for the reason that there was a previous Award dated March 3, 1960 which has not been terminated and was still subsisting and in view of the said Award the present reference was invalid and further that no dispute was raised between the workmen and the appellant prior to the reference before the Indus trial Tribunal and as such the Tribunal has no jurisdiction to deal with the matter. He held that in view of the nature of the activity carried on the appellant does carry on an industry within the meaning of the Act and the dispute between the appellant and its workmen come within the ambit of the Act. As regards the Award dated March 3, 1960 the learned single Judge found that the workmen concerned had given notice to terminate the previous Award and as such the existence of previous Award and as such the existence of previous Award would not preclude a fresh reference. The learned single Judge observed that no specific plea was raised by the appellant before the Industrial Tribunal challenging the order and the reference on the ground that there was no such dispute prior to the reference between the workmen and the appellant about the questions referred to in the order of reference and that whether there was any demand or not is a question of fact. the learned single Judge, however, held that from the evidence it is clear that the workmen concerned had demanded before the order of reference in their charter of demands dearness allowance and provident fund and gratuity and as such there was a dispute between the workmen concerned and the employers before the order of reference was made. The Award was challenged on merits before the learned single Judge on the ground that the Industrial Tribunal did not consider the appellant 's capaci ty to pay in granting dearness allowance to the workmen concerned. The learned single Judge 939 rejected the said contention on the view that reading the Award as a whole it could not be contended that the Tribunal did not take into consideration either the capacity to pay or the leval of the cost of living. The appellant filed an appeal against the judgment of the learned single Judge which was dismissed by a Division Bench of the High Court by its judgment and order dated December 20, 1974. The learned Judges agreed with the deci sion of the learned single Judge that the appellant is carrying on an industry under Section 2(j) of the Act. Before the Division Bench it was contended on behalf of the appellant that the earlier Award was made on the basis of a settlement between the two parties and that since the said Award was in a nature of settlement it could only be termi nated in accordance with the provisions of Section 19(2) of the Act relating to termination of a settlement. The learned Judges of the Division Bench held that the said contention was not raised by the appellant before the Tribunal and also before the learned single Judge and it could not be raised for the first time at the stage of the appeal and that it cannot be considered to be a pure question of law because for a settlement under Section 2(p) of the Act the necessary requirements of settlement as laid down in the statute and the rules have to be satisfied and whether the necessary recruitments have been satisfied or not will involve inves tigation into facts. The learned Judges were, however, of the view that even if the said plea was allowed to be raised it could not be accepted inasmuch as the materials on record do not establish that the requirement of "settlement" as defined in Section 2(p) of the Act are satisfied in respect of the earlier Award. It was held that an Award does not necessarily cease to be an Award merely because the same was made on the basis of a settlement arrived at between the parties and that the earlier Award was an "Award" within the meaning of Section 2(b) of the Act and was not a settlement as contemplated by Section 2(p) of the Act. With regard to the termination of the earlier Award, the learned Judges have held that in the facts and circumstances of the case it had been validly terminated in accordance with Section 19(6) as well as Section 19(2) of the Act. Before the Division Bench it was urged on behalf of the appellant that the Tribunal has not considered the financial capacity of the appellant while making the Award with regard to dearness allowance and reliance was placed on certain documents which were filed before the Division Bench. The learned Judges held that in considering the findings arrived at by the Tribunal the Court should generally consider the materials which were made available to the Tribunal and fresh or further materials which were not before the 940 Tribunal should not be allowed to be placed before the Court in a writ petition for determining whether the findings of the Tribunal are justified or not and that in the instant case no proper grounds have been made out for not producing the materials which were then available at the time of the hearing before the Tribunal and why the said documents could not be produced even before the learned single Judge. The learned Judges further held that even if the said documents are taken into consideration the same would be of no partic ular assistance to the appellant inasmuch as the said docu ments consist mainly of balance sheets and assessment or ders, and that the legal position is settled that while computing gross profits for the purpose of revising wage structure and dearness allowance the provision made for taxation, depreciation and development rebate cannot be deducted and the provisions of the Companies Act contained in Sections 205 and 211 and the principles of accountancy involved in preparation of profit and loss accounts have no relevance or bearing while considering the revision of wages and dearness allowance. Aggrieved by the decision of the Division Bench of the High Court the appellant has flied this appeal after obtain ing leave to appeal from the High Court under Article 133(1)(a) of the Constitution. Nath, the learned counsel for the appellant, has submitted that the High Court was in error in holding that the appellant is an industry under Section 2(j) of the Act. Shri Nath has submitted that in arriving at the said conclusion the learned Judges of the Division Bench of the High Court have relied upon the decision of this Court in Management of Safder Jung Hospital vs Kuldip Singh Sethi, [ ; which decision was overruled by this Court in Bangalore Water Supply & Sewerage Board vs R. Rajappa and Others, ; The submission of Shri Nath is that in accordance with the principles laid down in Bangalore Water Supply & Sewerage Board Case, (supra) the appellant cannot be taken to be carrying on an "industry" under Section 2(j) of the Act. It is no doubt true that the learned Judges of the Division Bench of the High Court have placed reliance on the decision of this Court in the Safdar Jung Hospital Case, (Supra) for holding that the appellant is carrying on an industry under Section 2(j) of the Act and the decision in Safdar Jung Hospital case, (supra) has 941 been overruled by a larger Bench of this Court in Bangalore Water Supply & Sewerage case, (supra). But this does not mean that the view of the High Court that the appellant is carrying on an industry under Section 2(j) of the Act is erroneous. In Safdar Jung Hospital case, (supra), a six member Bench of this Court had overruled the earlier deci sion in State of Bombay vs Hospital Mazdoor Sabha, ; and gave a restricted interpretation to the definition of "industry" contained in Section 2(j) of the Act. In other words, the effect of decision on Bangalore Water Supply & Sewerage Board case, is that the expression "industry" as defined in Section 2(j) has to be given the meaning assigned to it by this Court in the earlier decisions in D.N. The first principle formulated by the learned Judge is as under: "I, Industry, as defined in Section 2(j) and explained in Banerjee has a wide import: (a) Where (i) systematic activity (ii) organised by cooper ation between employer and employee, (the direct) and sub stantial element is chimerical) (iii) for the production and/or distribution of goods and services calculated to satisfy human wants and wishes (not spiritual or religious but inclusive of material things or services geared to celestial bliss e.g. making, on a large scale prasad or food), prima facie, there is an industry in that enterprise. (b) Absence of profit motive or gainful objective is irrele vant, be the venture in the public joint or other sector. 942 If the said principles are applied to the facts of the present case and there can be no doubt that the activity carried on by the appellant satisfies the requirements of the definition of "industry" contained in Section 2(j) of the Act. In this regard, it may be mentioned that the learned Judges of the Division Bench of the High Court have found as under: "(i) The Memorandum of Association of the appellant company indicate that the principal object for which the appellant company was incorporated is to acquire by purchase, trans fer, assignment or otherwise lands, buildings and landed properties of all description and in particular to acquire from the Karnani Industrial Bank Ltd., the immovable proper ties now belonging to the said Bank and to improve, manage and develop the properties and to let out the same on lease or otherwise dispose of the same. (ii) The principal business of the company is to deal with the real property and it is a real estate company. (iii) The income which the appellant derives is not from mere letting out the properties to the tenants and that the tenants pay not only for mere occupation of the property but also for enjoyment of the various services which are ren dered by the appellant to the tenants and to which services the tenants are entitled as a matter of right for the occu pation of the premises. (iv) The services which are rendered to the tenants and about which there does not appear to be any dispute are: (a) elaborate arrangements for supply of water; (b) free supply of electricity; (c) washing and cleaning of floors and lavatories; (d) lift services; (e) electric repairs and replacing; and (f) sanitary repairs and replacing etc. 943 (v) For offering these services to the tenants, the appel lant has employed a number of workmen and these services which undoubtedly confer material benefits on the tenants and constitute material services, are rendered by the em ployees. (vii) Activity carried on by the appellant company is un doubtedly not casual and is distinctly systematic. (viii) The work for which labour of workmen is required is clearly productive of the services to which the tenants are entitled and which also form a part of the consideration for the payments made by the tenants. (ix) The appellant carries on its business with a view to profits and it makes profits and declares dividends out of the profits earned. From the aforesaid findings recorded by the High Court, with which we find no reason to disagree, it is evident that the activity carried on by the appellant falls within the ambit of the expression "industry" defined in Section 2(j) of the Act as construed by this Court in Bangalore Water Supply & Sewerage Board case (supra). The Award of the Industrial Tribunal cannot, therefore, be assailed on the basis that the appellant is not carrying on an industry under the Act. Shri Nath has next contended that the Industrial Tribu nal was not competent to make the Award as the earlier Award dated March 3, 1960, had not been validly terminated. Shri Nath has pointed out that for terminating a settlement under Section 19(2) a written notice is necessary whereas for termination of an Award under Section 19(6) of the Act a written notice is not required and a notice is sufficient. In our opinion this contention does not require consid eration in view of the finding recorded by the learned Judges of Division Bench of the High Court that the letter dated November 24, 1966 was a notice 944 under Section 19(6) as well as under Section 19(2) of the Act. It has been found that the said letter of the union which was addressed to the Labour Commissioner was sent to the appellant company and that in the said letter there is a clear intimation of the intention of the employees to termi nate the Award and from the letter of the appellant dated February 13, 1967 it appears that the appellant had become aware of the intention of the union to terminate the Award and that the order of reference was made on July 29, 1967, long after the expiry of the period of two months. It is not the requirement of Section 19(2) of the Act that there should be a formal notice terminating a settlement and notice can be inferred from the correspondence between the parties (See: Indian Link Chain Manufacturers Ltd. vs Their Workmen, ; In the aforesaid facts and circumstances the High Court was justified in holding that the Award dated March 3, 1960 had been validly terminated before the passing of the order of reference. Shri Nath has urged that there has been non compliance of the provisions of Section 19(7) of the Act which lays down that no notice given under sub section (2) or sub sec tion (6) shall have effect unless it is given by a party representing the majority of the persons bound by the set tlement or Award as the case may be. This question has been raised by the appellant for the first in this Court. Shri Nath has lastly urged that the Industrial Tribunal was in error in making the Award in relation to Dearness Allowance without examining the capacity of the appellant to pay the additional amount and that the High Court should have remanded the matter to the Tribunal for considering this issue in the light of the documents which were submit ted by the appellant before the High Court. The High Court has rightly held that in considering the finding arrived at by the Tribunal the High Court while exercising its jurisdiction under Article 226 of the Constitution should generally consider the materials which were made available to the Tribunal and fresh or further materials which were not before the Tribunal should not normally be allowed to be placed before the Court. It is not the case of the appellant that the Tribunal had precluded the appellant from producing these documents. In these circumstances we find no justification for accepting the plea of the learned counsel for the appel lant for 945 reconsideration of the Award of the Tribunal in the light of the documents submitted by the appellant during the pendency of the appeal before the High Court. The appeal is, therefore, dismissed with costs. During the pendency of this appeal, the appellant has made a deposit before the Tribunal.
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The real estate company in this case rented out its property. It also provided services to its renters. These services included electricity, water, cleaning, elevators, and repairs. Renters paid for these services. The company hired workers to provide these services. The workers and the company disagreed about wages, pay scales, cost of living payments, and retirement benefits. The state government asked a special court called an Industrial Tribunal to settle the disagreements. The company argued that the Tribunal should not hear the case. It said the disagreement was not an industrial dispute. The company also said an earlier agreement with the workers' union was still in place. They said this agreement had not been canceled by either side, as required by law. On August 24, 1968, the Tribunal decided it could hear the case. On March 3, 1969, it ordered the company to increase the workers' cost of living payment. The Tribunal also created a new retirement benefits plan. However, it did not set specific pay scales for the workers because it did not have enough information. The company asked a higher court (High Court) to review the Tribunal's decisions. The company argued that the Tribunal did not have the authority to make the order because the company was not an "industry," and the disagreement was not an "Industrial Dispute." The company also said the previous agreement was still in effect. The company also argued that the workers had not raised any issues before the case was sent to the Tribunal. Finally, the company claimed the Tribunal did not consider whether the company could afford to pay the increased cost of living payment. A single judge in the High Court rejected the company's arguments and dismissed the case. The company appealed to a larger group of judges in the High Court, but they also dismissed the case. The company then appealed to the highest court (Supreme Court). The company argued that the High Court was wrong to say the company was an "industry." It also said the Tribunal could not make the order because the earlier agreement had not been properly canceled with a written notice. The company also claimed that certain legal procedures were not followed. Finally, the company argued that the Tribunal should not have ordered the increased cost of living payment without considering the company's ability to pay. The company asked the High Court to send the case back to the Tribunal to consider new documents the company had submitted. The Supreme Court dismissed the company's appeal and HELD: 1. The company's activities fit the definition of "industry" under the law. The Tribunal's order cannot be challenged on the grounds that the company is not an "industry." 2. The law does not require a formal written notice to cancel an agreement. A notice can be inferred from the parties' communications. 2.1 The High Court correctly found that a letter from the workers' union was a valid notice to cancel the earlier agreement. The letter clearly stated the workers' intention to end the agreement. Therefore, the High Court was right to say the earlier agreement had been properly canceled before the case was sent to the Tribunal. 3. The High Court was correct to only consider the information that was available to the Tribunal. New information should not be considered unless there is a good reason why it was not presented to the Tribunal earlier. 3.1 The company did not explain why it had not provided the documents to the Tribunal. Therefore, the Court saw no reason to reconsider the Tribunal's order based on those documents. 4. The Supreme Court cannot consider issues that are raised for the first time in the Supreme Court and require an investigation into new facts.
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rary to principles of natural justice to retire prematurely a government employee on the basis of adverse entries which are either not commu nicated to him or if communicated representations made against those entries are not considered and disposed of. In the instant case, the appellant had submitted his represen tations against adverse entries for the year 1971 72 and 1972 1973 and admittedly those representations were not considered and disposed of and yet the appropriate authority considered those entries in forming opinion that the appel lant 's premature retirement was in public interest. There fore the order of the state Government is not sustainable in law. [593E G] & CIVIL APPELLATE JURISDICTION: Civil Appeal No. 7427 of 1983. From the Judgment and Order dated 5.8.1981 of the Punjab and Haryana High Court in Civil Writ No. 1384 of 1981. Rao and K.K. Sodhi for the Respondent. This appeal is directed against the Order of the High Court of Punjab and Haryana dismissing the appel lant 's petition made under article 226 of the Constitution challenging validity of the Punjab Government 's Order dated 19.3.80 retiring the appellant prematurely from service. for study and training in France for a period of three years. On his return from abroad he was appointed as Superintendent Quality Marking Centre (Scientific Instruments) of the Government of Punjab. In 1968 he was promoted to the post of Joint Director (Industries), which post he continued to hold till he was prematurely retired by Government order dated 19th March, 1980 issued in exercise of power under rule 3 of the. Punjab Civil Services (Premature Retirement) Rules 1975 (hereinafter referred to as the Rules). The appellant made a representation against the order of prema ture retirement to the Government but the same was rejected, thereupon the appellant challenged the validity of the Government order by means of a writ petition under Article 226 of the Constitution before the High Court, which was dismissed in limine by the High Court on August 5, 1981. The learned counsel for the appellant contended that the Government decision to retire the appellant prematurely was arbitrary and unreasonable as the appellant 's service record has all along been good and there was no material before the appropriate authority on the basis of which the requisite opinion that the appellant 's premature retirement was neces sary in public interest, could be formed. He urged that the appellant had earned consistent good entries for the last 5 years, but the competent authority relied on some adverse entries of remote past to retire the appellant. Learned counsel further urged that appellant 's representation against some of the adverse entries which had been consid ered against him was pending and the same had not been considered and disposed of. Those entries should not have been considered against the appellant. On the other hand learned counsel appearing for the State urged that the appellant 's work and conduct was not satisfactory and the State Government having considered the over all service record of the appellant formed the requisite opinion bona fide that the appellant 's premature retirement was necessary in public interest. In support of his contention he placed the service record before the Court and referred to a number of adverse entries 588 earned by the appellant during his service career to which we shall make reference at a later stage. The purpose and object of premature or compulsory re tirement of Government employee is to weed out the ineffi cient, corrupt, dishonest or dead wood from the Government service. In the instant case the appellant was prematurally retired in exercise of power under Rule 3 of the Punjab Civil Services (Premature retirement) Rules 1975, it would therefore be necessary to have a look at these provisions. Rule 3 reads as under: "3. Premature retirement: (1)(a) The appropriate authority shall if it is of the opinion that it is in public inter est to do so, have the absolute right, by giving an employee prior notice in writing, to retire that employee on the date on which he completes twenty five years of qualifying service or attains fifty years of age or on any date thereafter to be specified in the notice. (b) The period of such notice shall not be less than three months. Provided that where at least three month 's notice is not given or notice for a period less than three months is given, the employee shall be entitled to claim a sum equivalent to the amount of his pay and allow ances, at the same rate at which he was draw ing them immediately before the date of re tirement, for a period of three months or, as the case may be, for the period by which such notice falls short of three months. (2) Any Govt. employee may, after giving at least three month 's previous notice in writing to the appropriate authority retire from service on the date on which he completes twenty five years of qualifying service or attains fifty years of age or on any date thereafter to be specified in the notice. The above rule invests absolute right in the appropriate authority to retire an employee prematurely on his comple tion of 25 years of qualifying service or 50 years of age. The appropriate authority as defined by rule 2 means the authority which has the power to make substantive appoint ment to the post or service from which the Govt. employee is required to retire. Before a Govt. employee is retired in exercise of power under this rule it is necessary that the Govt. servant must have completed 25 years of qualifying service or he must have attained 50 years of age and further he must be given three month 's notice in writing. The rule does not lay down any criteria, guidelines for the exercise of power, although public interest is specified in the rule, which means power has to be exercised in the public interest only. The public interest in relation to public administra tion envisages retention of honest and efficient employees in service and dispensing the services of those who are inefficient, dead wood or corrupt and dishonest. Therefore the rule contemplates premature retirement of the ineffi cient, corrupt or dead wood which would subserve the public interest. Since the rule does not contain any further guidelines, the State Government issued a Government Order on September 26, 1975 laying down the guidelines and the procedure neces sary to be followed in exercising powers under rule 3 for premature retirement of a Government employee. The order stated that the appropriate authority should utilise the power under rule 3 in a judicious manner to retire a Govern ment employee on formulating its opinion by scrutiny of the confidential reports of the employee and by taking into consideration any other substantial material, it may have before it. The order further stated that it was not feasible to lay down any absolute terms as to how many adverse en tries about inefficiency or lack of integrity would justify the premature retirement but it laid stress that the service record as a whole would determine the merit of each case. Paragraph 6 of the letter further stated that remoteness of an adverse entry, the scrutiny of the service record of the employee concerned such as crossing of efficiency bar, confirmation and promotion to a higher post or any other meritorious service rendered by the employee, would have their relative importance. The order emphasizes that the appropriate authority may consider premature retirement of a Government employee if it has reasonable cause to believe that the employee con 590 cerned was lacking in integrity irrespective of the assess ment of ability and efficiency in work. It further provides that the appropriate authority should review the cases of employees on their completing 25 years of qualifying service or their attaining 50 years of age. The Government issued another order on August 4, 1978 pointing out that while exercising power under rule 3 the service of an employee as a whole would determine the merit of each case but if there was a single entry describing the employee concerned as a person of doubtful integrity, that would justify the prema ture retirement under the rules. The executive instructions issued as contained in these two Govt. orders provide suffi cient guidance for the exercise of power under rule 3. According to these instructions the service record of an employee has necessarily to be considered while taking decision for the premature retirement of an employee and if there was a single entry casting doubt on the integrity of an employee, the premature retirement of such an employee would be in public interest. In the absence of any details by which the question of public interest could be determined in the rules it was open to the State Govt. to issue execu tive instructions for the guidance of the appropriate au thority to exercise the power of premature retirement and the instructions so issued as contained in the aforesaid Govt. In the counter affidavit filed on behalf of the State of Punjab it is asserted that the appellant during his service with the industries department earned adverse remarks in the annual confidential reports on his work and conduct for the years 1960 61, 1963 64, 1964 65, 1969 70, 1970 71, 1971 72, 1972 73 and 1975 76 which indicate that the overall service record of the appellant was bad and his integrity was fre quently challenged. It was been further stated that these entries were taken into consideration in retiring the appel lant. No other material was considered against the appel lant. According to the respondents the appellant 's service record as a whole was taken into consideration and thereupon it was found that he had earned a number of adverse entries which indicated his inefficiency and for that reason it was considered necessary to retire him prematurely in public interest. We have been taken through the adverse entries by the learned counsel appearing for the State as he placed the service record before us. On a perusal of the same we find that the respondents took into consideration some of the adverse entries which related to remote past prior to the promotion of the appellant to the post of Joint Director (Industries). It is now settled that adverse entries if any, awarded to an employee lose their significance on or after his promotion to a higher post. The adverse entries awarded to the appellant prior to 1968 could not be taken into 591 consideration and therefore the adverse entries for the years 1960 61, 1963 64 and 1964 65 could not legally be taken into consideration in forming the requisite opinion to retire the appellant prematurely from service. It is now well settled that while considering the question of prema ture retirement it may be desirable to make an overall assessment of the Government servant 's record, but while doing that, more value should be attached to the confiden tial reports pertaining to the years immediately preceding such consideration. It is possible that a new entrant to a service may have committed mistakes and for that reason he may have earned adverse entries and if those entries of early years of service are taken into consideration for prematurely retiring a Government employee then perhaps no employee would be safe even though he may have brilliant record of service in later years. This aspect was emphasised by this Court in a number of cases namely, Baldev Raj Chadha vs Union of India & Ors., ; ; Briij Bihari Lal Agarwal vs High Court of M.P. & Ors., ; ; Amar Kant Choudhary vs State of Bihar & Ors., ; and J.D. Srivastava vs State of M.P. & Ors., ; This Court has consistently taken the view that old and stale entries should not be taken into account while consid ering the question of premature retirement instead; the entries of recent past of five to ten years should be con sidered in forming the requisite opinion to retire a Govern ment employee in public interest. It would be unreasonable and unjust to consider adverse entries of remote past and to ignore the good entries of recent past. We are therefore of the opinion that if entries for a period of more than 10 years past are taken into account it would be an act of digging out past to get some material to make an order against the employee. In view of this we would confine our scrutiny to the appellant 's record of service for the last 10 years prior to the date on which he prematurely retired. We would now examine the appellant 's service record for the last 10 years. On a perusal of the same we find that the appellant was awarded adverse remarks for the year 1971 72 and 1972 73 and for the rest of the years he was not awarded any adverse remarks. On the other hand for the years 1974 75 and 1975 76 the reporting officer rated him as a 'very good ' officer although the reviewing officer treated him as 'ave rage '. In 1976 77 the reporting officer rated him as a 'good ' officer while the reviewing officer rated him as an 'average '. For the year 1977 78, 1978 79 and 1979 80 the reviewing officer assessed his work and conduct 'good '. During the last 5 years of his service the appellant had earned good entries which are commendable in nature. Except the two entries awarded to him for the years 1971 72, 1972 73 592 the appellant has not earned any adverse entry reflecting upon his work and conduct. So far as the adverse entries for the year 1971 72 and 1972 73 are concerned the appellant has asserted that even though he had filed representations in accordance with the rules against those entries, his representations had not been considered or disposed of, but the appropriate authority considered those entries against him. In the counter affidavit filed on behalf of the State it is conceded that the appellant had filed representations against the aforesaid two entries, but the two representations could not be disposed of as the representations were not traceable on the Government file. adverse entries and the receipt of the representations is admitted by the Govt. The question which fails for consideration is whether the aforesaid two entries could be taken into consideration in forming the requisite opinion to retire prematurely the appellant from service. There is no doubt that whenever an adverse entry is awarded to a Government servant it must be communicated to him. The object and purpose underlying the communication is to afford an opportunity to the employee to improve his work and conduct and to make representation to the authority concerned against those entries. If such a representation is made it is imperative that the authority should consider the representation with a view to determine as to whether the contents of the adverse entries are justi fied or not. Making of a representation is a valuable right to a Govt. employee and if the representation is not consid ered, it is found to affect him in his service career, as in Govt. In Gurdial Singh Fiji vs State of Punjab & Ors., the appellant therein was denied promotion on account of certain adverse entries against which he had made representation to the Govt. but for some reason or the other those representations could not be considered or disposed of. In view of those adverse entries he was not selected for promotion. This Court while consid ering the effect of non consideration of the representation observed: " The principal is well settled that in accordance with the rules of natural justice, an adverse report in a confidential roll cannot be acted upon to deny promotional opportunities unless it is communicated to the person concerned 593 so that he has an opportunity to improve his work and conduct or to explain the circum stances leading to the report. Unfortunately, for some reason or another, not arising out of any fault on the part of the appellant, though the adverse report was communicated to him, the Government has not been able to consider his explanation and decide whether the report was justified. " After the aforesaid observation this Court directed the State Govt. to consider and dispose of the representation made by the appellant and thereafter the Selection Committee was directed to consider his case afresh. In Amar Kant Choudhary vs State of Bihar & Ors. (supra) the Court again emphasized that adverse report in a confidential roll cannot be acted upon to deny promotional opportunities unless it is communicated to the person concerned so that he has an opportunity to improve his work and conduct or to explain the circumstances leading to the report. Unless the repre sentation against the adverse entry is considered and dis posed of it is not just and fair to act upon those adverse entries. These decisions lay down the principle that unless an adverse report is communicated and representation, if any, made by the employee is considered, it cannot be acted upon to deny promotion. We are of the opinion that the same consideration must apply to a case where the advese entries are taken into account in retiring an employee prematurely from service. It would be unjust and unfair and contrary to principles of natural justice to retire prematurely a Govt. employee on the basis of adverse entries which are either not communicated to him or if communicated representation made against those entries are not considered and disposed of. The appellant had submitted his representation against adverse entries for the year 1971 72, and 1972 73 and admit tedly those representations were not considered and disposed _of and yet the appropriate authorities considered those entries in forming opinion that the appellant 's premature retirement was in the public interest. We are, therefore, of the opinion that for this reason the order of the State Govt. Though the entire service record of an employee may be considered while considering the question of his premature retirement, but if the service record of the last 10 years of his service do not 594 indicate any deficiency in his work and conduct it would be unjust and unreasonable to retire him prematurely on the basis of entries which may have been awarded to him prior to that period. In Baldev Raj Chadha vs Union of India & Ors., (supra) this Court held that if an officer had earned no adverse entries atleast for five years immediately before the compulsory retirement, he cannot be cashiered on the score that long years ago his performance had been poor. It appears that the State of Punjab realised that premature retirement of an employee on the basis of entire service record which may include stale entry, would be unreasonable and it therefore issued Govt. order on June 22, 1981 direct ing that under the Punjab Civil Services (Premature Retire ment) Rules 1975 it would not be desirable to scrutinize the entire service record of an employee and premature retire ment should not be ordered if during the last 5 years the work and conduct of the employee have been good. This direc tion was no doubt issued after the appellant was prematurely retired in March 1980 but nonetheless it is apparent that the Govt. had changed its policy in accordance with the decisions of this Court and it had taken a decision not to retire a Govt. servant if his service record for the last five years did not contain any adverse remarks. The appel lant had not earned any adverse remarks during the last five years of service; on the other hand he had earned 'good ' and 'very good ' entries during those years. In this view the Government 's decision to retire the appellant prematurely in exercise of the power under rule 3 is not sustainable in law. We accordingly allow the appeal, set aside the order of the High Court, ,quash the Govt. order dated 19.3.1980 and direct that the appellant shall be treated as being in service without break. He is entitled to his salary, allow ances and such other benefits as may be admissible to him under the rules. The respondents shall pay the costs of this appeal to the appellant. Appeal allowed.
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Under Rule 3 of the Punjab Civil Services (Premature Retirement) Rules, 1975, the government can make an employee retire early if it's in the best interest of the public. The rule doesn't list specific reasons for early retirement, but it says it must be in the public interest. This means the government can only use this power if it benefits the public. The State Government made an order on September 26, 1975, giving rules on how to use the power to retire government employees early under Rule 3. The order said the government should use this power carefully. But it stressed that the whole work record should be considered in each case. Paragraph 6 of the letter added that how old a bad review is, the employee's work history (like getting promoted), and any good work the employee did are all important things to consider. The order said the government can consider early retirement if they have a good reason to believe the employee isn't honest, even if their work is good. It also said the government should review employees' cases when they finish 25 years of work or turn 50. The government made another order on August 4, 1978, saying that when using Rule 3, the employee's entire work history should be considered. However, if there's even one report saying the employee might not be honest, that's enough to justify early retirement. The government realized that retiring someone early based on their whole work record, including old issues, might be unfair. It said that the government shouldn't look at an employee's entire work record and shouldn't order early retirement if the employee's work and behavior have been good for the last 5 years. The employee in this case was appointed as a Superintendent for the government in 1953. He held this position until the government retired him early on March 19, 1980, using Rule 3 of the Punjab Civil Service (Premature Retirement) Rules, 1975. He then challenged the order in court, but the court dismissed his case on August 5, 1981. The reason for early or forced retirement is to get rid of bad employees from the government service. The government has the right to do this, and it's usually done based on the service rules. How this power is used depends on the rules and the Constitution. [588A C] 2.1 When it comes to government jobs, the public interest means keeping honest and good employees and getting rid of those who are not good at their jobs, not useful, corrupt, or dishonest. So, Rule 3 of the Punjab Civil Service (Premature Retirement) Rules, 1975, is about retiring employees who are not good, corrupt, or not useful, which is in the public interest. [589D] 2.2 The instructions the government issued give enough guidance for using the power under Rule 3. According to these instructions, the employee's work record must be considered when deciding on early retirement. Since the Rules don't say how to decide what's in the public interest, the government can issue instructions to guide the decision. When considering early retirement, it's good to look at the employee's whole record. But, more importance should be given to the reviews from the years right before the decision. If those early reviews are used to retire them early, no employee would be safe, even if they have a great record later on. [591A E] 3.2 In this case, the bad reviews the employee received before 1968 shouldn't be considered because the bad reviews from 1960-61, 1963-64, and 1964-65 are no longer valid because of his promotion. Except for two reviews from 1971-72 and 1972-73, the employee hasn't received any bad reviews about his work or behavior. [591H; 592A] Baldev Raj Chadha vs Union of India & Ors., ; ; 586 Brij Bihari Lal Aggarwal vs High Court of A.P. & Ors., ; ; Amar Kant Chowdhary vs State of Bihar & ors. ; , and J.D. Srivastava vs State of M.P. 4.1 When a government employee gets a bad review, it must be given to them. The reason for this is to give the employee a chance to improve their work and behavior and to protest the review. If the employee protests, the government must consider the protest to decide if the bad review is justified. The right to protest is important for a government employee. If the protest isn't considered, it can affect their career because things like raises, promotions, and early retirement all depend on their work record. [592D F] Gurdial Singh Biji vs State of Punjab & Ors., , applied.
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No. 467 of 1972. Petition Under Article 32 of the Constitution of India. B. Sen and R. M. Mehta, section K. Dholakia and R. C. Bhatia, for the petitioner. L. N. Sinha, Solicitor General of India, G. A. Shah and section P. Nayar, for the respondent. The Judgment of the Court was delivered by UNTWALIA, J. By this petition under Article 32 of the Constitution of India the petitioner has challenged the constitutional validity ,of the Gujarat Vacant Lands in Urban Areas (Prohibition of Alienation) Act, 1972, Gujarat Act No. 12 of 1972 hereinafter referred to as the Act on the around that it violates the fundamental rights of the petitioner granted under articles 14 and 19 of the Constitution. In the writ petition the petitioner claims that he owns 9559 square yards ,of land situate in District Bulsar, sub district and Taluka Navsari, village Kohilpore. He intends to sell the said land but is unable to do so because of the prohibition of alienation imposed under the Act. Mr. B. Sen, learned counsel for the petitioner conceded, and in ID ,our opinion rightly, that since the Proclamation of Emergency is in operation under Article 358 of the Constitution, fundamental right guaranteed under Article 19 is under suspension and therefore the Act could not be assailed for infraction of Article 19 even if there be any. Counsel, however, submitted that it does violate the guarantee of equal protection of the law and offends Article 14. In the Act under section 2 is embodied a declaration that the Act is for giving effect to the policy of the State towards securing the principles specified in clauses (b) and (c) of Article 39 of the Constitution and consequently Article 31C would save the Act from attack on account of the infraction of Article 14. But it was submitted that the Act is not directly relatable to the object of Article 39(b) and (c) and hence Article 31C cannot protect it. In our opinion it is not necessary in this case to take recourse to Article 31C for upholding the constitutional validity of the Act as it does not infringe the equal protection of law guaranteed under Article 14 of the Constitution. Learned counsel for the petitioner endeavoured to make out the following points for attacking the Act as being violative of Article 14. (1) That the limit of Prohibition in respect of the area of the vacant land is the same irrespective of its situation and value thus putting unequals as equals. (2) That it does not apply to building lands and building areas have been left out. (3) That there is discrimination between the permissible limit of alienation on the basis of the irrational consideration of the area forming part of a compact block or not. 66 9 (4) That there is no rational basis for not applying the Act in respect of the alienation of vacant in favour of the State, Govt., the Central Govt. , Local authorities, Govt. companies, Govt. Corporations or the Cooperative House Building Societies. (5) There is no guideline provided in section 7 of the Art for exercise of the power of exemption. Learned Solicitor General appearing for the respondent, the State of Gujarat, submitted that none of the points urgea on behalf of the ,petitioners has got any substance and there is no violation of the equal protection of law guaranteed under Article 14 of the Constitution. We shall first refer to and wherever necessary read some of the relevant provisions of the Act. The Preamble of the Act indicates that it is an Act to prohibit alienation of certain vacant lands in urban areas in the State of Gujarat. The object of the Act is to prohibit alienation of the vacant lands so that ultimately the ownership and control of the material resources of the Community may be so distributed as best to sub serve the common good and may prevent the concentration of wealth to the common detriment. It may be pointed ,out here that the impugned Act is a temporary one. Originally it was to remain in force for one year but the period is being extended from time to time in order to enable the State Legislature to pass the Urban Property Ceilings Act. Prohibition of alienation by the Act is a preparatory measure for distribution of the material resources of the community. The definition section of the Act is section 3. Clause (b) defines "City" to mean a City as constituted under the Bombay Provincial Municipal Corporations Act, 1949. The definition of "Collector" includes certain other officers also as mentioned in clause (c). It is necessary to read clause (d) which defines the "compact block" to mean "any block of vacant land in an urban area exceeding one thousand square metres in extent, (whether owned by one person or jointly by more than one person or owned in contiguous parts separately by one or more members of a family unit) and whether or not divided by a private road, street, lane, footway, passage or drain, natural or artificial. " Under clause (dd) "family unit" means an indi vidual, his or her spouse and their children. " Clause (e) defines " 'municipal borough" to mean "a municipal borough as constituted or deemed to be constituted under the Gujarat Municipalities Act, 1963. " It is necessary to read clauses (i) and (j) of section 3 in full. (i) "urban area" means (1) any area which is comprised for the time being in a City or a municipal borough and also any such area in the vicinity thereof, within a distance, not exceeding sixteen kilometres from the local limits of the City, or as the case may be, of the municipal borough concerned, as the State Govt. may, having regard to the extent of and the scope for the urbani 670 sation of that area or other relevant considerations, by a notification in the Official Gazette, specify in this behalf; and (2) any other area which the State Government may, by notification in the Official Gazette declare to be an urban area. having regard to any project existing in that area on the appointed day or having regard to the possibility in the near future of any project being established in that area where any such project, in the opinion of the State Government, has led to or is likely to lead to urbanisation of that area; (j) "vacant land" means land in an urban area, agricultural or non agricultural, other than land on which any building has been or is being constructed in accordance with any law regulating such construction and the land appurtenant to such, building to the minimum extent required under such law or under the provisions of the Bombay; Town Planning Act, 1954 or any other corresponding law for the time being in force '. Explanation for the purposes of this clause any land which is vacant on the appointed day shall be 'deemed to be vacant land, notwithstanding that the construction of 2 a building thereon has been commenced on or after the said day. " Section 4 provides for prohibition of alienation etc. in these terms (1) No person who owns any vacant land shall, on or after the appointed day, alienate such land by way of sale, gift, exchange (mortgage other than simple.mortgage), lease or otherwise, or effect a partition or create a trust of such land ', and any alienation made, or, partition effected, or trust created in contravention of this section shall be null and void : Provided that nothing in this sub section shall apply to the alienation by any person of any one plot of vacant land owned by him not exceeding one thousand square metres in extent and not forming part of a compact block or to the effecting of a partition or creation of a trust of any such plot. (2) The provisions of sub section (1) shall apply to any sale, partition or creation of trust, of vacant land of any person in execution of a decree or order of a civil court or of any award or order of any other authority. Restrictions on registration of documents have been put in section 5. Section 6(1) says that "Nothing in this Act shall apply to any transfer of vacant land by or in favour of (a) A State Government or the Central Government or local authority;, 671 (b) A Government Company as defined in section 617 of the ; (c) a corporation established by or, under a Central Provincial or State Act, which in controlled or managed by a State Government or the Central Government; (d) such cooperative house building societies established for the purpose of providing housing accommodation to weaker sections of people, as may be approved by the State Government in this behalf. " Sub section (2) of section 6 makes a distinction in the application of sub section (2) of section: 4 in relation to the execution of a decree or an order of a civil court in favour of the Government or the local authority. Under subsection (1) of section 7 "the State Government, may, by a general or special order in writing and for reasons to recorded therein, exempt any area or any alienation or other transfer of any vacant land from all or any of The provisions of this Act." Under sub section (2), to avoid any hardship also, the State Government may, if it considers it necessary so to do, exempt, by an order in writing, any alienation or other transfer of any vacant land from all or any of the provisions of this article Subject to any rules that may be made in this behalf or to any general or special orders of the State Government, the Collector has. been authorised under sub section (3) of section 7 by order in writing, to exempt any alienation or other transfer of any vacant land from the Provisions of this Act in case the land is to be used for ;my educational, scientific, industrial or commercial purpose or for such other purpose as may be prescribed. "Prescribed" means under clause (g) of the third section "prescribed by rules made under this article ', The State Government has power under section 12 to make the rules. Sub section (4) enjoins that every order issued by the State Government, under sub sections (1) and (2) and by the Collector under section 3 shall be laid before the State Legislature as soon as possible after its issue. Alienation etc. made on or after the 1st July, 1972 but before the appointed day under the Act has also been affected under section 8. Section 9 gives a right to appeal against the order of the Collector under sub section (3) of section 7 to the State Government within the prescribed period and in the prescribed manner. The jurisdiction of the Civil Court has been barred under section 10. A penalty has been provided under section 11. The act overrides other laws in view of section 13. It would be noticed that the urban 'area means any area which is comprised in the City or a Municipal Borough. Surrounding, distance of the City or municipal borough has to,.be fixed by a notification of the State Government 'in the Official Gazette having regard to the relevant considerations. The maximum distance of such an area cannot exceed sixteen kilometres. We were informed at the Bar by, the learned Solicitor General that notifications have been issued fixing the maximum limit of 16 kilometres in case of big cities like Ahmedabad, Baroda etc. but lesser limits of distances have been notified in case of small municipal boroughs. Under the proviso to sub section (1) of L319SupCI/75 672 section 4 a person is not_ prohibited from alienating one plot of vacant land owned by him not exceeding 1000 sq. metres provided it does not form part of a compact block. When the limit of the distance outside the City or town area differed from place to place it was not necessary to fix the limit of permissible area of transfer with reference to the value of the land. It was neither feasible nor expedient to do so. From the permissible limit of transfer the area forming part of the compact block had to be excluded as it would have led to manipulations and manoeuvrings by persons belonging to the same family unit. The land belonging jointly to more than one person or owned in contiguous part separately by one or more members of a family unit, which unit is a narrow one as defined in clause (dd) of section 3, comes under the definition of compact block. Then only the permissible limit of transfer does not apply. Excluding the land on which any building has been or is being constructed in accordance with any law regulating such construction and only the permissible limit of the vacant land appertaining to it is a reasonable classification distinguishing the vacant land from the building land. The object of the act is to prevent alienation of certain vacant lands and that being so it is rightly excluded the building lands from its operation. It is plain that the main object of the act being ultimately to distribute the ownership and control of the material resources of the community as best to subserve the common good and to prevent concentration of wealth, a transfer in favour of the Government, local authorities, Government companies or Corporations had to be excluded as such transfer could not possibly defeat the object of the Act, rather, it would give a fillip to it. Permitting transfers of vacant lands in favour of Cooperative Housing Building Societies is obviously a step for the fulfilment of the object of the Act. The Act cannot be held to be discriminatory on such grounds. The power of the State Government under sub section (1) of section 7 to exempt any area or any alienation or other transfer of vacant land from all or any of the provisions of the Act is a power which is to be exercised for the reasons to be recorded in the general or the special order and in furtherance of the object of the Act. The guideline is to be found in the object of the act itself. The power under sub section (2) has to be exercised by the State Government for avoiding any hardship. There is sufficient guideline for exemption in case of hardship which will depend upon the facts and circumstances of each case. The order ;if exemption to be made by the Collector can only be in a case where the land is to be used for any educational, scientific, industrial or commercial purposes. It has not been left open to the Collector to decide for what other purpose he can grant the exemption. Such other purpose can be only that as may be prescribed by the State Government by rules made under section 12 of the Act. Sub section (4) of section 7 is a good safety valve. The State Legislature will act as a Supervisor of the orders of exemption 673 made by the State Government or the Collector. The exercise of the power of exemption by the Collector is further controlled by providing an appeal to the State Government under section 9 of the Act. In our opinion, therefore, there is no violation of the equal protection of law guaranteed under article 14 of the Constitution. Classifications are all reasonable and there is a clear nexus between the object of the act and the classifications. They have neither put unequals as equals nor has discriminated between equals. In the result the writ petition fails and is dismissed with costs. P.H.P. Petition dismissed.
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The Gujarat Vacant Lands in Urban Area (Prohibition of Alienation) Act of 1972 was created to stop people from selling or giving away empty land in cities in Gujarat. Section 2 of the Act says that the law is meant to help the state follow the rules in Article 39, clauses (b) and (c) of the Constitution. These rules are about sharing resources fairly and preventing wealth from being controlled by a few. Section 4 says that you can't sell or give away empty land after a certain date. However, if you own one piece of empty land that is less than 1000 square meters and not part of a larger connected area, this rule doesn't apply. Also, this rule doesn't apply if the land is being transferred to the State Government, the Central Government, a local government, a government-owned company, organizations created by law, or cooperative housing societies. The State Government can also make an order to exempt any area or sale from all or some of the rules in this Act. This power is subject to the rules made by the State Government. Every order made by the State Government or the Collector (a local official) to exempt an area or sale must be presented to the State Legislature (the state's law-making body). The lawyer for the person challenging the law agreed that during a declared emergency, some basic rights guaranteed by Article 19 are temporarily suspended. The lawyer argued that this Act was unfair under Article 14 and that it didn't directly relate to the goals of Article 39 (b) and (c). Because of this, Article 31C, which protects laws related to these goals, shouldn't protect this Act. HELD: (i) It's not necessary to use Article 31C to defend the Act's validity because it doesn't violate the right to equal protection under Article 14 of the Constitution. "Urban area" means any area within a city or a municipal borough (a type of local government). The surrounding area, up to 16 kilometers, can also be included if the State Government announces it. The government has set a limit of 16 kilometers for big cities like Ahmedabad and Baroda. But for smaller municipal boroughs, they've set smaller limits. Because the distance limit outside the city or town differs from place to place, it wasn't necessary to set the limit of how much land could be transferred based on the land's value. It wasn't practical or wise to do so. The area that's part of a connected block had to be excluded from the amount of land that could be transferred. If it wasn't, it could have led to a few families monopolizing the land. [668F; 672 B] (ii) There is a good reason for the different rules, and there's a clear connection between the purpose of the Act and these rules. The Act doesn't treat unequal situations as equal, nor does it discriminate between equal situations. The Act aims to prevent the sale of empty lands, so it makes sense to exclude land with buildings on it. Since the Act's goal is to eventually share ownership and control of resources for the common good, it makes sense to exclude transfers to the Government, Local Authorities, Government Companies, and Statutory Corporations. Forming Cooperative House Building Societies is clearly a step towards achieving the Act's goal. The State Government's power to exempt any area or sale is only to be used for recorded reasons and to further the Act's purpose. The Act's purpose serves as a guideline. The Collector can only make an exemption order if the land will be used for educational, scientific, industrial, or commercial purposes. The Collector's power is also checked by allowing appeals to the State Government. The orders must be presented to the State Legislature, which will oversee the exemption orders made by the State Government or the Collector. [672D H] 668
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ivil Appeals Nos. 945 47 of 1991. From the Judgment and Order dated 8.8.1990 of the Punjab & Haryana High Court in L.P.A. Nos. 266, 267 and 268 of 1986. Rao, J. Lal, Ms. Yasmin Tarapore, S.K. Bagga and C.M. Singhi, J.K. Sibal and Ms. Kamini Jaiswal for the Respondents. Special leave granted. These Civil Appeals arise from the common judgment dated 8.8.1990 of the High Court of Punjab and Haryana dismissing Letters Patent Apeals against the judgment dated 12.2.1986 of the single Judge allowing writ petitions filed under Articles 226 and 227 of the Constitution of India. Civil Appeals arising out of S.L.P. (C) Nos. 14471 73 of 1990 are filed by the State of Punjab and Civil Appeals arising out of S.L.P. (C) Nos. 14236 38 of 1990 are filed by Ram Saran and O.P. Singhla, the respondents in the writ petitions. We shall hereinafter refer the contesting respondents Ram Saran and O.P. Singhla as 'the appellants ' and writ petitioners as 'the petitioners ' for the sake of convenience. In the Punjab Excise & Taxation Department, there were two separate and distinct cadres known as Assistant Excise and Taxation 733 Officers governed under the Punjab Excise and Taxation Department (State Service Class III A) Rules, 1956 (hereinafter referred to as Class III/A Rules ') and the Excise and Taxation Officers governed by the Punjab Excise and Taxation Department (State Service Class II) Rules. Under the Class II Rules, appointment to the cadre of Excise and Taxation Officers was made (a) by direct recruitment to the extent of 50% and (b) by promotion from amongst Assistant Excise and Taxation Officers to the extent of 50%. Under Class III A Rules, subordinate staff was eligible for promotion to the extent of 50% of the vacancies of Assistant Excise and Taxation Officers and their shares were as under: (i) Taxation Inspector 25% (ii) Excise Inspector 12 1/2% (iii) Ministerial Staff Head Office 6 1/4% (iv) Ministerial Staff Sub Office 6 1/4% The appellants as well as the writ petitioners joined the ministerial cadre of the Excise and Taxation Department as Clerks and were confirmed as such. The writ petitioners were promoted to the higher post and later appointed as Excise/Taxation Inspectors in 1971 72 by transfers under Rule 7(a)(ii) of the Punjab Excise Subordinate Service Rules, 1943. On such transfer as Excise/Taxation Inspectors, the lien of the writ petitioners was suspended in accordance with the provisions of Rule 3.14(b) of the Punjab Civil Services Rules (Volume I Part I). The appellants continued in the ministerial cadre, Ram Saran as Assistant and O.P. The Excise and Taxation Department was reorganised on 18th May, 1977. The cadre of Assistant Excise and Taxation Officers was abolished on 18th May, 1977 and the Assistant Excise and Taxation Officers were redesignated as Excise and Taxation Officers. The Government in order to provide avenues of promotion to the subordinate staff decided to make suitable amendment to the Class II Rules on the following terms: "Rule 5. The members of the service shall be recruited in 734 the following manner, namely: a. xxx xxx xxx b. In the case of an Excise and Taxation Officer; (i) by promotion from amongst the Taxation Inspectors and Excise Inspectors who have an experience of working as such for a minimum period of five years; or (ii) by promotion from amongst the Superintendents, Assistant, Accountants and Senior Scale Stenographers working in the Excise and Taxation Commissioners Head Office and in the Divisional and District Offices of the Department of Excise and Taxation, Punjab," It was further provided that there will be certain quota for each of the above categories for promotion to the rank of Excise and Taxation Officers. The State Government decided to adopt and apply the draft provision of Rule 5 in the matter of filling up of the vacancies in the carde of Excise/Taxation Officers before rules could be formally promulgated. Thus on 22.8.1983, Ram Saran and O.P. Singhla were promoted as Excise/Taxation Officers. The writ petitioners having been transferred to the other cadres of Excise/Taxation Inspectors have continued there for 14/15 years beyond and period of probation and also qualified the departmental test for Inspectors and they were not considered for the promotion as Excise and Taxtion Officers. The writ petitions were, therefore, filed challenging the promotion of the appellant mainly on the ground that on the basis of their seniority and lien on the post in the ministerial cadre, the writ petitioners had a right to be considered for promotion to the post of Excise and Taxation Officers prior to the appellants. The contention of the appellants as well as the State was that though the lien of the writ petitioners in the ministerial cadre was suspended in terms of Rule 3.14(b) of the Punjab Civil Service Rules, if the petitioners wanted that they should be considered for the post of Excise and Taxation Officers on the basis of their lien in the ministerial cadre, they may seek reversion and thereafter their case would be considered on merits and under rules. It was clarified by the Financial Commissioner in the order dated 7.8.1985 that the case of the writ petitioners would be considered in the light of the eligibility under the 735 relevant rule, that is to say, the amended Rule 5. in the ministerial service includes experience of working as such for a period of five years. The writ petitioners felt that if the service rendered by them as Excise and Taxation Inspectors was not being considered as service rendered in the ministerial cadre, they would be ineligible for consideration to the post of Excise and Taxation Officers. The learned single Judge accepted the contention of the writ petitioners that there was no conscious decision to apply the draft rules and consequently for the post of Excise and Taxation Officer, the writ petitioners are entitled to be considered without any bar of eligibility as their juniors had already been considered for the post. On appeal, the Division Bench proceeded on the assumption that the draft rules though not promulgated were rightly implemented. The Division Bench dealt with the question whether the service rendered on transfer to the ex cadre would be available to the writ petitioners in the matter of their promotion to the higher posts thus: "In view of this, question that calls for determination is as to whether on the return of the writ petitioners from the post of Excise and Taxation Inspectors to the Ministerial cadre, the service rendered by them on the post of Excise and Taxation Inspector could by deeming fiction be considered as having been rendered in the Ministerial cadre? The answer to this question is that such a service is to be counted as if the petitioners were always in the Ministerial cadre. Once it is held that the petitioner lien was only suspended under Rule 3.14(b) of the Punjab Civil Service Rules, the petitioners had a right to come back to their posts in the Ministerial cadre and once that is so, the rest would follow as if for all times deemingly they were in the Ministerial cadre. " The Division Bench relied on the decision of this Court in State of Mysore & Anr. vs P.N. Nanjundiah & Anr., , and opined that the entire service rendered by the petitioners as Excise and Taxation Inspectors will be considered in the Ministerial cadre and if that is counted the petitioners would be eligible for promotion under the relevant rules. It rejected the contention that the petitioners could not be said to be retaining a lien in the Ministerial cadre as they had successfully completed the period of probation as Excise and Taxation 736 Inspectors and they will be deemed to be confirmed there. The Division Bench endorsed the view that the revival of the lien essentially means that it stands revived with effect from the date it had been suspended, and dismissed the appeals observing: ". we may observe that the petitioners shall now be considered forthwith for the posts of ETOs from the date their juniors were promoted and if found suitable they will be promoted to that rank from the dates their juniors were promoted and they would be entitled to all the consequential benefits arising out of their promotion from the said date. " Shri P.P. Rao, the Senior Counsel for the appellants, and Shri G.L. Sanghi, the Senior Counsel for the respondents (writ petitioners), conceded that both parties claim promotion to the post of Excise and Taxation Officers only by virtue of the provision in the amended Rule 5 of Class II Rules and, therefore, the question whether there had been conscious application of the said rule before promulgation is only academic. We agree with the view of the High Court that for the purpose of present controversy we have to assume that the amended Rules were rightly implemented before they were formally promulgated in effecting the promotions now challenged. The appellants maintain that the Division Bench as clearly wrong, and that the petitioners in order to claim the benefit of promotion from the ministerial cadre under the amended Rules have necessarily to satisfy the eligibility test. To be more specific, they should have actual experience of five years in the ministerial cadre even when they are reverted back to that cadre. We have said that the petitioners were appointed as Inspectors by transfer under Rule 7 of the Punjab Excise Subordinate Service Rules, 1943 and thereafter they belonged to a different cadre. (a) A competent authority shall suspend the lien of a Government employee on a permanent post which he holds substantively; if he is appointed in a substantive capacity 737 (1) to a tenure post, or (2) to a permanent post outside the cadre on which he is borne, or (3) provisionally, to a post on which another Government employee would hold a lien, had his lien not been suspended under this rule. (b) A competent authority may, at its option, suspend the lien of a Government employee on a permanent post which he holds substantively if he is deputed out of India or transferred to foreign service, or in circumstances not covered by clause (a) of this rule, is transferred, whether in a substantive or officiating capacity, to a post in another cadre, and if in any of these cases there is reason to believe that he will remain absent from the post on which he holds a lien, for a period of not less that three years. (c) xxx xxx xxx (d) If a Government employee 's lien on a post is suspended under clause (a) or (b) of this rule, the post may be filled substantively, and the Government employees appointed to hold it substantively shall acquire a lien on it: Provided that the arrangements shall be reversed as soon as the suspended lien revives. Note 1. xxx xxx xxx Note. When a post is filled substantively under this clause, the appointment will be termed "a provisional appointment"; the Government employee appointed will hold a provisional lien on the post; and that lien will be liable to suspension under clause (a) but not under clause (b) of this rule. (e) xxx xxx xxx (f) A Government employee 's lien which has been suspended under clause (b) of this rule shall revive as soon as he ceased to be on deputation out of India or on foreign service or to hold a post in another cadre . " 738 According to the appellants, the respondents having been transferred to the cadre of Excise and Taxation Inspectors and having continued there for 14/15 years beyond the period of probation, their lien over ministerial post was suspended. The consideration of their names for the purpose of promotion as Excise and Taxation Officers from the ministerial post did not arise. The amended Rule introduced eligibility that would exclude the service rendered by the petitioners in other posts and if such service is excluded, the petitioners would be ineligible. The lien of the petitioners had been suspended by the competent authority under the mandatory provisions of Rule 3.14(b) referred to. They could seek reversion to their parent ministerial cadre and claim consideration for promotion to the post of Excise and Taxation Officers according to their eligibility and suitability. The recruitment to the post of Excise and Taxation Officer is governed by Punjab Excise and Taxation Department (State Service Class II) Rules, 1956. The eligibility of Taxation Inspectors and Excise Inspectors and members of ministerial establishment for the post is governed by the amended Rule 5. According to the proposed Rule 5(b)(ii), promotion to the post of Excise and Taxation Officer is to be made from amongst the Superintendents, Assistants, Accountants and Senior Scale Stenographers working in the Excise and Taxation Commissioners Head Office and in the District and Divisional Offices. In view of this provision, the Taxation Inspectors and Excise Inspectors whose lien against their posts in the ministerial cadres has been suspended and who are not working on the eligible ministerial establishment posts and who have been working as Taxation Inspectors and Excise Inspectors for a long number of year cannot claim that they are to be considered automatically for recruitment to the post of Excise and Taxation Officer. The normal line of promotion within the cadre for the members of the ministerial establishment was from the lowest post of a Clerk to the highest post of a Superintendent. So also the further channel of promotion was open to the Inspectors to the post of Excise and Taxation Officer. If the Inspectors are to be considered for the post of Excise and Taxation Officer from the quota of the ministerial establishment, that will result in the Inspectors getting two avenues for promotion while the ministerial staff losing even the one which had been provided. The appointment to the ex cadre posts of Excise and Taxation Inspector is made by transfer in accordance with the provisions of Rule 739 7 of Subordinate Service Rules, 1943 which provide that appointment to the cadre post shall be made by transfer or deputation of an official already in Government service. Instead of waiting for their turn to be promoted from the Inspectors quota, the petitioners have laid the claim to the quota in the ministerial service. The appellants are also persons who have been confirmed in the ministerial cadre and have worked for more than 20 years as such. The result would be that there would be no promotions to the post of Excise and Taxation Officer from the ministerial staff as such, and those who got transferred as Inspectors would be getting double benefit by claiming promotion to the post of Excise and Taxation Officer as members of the ministerial staff while retaining their right to claim promotion from within the quota specifically provided for the Inspectors. The petitioners with suspended lien on the post of Clerk and continuously holding the Inspector 's post for over 13 years cannot be considered to be at par with officials continuously working on the ministerial post for over 21 year. From the scheme of the Rules and the method of recruitment, it is clear that the petitioners while working as Inspectors on appointment by transfer to that cadre had the advantage of being considered for promotion as Officers under the amended Rule 5 out of the quota for Inspectors, while the ministerial staff to the exclusion of the Inspectors were entitled to certain percentage. The petitioners without being on the ministerial cadre even by reversion could not claim promotion as a member of the ministerial cadre without revival of the lien. Such revival could be effected only on reversion and not while the lien remained suspended. When the rule requires members of the ministerial staff to have experience as such for five years to satisfy the elibility requirement, the Inspectors cannot claim that service in the different cadre with their lien suspended be equated to service in the ministerial cadre and treated as experience in the ministerial cadre even if the functions and duties of the Inspectors may be of identical nature. The argument that the petitioners if found ineligible would remain in the lower cadre while their juniors are being promoted to the higher cadre 740 cannot be coutenanced. Even when the juniors continued in the lower ministerial cadre for long years, the petitioners were in a different cadre which had a larger promotional avenue and they are satisfied in that post. If the petitioners did not exercise their option to revert back to the ministerial cadre at the right time to qualify themselves for further promotion, the appellants cannot be deprived of the benefit they derived by continuing in the lower cadre on account of that situation. The High Court was clearly wrong in holding that the petitioners have acquired eligibility by rendering service in the cadre of Inspectors since their lien had been suspended. Rule 53(b)(i) of the Mysore Service Rules considered in that case provided that service in another post whether in a substantive or officiating capacity shall count for increments in the time scale applicable to the post on which the Government servant holds a lien or as well as in the time scale applicable to the post, if any, on which he would hold a lien had his lien not been suspended. The Court noticed that the service of an officer on deputation to another department is treated as equivalent to the service in the parent department under the rule. On account of that equation between the service in the two departments, it was held that the service on deputation should be deemed to be rendered in the parent department. The ratio of the decision is, therefore, not applicable in the present case. In C. Narasinga Rao & Ors. vs State of Andhra Pradesh by its Secretary, Vol. 2 1968 S.L.R.644, Rule 9 of the Andhra Pradesh State and Subordinate Service Rules provided that service rendered in the transferred department should be deemed to have been rendered in the parent department for promotion and seniority. And when the rule is thus specific, it was held that the petitioners ' service in the police department should be deemed to have been rendered in the parent department entitling them to promotion. If the Government employee was on deputation or holding a post in another cadre, the lien shall revive as soon as he ceased to hold the post in another cadre. There is no revival of the lien during the period the employee continues to hold a post in another cadre. Therefore, during the period the suspension is operative, the employee cannot claim that he had been continuing in the post in the parent cadre and gaining experience. When the rule is clear and specific that for the purpose of promotion from the cadre of Superintendents, Assistants, Accountants, Senior Scale Stenographers to the post of Excise and 741 Taxation Officers, the eligibility qualification is 'experience of working 'as such ' for five years ' the employee is not entitled to claim the experience in the ex cadre as experience of working in the ministerial cadre. In the light of what has been stated above, we are unable to uphold the decision of the High Court. The writ petitions are liable to be dismissed. Accordingly, we allow the appeals. Appeals allowed.
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They followed rules from 1956 called the State Service Class III A Rules. The other group was called "Excise & Taxation Officers." They followed rules called the State Service Class II Rules. Under the Class II Rules, new "Excise & Taxation Officers" were chosen in two ways: (a) 50% were hired directly, and (b) 50% were promoted from the "Assistant Excise and Taxation Officers" group. Similarly, under the Class III A Rules, half of the open positions were filled by hiring new people. The people who filed the court case, and the people they were arguing against (Ram Saran and O.P. Singhla), all started as clerks in the Punjab Excise and Taxation Department. The people who filed the court case were later promoted to Excise/Taxation Inspectors. This happened under a rule called Rule 7(a)(ii) of the Punjab Excise Subordinate Service Rules, 1943. Because of this promotion, they temporarily lost their place in the taxation department under Rule 3.14(b) of the Punjab Civil Service Rules. Singhla stayed in the office jobs. After the department was reorganized, the "Assistant Excise & Taxation Officers" group was ended. All of those officers were then called "Excise and Taxation Officers." Under the Class II Rules, people from lower-level jobs could not be promoted directly to "Excise & Taxation Officers." So, the government changed the rules to allow office staff, including Taxation Inspectors and Excise Inspectors, to be promoted. The new rules said: "Rule 5. For an Excise and Taxation Officer; (i) by promoting Taxation Inspectors and Excise Inspectors who have worked in those jobs for at least five years; or (ii) by promoting Superintendents, Assistants, Accountants, and Senior Scale Stenographers who work in the Excise and Taxation Commissioner's Head Office and in the department's local offices." Before the new rules were officially announced, Ram Saran and O.P. Singhla were promoted to "Excise & Taxation Officers" on August 22, 1983. So, they filed court cases in the High Court. They argued that because of their seniority and their place in the office jobs, they should have been considered for promotion before Ram Saran and O.P. Singhla, and the government argued that if the people who filed the court case wanted to be considered based on their place in the office jobs, they should go back to those jobs. Then, their case would be considered based on the new Rule 5, which required five years of experience in the office jobs. The people who filed the court case replied that if their time as Excise and Taxation Inspectors did not count as time in the office jobs, they would not be eligible for promotion. He said that there was no clear decision to use the new rules. So, the people who filed the court case were entitled to be considered for the "Excise & Taxation Officers" jobs without any experience requirements, since people with less experience than them had already been considered. On appeal, a different group of judges said that the new rules were correctly used, even though they had not been officially announced. However, on the question of whether the time the people who filed the court case spent in the other jobs could count as time in the office jobs, the judges referred to a previous court case, State of Mysore & Anr. vs P.N. If that time was counted, the people who filed the court case would be eligible for promotion under the rules. Their temporarily lost place in the office jobs would be restored, and they should be considered for promotion immediately. Singhla, and the government separately, appealed this decision. The Supreme Court said: The rules and the way people are hired make it clear that the people who filed the court case, while working as Inspectors, could be considered for promotion under the new Rule 5 from the Inspectors' group. The people who filed the court case were not in the office jobs, and they could not claim promotion as members of the office staff without going back to those jobs. Their temporarily lost place could only be restored by going back to those jobs, not while it was suspended. When the rule clearly states that for promotion from the office staff jobs (Superintendents, Assistants, Accountants, Senior Scale Stenographers) to "Excise and Taxation Officers," the requirement is 'experience of working' in those jobs 'for five years,' the worker cannot claim that experience in the other job counts as experience in the office jobs. State of Mysore & Anr. vs P.N. was different from this case. C. Narasinga Rao & Ors. vs State of Andhra Pradesh by its Secretary, Vol.
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No. The appellants were in service as tube well operators in the irrigation branch of the Public Works Department of the Punjab State. It was contended: (a) that the impugned notices did not fulfil the requirements of clauses (b) and (c) of section 25 F; (b) that the notifica tion by which the tubewells were transferred was mala fide, the only object of the transfer being to frustrate certain claims of the petitioners which had been judicially recog nised; and (c) that, in case the action of the State is upheld, the respondent Corporation should be held to be under an obligation to employ the petitioners with conti nutiy of service and under the same terms and conditions which they were enjoying prior to their retrenchment from the service of the State. It was pointed out that the writ petitions had been filed before the expiry of the date from which the retrenchment notice was to be effective, namely, 31st August, 1983. No. Accordingly to the appellants, the authorities took a decision to transfer the tubewells of the irrigation branch to the Corporation only with a view to deprive the appellants of the benefit they had gained as a result of the above litigation. Though the Corporation had been formed so long ago with the express object of taking over the tubewells of the irriga tion branch and though it was operating a large number of tubewells on its own account since then, no efforts had been made by the Government to transfer the tubewells belonging to the State to the Corporation till 1982. No. It was pointed out by the High Court that the appellants had subsequently been given all the benefits which they had derived as a result of the writ petitions. That apart, it was also found that the Corpora tion had made an offer of re employment to all the appel lants effective from the date of expiry of the notice of their retrenchment by the State Government. On contention (c), the High Court observed as follows: "So far as the alternative relief of re employment with continuity of service and pensionary benefits in terms of the Punjab Civil Service Rules is concerned, the petitioners cannot be granted the same in view of the provisions of section 25 FF (of the ) as introduced on September 4, 1956. In this regard the petitioners have based their whole claim on certain observations made in two Division Bench judgments of the Bombay High Court, reported as New Cotton Mills Ltd. vs Labour Appellate Tribunal and Others, and N.J. Chavan and Others vs P.D. Otherwise also we are of the view that the claim of the petitioners is not covered by section 25 FF of the Act as it has nowhere been pleaded or established by them that the ownership or management of the tubewells has been transferred by the State Government to the corporation either 'by agreement or by operation of law '. As already pointed out, the transfer of the tubewells in the instant case has taken place as a result of the unilateral decision by the State Government. Even if it is to be accepted to be a case of transfer of the undertaking by agreement as is suggested by the learned counsel for the petitioners, still the wording of the proviso and more 'particularly of clause (b) to section 25 FF clearly indi cate that the transfree concern of the management can change the terms and conditions of the workman. It might appear at first sight that the appellants have really no cause of grievance inasmuch as, though retrenched by the State Government, their services have been taken over by the Corporation. We have also been informed that the scale of pay of the tubewell operators in the Corporation is identical with that of those employed by the State Government. Though at one stage the Corporation had taken the stand that the appellants will be taken as fresh appointees in the Corporation, it is now common ground that the Corporation has fixed them up at the same level of pay at which they were in Government service immediately before retrenchment and they are also being granted incre ments on that scale. There are, however, two grounds of dissatisfaction which are consequent on the appellants being treated as fresh appointees who have entered the service of the Corporation only on the dates of their respective ap pointments thereto with the result that all the appellants will be junior in service to the tubewell operators who had been engaged by the Corporation, on its own account, between 1970 and the dates on which the appellants joined the serv ice of the Corporation. This by itself may also not be much of a disadvantage to the appellants since many of them are senior in age the other tubewell operators and may well retire earlier and we are also told that there are no ave nues of promotion from the post of tubewell operators, with the result that the question of seniority may not be very material. On the other hand, if they were to continue with the Corporation under the same terms and conditions which they were enjoying under the Government, they would get the advantage of continuity of service and thus be entitled to substantially higher amounts of pension and other terminal benefits. We have heard the learned counsel for the appellants as well as the counsel for the State and the counsel for the Corporation. However, as pointed out by the High Court, the decision that there should be a tubewell Corporation, that the Corporation should, in course of time, acquire the tubewells belonging to the Government and that the tubewells of the irrigation branch should be made over to the Corporation had been taken quite a long time back. The fact appears to be that the tubewells were not being operated profitably by the Government and the Government seems to have taken a decision that it would be more efficient, economical and prudent to have these tube wells run by the Corporation. We do not think we need elaborate further on this aspect since the relevant records were brought before the High Court and the High Court was satisfied that the individual compensation drafts were sent to the various subordinate offices ready for distribution to the concerned workers on or before the relevant date. In the circumstances of this case, we agree with the High Court that when indi vidual drafts for the amounts of compensation due to the various tubewell operators were forwarded to the divisional/sub divisional offices, sufficiently in time to be available to be taken by them by 31st August, 1983, there was sufficient compliance with the provisions of clause (b) of section 25 F. The contention based on clause (c) of section 25 F is equally baseless. The State 's case is that it had transferred its tubewells to the Corporation. It was under no obligation to find any fresh or alternative employment to the workers. It is submitted that 380 the Corporation had its own terms and conditions of service for its employees and could not change those terms and conditions of service for the benefit of those few employees whose services had been taken over as an act of commiseration. It would be unfair on the part of the Corporation to give the appellants benefit of their earlier service in the Government and made them senior to other employees who had been serving in the Corporation right from the beginning. The appellants have no right to claim any continuity of service in the circumstances. It is no doubt an independent entity in the sense that it has a separate legal existence with its own employees and its own finances to be looked after according to certain rules and regulations but, says Sri Gujral, in circumstances such as these, the "corporate veil" of the Corporation has to be torn as under and the basic identity of the Corporation as a department of the Government should be recognised and given effect to. It is also common ground that in this case, while transferring the tubewells to the Corporation, the Government has assured the Corporation that, if it suffers any loses because of the transfer, the losses would be made good by the Government. This, according to Shri Gujral, is the proper test to be applied and, if that is done, he submits, there can be put one answer to the question in this case. As pointed out by this Court in State of Bihar vs Industrial Tribunal,, , there is also no incompatibility in applying some of the provisions of the to persons in the service of the Government. Shri Gujral contends that there is preponderant authority for holding that, if those princi ples were to apply, the tubewell operators should have, in the Corporation, the same terms and conditions of service which they enjoyed when they were in the Government. The successor company, however, declined to continue in its employment some of the employees of the predecessor company. 13.Unlike the civil law, however, the industrial law has naturally taken a different view with regard to the duties of a successor in business who has decided to run the same and in the case of employees of the old concern it has regarded the rights and obligations of the old concern as continuing and to be enforceable as against the new manage ment and not to be affected by the substitution of the new management for the old, whenever justice of the case would require such enforcement . The same principles have also been recognised as of general application by the Madras High Court in the case of Odeon Cinema, [1954] II LLJ 314 as shown by the observations of their Lordships at p.319 where they remark : 'The industrial tribunal has cited a number of decisions of other industrial tribunals, in the course of which it has been held that where there is a transfer of business of one management to another, the rights and obli gations which existed as between the old management and their workers continue to exist vis a vis the new manage ment, after the date of the transfer. It appears to have been settled by a large number of decisions of the industrial and labour courts that the industrial law takes a different view about the duties and obligations of a successor inbusiness, and if a successor decides to run the same business which was carried on by his predecessor, the employees of the old concern are entitled to submit a dispute before the indus trial tribunal regarding their rights and obligations in the business of the old concern, and those rights and obliga tions must be regarded as continuing and enforceable against the new management and not affected by the substitution of the new management for the old. Shri Nayar submits that the Bombay case was one in which the employees of the old concern had only sought 're employment" in the successor concern, a concept quite different from the concept of continuity in service on the same terms and conditions and invited our attention to section 25H of the Act and to the decision in Indian Hume Pipe Co. Ltd. vs Bhima rao, It is true that the claim in the Bombay case appears to have been one for re employment but the principle laid down in these decisions is in wider terms, as the passages 384 underlined in the above excerpts will show. This Court passed a brief order to the following effect: "In the proceeding before the High Court, as also here, the State and the Nigam have not been impleaded as parties but learned counsel for the Corporation tells us that it was the understanding that the Nigam would takeover these 149 work men on the same terms and conditions as were applicable when they were working under the Corporation. The High Court has, however, referred to decision of this Court in Anakapala Coop Agricultural and Industrial Society Ltd. vs Its Workmen, [1963] Supp. This section provides that where there is a transfer of an undertaking by agreement or operation of law, an employee who loses his job because of such transfer will have a right to compensation from the predecessor, except where he gets the benefit of uninter rupted service with the new employer on no less favorable terms than before and will be entitled to compensation in case he should be retrenched later by the new employer. It has been construed in the Anakapalla Society case to say that in such a situation the employee can at best claim retrenchment compensation from the predecessor on the basis of a notional 385 retrenchment but will have no right to claim re employment, much less on the same conditions as before, from the successor. If the answer was that the transferee was a successor in interest in business, then industrial adjudication considered the question of re employment in the light of broad principles. Indeed, experience of industrial adjudication shows that in resolv ing industrial disputes from case to case and from time to time, industrial adjudication generally avoids as it should to lay down inflexible rules because it is of the essence of industrial adjudication that the problem should be resolved by reference to the facts in each case so as to do justice to both the parties. But it is significant that no industrial decision has been cited before us prior to 1956 under which the employees were held entitled to compensation against the vendor em ployer as well as re employment at the hands of the purchas er on the ground that it was a successor ininterest of the vendor. " and, therefore, in all cases to which section 25FF applies; the only claim which the employees of the transferred concern can legitimately make is a claim for compensation against their employers. No claim can be made against the transferee of the said concern. Of course, in such a case, "there has been no change of ownership or management and despite an apparent transfer, the transferor employer continues to be the real employer and there has to be continuity of service under the same terms and conditions of service as before and there can be no question of compensation". But it is not necessary here to decide whether this principle will help us to identify the corporation with the State Government in the present case for the present purposes, particularly as there is a catena of cases which do not approve of such identification (see Accountant and Secretarial Services P. Lid: vs Union, ; and the cases cited therein.). The tubewell operators, however, could not have been sent on deputation because there was no possibility at all of their being fitted into the irrigation branch later, in case the Corporation could find no use for them because, once the tubewells had been transferred for good to the Corporation, the Government could find no openings for them in the service. While, therefore, we do not agree with the appellant that the State Government discriminated against the appellants as compared with the other members of the staff by sending them on deputation but not the appellants, we think that this treat ment meted but to the other staff shows that the Government did not hesitate to burden the Corpo 389 ration with the liability of their salary etc. It was very fair on the part of the State Government to decide that, as the tube wells would be operated by the Corporation, it would be prudent to run them with the help of the appellants rather than recruit new staff therefore and that the Government should bear the burden of any losses which the Corporation might incur as a result of running the tubewells But having gone thus far, we are unable to see why the Government stopped short of giving the appellants the benefit of their past services with the Government when thus absorbed by the Corporation. The conduct of the Government in depriving the appellants of substantial benefits which have accrued to them as a result of their long service with the Government, although the tubewells continue to be run at its cost by a Corporation wholly owned by it, is something which is grossly unfair and inequitable. Though, as we have mentioned earlier, seniority in service is not of much importance in this case as there is no avenue of promotion to tubewell operators, the ques tion of seniority still becomes crucial in case the Corpora tion should close down any of the tubewells or decide on the retrenchment of its staff by reorganising the operation of tubewells in such a way that some of the staff may become surplus. In such an event, if the appellants are given the benefit of their length of service with the Government for all purposes, some of the present employees of the Corpora tion may become liable to be retrenched as junior in length of service to some of the appellants. Clearly, this should not be allowed to happen and the Corporation staff should not suffer merely because the appellants, who have been subsequently inducted into the Corporation, are given all the benefits of the length of their service with the Govern ment. There can be no question of any of the appellants being considered senior to such operators on the Corpora tion 's establishment. We would, therefore, like to make it clear that, while the appellants will have, for purposes of computation of their salary, length of service and retirement benefits the advantage of counting the period of their service with the Government, this will not enable them to claim any seniority over the former employees of the Corporation. At the same time there is the apprehension of the appel lants that if they are treated as juniors to all the Corpo ration 's employees, they may be sent out first in case there is any retrenchment. This is a situation that cannot be helped, being one in which the equities in favour of the appellants will be counter weighed by those in favour of the Corporation 's direct employees, The only solution to this difficulty which we can see in for the Corporation not to retrench the services of any of the appellants as far as possible whether due to the closure of some of the tubewells or otherwise. The Corporation can perhaps manage to continue them i. service without retrenching any of them on the ground that some of the tubewells have to be closed down or that some of these operators for some other reason have become surplus for its needs. If this could be done, it will be most equitable as it will achieve the following ends: (1) it will enable the present appellants to continue in service till they retire in normal course; (2) it will protect the interests of the erstwhile operators of the Corporation who have been serving in the Corporation from the beginning; (3) it will not cause any financial prejudice to the Corpo ration because of the assurance already given that any losses incurred by running the tubewells would be borne by the Government itself; and it will ensure that the Government acts fairly and equitably fulfilling the legitimate expectations of its employees. But in a case where one or both of the par ties is a State instrumentality, having obligations under the Constitution, the Court has a right of judicial review over all aspects of transfer of the undertaking. We, therefore, direct the State Government and the Corporation which is but a wholly owned State instrumentality bound to act at the behest of the State to carry out our directions above, the Corpora tion being at liberty to amend its rules and regulations, if necessary, to give effect to the same. We should, therefore, like to make it clear that in case any of the appellants have been paid any compensation, that amount will have to be refunded by them before this order can be given effect to qua them.
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The workers were tubewell operators for the Irrigation Branch of the Punjab Government's Public Works Department. The government decided to move all the tubewells from this branch to the Punjab State Tubewell Corporation. This corporation was owned and run by the government. It said that all tubewell operator jobs in the Irrigation Branch were canceled. The workers went to the High Court to challenge their firing. They argued that: (i) the transfer of tubewells was done in bad faith. They believed the only reason was to avoid paying the workers what they were owed; (ii) the notices didn't follow the rules of Section 25F of the law. This section says workers must get their compensation delivered to them, and notices must be sent by registered mail; and (iii) if the government's actions were legal, the Corporation should have to hire the workers. They wanted to keep their same job status and benefits as before. The High Court disagreed with the workers and rejected their requests. The High Court said the workers had already received all the payments they were owed. It also said that the Corporation had offered to rehire all the workers when their firing notices from the government expired. According to the judges, the only reason for the transfer was to get rid of the tubewells. The tubewells were causing the government to lose money, and there was no bad intent. The Corporation has since hired the workers. At first, the Corporation said the workers would be treated as new employees. But later, they set the workers' pay at the same level they had been making with the government. They also gave them raises as if they had never left. The workers still had two concerns: (1) They would be lower in seniority than other tubewell operators already working for the Corporation. (2) If they were considered fired government workers, their retirement benefits and pensions would only be based on their time working for the government. The workers argued that the Corporation was really just another part of the government. They said the court should ignore the fact that it was a separate company and recognize it as a government department. Alternatively, they argued that even if the Corporation was a separate company, it was the "successor" to the government department. The government had promised the Corporation that it would cover any losses from the transfer. Because the Corporation and the government were so closely linked, this was like the Corporation taking over a government department. Both the Irrigation Branch and the Corporation were considered an "industry" under the law, and the problem should be viewed that way. The Corporation argued that the government's responsibility ended when it paid the workers their separation pay. The Corporation said it was doing the workers a favor by hiring them. It would be unfair to give the workers credit for their time with the government and make them more senior than other employees. This was a new job, subject to the Corporation's rules, and the workers had no right to claim they had been working there continuously. The government decided it would be better if the Corporation ran them. There is no reason to think this decision was made in bad faith. (2) The government sent the payments to the workers in time for them to be picked up by August 31, 1983. This followed the rules of Section 25 F. (3) Running tubewells is an "industry," whether the government or the Corporation does it. (4) Some parts of the law can apply to people working for the government. (5) Notices were sent to the Labor Department and the employment office. The High Court was right to say that the notices did not have to be sent by registered mail to be legal. (6) When the government transfers a business to another government-controlled group, the Court can decide if the deal is fair. In this case, the Court can review the agreement between the government and the Corporation and make changes if needed. (7) In this case, the government acted unfairly toward the workers. The government unfairly took away benefits the workers had earned over many years of service. This kind of behavior is understandable for a private business, but not for the government. (8) The workers can add their time with the government to their time with the Corporation. This will be used to calculate their pay, length of service, and retirement benefits. The Corporation must also try to avoid laying off any of the workers due to tubewell closures or other reasons, until they retire or leave on their own. (9) Even before a certain section was added to the law, workers of a previous business owner had no right to be rehired by the new owner, except in special cases. Even then, it was not a guaranteed right, but a decision to be made fairly based on the situation.
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Civil Appeal No.257 of 1958. Appeal by special leave from the Award dated August 20, 1957, of the Industrial Court, Bombay, in Reference (IC) No. 197 of 1956. section N. Andley, J. B. P. Maheshwari, for the respondent. I. N. Shroff, for Interveners Nos. 1 and 2. The Intervener No. 1960 January 22, The Judgment of the Court was delivered by SUBBA RAO J. This appeal raises the question as to what extent the reserves can be deducted from the amount required for rehabilitation of plant and machinery and also as to the manner by which the deductible reserves can be ascertained. It would be enough if we narrated only the facts relevant to the question raised. The respondent, Rashtriya Girni Kamgar Sangh, represents the employees of the appellant Company. The respondent on behalf of the employees issued a notice to the appellant under section 42(2) of the Bombay Industrial Relations Act, 1946, demanding payment of reasonable bonus for the period from January 1, 1955 to December 31, 1955. Negotiations in this regard having failed, the respondent made a reference to the Industrial Court under section 73A of the said Act for arbitration of the dispute arising out of the said notice. 2.20 lakhs after deducting the prior charges from the gross profits of the Company, but it did not give any credit to the rehabilitation amount apart from the statutory depreciation. The Industrial Court disallowed this item for the following reasons: It estimated the amount required for rehabilitation at Rs. 60 lakhs; out of this amount it deducted Rs. 51 lakhs representing tile reserves and the balance of Rs. 9 lakhs spread over a period of 15 years gave the 843 figure of Rs. 60,000 as the amount that should be set apart for the year in question for rehabilitation. As the statutory depreciation was Rs. 83,639, it came to the conclusion that the Company would not be entitled to any allocation as a prior charge for rehabilitation. After excluding the said item of rehabilitation, it The fixed the surplus in a sum of Rs. The learned Solicitor General contended that the Industrial Court accepted the position that the reserves were used as working capital, but deducted the said amount from the amount required for rehabilitation on a wrong and unjustified assumption that, as the amounts so required would be spent for rehabilitation over a course of 15 years by instalments, the temporary user of the said reserves would not affect the question as they would be released in part or in whole in future years. He argued that this assumption was contrary to the view expressed in decided cases and also the principle governing the ascertainment of the amount for rehabilitation purposes. On the contrary the learned counsel for the respondent argued that the Industrial Court only assumed that the reserves had been utilised as working capital, as in the view taken by it did not in the least matter whether the reserves were so utilised or not and that, even if that view was wrong, the appellant could not succeed, unless it proved by relevant and acceptable evidence that the reserves were so utilised and that it did not place before the Industrial Court any such evidence to prove that fact. The first ques tion, therefore, is, what is the scope of the finding of the Industrial Court in this regard ? The Industrial Court in dealing with the contentions of the parties before it observed as follows: "It is true that until some amount is required to be spent for rehabilitation, replacement or modernization, reserves must be used as working capital, but Shri Vimadalal 's argument overlooks that the amount required to be spent for rehabilitation over a course of 15 years is not required to be 844 spent all at once, but by installments over a long period. " These observations did not record any finding that the reserves were used as working capital. It was only an assumption made by the Industrial Court, as, the view taken by it, it was immaterial whether the reserves were used as working capital or not. In ascertaining the surplus for the purpose of fixing the bonus for a particular year, the state of affairs in that year is the guiding factor. If in a subsequent year any part of the reserves used as working capital is released, that amount will have to be taken into account in ascertaining the surplus for that year and so on for subsequent years: otherwise it will lead to the anomaly of the reserves being excluded from the amount required for rehabilitation, though as a matter of fact the entire reserves were utilised as working capital, and though in future years they were expected to be released but in fact not so released. This would lead to a result inconsistent with the decisions on the subject which have clearly laid down that the reserves which have been used as working capital shall not be deducted from the amount fixed for rehabilitation. This result does not advance the case of the appellant unless it is able to prove by admissible evidence that it has used the reserves as working capital during the bonus year in question. Then the depreciation and general liquid reserves available to the employer are deducted. The reserves which have already (1) 845 been reasonably earmarked for specific purposes of the industry are, however, not taken into account in this connection. Last of all the rehabilitation amount which may have been allowed to the employer in previous years would also have to be deducted if it appears that the amount was avail able at the time when it was awarded in the past and that it bad not been used for rehabilitation purposes in the meanwhile. This decision, therefore, lays down, so far as it is relevant to the present purpose, that two items shall be deducted from the rehabilitation amount ascertained by adopting the "Full :Bench .Formuula" namely,(i)general reserves available to the employer and (ii) reserves which have not already been reasonably earmarked for specific purposes of the industry. The question is whether the mere availability of reserves or the simple earmarking for specific purposes would be sufficient to claim the said amounts as deductions. We do not think that by using the said words this Court meant to depart from the well recognized principle that if the general reserves have not been used as working capital, they cannot be deducted from the rehabilitation amount. The reserves may be of two Kinds. Moneys may be set apart by a company to meet future payments which the company is under a contractual or statutory obligation to meet, such as gratuity etc. These amounts are set apart and tied down for a specific purpose and, therefore, they are not available to the employer for rehabilitation purposes. But the same thing cannot be said of the general reserves: they would be available to the employer unless he his used them as Working capital. It must be ascertained by the Industrial Court on the material placed before it whether the said amount is far in excess of the requirements of the particular purpose for which 846 it is so earmarked and whether it is only a device to reduce the claim of the labour for bonus. We do not suggest that it is the duty of the Industrial Court to ascertain the correct or exact figure required for a particular purpose; but it is certainly its duty to is cover whether the so called earmarking for a particular purpose is a device to circumvent the formula. If it is satisfied that there is such a device, it shall deduct that figure in calculating the rehabilitation amount and if possible arrive at a real figure for that purpose. So too, in the case of general reserves when an employer claims that a specific amount reserved has been used as working capital, it is the duty of the Industrial Court to arrive at a finding whether the said reserves, or any part of them, have been used as working capital and, if so, to what extent during the bonus year. Shortly stated before a particular reserve can be deducted from the rehabilitation amount it must be established that it has been reasonably earmarked for a binding purpose or the whole or a part of it has been used as working capital and that only such part of the reserves coming under either of the two heads can be deducted from the said amount. To start with, from the gross profits of that year only items specifically declared by this Court in The Associated Cement Companies Ltd. vs Its Workmen to have a prior charge over the bonus shall be deducted to arrive at the surplus. No question of deducting any other amount reserved in regard to the profits of that year arises. But the company has specifically earmarked certain amounts for specific binding purposes in 1954 or earlier to meet future binding obliga tions, such as gratuity etc. ; or has reserved amounts for general purposes but not to meet any contractual or statutory obligations and has not utilised the same as working capital. In the former case the amount must be deemed to have been utilised and, therefore, it cannot be deducted from the rehabilitation amount; but in the latter case, as the said amounts were not utilised by the employer as working capital, they shall be deducted from the rehabilitation amount. (1) 847 What taken is the procedure to be followed for ascertaining the said facts ? The burden is obviously on the employer who claims the exclusion of the reserves from the rehabilitation amount on the ground that they are used as working capital or reasonably earmarked for a specific purpose to establish the said facts and to prove the same by relevant and acceptable evidence. The importance of this question in the context of fixing the amount required for rehabilitation cannot be over estimated. The item of rehabilitation is generally a major item that enters into the calculations for the purpose of ascertaining the surplus and, therefore, the amount of bonus. So, there would be a tendency on the part of the employer to inflate this figure and the employees to deflate it. The accounts of a company are prepared by the management. The balance sheet and the profit and loss account are also prepared by the company 's officers. The labour have no concern in it. When so much depends on this item, the principles of equity and justice demand that an Industrial Court should insist upon a clear proof of the same and also give a real and adequate opportunity to the labour to canvass the correctness of the particulars furnished by the employer. Cases coming before us disclose that the Industrial Courts and Labour Tribunals are not bestowing so much attention on this aspect of the case as they should. Some of the tribunals act oil affidavits and sometimes even on balance sheets and extracts of accounts without their being proved in accordance with law. For the purpose of holding an enquiry or a proceeding under the Bombay Industrial Relations Act, 1946, section 118 of the said Act confers on the Industrial Court the same powers as are vested in Courts in respect of (a) proof of facts by affidavits; (b) summoning and enforcing the attendance of any person and examining him on oath; (c) compelling the production of documents; and (d) issuing commissions for the examinations of witnesses. In Courts facts have to be established either by oral evidence or by documentary evidence proved in the 108 848 manner prescribed by law. But Order XTX of the Code of Civil Procedure empowers the Court, to have particular facts proved by affidavits. Under rule `thereof "any Court may at any time for sufficient reason order that any particular fact or facts may be proved by affidavit, or that the affidavit of any witness may be read at the hearing, on such conditions as the Court thinks reasonable". But it is subject to the proviso that where it appears to the Court that either part%, bonafide desires the production of a witness for (cross examination, and that such witness can be produced, an order shall not be made authorizing the evidence of ' such witness to be given by affidavit. Under rule 2, "upon any application evidence may be given by affidavit, but the Court may, at the instance of either party, order the attendance for cross examination of the deponent ". A combined effect of the relevant provisions is that ordinarily fact has to be proved by oral evidence,, but the Courts, subject to the conditions laid down in Order XIX, may ask a particular fact or facts to proved by affidavits. Industrial Courts may conveniently follow the procedure. In view of the importance of the item of rehabilitation in the matter of arriving at the surplus for fixing the bonus principles of equity and justice demand that tribunals should weigh with great care the evidence adduced by the management as well as by the labour to ascertain every sub item that goes into or is subtracted from the rehabilation. If they agree to the decision of affidavits that course may be followed. in the absence of an agreement, the procedure prescribed in Order XIX of the Code of Civil Procedure may usefully be followed by the tribunals so tlitt, both the parties may have full opportunity to (Establish their respective cases. In lndian Hume Pipe Company Ltd vs Their workmen (1), the balance sheet was upon for proving that the amounts were available for use as working capital and that the (1) ,5 849 balance sheet showed that they were in fact so used. Bhagwati, J., who delivered the judgment of the Court, presumably to meet the contention that the balance sheet had not been proved, observed at p. 362 thus : " Moreover, no objection was urged in this behalf, nor was any finding to the contrary recorded by the tribunal. " In that case it was conceded that the reserves were in fact used as working capital. It is suggested that the learned Judge solely relied upon the relevant items in the balance sheet in support of his conclusion and that the said observation was only an additional ground given by him, but we are inclined to think that the Court would not have accepted the items in the balance sheet as proof of user if it was not satisfied that no objection was taken in that behalf. In Tata Oil Mills Company Ltd. vs Its Workmen (1), a similar question was raised. It was contended by the labour in that case that the depreciation reserve was Dot used as working capital and therefore no return should be allowed on the said reserve. The Chief Accountant of the Company made an affidavit on behalf of the Company that the said depreciation reserve, along with others, had been used as working capital. This Court accepted the affidavit for the year in question, but made the following observations for future guidance: "It will, however, be open to the workmen in future to show by proper cross examination of the company 's witnesses or by proper evidence that the amount shown as the depreciation reserve was not available in whole or in part to be used as working capital and that whatever may be available was, not in fact so used in the sense explained above. In the present appeal, however,we must accept the affidavit of the chief accountant. " These observations also recognized the necessity to give an opportunity to the workmen to cross examine the witnesses put forward by the management to prove the user of any particular reserve as working capital. This Court once again dealt with the same (1) 850 subject in Anil Starch Products Ltd. vs Ahmedabad Chemical Workers Union (1). That appeal also raised the question whether return should be allowed on the depreciation reserve used as working capital. It was contended for the labour in that case that the depreciation reserve was not used as working capital. Rejecting the said contention, Wanchoo, J., observed: It is enough to say in that connection that an affidavit was filed by the manager of the company to the effect that all its reserves including the depreciation fund had been used as working capital. He was cross examined as to the amount required for rehabilitation, which was also given by him in that affidavit; but no question was put to him to challenge his statement that the entire depreciation reserve had been used as working capital In the circumstances, we must accept the affidavit so far as the present year is concerned and hold that the working capital was Rs. Notwithstanding the said finding, the learned Judge took care to reserve the rights of the workmen in future by making the following observations: "It will, however, be open to the workmen in future to show by proper cross examination of the company,s witnesses or by proper evidence that the amount shown as depreciation reserve was not available in whole or in part as explained above to be used as working capital and that whatever was available was not in fact so used. " This judgment again reinforces the view of this Court that proper opportunity should be given to the labour to test the correctness of the evidence given on affidavit on behalf of the management in regard to the user of the reserves as working capital. What is the position in the present case ? It is not suggested that there is any reserve which has been reasonably earmarked to discharge a contractual or statutory obligation. We are only concerned with (1) Civil Appeal No. 684 Of 1957 (not reported) 851 general reserves. The learned Solicitor General contends that the balance sheet discloses that the entire reserves have been used as working capital and that the respondent did not canvass this position in the statement filed by it before the Industrial Court. We have already pointed out that the balance sheet, without its being proved by a person competent to do so, cannot prove that any reserves have been utilised as working capital. In the written statement filed by the appellant before the Industrial Court, no specific allegation is made that the reserves were utilised as working capital, though in its statement of calculations the said reserves were not excluded from the amount claimed towards rehabilitation. As there is no specific allegation, the respondent also in its statement did not deny the said fact, but in its statement of calculations it did not deduct the reserves from the rehabilitation amount. Therefore, it must be held that the respondent did not accept the position that the reserve funds were utilised as working capital. Strong reliance is placed upon the evidence of the General Superintendent of the appellant Company, but a perusal of that evidence discloses that the said witness has not deposed that the Company used the reserves as working capital; nor does the said witness seek to prove either the balancesheet or any extract taken therefrom. In the circumstances, the respondent had no opportunity to cross examine him in respect of the alleged user of the reserves. For the aforesaid reasons, we have no option but to hold that Rs. 51 lakhs representing the reserves were not used as working capital and, therefore, the said amount was rightly deducted by the Industrial Court from Rs. 60 lakhs fixed by it towards rehabilitation. As the balance of Rs. 9 lakhs spread over 15 years came to only Rs. 60,000 during the bonus year and as the statutory depreciation was Rs. 83,639, the Industrial Court rightly excluded the entire rehabilitation amount from its calculations in arriving at the surplus. No other points were raised before us. In the result, the appeal fails and is dismissed with costs. Appeal dismissed.
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To figure out how much extra money a company has to pay bonuses, the Industrial Court used a certain formula. The court allowed the company to subtract the standard amount for depreciation (the loss of value of equipment over time). However, the court didn't give the company credit for the money it claimed it needed for repairs and upgrades (rehabilitation). The Industrial Court estimated that the company needed 60 lakhs (6 million) Rupees for rehabilitation. From this amount, the court subtracted 51 lakhs (5.1 million) Rupees because the company had that much in reserve funds. The remaining 9 lakhs (900,000) Rupees, spread out over 15 years, meant the company should set aside 60,000 Rupees per year for rehabilitation. Because this yearly amount was less than the standard depreciation, the Industrial Court decided the company couldn't deduct anything extra for rehabilitation before paying bonuses. The company argued that it used all of its reserve funds as working capital (money used for day-to-day operations). Because of this, the company claimed the reserve funds shouldn't be subtracted from the amount needed for rehabilitation. The court decided the company didn't prove it actually used the reserve funds as working capital. So, the Industrial Court was right to subtract that amount from the money set aside for rehabilitation. The case *The Associated Cement Companies Ltd. vs Its Workmen* was mentioned. Because rehabilitation costs are important when figuring out how much extra money is available for bonuses, courts must carefully consider the evidence from both sides. They need to check every detail that goes into or is taken out of the rehabilitation costs. If both sides agree on certain numbers, those numbers can be used. If they agree to make a decision based on written statements (affidavits), that can be done too. But if they don't agree, the procedure outlined in Order XIX of the Code of Civil Procedure must be followed. The company's management prepares the financial records, like the balance sheet and profit and loss statements. The workers have no say in it. Because the rehabilitation costs are so important, the Industrial Court needs to make sure there's clear proof of those costs. The court also needs to give the workers a fair chance to question the accuracy of the information the company provides. The cases *Indian Hume Pipe Company, Ltd. vs Their Workmen*, *Tata Oil Mills Company Ltd. vs Its Workmen*, and *Anil Starch Products Ltd. vs Ahmedabad Chemical Workers ' Union* were mentioned.
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Heard the learned counsel on either side.
2. The petitioner after completing his 10th standard, joined Diploma in
Mechanical Engineering and thereafter, he obtained B.E Degree Course through
lateral entry. Now he wants to study law. Since he has not done 12th standard,
he had difficulties in taking up the Law Degree Course. That led to filing of
this writ petition.
3. When the matter was taken up for hearing, the learned Standing
Counsel appearing for the Bar Council of India drew my attention to the
decision taken by the Legal Education Committee on 21.05.2022. The said
decision reads as follows:
To consider the Orders dated 23.03.2021 passed by the Hon'ble
High Court of Madras in W.P.No.7665 of 2021 and in W.P.No.
10646 of 2021 vide dated 27.04.2021.
W.P(MD)No.17420 of 2022
The Legal Education Committee of the Bar Council of India
has considered the Orders dated 23.03.2021 passed by the
Hon'ble High Court of Madras in W.P.No.7665 of 2021 and in
W.P.No.10646 of 2021 vide dated 27.04.2021.
After consideration, it is resolved that the 3 year
diploma/polytechnic course issued by an institution recognized
by the Government shall be considered at par with +2
certificate for the purpose of equivalence for admission to the 5
year integrated L.L.B. Degree Course.”
Since the position has been clarified, the petitioner is now eligible to apply for
the three year L.L.B Course in the first respondent University. The first
respondent shall consider the case of the petitioner in view of the aforesaid
decision taken by the Bar Council of India.
4. This writ petition is disposed of on these terms. No costs.
Note: Issue Order Copy on 29.08.2022.
W.P(MD)No.17420 of 2022
1.The Registrar cum Chairman,
School of Excellence in Law,
3 years L.L.B.Hons Admission 2020-21,
Bar Council of Tamil Nadu and Puducherry,
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A college graduate asked the court to let him study law even though he hadn't finished 12th grade. During this hearing, the Bar Council of India spoke to a judge named Justice GR Swaminathan. The Council explained that its Legal Education Committee had decided on May 21, 2022. This decision meant that diploma and polytechnic courses would be considered the same as a 12th-grade certificate.
After thinking about it, they decided that a three-year diploma or polytechnic course from a government-approved school will be treated like a 12th-grade certificate. This makes it equal for getting into a five-year combined law degree program (L.L.B.).
The student who brought the case finished 10th grade and then studied for a Diploma in Mechanical Engineering. After that, he earned a Bachelor of Engineering (BE) degree by joining the program partway through. He then wanted to get a three-year law degree (LLB). But because he had not finished 12th grade, he had trouble getting accepted.
Because the Bar Council of India made its rule clear, the court stated that the student was allowed to apply for the three-year law program. So, the court told the main administrator (Registrar) of the Tamil Nadu Dr. Ambedkar Law University to review the student's application and make the correct decision.
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etition (C) No. 381 of 1998. 8 (Under Article 32 of the Constitution of India). S.K. Sinha for the Petitioner. D. Goburdhan, Ms. A. Subhashini, K.K. Lahiri, Ms. Lira Goswami and D.N. Misra for the Respondents. The Judgement of the Court was delivered by SINGH,J. We heard the arguments in detail on 13.12. 1990 and dismissed the petition with costs amounting to Rs. 5,000 with the direction that the reasons shall be delivered later on. We are, accordingly, delivering our reasons. This petition is under Article 32 of the Constitution by Subhash Kumar for the issue of a writ or direction directing the director of Collieries, West Bokaro Collieries at Ghatotand, District Hazaribagh in the State of Bihar and the Tata from & Steel Co. Ltd. to stop forthwith discharge of slurry/sludge from its washeries at Ghatotand in the District of Hazaribagh into Bokaro river. This petition is by way of public interest litigation for preventing the pollution of the Bokaro river water from the sludge/slurry discharged form the washeries of the Tata Iron & Steel Co. Ltd. The petitioner has alleged that the Parliament has enacted the (hereinafter referred to as `the Act ') providing for the prevention and control of water pollution and the maintaining or restoring of wholesomeness of water, for the establishment of Board for the prevention and control of water pollution. Under the provisions of the Act the State Pollution Control Board constituted to carry out functions prescribed under Section 17 of the Act which among other things provide that the Board shall inspect sewage or trade effluents and plants for the treatment of sewage and trade effluents and to review plans, specifications or other data set up for the treatment of water and to lay down standards to be complied with by the persons while causing discharge of sewage or sullage. Section 24 of the Act provides that no person shall knowingly cause or permit any poisonous, noxious or polluting matter to enter into any stream or well, which may lead to a substantial aggravation of pollution. The petitioner has asserted that Tata Iron and Steel Co respondent No.5 carries on mining operation in coal mines/washeries in the town of Jamshedpur. These coal mines and collieries are known as West Bokaro Collieries and the Collieries have two coal washeries where the coal after its extraction from the mines is brought and broken into graded pieces and there 9 after it is processed for the purpose of reducing its ash contents. A chemical process is carried out which is known as `froth floatation process '. Under this process the graded coal is mixed with diesel oil, pine oil and many other chemical ingredients and thereafter it is washed with the lacs of gallons of water. The end water is washed coal with reduced quantity of ash content fit for high graded metallurgical process for the purposes of manufacture of steel. In the process of washing large quantity of water is discharged through pipes which carry the discharged water to storage ponds constructed for the purpose of retaining the slurry. Along with the discharged water, small particles of coal are carried away to the pond where the coal particles settle down on the surface of the pond, and the same is collected after the pond is de watered. The coal particles which are carried away by the water is called the slurry which is ash free, it contains fine quality of coal which is used as fuel. The petitioner has alleged that the surplus waste in the form of sludge/slurry is discharged as an effluent from the washeries into the Bokaro river which gets deposited in the bed of the river and it also gets settled on land including the petitioner 's land bearing Plot No.170. He was further alleged that the sludge or slurry which gets deposited on the agricultural land, is absorbed by the land leaving on the top a fine carbonaceous product or film on the soil, which adversely affects the fertility of the land. The petitioner has further alleged that the effluent in the shape of slurry is flown into the Bokaro river which is carried out by the river water to the distant places polluting the river water as a result of which the river water is not fit for drinking purposes nor it is fit for irrigation purposes. The continuous discharge of slurry in heavy quantity by the Tata Iron & Steel Co. from its washeries posing risks to the health of people living in the surrounding areas and as a result of such discharge the problem of pure drinking water has became acute. The petitioner has asserted that inspite of several representations, the State of Bihar and State Pollution Control Board have failed to take any action against the Company instead they have permitted the pollution of the river water. He has further averred that the State of Bihar instead of taking any action against the Company has been granting leases on payment of royalty to various persons for the collection of slurry. He has, accordingly, claimed relief for issue of direction directing the respondents which include the State of Bihar, the Bihar Pollution Control Board, Union of India and Tata Iron & Steel Co. to take immediate steps prohibiting the pollution of Bokaro river water from the discharge of slurry into the Bokaro river and to take further action under provisions of the Act against the Tata Iron & Steel Co. 10 The respondents have contested the petition and counter affidavits have been filed on behalf of the respondent Nos. 2, 4 and 5 State of Bihar, State Pollution Board, Directors of Collieries and Tata Iron & Steel Co. Ltd. In the counter affidavits filed on behalf of the respondents, the petitioner 's main allegation that the sludge/slurry is being discharged into the river Bokaro causing pollution to the water and the land and that the Bihar State Pollution Board has not taken steps to prevent the same is denied. In the counter affidavit filed on behalf of the Bihar State Pollution Board it is asserted that the Tata Iron & Steel Co. operates open case and underground mining. The Company in accordance to Sections 25 and 26 of the Water (Prevention Control of Pollution) Act, 1974 applied for sanction from the Board of discharge their effluent from their outlets. The Board before granting sanction analysed their effluent which was being watched constantly and monitored to see that the discharges does not affect the water quality of the Bokaro river adversely. In order to prevent the pollution the Board issued direction to the Director of the Collieries to take effective steps for improving the quality of the effluent going into the Bokaro river. The State Pollution Board imposed conditions requiring the Company to construct two settling tanks for settlement of solids and rewashing the same. The Board directed for the regular samples being taken and tested for suspended solids and for the communication of the results of the tests to the Board each month. The State Board has asserted that the Company has constructed four ponds ensuring more storing capacity of effluent. The Pollution Board has been monitoring the effluent. It is further stated that on the receipt of the notice of the instant writ petition the Board carried out an inspection of the settling tanks regarding the treatment of the effluent from the washeries on 20th June, 1988. On inspection it was found that all the four settling tanks had already been completed and work for further strengthening of the embankment of the tanks was in progress, and there was no discharge of effluent from the washeries into river Bokaro except that there was negligible seepage from the embankment. It is further stated that the Board considered all the aspects and for further improvement it directed the management of the collieries for removal of the settle slurry from the tanks. The Board has directed that the washeries shall perform desludging of the settling tanks at regular intervals to achieve the proper required retention time for the separation of solids and to achieve discharge of effluents within the standards prescribed by the Board. It is further asserted that at present there is no discharge from any of the tanks of the Bokaro river and there is no question of pollution of the river water of affecting the fertility of land. In their affidavits files on behalf of the respondent 11 Nos. 4 and 5, they have also denied the allegations made in the petition. They have asserted that the effective steps have been taken to prevent the flow of the water discharge from the washeries into the river Bokaro. it is stated that infact river Bokaro remains dry during 9 months in a year and the question of pollution of water by discharge of slurry into the river does not arise. However, the management of the washeries have constructed from different ponds to store the slurry. The slurry which settles in the pounds is collected for sale. The slurry contains highly carbonaceous materials and it is considered very valuable for the purpose of fuel as the ash contents are almost nil in the coal particles found in the slurry. Since, it has high market value, the Company would not like it to go in the river water. The Company has taken effective steps to ascertain that no slurry escapes from its ponds at the slurry is highly valuable. The Company has been following the directions issued by the State Pollution Control Board constituted under the 1974 Act. On the facts as appearing from the pleadings and the specific averments contained in the counter affidavit filed on behalf of the State Pollution Control Board of Bihar, prima facie we do not find any good reason to accept the petitioner 's allegation that the water of the river Bokaro is being polluted by the discharged of sludge or slurry into it from the washeries of the respondent company. On the other hand we find that the State Pollution Control Board has taken effective steps to check the pollution. We do not consider it necessary to delve into greater detail as the present petition does not appear to have been filed in public interest instead the petition has been made by the petitioner in his own interest. On a perusal of the counter affidavit filed on behalf of the respondent Nos. 4 and 5 it appears that the petitioner has been purchasing slurry from the respondent Nos. 4 and 5 for the last several years. With the passage of time he wanted more and more slurry, but the respondent company refused to accept his request. The petitioner is an influential businessman, he had obtained a licence for coal trading, he tried to put pressure through various sources on the respondent company for supplying him more quantity of slurry but when the Company refused to succumb to the pressure, he started harassing the Company. He removed the Company 's slurry in an unauthorised manner for which a Criminal Case No., 173 of 1987 under Sections 379 and 411 of the Indian Penal Code read with Section 7 of the Essential Commodities Act was registered against the petitioner and Pradip Kumar his brother at Police Station Mandu, which is pending before 12 the Sub Judge, Hazaribagh. One Shri Jugal Kishore Jayaswal also filed a criminal complaint under Section 379 and 411 of the IPC against the petitioner and his brother Pradip Kumar in the Court of Judicial Magistrate, First Class, Hazaribagh, which is also pending before the Court of Judicial Magistrate, 2nd Class Hazaribagh. The petitioner initiated several proceedings before the High Court of Patna under Article 226 of the constitution for permitting him to collect slurry from the Raiyati land. These petitions were dismissed on the ground of existence of dispute relating to the title of the land. The petitioner filed a writ petition C.W.J.C. No. 887 of 199o in the High Court of Patna for taking action against the Deputy Commissioner, Hazaribagh for implementing the Full Bench judgment of the Patna High Court in Kundori Labours Cooperative Society Ltd. & etc. vs State of Bihar & Ors. , AIR 1986 Patna 242 wherein it was held that the slurry was neither coal nor mineral instead it was an industrial waste of coal mine, not subject to the provisions of the Mines and Mineral (Regulation and Development) Act, 1957. Consequently the collection of slurry which escaped from the washeries could be settled by the State Government with any person without obtaining the sanction of the Central Government. The petitioner has been contending before the High Court that the slurry which was discharged from washeries did not belong to the Company and he was entitled to collect the same. Since the respondent company prevented the petitioner from collecting slurry from its land and as it further refused to sell any additional quantity of slurry to him, he entertained grudge against the respondent company. In order to feed fat his personal grudge he has taken several proceedings against the respondent company including the present proceedings. These facts are quite apparent from the pleadings of the parties and the documents placed before the Court. Infact,there is intrinsic evidence in the petition itself that the primary purpose of filling this petition is not to serve any public interest instead it is in self interest as would be clear from the prayer made by the petitioner in the interim stay application. The petitioner claim interim relief from this Court permitting him to arrest/collect sludge/slurry flowing out of the washeries of the respondent Nos. 4 and 5 and with a direction to the State of Bihar, its officers and other authorities for not preventing him from collecting the sludge/slurry and transporting the same. The prayer for the interim relief made by the petitioner clearly indicates that he is interested in collecting the slurry and transporting the same for the purposes of his business. As already state a Full Bench of the Patna High Court held that the slurry was not coal and the provisions of the Mines and Mineral (Regulation and Development) Act, 1957 were not applicable, the State Government was tree to settle the same 13 and the Tata Steel & Iron Co. had no right to collect the slurry which escaped from its washeries. The respondent company filed an appeal before this Court. During the pendency of the aforesaid appeal, the petitioner filed the present petition. The appeal preferred by the Tata Iron & Steel Co. Ltd. and Bharat Coking Coal Ltd. was allowed by this Court and judgment of Patna High Court was set aside. The judgment of this Court is reported in Judgments today Vol. 3 wherein it has been held that the slurry/coal deposited on any and continues to be coal and the State Government has no authority in law to deal with the same and the slurry deposited on the Company 's land belongs to the Company and no other person had authority to collect the same. Article 32 is designed for the enforcement of Fundamental Rights of a citizen by the Apex Court. It provides for an extraordinary procedure to safeguard the Fundamental Rights of a citizen. Right to live is a fundamental right under Art 21 of the Constitution and it includes the right of enjoyment of pollution free water and air for full enjoyment of life. If anything endangers or impairs that quality of life in derogation of laws, a citizen has right to have recourse to Art, 32 of the Constitution for removing the pollution of water or air which may be detrimental to the quality of life. A petition under article 32 for the prevention of pollution is maintainable at the instance of affected persons or even by a group of social workers or journalists. But recourse to preceeding under article 32 of the Constitution should be taken by a person genuinely interested in the protection of society on behalf of the community. Public interest litigation cannot be invoked by a person or body or person to satisfy his or its personal grudge and enmity. if such petitions under Article 32, are entertained it would amount to abuse of process of the Court, preventing speedy remedy to other genuine petitioner from this Court. Personal interest cannot be enforced through the process of this Court under article 32 of the Constitution in the garb of a public interest litigation. Public interest litigation contemplates legal proceeding for vindication or enforcement of fundamental rights of a group of persons or community which are not able to enforce their fundamental rights on account of their incapacity, poverty or ignorance of law. A person invoking the jurisdiction of this Court under article 32 must approach this Court for the vindication of the fundamental rights of affected persons and not for the purpose of vindication of his personal grudge or enmity. It is duty of this Court to discourage such petitions and to ensure that the course of justice is not obstructed or polluted by unscrupulous litigants by invoking the extraordinary jurisdiction of this Court for personal matters under the garb 14 of the public interest litigation see Bandhua Mukti Morcha vs Union of India, ; ; Pandey vs State of West Bengal, ; at 331; Ramsharan Autyanuprasi & Anr. vs Union of India & Ors., [1989] Suppl. 1 SCC 251 and Chhetriya Pardushan Mukti Sangharsh Samiti vs State of U.P. & Ors., [1990] 4 SCC 449. In view of the above discussion we are of the opinion that this petition has been filed not in any public interest but for the petitioner 's personal interest and for these reasons we dismissed the same and directed that the petitioner shall pay Rs. 5,000 as costs. These costs are to be paid to the respondent Nos. 3,4 & 5.
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The petitioner (the person who filed the case) asked the court to step in, arguing it was a matter of public interest. They claimed that West Bokaro Collieries and Tata Iron and Steel Company (TISCO) were polluting the Bokaro River. They said these companies were dumping waste (sludge/slurry) from their cleaning processes into the river. This made the water unsafe to drink or use for farming, harming people's health. The petitioner also said that the government of Bihar and the State Pollution Control Board hadn't done enough to stop the pollution. Instead, Bihar was giving people permission to collect the waste sludge, in exchange for payment. Because of this, the petitioner asked the court to order the companies to stop polluting the river immediately and to take legal action against TISCO. The petitioner also asked the court for temporary permission to collect the sludge/slurry coming from the companies' cleaning facilities. The companies disagreed with the petitioner's claims and fought the petition. The Bihar State Pollution Board said they had told Bokaro Collieries to improve the quality of the waste going into the Bokaro River. They also said that TISCO had permission to release waste from their factories, following certain rules (sections 25 and 26 of the 1974 Act, a pollution control law). TISCO and Bokaro Collieries said they had taken all possible steps to prevent pollution and were following the State Pollution Board's instructions. On December 13, 1990, the court dismissed the petition and made the petitioner pay court costs. The court explained why it dismissed the petition: 1. Article 32 of the Constitution (the country's basic law) is meant to protect people's fundamental rights through the highest court. It's a special way to protect these rights. The right to life, under Article 21, includes the right to clean water and air. If something breaks the law and threatens people's quality of life, they can use Article 32 to stop water or air pollution that harms them. A petition under Article 32 to prevent pollution can be filed by those affected, or even by a group of concerned citizens or reporters. But, Article 32 should be used by people who genuinely care about protecting the community. Public interest cases can't be used to settle personal scores or grudges. If the court allowed such cases, it would be unfair to others with real concerns and slow down justice. Personal issues can't be brought to the court as public interest cases under Article 32. Public interest cases are for protecting the fundamental rights of a group or community that can't do it themselves because they're poor, powerless, or don't know the law. Someone using Article 32 must be trying to protect others' rights, not settle a personal issue. The court has a duty to stop people from misusing the system and using public interest cases for their own benefit. 2. This case isn't really about public interest, but about the petitioner's own interests. There's evidence in the petition itself that the main reason for filing it was selfish, not for the good of the public. The petitioner had been buying sludge from the companies for years. Over time, he wanted more sludge, but the Company refused. He took the Company's sludge without permission, leading to criminal charges against him and his brother. Because the company wouldn't sell him more sludge, he became angry and filed several cases against them, including this one. The fact that the petitioner asked for permission to collect sludge/slurry from the companies and for the government to allow him to do so shows that he's interested in collecting it for his business. So, there's no good reason to believe the petitioner's claim that the river is being polluted by the companies. The records show that the State Pollution Control Board is working to control pollution.
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Criminal Appeal No. 82 of 1967. Appeal by special leave from the judgment and order dated March 15. 1967 of the Rajasthan High Court in Criminal Appeal No. 219 of 1965. Sobhag Mal Jain and V.S. Dave, for the appellant. K.B. Mehta, for the respondent. The Judgment of the Court was delivered by Hegde, J. The appellant 's conviction by the learned Additional Sessions Judge, Jodhpur under section 314 read with section 109, Indian Penal Code, having been affirmed by the High Court of Rajasthan, he appeals to this Court after obtaining special leave. The charge on the basis of which he was tried was that some 689 days prior to May 1, 1963, he abetted one Mst. Radha at Jodhpur to cause the miscarriage of one Miss Atoshi Dass alias Amola, who as a result of administration of tablets and introduction of "laminaria dento" by the said Mst. Radha, died on May 1, 1963. The case for the prosecution is that in about the years 1962 63, the appellant was the 13resident of Gramotthan Pratishthan at Jalore. Miss Atoshi Dass was a teacher working in Indra Bal Mandir, Tikhi, an institution under the management of the appellant. She was young and unmarried. Illicit relationship developed between the aforementioned Atoshi Dass and the appellant as a result of which Miss Atoshi Dass became pregnant. With a view to cause abortion of the child in her womb, the appellant took Miss Dass to Jodhpur and there attempted to cause the miscarriage mentioned above through one Mst. Radha. The attempt was not successful. The insertion of "laminaria dento" in the private pacts of Miss Dass caused septicaem as a result of which she died in the hospital on May 1, 1963. The appellant 's case is that he had no illicit relation with Miss Atoshi Dass nor did he abet the alleged abortion. He denies that Miss Atoshi Dass died as a result of any attempt at abortion. As seen earlier the appellant was charged and tried for the offence of abetting Mst. Radha to cause the miscarriage in question but he was ultimately convicted of the offence of abetting Miss Dass in the commission of the said offence. It may be stated at this stage that one Mst. Radha was tried along with the appellant in the trial court but she was acquitted on the ground that there was no evidence to show that she had anything to do with the abortion complained of. Despite the contentions of the appellant to the contrary, we think there is satisfactory evidence to show that the death of Miss. Dass was due to septicaem resulting from the introduction of "laminaria dento" into her private parts. On this point we have the unimpeachable evidence of Dr. A.J. Abraham. P.W. 4. There is also satisfactory evidence to show that the appellant was in terms of illicit intimacy with Miss Dass. It is true that the principal witness on this point is Miss Chhayadass, P.W. 6, the sister of the deceased, a witness who has given false evidence in several respects. But as regards the illicit relationship between the appellant and Miss Atoshi Dass, her evidence receives material corroboration from the evidence of P.W. 7, M.B. Sen and P.W. 5. Misri Lal. Further it also accords with the probabilities. of the case. It is not necessary to go into that question at length as we have come to the conclusion that the appellant is entitled to an acquittal for the reasons to be stated presently. 690 While we are of opinion that there was illicit intimacy between the appellant and the deceased, we are unable to accept the assertion of Miss Chhayadass that the appellant was her only paramour. D. 3 conclusively proves that the deceased had illicit relationship with one Sood at Delhi. In the committal court Miss Chhayadass admitted that the address on Exh. D 3 is in the handwriting of the deceased. In that court she was positive about it; but in the trial court she went back on that admission. In many other respects also she had deviated from the evidence given by her in the committal court. Hence we are unable to. accept her statement in the trial court that the address found on Exh. D 3, an inland letter is not in the handwriting of the deceased. D 3, appears to be a self addressed letter sent by the deceased to one Sood. The fact that the deceased had more than one paramour is not a material circumstance though it may indicate that the appellant could not have had any compelling motive to abet the abortion complained of. The .fact that the appellant was on terms of illicit intimacy with the deceased, an unmarried girl and that she later became pregnant through him is without more, not sufficient to connect the appellant with the crime. From the evidence of Misrilal and Sengupta, it is clear that the appellant and the deceased had gone together to Jodhpur on April 24, 1963. But from the evidence of Sengupta, it is also clear that the deceased had some work to attend to at Jodhpur. It is also clear from the evidence of Miss Chhayadass that the deceased and the appellant were going together to Jodhpur and other places off and on. It may be noted that while returning from Jodhpur to his native place, the appellant left the deceased with Mr. and Mrs. Sengupta. Hence the circumstance that the appellant and the deceased went together to Jodhpur on April 24, 1963. cannot be held to be an incriminating circumstance. This leaves us with the evidence relating to the actual abetment. On this aspect of the case the only evidence brought to our notice is the evidence of Miss Chhayadass and the letter exhibit P.4. Miss Chhayadass deposed in the trial court that when the pregnancy of the deceased became noticeable, the appellant told the deceased in the presence of that witness; that he would get the the child aborted through Mst. Radha. As mentioned earlier Miss Chhayadass is a highly unreliable witness. She had admitted in the committal court that she had been tutored by the police to give evidence. In fact she pointed out a police officer who was in the court as the person who had tutored her. In the trial court she denied that fact. There is no gainsaying the fact that she was completely under the thumb of the police. She deviated from most of the important admissions made by her during her cross examination in the committal court. Coming to the question of the abetment referred to earlier, this is what she stated during her cross examination in the committing court: 691 "My sister did not tell Madan Raj about her illness (arising from her pregnancy) in my presence. On being enquired by me about my sister at Jalore I was informed that my sister had gone to Mst. Radha Nayan in the hospital for treatment. No talks about it were held before me prior to my talk at Jalore (talks between Madanraj and my sister about treatment). " According to the admissions made by her in the committal court she came to know for the first time about her sister 's intention to cause miscarriage only after her death. No reliance can be placed on the evidence of such a witness. Now coming to Exh. P.4, this is a letter said to have been written by the deceased sometime before her death intending to send the same to the appellant which in fact was not sent. It was found in her personal belongings after her death. There was some controversy before the courts below whether the same is admissible under section 32 (1 ) of the Evidence Act and whether it could be brought within the rule laid down by the Judicial Committee in Pakala Narayana Swami vs Emperor(1). We have not thought it necessary to go into that question as in our opinion the contents of the said letter do not in any manner support the prosecution case that the appellant instigated the deceased to cause miscarriage. The letter in question reads thus: "Santi Bhawan 28 4 63. I went with your letter to. the father. Since I could not get money from him, I dropped you a letter. I went to Mst. Radha and asked her to give me medicine. I further said that the money would be received. She gave me a tablet and told me that injection would be given on receipt of full payment. This tablet is causing unbearable pain and bleeding but the main trouble will not be removed without the injection. How can I explain but the pain is untolerable. I have left Sen 's residence. He and particularly neighbouring doctor would have come to know everything by my condition, which is too serious. (Meri is halat se unaki vishesker pas me Daktarji ko sub kuch pata chal jati powon tak ulati ho jati). Firstly I intended to proceed to Jalore but on reaching the Station I could not dare to proceed. I feel that you are experiencing uneasiness and trouble for me. I am causing monetary as well as mental worries to you. I have been feeling. this for a considerable longer period. Please do not be annoyed. It has become very difficult for me to stay alone for the last several days. (1) A.I.R. [1939] P.C. 47. 692 Had you accepted me as your better half you would have not left me alone in my such serious condition. You cannot know what sort of trouble I am experiencing. Had you been with me I would not have felt it so such. Please do not be annoyed. Perhaps no one has given you so much trouble. I will write all these facts to my mother I will also write about our marriage. 28 4 63 Today is Sunday. I cannot book a trunk call you the court. Today I tried on the Phone number of Hazarimal but it was engaged, and latter on it cancelled. My Pranam. Yours Ritu. Today I have taken injection and have come from Shanti Bhawan. " portion of that letter indicates that the appellant was in any manner responsible for the steps taken by the deceased for causing miscarriage. No other evidence has been relied upon either by the trial court or by the High Court in support of the finding that the appellant was guilty of the offence of abetting the deceased to cause miscarriage. For the reasons mentioned above we are of the opinion that there is no legal basis for the conviction of the appellant. The learned Counsel for the appellant challenged the conviction of the appellant on yet another ground. As mentioned earlier he 'was charged and tried for the offence of abetting Mst. Radha to cause abortion of the child in the womb of the deceased but curiously enough he was convicted for abetting the deceased to cause miscarriage. Abetment as defined in section 107 of the I.P.C., can be by instigation, conspiracy or intentional aid. If the abetment was that of Mst. Radha, it could have been only by instigation or conspiracy but if it was an abetment of the deceased, it could either be by instigation or by conspiracy or by intentional aid Throughout the trial the accused was asked to defend himself against the charge on which he was tried. At no stage he was. notified that he would be tried for the offence of having abetted the deceased to cause miscarriage. It is now well settled that the absence of charge or an error or omission in it is not fatal to a trial unless prejudice is caused see Willie (William) Slaney vs The State of Madhya Pradesh(1). Therefore the essential question is whether there is any reasonable likelihood 693 of the accused having been prejudiced in view of the charge flamed against him. From what has been stated above one can reasonably come to the conclusion that the accused was likely to have been prejudiced by the charge on the basis of which he was tried. From the cross examination of the prosecution witnesses, it is seen that the principal attempt made on behalf of the appellant was to show that he had nothing to do with the co accused, Mst. Radha. He could not have been aware of the fact that he would be required to show that he did not in any manner abet the deceased to cause miscarriage. The facts of this case come within the rule laid down by this Court in Faguna Kanta Nath vs The State of Assam(1). The case of Gallu Sah vs The State of Bihar(2) relied by the High Court is distinguishable. Therein Gallu Sah was a member of an unlawful assembly. He was said to have abetted Budi to set fire to a house. One of the members of the unlawful assembly had set fire to the house in question though it was not proved that Budi had set fire to the house. Under those circumstances this Court held that the offence with which Gallu Sah was charged was made out. As observed by Calcutta High Court in Umadasi Dasi vs Emperor(a) that as a general rule, a charge of abetment fails when the substantive offence is not established against the principal but there may be exceptions. Gallu 's case was one such exception. For the reasons mentioned above we allow the appeal and acquit the appellant. He is on bail. His bail bonds stand cancelled. V.P.S. Appeal allowed. (1) [1959] 2 Supp.
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The person appealing the case was accused of helping someone named R cause a woman to have a miscarriage. The woman died during the attempt. R was found not guilty. However, the person appealing was found guilty of helping the woman commit the act that led to her death. The High Court agreed with the guilty verdict. In the appeal to this Court, it was DECIDED: This case follows the general rule that if the main offender (R) is not found guilty of the crime, then the charge of helping them usually fails. The High Court made a mistake by saying that the rule from the Gallu Sah vs The State of Bihar case applied here. That was a special case. The Faguna Kanta Nath vs State of Assam case was followed. The Umadasi Dasi vs Emperor case was approved. Also, the person appealing only questioned the prosecution's (government's) witnesses to prove he wasn't involved with R. He didn't know he needed to prove he didn't help the woman in any way. Because he didn't know, he was harmed by not being charged with helping the woman. Therefore, he should be found not guilty. The Willie Slaney vs The State of M.P. case was referred to.
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Summary- Supreme Court by 4:1 majority holds that the decision-making process behind the demonetisation of Rs.500 and Rs.1000 currency notes in 2016 was lawful - Justices S Abdul Nazeer, BR Gavai, AS Bopanna and V Ramasubramanian in majority - Justice BV Nagarathna in minority. Reserve Bank of India Act, 1934; Section 26(2) - on recommendation of Central Board of RBI, Central Government may declare “any” series of bank notes of any denomination shall cease to be legal tender with effect from a specific date - the word “any” must be interpreted as “all”, otherwise it would lead to an anomaly - e.g. if there are 20 series of a particular denomination, the Centre cannot demonetise 19 series and leave behind one series to continue as legal tender - an interpretation which nullifies the purpose for which power is bestowed would be contrary to the principle of purposive interpretation. [Para 144 - 150] Reserve Bank of India Act, 1934; Section 26(2) - Central Government may take recourse to the power to demonetise taking into consideration several factors - these factors must have reasonable nexus with the object sought to be achieved. Reserve Bank of India Act, 1934; Section 26(2) - on earlier two occasions, when RBI was not in favour of demonetisation, the Government resorted to promulgation of ordinances to demonetise currency notes - merely because on two earlier occasions the Central Government had enacted law to demonetise, does not mean the the word “any'' can be given a restrictive meaning - “any” would mean “all”. Reserve Bank of India Act, 1934; Section 26(2) - does not provide for excessive delegation as there is a safeguard that the power can be used only upon recommendation of RBI - though legislature cannot give up its power in favour of another, in view of the multifarious activities of a welfare State, it cannot work out all the details, thus making it necessarily to delegate the same to the executive - Parliament and State Legislatures may not have specialised knowledge - technical and situational intricacies are better left to expert executive bodies and specialist
public servants - mere possibility or eventuality of abuse of delegated powers in the absence of any evidence supporting such claim cannot be a ground to strike down a provision - it can be struck down only if it satisfies the ‘policy and guideline’ Reserve Bank of India Act, 1934 - Section 26(2) - The decision taken by the Central Government to demonetise is to be based on the recommendation of the Central Board of RBI - RBI is the sole repository of power for the management of currency; it plays a pivotal role in management and issuance of currency notes; dealing with the management and regulation of currency; and in evolving the monetary policy - provision of recommendation by Central Board of RBI acts as a safeguard. [Para 202 Reserve Bank of India Act, 1934; Section 26(2) - the decision making process is not flawed in law - the duty of the Court is to confine itself to the question of legality - it ought to determine whether a decision-making authority exceeded its powers, committed an error of law, committed a breach of the rules of natural justice, reached a decision which no reasonable tribunal would reach or abused its powers - it is not concerned with the manner in which the decision was taken. [Para 215, 226] Reserve Bank of India Act, 1934; Section 26(2) - two requirements of the provision a) recommendation by the Central Board and b) decision of the Central Government - dictionary meaning of “recommend” is “to advise as to a course of action” or “to praise or command” - the word recommendation ought to be construed in the context in which it is used - in the present context “recommendation” would mean a consultative process between the Central Board and the Central Government - it is to be considered by the Court whether each of the party had disclosed all relevant facts and factors to each other for due consideration. [Para 239 - 245] Objective of demonetisation - the Court does not have the expertise to go into the question whether the object with which demonetisation was effected is served or not - mere errors of Government are nor subject to judicial review, only palpably arbitrary ones are declared void. [Para 247 - 252]
Test of proportionality - a) it is designated for a proper purpose; b) the measures undertaken to effectuate such a limitation are rationally connected to the fulfilment of that purpose; c) measures undertaken are necessary, there are no alternative measures; and d) there needs to be a proper relation between importance of achieving the purpose and the social importance of preventing the limitation on the constitutional right - the purpose of demonetisation was elimination of fake currency; black money and terror financing, which is a proper purpose - there is a reasonable nexus between the measure of demonetisation with the purpose of addressing issues of fake currency bank notes, black money, drug trafficking and terror financing - court does not possess the expertise to decide what alternative measure could have been undertaken - there is a proper relation between importance of curbing the menace of fake currency, black money, drug trafficking and terror financing and demonetisation of Rs. 500 and Rs. 1000 notes - even if there was reasonable restriction, it was in the larger public interest. [Para 266 - 276, Constitution of India, 1950; Article 300A - Assuming holding notes is a right under the Constitution, the rights vested in the notes was not taken away - only restrictions were with respect to exchange of old notes with the new notes. [Para Period for Exchange of notes - 52 days’ period was not unreasonable - if the time for such exchange are not limited, the high denomination bank notes could be circulated and transferred without the knowledge of the authorities concerned, from one person to another and such transferee would have demand exchange of their notes on any subsequent day - thus, the very purpose of demonetisation would be Specified Bank Notes (Cessation of Liabilities) Act, 2017 - the purpose of the Act was to extinguish the liabilities of the SBNs which have ceased to be legal tender with effect from 09.11.2016 - Section 4 is a complete code in itself - Section 4(1) empowers the Central Government to provide grace period - under Section 4(2), RBI is required to satisfy whether a person seeking to take benefit of grace period is entitled after satisfying that the reasons for the delay are genuine - Section 4(2)
cannot be read independently - if the Central Government finds that there exists any class of persons to whom benefit under Section 4 is to be extended it has the discretion to do so - RBI does not have independent power under Section 4(2) to accept the demonetised notes beyond the period specified in the notification. [Para Reserve Bank of India Act, 1934; Section 26(2) - Essential Ingredients - i) on recommendation of the Central Board of RBI - ii) the Central Government by notification in the Gazette of India; iii) may declare any series of bank notes of any denomination to cease to be legal tender; iv) with effect from such date as may be specified in the notification; v) to such extent as may be specified in the notification. Reserve Bank of India Act, 1934; Section 26(2) - Scheme of the Act envisages that the issuance of bank notes, various denomination of bank notes, design and form of bank notes are to be specified by the Central Government ‘only’ on recommendation of the Central Board. Reserve Bank of India Act, 1934; Section 26(2) - when Central Board recommends demonetisation it is only a particular series of bank notes of a particular denomination as recommend under Section 26(2) - the word ‘any’ cannot be read as ‘all’ - if ‘any’ is to be read as ‘all’, it would provided unguided discretion to the Reserve Bank of India Act, 1934; Section 26(2) - if demonetisation of any bank note takes place under the provision of the Act, it is only by issuance of a notification in the Gazette of India and not by any other method - only the Central Board of RBI is the initiator of the process of demonetisation - the provision has a restricted operation, either the Central Government accepts the recommendation of the Central Board and issue a gazette notification, or refuse to accept the recommendation [Para 15.17, 15.18 and 15.25] Constitution of India, 1950; Entry 36 of List I of the Seventh Schedule - deals with currency, coinage and legal tender; foreign exchange which is a field of legislation - Central Government has the power to initiate the process of demonetisation on
the strength of Entry 36 - apart from financial health of the country Central Government is also concerned about the sovereignty, integrity and security of the country - if it thinks fit to initiate a proposal for demonetisation to eradicate black money, fake currency, terror funding etc, it should be able to do so. [Para 15.7, 15.8 Constitution of India, 1950; Entry 36 of List I of the Seventh Schedule - power of Central Government to demonetise banknotes - Central Government has the power to demonetise ‘all’ series of bank notes of ‘all’ denominations, even without the recommendation of Central Board; but not in exercise of Section 26(2) - such an extensive power is to be exercised only through a legislative process [legislation/Ordinance (if urgent)] and not by way of an executive act - the Parliament should be involved in the process of implementation of such a scheme of demonetisation. [Para 15.13, 15.4 and 15.22] Central Government proposes demonetisation - it must seek the opinion of the Central Board of RBI as RBI is the sole authority to regulate circulation of bank notes and secure monetary stability and generally operate the currency and credit system of the country and to maintain price stability - opinion of the Central Board ought to be an independent and frank opinion - the Central Government can move ahead with demonetisation irrespective of positive or negative opinion of the Central Board, but by enacting a legislation or by way of an Ordinance and not an executive notification. [Para 21] 14131/2017, SLP(C) No. 14216/2017, W.P. (C) No. 341/2018, W.P. (C) No. 193/2018, W.P. (C) No. 316/2018, MA 1552/2018 in Jha,Adv. Mr. Ram Kumar,Adv. Mr. Manohar Lal Sharma, in-person Ms. Suman,Adv. Mr. Thampan Thomas,Adv. Mr. K. V. Mohan,
I. INTRODUCTION ................................................................................................. Paras 6 to 7 II. BACKGROUND ................................................................................................... Paras 7 to 9 III. SUBMISSIONS OF PETITIONERS ..................................................................... Paras 9 to 16 IV. SUBMISSIONS OF UNION OF INDIA ................................................................. Paras 16 to 22 V. SUBMISSIONS OF THE RBI ............................................................................... Paras 22 to 24
VI. SUBMISSIONS IN REJOINDER .......................................................................... Paras 24 to 25 VII. REFRAMED QUESTIONS................................................................................... Paras 25 to 26 VIII. STATUTORY SCHEME ....................................................................................... Paras 26 to 28 Precedents construing the word “any” .................................................................. Paras 28-33 Purposive interpretation ........................................................................................ Paras 33-38
Construction of sub-section (2) of Section 26 of the RBI Act ................................ Paras 38-40 Precedents considering delegated legislation ....................................................... Paras 40-49 Status of the RBI ................................................................................................... Paras 49-51 Application of the aforesaid principles to the present case ................................... Paras 51-52 Scope of Judicial Review ...................................................................................... Paras 52-54 Scope of Judicial Interference in matters pertaining to economic policy ............... Paras 54-56 Application of the aforesaid principles to the present case ................................... Paras 56-58
Recommendation of the RBI ................................................................................. Paras 58-60 Relevancy of attainment of objectives................................................................... Paras 60-64 Four-pronged test of proportionality ...................................................................... Paras 64 Contextual and harmonious construction of the provisions of the 2017 Act .......... Paras 70-73 1. This reference to the larger bench of Five-Judges arises out of the writ petitions filed challenging the Notification No. 3407(E) dated 8th November 2016 (hereinafter referred to as “the impugned Notification”), issued by the Central Government in exercise of the powers conferred by sub-section (2) of Section 26 of the Reserve Bank of India Act, 1934 (hereinafter referred to as “the RBI Act”), vide which the Central Government declared that the bank notes of denominations of the existing series of the value of five hundred rupees and one thousand rupees shall cease to be legal tender with effect from 9th November 2016, to the extent specified in the impugned Notification. This is popularly known as an act/policy of ‘demonetization’. 2. Immediately after the impugned Notification was issued, several writ petitions challenging the policy of demonetization came to be filed before this Court as also before
various High Courts. Transfer Petitions were filed by the Union, seeking transfer of all such matters pending before the High Courts to this Court. 3. A bench of learned three Judges of this Court passed an order dated 16th December 2016 in Writ Petition (Civil) No.906 of 2016 and other connected petitions, observing therein that, in their opinion, following important questions fall for consideration: “(i) Whether the notification dated 8th November 2016 is ultra vires Section 26(2) and Sections 7, 17, 23, 24, 29 and 42 of the Reserve Bank of India Act, 1934; (ii) Does the notification contravene the provisions of Article 300A of the Constitution; (iii) Assuming that the notification has been validly issued under the Reserve Bank of India Act, 1934 whether it is ultra vires Articles 14 and 19 of the Constitution; (iv) Whether the limit on withdrawal of cash from the funds deposited in bank accounts has no basis in law and violates Articles 14, 19 and 21; (v) Whether the implementation of the impugned notification(s) suffers from procedural and/or substantive unreasonableness and thereby violates Articles 14 and 19 and, if so, to what effect? (vi) In the event that Section 26(2) is held to permit demonetization, does it suffer from excessive delegation of legislative power thereby rendering it ultra vires the Constitution; (vii) What is the scope of judicial review in matters relating to fiscal and economic policy of the (viii) Whether a petition by a political party on the issues raised is maintainable under Article 32; (ix) Whether District Co-operative Banks have been discriminated against by excluding them from accepting deposits and exchanging demonetized notes.” 4. Vide the said order dated 16th December 2016, this Court also directed that, if any other writ petitions/proceedings were pending in any High Court, further hearing of those matters should also remain stayed. This Court further directed that no other Court should entertain, hear or decide any writ petition/proceeding on the issue of or in relation to or arising from the decision of the Government of India to demonetize the notes of Rs.500/-
and Rs.1,000/-, since the entire issue in relation thereto was pending consideration before 5. Before we consider the matter, it will be necessary to refer to certain facts. 6. On 8th November 2016, vide the impugned notification, the Central Government, in exercise of the powers conferred by sub-section (2) of Section 26 of the RBI Act, notified that the specified bank notes (hereinafter referred to as “SBNs”) shall cease to be legal tender with effect from 9th November 2016. The SBNs were bank notes of denominations of the existing series of the value of Rs.500/- and Rs.1000/-. Under clause 1 of the said notification, every banking company and every Government Treasury was required to complete and forward a return along with the details of SBNs held by it at the close of business as on the 8th November 2016, not later than 13:00 hours on the 10th November 2016 to the designated Regional Office of the Reserve Bank of India (hereinafter referred to as “RBI”). Insofar as the individual persons were concerned, under clause 2 of the impugned notification, they were entitled to exchange SBNs in various banks specified therein upto 30th December 2016 subject to certain conditions. Initially it provided a limit of Rs.4,000/- for such exchange. It also provided that the limit of Rs.4,000/- for exchanging SBNs shall be reviewed after 15 days from the date of commencement of the impugned notification. It further provided that, insofar as Know Your Customer (KYC) compliant bank account maintained by a person with a bank was concerned, there was no limit on the quantity or value of the SBNs that could be credited to such an account. However, insofar as non-KYC compliant bank accounts were concerned, an outer limit was fixed at Rs.50,000/-. There were certain other provisions made under the impugned notification. 7. Vide another notification of the even date, various other relaxations were granted whereunder SBNs could be used for making payment in Government hospitals, pharmacies, Railway booking centers, for purchases at consumer cooperative stores, milk
booths, purchase of petrol, etc. The said relaxations were to be valid till 11th November 2016. Thereafter, various notifications came to be issued from time to time granting further 8. On 30th December 2016, the Specified Bank Notes (Cessation of Liabilities) Ordinance, 2016 (hereinafter referred to as “the 2016 Ordinance”) was promulgated by the Hon’ble President of India. Subsequently, the Parliament enacted the Specified Bank Notes (Cessation of Liabilities) Act, 2017 (hereinafter referred to as “the 2017 Act”), which received the assent of the then Hon’ble President of India on 27th February 2017. 9. Section 3 of the 2017 Act provides that, on and from the appointed day, notwithstanding anything contained in the RBI Act or any other law for the time being in force, the SBNs which had ceased to be legal tender in view of the impugned Notification of the Government of India, shall cease to be liabilities of the RBI under Section 34 of the RBI Act and shall cease to have the guarantee of the Central Government under sub- section (1) of Section 26 of the RBI Act. 10. Section 4 of the 2017 Act provides for a grace period in case of certain classes of persons holding such SBNs on or before the 8th day of November, 2016 for tendering, with such declarations or statements, at such offices of the RBI or in such other manner as may be specified by it. One of the classes of persons who was provided a grace period by clause (i) of subsection (1) of Section 4 of the 2017 Act was a citizen of India who makes a declaration that he was outside India between 9th November 2016 and 30th December 2016. Clause (ii) of subsection (1) of Section 4 of the 2017 Act also provided a grace period for such class of persons and for such reasons as may be specified by Notification, by the Central Government. 11. Sub-section (2) of Section 4 of the 2017 Act provides that the RBI may, if satisfied, after making such verification as it may consider necessary that the reasons for failure to deposit the notes within the period specified in the notification referred to in Section 3, are
genuine, credit the value of the notes in his ‘KYC compliant bank account’ in such manner as may be specified by it. Sub-section (3) of Section 4 of the 2017 Act makes a provision for enabling any person, aggrieved by the refusal of the RBI to credit the value of the notes under subsection (2), to make a representation to the Central Board of the RBI (hereinafter referred to as “the Central Board”) within fourteen days of the communication of such refusal to him. 12. On the very same day of the promulgation of the 2016 Ordinance i.e. 30th December 2016, the Central Government issued Notification No. 4251(E), in exercise of the powers conferred by clause (b) of sub-section (1) of Section 2, read with clause (i) of sub-section (1) of Section 4 of the 2016 Ordinance. It provided a grace period till 31st day of March 2017 to citizens who were residents in India. Insofar as the citizens who were not resident in India are concerned, the period was upto 30th day of June 2017. The proviso thereto limited the amount of SBNs tendered to not exceed the amount specified under regulation 3 or regulation 8 of the Foreign Exchange Management (Export and Import of Currency) Regulations, 2015 [Notification No. FEMA 6 (R)/RB-2015, dated the 29th December, 2015] made under the provisions of the Foreign Exchange Management Act, 1999 (42 of 1999) and the conditions specified therein are complied with. 13. Some of the writ petitions were listed before this Court on 21st March 2017, when this Court passed the following order: 2. On our asking, Mr. R. Balasubramanyam, learned counsel, accepts notice on behalf of the Union of India and Mr. H.S. Parihar, learned counsel, accepts notice on behalf of the Reserve Bank of India. 3. Having heard submissions, which remained inconclusive, and before proceeding further with the matter, it was felt, that this Court should ascertain from the Union of India (a) whether the
Central Government intends to exercise the power conferred by clause (4)(1)(ii) of Ordinance 10 of 2016; and (b) if the answer to (a) is in the negative, the reason why the Central Government chose not to exercise its jurisdiction. An affidavit may accordingly be filed by the Central Government, explaining its position to this Court. 14. In pursuance of the directions issued by this Court, a short affidavit came be to be filed on behalf of the Union of India on 7th April, 2017. It was stated in the said affidavit “26. In view of the above and those to be urged at the time of hearing, it is most humbly submitted that the Central Government took a conscious decision that no necessity or any justifiable reason exists either in law or on facts to invoke its power under Section 4(1)(ii) of the Ordinance to entitle any person to tender within the grace period the specified bank notes.” 15. The matter came up for hearing before this Bench initially on 12th October, 2022 and, thereafter, on various dates. We have heard Shri P. Chidambaram and Shri Shyam Divan, learned Senior Counsel, Shri Prashant Bhushan, learned counsel, Shri Viplav Sharma, petitioner-in-person in support of the petitions and Shri R. Venkataramani, learned Attorney General appearing for the Union of India and Shri Jaideep Gupta, learned Senior Counsel appearing for the RBI. We have also heard the learned counsels appearing in the connected petitions. 16. Shri P. Chidambaram, learned Senior Counsel led the arguments on behalf of the 17. Shri P. Chidambaram submitted that, upon its correct interpretation, sub-section (2) of Section 26 of the RBI Act will have to be read down in a manner that sub-section (2) of Section 26 of the RBI Act does not permit the power to be exercised in respect of “all series” of notes of a specified denomination. He submits that the word “any” will denote that the power can be exercised only when a particular series of any denomination is sought to be demonetized.
18. Shri Chidambaram submits that, on earlier occasions i.e. by the High Denomination Bank Notes (Demonetization) Ordinance, 1946 (hereinafter referred to as “the 1946 Ordinance”) and the High Denomination Bank Notes (Demonetization) Act, 1978 (hereinafter referred to as “the 1978 Act”), “all series” of high denomination bank notes were demonetized. He submits that, by the 1946 Ordinance, high denomination bank notes were meant to be “all series” of bank notes of the denominational value of Rs.500/- Rs.1,000/- and Rs.10,000/-. Similarly, by the 1978 Act, the high denomination bank notes were meant to be “all series” of the bank notes of the denominational value of Rs.1,000/- , Rs.5,000/- and Rs,10,000/-. It is thus submitted that, whenever it was found necessary to demonetize “all series” of a particular denomination, it was considered necessary to do so by way of a separate enactment of Parliament. 19. Shri Chidambaram submits that, since the bank notes are issued in different series, the words “any series” before the words “of bank notes of any denomination” appearing in subsection (2) of Section 26 of the RBI Act, will have to be construed as limiting the power of the Government to declare only a specified series of notes to be no longer legal tender. He submits that it will have to be held that the words “any series” mean “any specified series” and not “all series” of bank notes. 20. Shri Chidambaram submits that, if it is held that the Central Government is conferred with the power under subsection (2) of Section 26 of the RBI Act to demonetize currency notes of “all series”, then a situation may arise wherein the bank notes issued on the previous day can be demonetized on the very next day. He submits that, as a result of the demonetization done on 8th November 2016, even the currency notes issued on the
previous day of the denominational value of Rs.500/- and Rs.1,000/- had become illegal 21. Shri Chidambaram submits that if sub-section (2) of Section 26 of the RBI Act is not read down in the aforesaid manner, then the said Section would be vulnerable to be challenged on the ground that it confers an unguided, uncanalised and arbitrary power upon the Executive Government. He submits that, in such a situation, the said provision is liable to be struck down on the ground that it violates Articles 14, 19, 21 and 300A of the Constitution of India. He submits that the fact that the demonetization of “all series” of high denominational currency notes in the years 1946 and 1978 was done through separate enactments of Parliament would support the said proposition. 22. Shri Chidambaram submits that, upon a plain reading of sub-section (2) of Section 26 of the RBI Act, it is obvious that there is neither any policy nor any guidelines in the said provision. What factors are required to be taken into consideration and what factors are to be eschewed from consideration, are not specified in sub-section (2) of Section 26 of the RBI Act. It is submitted that if a drastic power of demonetizing currency notes of “all series” in certain denominations is to be entrusted to the Executive Government, then Parliament ought to have laid down the guidelines for exercising such power. He submits that, in the absence of anything of that nature, it will have to be held that the delegation to the Executive Government is excessive, arbitrary and as such, violative of Articles 14, 19, 21 and 300A of the Constitution of India. Learned Senior Counsel relied on the Constitution Bench Judgments of this Court in the cases of Hamdard Dawakhana (Wakf) Lal Kuan, Delhi and another v. Union of India and others 1 and Harakchand Ratanchand Banthia and others v. Union of India and others 2 in support of his 23. Shri Chidambaram submits that, in any case, the decision-making process in the
present case was deeply flawed and, therefore, is liable to the scrutiny of judicial review by this Court. 24. The learned Senior Counsel submits that a plain reading of sub-section (2) of Section 26 of the RBI Act would reveal that the Central Government can exercise the power only on the recommendation of the Central Board. It is, therefore, submitted that it is implicit in the said sub-section that the proposal for demonetization must emanate from the RBI. It is submitted that, from the scheme of the RBI Act, it is clear that the Central Board, consisting of Members specified in Section 8 of the RBI Act, would consider all relevant material, weigh the pros and cons, consider the impact of the proposed measure on the people of the country and the consequences on the economy before making a recommendation. It is submitted that, on a plain reading of sub-section (2) of Section 26 of the RBI Act, it is clear that the Central Government is not bound to accept the recommendation of the Central Board. The word ‘may’ used therein, postulates exercise of discretion and, therefore, the discretion so exercised by the Central Government must be exercised after considering the matter carefully, as to whether the recommendation of the RBI is required to be accepted or not. 25. Learned Senior Counsel, therefore, submits that it is implicit in sub-section (2) of Section 26 of the RBI Act that the Central Board constituted under Section 8 of the RBI Act must devote sufficient time to apply their mind while making a recommendation, particularly when a major step like demonetization is to be taken. 26. Learned Senior Counsel submits that, however, in the present case, the decision- making process is deeply flawed. He submits that, under Section 8 of the RBI Act, the only channel for non-government Directors to come on the Central Board of the RBI is through clause (c) of sub-section (1) of Section 8 of the RBI Act. He submits that, usually, experts in trade and commerce, economists, industrialists, etc. are nominated in the said category. However, on the date on which the decision for demonetization was taken by
the Central Board i.e. 8th November, 2016, there were only 3 independent Directors under clause (c) of sub-section (1) of Section 8 of the RBI Act. He submits that, it is thus clear that, at the relevant time, the Central Board consisted of a majority of the Directors who were representatives of the Central Government inasmuch as there were 7 vacancies of Directors in category under clause (c) of sub-section (1) of Section 8 of the RBI Act. 27. Learned Senior Counsel further submits that, in the present case, a reverse mechanism was adopted. He submits that it was the Central Government which initiated the proposal for demonetization and sought opinion of the Central Board vide its communication dated 7th November 2016. The meeting of the Central Board was held immediately on the next day i.e. 8th November 2016 at 5.00 p.m. Within hours, a recommendation of the Central Board was sent to the Central Government and, on the same date itself, i.e. 8th November 2016, the Hon’ble Prime Minister announced the decision of the Cabinet with regard to demonetization on National Television at 8.00 p.m. 28. Learned Senior Counsel submits that, unless the following documents are produced by the respondents, it cannot be verified as to whether the Central Board while recommending demonetization or as to whether the Central Government while deciding to notify demonetization had taken into consideration the relevant factors or eschewed a) The letter of the Central Government dated 7th November 2016; b) The Agenda Note dated 8th November 2016, if any, placed before the Central Board of RBI and the relevant research papers, background notes, information, data, report, etc. ; c) The recommendation of the Central Board dated 8 th November 2016 to the Central d) The Note for Cabinet, if any, that was placed before the Cabinet on 8th November 2016; e) The actual decision of the Cabinet as recorded in the Minutes of the Cabinet of its meeting 29. It is submitted that it is only on the perusal of the minutes of the meeting dated 8 th November 2016, of the Central Board, it could be seen as to whether the requisite quorum
was there or not and as to whether one director from the category under Section 8(1)(c) of the RBI Act as required under the Reserve Bank of India (General) Regulations, 1949 (hereinafter referred to as “the 1949 Regulations”) was present in the meeting or not. 30. Shri Chidambaram submits that there is no record available to show that there was application of mind to the relevant factors by the Central Board, so also by the Central Government. He submits that it is also not clear as to whether there was any Cabinet note based on the recommendation of the Central Board, which was placed before the Cabinet for consideration. He submits that the Hon’ble Prime Minister went on National Television at 8.00 p.m. on 8th November 2016, in a slot that had already been booked by the Government since all channels telecasted the speech at 8.00 p.m., and announced the decision on demonetization. He submits that the decisionmaking process was pre- meditated and rushed, which depicted a non-application of mind and was deeply and fatally flawed. It is thus submitted that the procedure adopted was in total violation of the procedure contemplated under sub-section (2) of Section 26 of the RBI Act. 31. Shri Chidambaram further submits that neither the RBI nor the Central Government took into consideration the relevant factors and eschewed irrelevant factors before making such a far-reaching recommendation and decision respectively, that would have serious consequences. He submits that, as a result of demonetization, 86.4% of the currency (by value) was declared no longer to be legal tender and was eventually withdrawn. He submits that, in terms of absolute value, it amounted to Rs.15,44,000 crore. It is submitted that 2,300 crore distinct notes had become illegal overnight. It is submitted that, at the relevant time, the notes in the denomination of Rs.500/- and Rs.1,000/- were commonly used and, since they were demonetized overnight, millions of people were left with no valid bank notes to buy essential goods, such as, food, milk or even medicines, etc.
Thousands of families went without a meal. In fact, various voluntary organizations distributed free food to thousands of families during the relevant period. 32. Shri Chidambaram submits that the result of demonetization was disastrous. It resulted in steep unemployment within a short period. Wages were not paid for several weeks. Millions of farmers were unable to withdraw or deposit money. They did not have money to buy seeds or fertilizers or to hire labour. It is submitted that the price of agricultural products dropped to a huge extent, thereby causing loss to the farmers. 33. Shri Chidambaram submits that the Government also did not take into consideration the fact that over 2 lakh ATMs were required to be recalibrated to dispense the newly issued notes. It is submitted that the Government, as also the RBI, also did not take into consideration that, out of 1,38,626 bank branches in India, over two-thirds were located in metropolitan, urban and semi-urban areas, while only one-third were located in rural areas, and that 90% of all ATMs were located merely in 16 States. He submits that the seven States in North-East India had only 5199 ATMs, of which 3645 were in Assam alone. As a result thereof, the individuals residing in rural areas and those in the Northeast region were disproportionately and adversely impacted. They had to travel long distances and stand in queues to exchange notes, forsaking their livelihood at considerable 34. Learned Senior Counsel submits that, without taking into consideration all these factors, the Central Board made the recommendation and the Central Government took the decision of demonetization. It is submitted that the consequence thereof is that demonetization cost the economy about 1-2% of the GDP, i.e. about Rs.1,50,000 crore. 35. Shri Chidambaram further submits that the objectives stated in the impugned Notification were false and illusory which could not have been achieved and which, in fact, were not achieved. He submits that one of the objectives was to weed out fake currency notes that were causing adverse effect on the economy. Another objective was to stop the
use of high denomination bank notes for the storage of unaccounted wealth. Learned Senior Counsel submits that, when a fake currency note is detected by a Bank Officer, he is obliged to impound it, report it and give the same to the RBI. The RBI is required to destroy the note, thus taking the fake currency note out of possible circulation. It is submitted that the Annual Report of the RBI for the year 2016-2017 reported that only fake currency of the value of Rs.43.3 crore was detected in the nearly Rs.15.31 lakh crore of currency exchanged through the banking system. It is submitted that this represented 0.0028% of the total currency notes that were returned/exchanged through the banking 36. Learned Senior Counsel submitted that, in fact, the Indian Express quoted a senior Directorate of Revenue Intelligence (DRI) official who said that, while fake currency seized before demonetization was of low quality and easily identifiable by the naked eye, the quality of fake notes considerably improved post-demonetization, making it harder to identify. It is submitted that, as such, it is clearly seen that the said objective was false and, in any case, demonetization hopelessly failed to achieve the said objectives. 37. Learned Senior Counsel further submitted that the third objective was to arrest the use of fake currency for financing subversive activities such as drug trafficking and terrorism, which cause damage to the economy and the security of the country. In this respect, learned Senior Counsel submits that new notes of denominational value of Rs.2,000/- were found on the bodies of two terrorists killed in an encounter in Bandipora on 22nd November 2016. Learned Senior Counsel submits that nearly 99.3% of the demonetized notes were returned, whether they represented storage of accounted or unaccounted wealth. It is submitted that to facilitate the exchange of money, several brokers sprung up, who offered to exchange ‘demonetized’ notes for a price. As such, even honest people turned dishonest to make some money. 38. Learned Senior Counsel submits that, shortly after demonetization, the Income Tax Department and the DRI conducted searches and raids and seized alleged unaccounted
wealth in the form of Rs.2,000 notes. It is, therefore, submitted that all the stated objectives have utterly failed. 39. Shri P. Chidambaram further submitted that the impugned Notification is liable to be set aside on another ground also. He submits that the doctrine of proportionality has now been recognised in Indian jurisprudence. Applying the test of proportionality to the impugned act of demonetization, he submits that there was absolutely no justification to demonetize 86.4% of the currency in circulation representing a value of Rs.15,44,000 crore that caused enormous damage to the economy and placed an intolerable and horrendous burden upon the people of the country, especially the poor. It is submitted that, before resorting to such a drastic step, the Central Board as well as the Central Government ought to have taken into consideration as to whether an alternative method could have been resorted to achieve the purpose for which the exercise of demonetization was done. In this respect, learned Senior Counsel relied on the judgment of this Court in the case of K.S. Puttaswamy (Retired) and another (Aadhaar) v. Union of India and another3 and Internet and Mobile Association of India v. Reserve Bank of India4. 40. Learned Senior Counsel submitted that though, while exercising the power of judicial review, it may not be permissible for this Court to examine the correctness of the decision, however, this Court can very well exercise its powers to examine the correctness of the decision-making process. He submits that the decision-making process in the present case is totally flawed. He submits that neither the Central Board while making the recommendation nor the Central Government while taking the decision have followed the procedure as prescribed in sub-section (2) of Section 26 of the RBI Act. He submits that, in any case, they have failed to take into consideration the relevant factors which were required to be taken into consideration and have taken into consideration those factors which were false from the very inception and have subsequently been proved to be so. He, therefore, submits that this Court is entitled to exercise its powers of judicial review
and hold that the decision-making process was not sustainable in law. In this respect, learned Senior Counsel relied on the judgments of this Court in the cases of Tata Cellular v. Union of India5, Uttamrao Shivdas Jankar v. Ranjitsinh Vijaysinh Mohite Patil6, Centre for Public Interest litigation and others v. Union of India and others 7, Lt. General Manomoy Ganguly Vsm v. Union of India and others8 and K.S. Puttaswamy (Retired) and another (Aadhaar) (supra). 41. Learned Senior Counsel further submitted that, despite the passage of time, this Court has the power to grant declaratory relief including the relief of declaring as to what is the true meaning and interpretation of various provisions of the RBI Act and also to mould the relief accordingly. Learned Senior Counsel relied on the judgment of this Court in the case of Somaiya Organics (India) Ltd. and another v. State of U.P. and another910, Orissa Cement Ltd. v. State of Orissa and others 10, and I.C. Golak Nath & Others v. State of Punjab & Another11 in support of the said submissions. 42. Learned Senior Counsel further submitted that the impugned Notification is also violative of Article 19(1)(g) of the Constitution of India. He submits that, if it is the contention of the State that the restriction imposed is reasonable and in the interest of the general public, then the burden is on the respondents to establish the same. However, in the present case, the respondents have failed to do so. He further submits that this Court in the case of Jayantilal Ratanchand Shah v. Reserve Bank of India and others12 has held the currency notes to be property. He, therefore, submits that depriving a person of his property by demonetization would be violative of Article 300A of the Constitution of 43. Shri Shyam Divan, learned Senior Counsel appearing on behalf of the applicant- Malvinder Singh, submitted that, apart from the guarantee given by the Central
Government with regard to exchange of every bank note as legal tender at any place in India, they are also the liabilities of the Issue Department under Section 34 of the RBI Act to an amount equal to the total of the amount of the currency notes of the Government of India and bank notes for the time being in circulation. 44. Learned Senior Counsel submitted that the Hon’ble Prime Minister, in his speech on 8 November 2016, gave a categorical assurance that the rights and interests of honest, hard-working people would be fully protected. A specific assurance was also given that if there may be some who, for some reason, are not able to deposit their old five hundred or one thousand rupee notes by 30th December 2016, they could go to specified offices of the RBI upto 31st March 2017 and deposit the notes after submitting a declaration form. He submits that a person of a stature no less than the Hon’ble Prime Minister of India has given an assurance that such persons would be able to go to specified offices of the RBI upto 31st March 2017 and deposit the notes after submitting a declaration form. It is further submitted that in the Press Note published on the same day, i.e. 8th November 2016, an assurance was given to the following effect: “(x) For those who are unable to exchange their Old High Denomination Bank Notes or deposit the same in their bank accounts on or before December 30, 2016, an opportunity will be given to them to do so at specified offices of the RBI on later dates along with necessary documentation as may be specified by the Reserve Bank of India.” 45. Learned Senior Counsel submits that the said assurance was also reiterated in the RBI Notice dated 8th November 2016. Learned Senior Counsel, therefore, submits that applicant’s/petitioner’s case (petitioner in Writ Petition (Civil) No.149 of 2017) stands on peculiar facts. Shri Divan submits that the applicant/petitioner withdrew an amount of Rs.1,20,000/- from his bank account operating in Central Cooperative Bank, Sangrur, Punjab (Branch-Ghelan) on 3rd December 2015 and kept the same with his previous
savings of Rs.42,000/- in cash, which totals to Rs.1,62,000/- (i.e. 60 notes of Rs. 500 denomination and 132 notes of Rs.1000/- denomination). On 11th April, 2016, he went to visit his son residing in the USA, leaving his above mentioned saving of Rs.1,62,000/- at home in India for his future knee operation. The applicant travelled with his wife. During their absence, their home was locked and the money could not have been deposited. Learned Senior Counsel submits that, after returning to India on 3rd February, 2017, and relying on the assurance given by the Hon’ble Prime Minister of India, he made a representation to the RBI for exchange of the currency notes in his possession. However, the same was not considered, thus constraining him to file a writ petition (i.e. Writ Petition (Civil) No.149 of 2017). This Court, vide order dated 3rd November 2017 disposed of the said writ petition giving him the liberty to file an application for intervention/impleadment in Writ Petition (Civil) No.906 of 2016 (Vivek Narayan Sharma vs. Union of India), which was accordingly filed him vide I.A. No.26757 of 2018 in Writ Petition (Civil) No.906 of 2016. 46. Shri Divan submits that the proviso to the Notification dated 30th December 2016 issued by the Ministry of Finance, Department of Economic Affairs, Government of India, totally excludes persons like the applicant. He submits that, only on account of the number of days residing abroad, the applicant was categorized as non-resident Indian and as such, he was only entitled to exchange currency notes to the extent as provided in the proviso to the Notification dated 30th December 2016. Learned Senior Counsel submits that, however, the applicant had not carried the cash while travelling abroad and as such, there was no question of making a declaration under clause (i) of sub-section (1) of Section 4 of the 2016 Notification. 47. Learned Senior Counsel further submitted that, in view of clause (ii) of sub-section
(1) of Section 4 of the 2017 Act, the Central Government is empowered to provide a grace period to such class of persons and for such reasons as may be specified, by notification. He submits that the said power is coupled with a duty. It is, therefore, submitted that when there are genuine cases, the Central Government is bound to exercise the power under clause (ii) of sub-section (1) of Section 4 of the 2017 Act and provide grace period to the applicant and persons like him. 48. Shri Divan further submits that the Circular of the RBI dated 31st December 2016 is also discriminatory, inasmuch as in the case of Resident Indians, there is no monetary limit for tender of SBNs. However, insofar as the Non-Resident Indians (NRIs) are concerned, the tender is restricted to a maximum of Rs.25,000/- per individual depending on when the notes were taken out of India as per relevant FEMA Rules. Learned counsel submits that an additional liability is imposed upon the NRIs to produce a certificate issued by the Indian Customs on arrival through Red Channel after 30th December 2016, indicating the import of SBNs, with details and value thereof. 49. Shri Divan relied on the article titled “Using Fast Frequency Household Survey Data to Estimate the Impact of Demonetization on Employment” by Mr. Mahesh Vyas, Centre for Monitoring Indian Economy (2018) in support of his submission that on account of demonetization, there was substantial reduction in employment, which was about 12 million lower than it was during the 2 months preceding demonetization. And, over a 4- month period when the entire sample was surveyed, the impact of demonetization reduced to a loss of about 3 million jobs. He submits that an article in the Indian Express dated 17th January 2017 based on a study conducted by the All India Manufacturers’ Organisation (AIMO), indicated that the manufacturing sector suffered from considerable job loss post-demonetization. 50. Learned Senior Counsel also submits that in the absence of a specific study with regard to the effect of demonetization on the Indian economy, the decision of the Central
Government for demonetizing about 86.4% of the total currency in circulation will have to be held to be vitiated on account of manifest arbitrariness. It is submitted that the impugned notification is also liable to be set aside applying the test of proportionality. Applying the classical equality test, he submits that it will have to be held that the decision of demonetization had no nexus to the objectives to be achieved. Learned Senior Counsel relies on the judgment of the Constitution Bench of this Court in the case of K.S. Puttaswamy (Retired) and another (Aadhaar) (supra) in this regard. 51. Shri Divan lastly submits that the right to life also includes the right to live with dignity. Relying on the Constitution Bench judgment of this Court in the case of Maneka Gandhi v. Union of India13, he submits that the right to live with dignity also includes the right to travel abroad, especially to visit the son of the petitioner/applicant in the USA. He, therefore, submits that when the applicant/petitioner had gone to the USA to visit his son during the period wherein the currency notes could have been exchanged, he will be deprived of his right under Article 21 of the Constitution of India if he is not granted an opportunity now to exchange the demonetized notes with the new notes. 52. Shri R. Venkataramani, learned Attorney General (“A.G.” for short), at the outset, submits that the action taken vide the impugned notification stands ratified by the 2017 Act. It is, therefore, submitted that with the executive action being validated by the will of Parliament, the challenge to the same would not survive. 53. The learned A.G. submits that the word “any” appearing before the words “series of bank notes” in sub-section (2) of Section 26 of the RBI Act should be construed as “all”. Learned A.G. relies on the following judgments of this Court in support of his submission that the word “any” will have to be construed to be “all”.
(i) The Chief Inspector of Mines and another v. Lala Karam Chand Thapar etc.14 (ii) Banwarilal Agarawalla v. The State of Bihar and others15 (vi) Raj Kumar Shivhare v. Assistant Director, Directorate of Enforcement and another19 54. The learned A.G. submits that the action under subsection (2) of Section 26 of the RBI Act cannot be construed in a narrow compass. It is submitted that various factors, aspects and challenging confrontations affecting the economic system of the country and its stability will have to be given due weightage while considering the validity of the action taken under sub-section (2) of Section 26 of the RBI Act. 55. The learned A.G. submits that the comparison of the action taken under sub-section (2) of Section 26 of the RBI Act with the 1946 and the 1978 legislations is totally misconceived. It is submitted that, in any case, the 2017 Act not only addresses the issues relating to cessation of legal tender under sub-section (2) of Section 26 of the RBI Act, but also provides for exchange of bank notes in order that Article 300A of the Constitution of India is complied with, and also extinguishes the liabilities of the Issue Department of the RBI under Section 34 of the RBI Act. 56. The learned A.G. submits that if the construction as advanced by the petitioners is accepted, then the very purpose for which the provision is made shall stand frustrated. The learned A.G., relying on the judgment of this Court in the case of C.I.T. v. S. Teja Singh20, submits that it is a settled principle of law that the Courts will strongly lean against a construction of a provision which will render it futile. It is submitted that the bolder construction, based on the view that Parliament would legislate only for the purpose of bringing about an effective result, is required to be accepted. 57. The learned A.G. submits that the argument that the word “any” would not mean “all” is fallacious in nature. If the same is accepted, the Government would technically be
permitted to issue separate notifications for each series but would be prohibited from issuing a common notification for all series. It is submitted that if such process is held to be permitted, it would lead to chaos and uncertainty. 58. The learned A.G. further submits that the word “any” has been used at two places in sub-section (2) of Section 26 of the RBI Act. It is submitted that the word “any” preceding the words “series of bank notes” has to be construed to mean “all”, whereas the word “any” preceding the word “denomination” may be construed to be singular or otherwise. He submits that the same word used in the same provision twice could be permitted to have a different meaning. He relies on the judgment of this Court in the case of Maharaj Singh v. State of Uttar Pradesh and others21 in support of his submission. 59. The learned A.G. submits that the alternative submission that if the word “any” is not given any restricted meaning then sub-section (2) of Section 26 of the RBI Act will have to be held to be invalid on the ground of vesting of excessive delegation, is also without substance. The learned A.G. submits that the RBI is not just like any other statutory body created by an Act of legislature. It is submitted that it is a creature created with a mandate to get liberated even from its creator. It is submitted that the guiding factors for exercise of power under sub-section (2) of Section 26 of the RBI Act have to be found from Section 3 of the RBI Act as well as from its preamble. It is submitted that the RBI Act was enacted for the purposes of taking over the management and regulation of the currency from the Central Government as per Section 3 of the RBI Act. The preamble of the RBI Act also states that the RBI has been constituted to “regulate the issue of bank notes”. It is submitted that the words “taking over the management of the currency” in Section 3 of the RBI Act and “regulate” in the Preamble have to be given the widest possible import. It is submitted that a narrower construction would defeat the very purpose
of the RBI Act. It is submitted that the word “regulate” would also include “prohibit”. 60. The learned A.G., relying on the judgment of this Court in the case of Municipal Corporation of Delhi v. Birla Cotton, Spinning and Weaving Mills, Delhi and another 22 submits that, in order to find out as to whether the legislature has given guidance for exercise of delegated powers, the Court will have to consider the provisions of the particular Act with which the Court has to deal with, including its preamble. It is submitted that the preamble of the RBI Act read with Section 3 thereof provides sufficient guidance to the delegatee Central Government for exercising its powers. It is further submitted that, while considering the question as to whether the delegation is excessive or not, the nature of the body to which delegation is made is also a factor to be taken into consideration. It is submitted that in the present case, the delegation is to the Central Government and not to any subordinate office or department. 61. The learned A.G. submitted that the judgment of this Court in the case of Harakchand Ratanchand Banthia and others (supra) would not be applicable to the facts of the present case inasmuch as in the said case, the delegation was to an Administrator and this Court found that the delegation to the Administrator was too wide and, thus, suffered from the vice of excessive delegation. It is submitted that, similarly, the judgment of this Court in the case of Hamdard Dawakhana (Wakf) Lal Kuan, Delhi and another (supra) also would not be applicable to the facts of the present case. 62. The learned A.G., in addition to the reliance placed on the judgment of this Court in the case of Birla Cotton, Spinning and Weaving Mills Delhi (supra) also relies on the judgments of this Court in the following cases: (ii) M.P. High Court Bar Association v. Union of India and others24 (iii) Kerala State Electricity Board v. The Indian Aluminium Co. Ltd.25 (iv) Ajoy Kumar Banerjee and others v. Union of India and others26
(v) Gwalior Rayon Silk Mfg. (Wvg.) Co. Ltd. v. The Asstt. Commissioner of Sales Tax (vi) Ramesh Birch and others v. Union of India and others28 (viii) Prabhudas Swami and Another v. State of Rajasthan and Others30 (ix) Rojer Mathew v. South Indian Bank Ltd. represented by its Chief Manager and Ors.31 (x) The Registrar of Co-operative Societies, Trivandrum and another vs. K. Kunjabmu (xi) Darshan Lal Mehra and others v. Union of India and others33 63. The learned A.G. also relies on the judgments of the U.S. Supreme Court in the cases of Yakus v. U.S. 34 and Federal Energy Administration v. Algonquin SNG. Inc. in support of his submission. 64. Insofar as the contention of the petitioners with regard to the impugned action being susceptible to challenge on the ground of proportionality is concerned, the learned A.G. submits that the reliance placed on the judgment of this Court in the case of Internet and Mobile Association of India (supra) is wholly misconceived. Relying on various paragraphs from the said judgment, the learned A.G. submits that the observations made in paragraph 224 of the said judgment have to be read in context with the issue that fell for consideration before this Court in the said case. It is submitted that in the said case, this Court was considering the action of the RBI in restricting the banks and financial institutions regulated by it from providing access to banking services to those engaged in transactions in crypto assets. It is submitted that, though this Court held that, in view of the provisions contained in the RBI Act, the Banking Regulation Act, 1949 and the Payment and Settlement Systems Act, 2007, and also in view of the special place and role that the RBI has in the economy of the country, the RBI had very wide and ample powers to take preventive and curable measures. However, this Court found that applying the test of proportionality, in the absence of the RBI pointing out some semblance of any
damage suffered by its regulatory entities, the action was not sustainable. The learned A.G. submitted that the action in the present case was taken after considering the relevant factors and to address serious concerns such as terror financing, black money and fake currency. It is, therefore, submitted that the judgment of this Court in the case of Internet and Mobile Association of India (supra) would not be applicable to the facts of the present case. 65. The learned A.G., relying on the judgment of this Court in the case of State of Tamil Nadu and another v. National South Indian River Interlinking Agriculturist Association 36 , submitted that in a case of non-classificatory arbitrariness, the test of proportionality would be applicable. However, in a case of classificatory arbitrariness, the only test that will have to be satisfied is the rational nexus test, i.e. whether the action taken has a reasonable nexus with the object to be achieved. In such a case, the proportionality test would not be applicable. It is submitted that the present case would fall in the latter category and not in the former category. 66. Countering the argument made on behalf of the petitioners that the power exercised under sub-section (2) of Section 26 of the RBI Act has not been exercised in the manner as provided therein and further that the decision-making process is flawed on account of patent arbitrariness, the learned A.G. submitted that in view of the settled legal position, the said contention is also not tenable. It is submitted that what is postulated under sub- section (2) of Section 26 of the RBI Act is that the Central Government may take a decision on the recommendation of the Central Board. It is submitted that in the present case, there was, in fact, a recommendation by the Central Board recommending demonetization. The decision by the Central Government has been taken after considering the said recommendation. It is, therefore, submitted that the procedure as provided in sub-section (2) of Section 26 of the RBI Act stands duly complied with. The learned A.G. submitted
that the RBI is not only an expert body but a very special institution charged with a duty of conceiving and implementing various facets of economic and monetary policy. It is submitted that there cannot be a straitjacket formula in the discharge of its duty. Learned A.G. submits that in any case, it is a settled law that this Court should not interfere with the opinion of experts and leave it to experts who are more familiar with the problems they face. Reliance in this respect is placed on the judgment of this Court in the case of Rajbir Singh Dalal (Dr.) v. Chaudhari Devi Lal University, Sirsa and another37 and Secretary and Curator, Victoria Memorial Hall v. Howrah Ganatantrik Nagrik Samity and 67. Relying on the judgment of this Court in the case of Bajaj Hindustan Limited v. Sir Shadi Lal Enterprises Limited and another 39 , the learned A.G. submits that economic and fiscal regulatory measures are a field where Judges should encroach upon very warily as Judges are not experts in these matters. 68. The learned A.G. submitted that the recommendation of the RBI and the decision of the Central Government was taken after taking into consideration that fake currency notes of the SBNs have largely been in circulation and it was difficult to identify genuine bank notes from the fake ones and to also address three serious problems viz., fake currency notes, storage of unaccounted wealth and terror financing. It is submitted that the material with regard to such factors cannot be considered overnight. It is submitted that the 2012 White Paper on Black Money throws light on the complexity of the problem. The information and data gathered from various agencies of the Government of India are required to be taken into consideration. It is submitted that both the RBI and the Central Government act in coordination with each other. The learned A.G. submits that the discussions over the issue have taken place over a long period of time and, after considering all the aspects, the RBI recommended demonetization and the Central Government took the decision to demonetize. 69. The learned A.G. further submitted that the contention of the petitioners that
demonetization has utterly failed to achieve its objectives as stated in the impugned Notification is also without substance. The learned A.G. submits that the repercussion of an action like the one under consideration can be best understood by considering the legal tender cessation measure not in isolation but by looking at the overall benefits flowing from such a measure. The learned A.G. submits that the benefits and advantages of such an action are direct as well as indirect. The learned A.G. submits that, as a result of the impugned action, there are direct benefits, like: (iv) significant increase in returns filed by corporate tax payers; (v) substantial growth in new PAN numbers. 70. The learned A.G. submits that, whereas self-assessment tax in the year 2015-16 was Rs.55,000 crore and Rs.68,000 crore in the year 2016-2017, it has jumped to Rs.1,00,000 crore in the year 2017-18. The learned A.G. further submitted that, as a direct benefit of demonetization, the volume of Unified Payments Interface (UPI) transactions shot up from 1.06 crore in 2016-2017 to 90.5 crore in 2017-18 and further to about 5000 crore in 2021-22. The value of the UPI transactions also grew 1210 times in 2021-22 as compared to 2016-17. It is submitted that the real GDP growth in the year 2017-18 was higher than the average annual growth of 6.6% in the decade (2010-11 to 2019-20). 71. The learned A.G. further submitted that there have also been various indirect benefits. Action against domestic black money resulted in undisclosed income of Rs.82,168 crores. Surveys conducted in 63,691 cases led to undisclosed income of Rs.84,396 crores getting deducted. The employees provident fund organization (EPFO) enrolment data saw an increase of 1.1 crore new enrolments. It also saw 55% increase in Employees’ State Insurance Corporation (ESIC) registrations. It is, therefore, submitted
that if the effect of impugned action is considered in a larger perspective, it will clearly show that there have been several direct as well as indirect benefits on account of the 72. The learned A.G. further submitted that, merely because in 1946 and 1978 the demonetization was effected by enactments of Parliament, cannot be a ground to hold that the Central Government does not have a power under sub-section (2) of Section 26 of the RBI Act. It is submitted that, in any case, the said argument does not hold water inasmuch as what has been provided under the impugned notification is wholly ratified by the 2017 Act. It is submitted that once the executive action is ratified by Parliament by way of legislation, the argument that since Parliament had chosen to do so in 1946 and 1978, the Central Government could not have done it under the impugned notification itself is 73. The learned A.G. submits that the perusal of the Parliamentary debates while enacting the 1978 Act would clearly show that, though by the said Act only high denomination bank notes of the denominational value of Rs.1,000/-, Rs.5,000/- and Rs.10,000/- were demonetized, the Members of Parliament advocated for demonetization of even the bank notes of the denominational value of Rs.100. 74. The learned A.G. submits that the provisions of the 1978 Act have been found to be constitutional by the Constitution Bench Judgment of this Court in the case of Jayantilal Ratanchand Shah (supra). It is submitted that, for the reasoning adopted by the Constitution Bench in the said case, the impugned notification, which now stands ratified by the 2017 Act, also deserves to be upheld. 75. In respect of the submission made on behalf of the petitioners, that in order to address concern of the genuine difficulties of various persons who could not deposit the demonetized bank notes within the limited period, a window should be opened for a limited period; the learned A.G. submitted that if such is permitted, it would amount to devising a norm which will alter the essential character of the enactment. It is submitted that, firstly,
it is difficult to ascertain genuineness of the money. Such a request will have to be based on certain declarations being made by the party whose veracity cannot be verified. It is submitted that this would also provide a loophole for non-genuine bank note holders to channelize their unaccounted money through the window. It is submitted that, incidentally, the law enforcing agencies are still recovering significant amount of SBNs from the 76. The learned A.G. further submitted that, as of now, Rs.10,719 crore of SBNs are still in circulation. It is submitted that in any case, in view of the provisions of clause (i) of subsection (1) of Section 4 of the 2017 Act, 77,748 applications involving an amount of Rs.284.25 crore were received from resident and non-resident Indians by the five designated Regional Offices of the RBI during the grace period. Out of this, a total of 57,405 cases (74% of the total applications received) amounting to Rs.221.95 crore (78% of the total amount under these applications) have been accepted and the amounts have been credited to their KYC compliant bank accounts. It is submitted that out of the total cases, 20,343 cases were rejected due to various reasons. The learned A.G. submits that it will not be permissible for the Court to devise a norm which would result in altering the essential character of the enactment. In support of this submission, he relies on the judgment of United States Supreme Court in the case of Metropolis Theater Company et al v. City of Chicago and Ernest J. Magerstadt40. 77. The learned A.G. lastly submits that the Court must not proceed for a formal judgment when it cannot grant any effectual relief. In this respect, he relies on the judgments of United States Supreme Court in the cases of North Carolina v. Wayne Claude RICE41 and Mills v. Green42 and the judgment of the Court of Appeal of New York in the case of People ex rel. Kingsland v. Clark43. 78. Taking the line further, the learned A.G. submits that it is also a settled proposition
of law that the Court should not decide academic questions. In this respect, he relies on the judgment of this Court in the cases of Shrimanth Balasaheb Patil v. Speaker, Karnataka Legislative Assembly and others44, Central Areca Nut & Cocoa Marketing & Processing Cooperative Ltd. v. State of Karnataka and others45 and R.S. Nayak v. 79. Shri Jaideep Gupta, learned Senior Counsel appearing on behalf of the RBI, would submit that the contention of the petitioners that the power under sub-section (2) of Section 26 of the RBI Act is uncanalised, unguided and arbitrary is without any basis. He submits that sub-section (2) of Section 26 of the RBI Act itself provides that the power by the Central Government has to be exercised on the recommendation of the Central Board. It is, therefore, submitted that there is an inbuilt safeguard in the provision itself. 80. Relying on the judgment of this Court in the case of Peerless General Finance and Investment Co. Limited and another v. Reserve Bank of India 47, it is submitted that the RBI, which is a bankers’ bank, has a large contingent of experts to render advice relating to matters affecting the economy of the entire country. It is submitted that the RBI plays an important role in the economy and financial affairs of India and one of its important functions is to regulate the banking system in the country. It is submitted that the recommendation of the Central Board is based upon the advice of the experts that the RBI has in its contingent. Shri Gupta also relies on the judgment of the Constitution Bench of this Court in the case of Joseph Kuruvilla Velukunnel v. Reserve Bank of India and others48 in support of this submission. 81. Shri Gupta further submitted that the contention that the decision-making process is faulty on account of not following the procedure under sub-section (2) of Section 26 of the RBI Act is also without substance. The learned Senior Counsel submits that the procedure under sub-section (2) of Section 26 of the RBI Act contemplates two things i.e. recommendation of the Central Board and the decision by the Central Government. It is
submitted that both these requirements stand fully satisfied in the present case. He submits that though it is the contention of the petitioners that the procedure is flawed, however, the petition itself is bereft of such averments. Shri Gupta submits that the Constitution Bench of this Court in the case of Ram Kishore Sen and others v. Union of India and others49 has held that the burden of proof primarily lies on a person who complains that the procedure prescribed has not been followed. In any case, he submits that in both the affidavits filed on behalf of the RBI i.e. the counter affidavit dated 19 th December 2018 filed by Haokholal, Assistant General Manager and the additional affidavit dated 15th November 2022 of Shri Kuntal Kaim, Deputy General Manager, it has been specifically averred that the procedure as prescribed under sub-section (2) of Section 26 43 25 Sickels 518 (1877)(Court of Appeals of New York) of the RBI Act read with Regulation 8 of the 1949 Regulations was duly followed. He submits that the quorum as prescribed under the 1949 Regulations was very much available when the meeting of the Central Board was held on 8th November 2016. In any case, it is submitted that in view of sub-section (5) of Section 8 of the RBI Act, a decision of the Board cannot be questioned merely on the ground of existence of any vacancy or any defect in the constitution of the Board. The learned Senior Counsel has placed on record an additional affidavit dated 6th December, 2022 reiterating the statements made in the aforesaid two affidavits dated 19th December 2018 and 15th November 2022. 82. Relying on the judgment of this Court in the case of Internet and Mobile Association of India (supra), Shri Gupta submits that to consider the question of proportionality, a fourpronged test, as set out in the judgment of this Court in the case of Modern Dental College and Research Centre and Others v. State of Madhya Pradesh and Others 50 is required to be applied. It is submitted that since the measure is designated for the purpose of dealing with fake currency, black money and terror funding,
the first test stands satisfied. The measure, i.e. demonetization, has a reasonable nexus for the fulfillment of the purpose of aforesaid three objectives and, as such, the second test is also fulfilled. Insofar as the third test is concerned, it is submitted that it is a matter of economic policy as to what measure is found to be appropriate for achieving the objective of dealing with the menace of aforesaid three evils. It is submitted that it is for the experts in the economic and monetary fields to take a decision in that regard and, as such, the third test, as to whether there was no alternative less invasive measure, would not be applicable to a decision pertaining to economic policy. Insofar as the fourth test is concerned, it is submitted that, as a matter of fact, there has been no infringement of the rights of the citizens. As a matter of fact, no currency is being taken away. Full value of the legitimate currency has been exchanged. It is submitted that non-cash transactions such as credit card, debit card, online transaction, etc. were permitted even during the period between 8th November 2016 and 31st December 2016. In any case, it is submitted that immediately after the demonetization was notified, in spite of enormity of operations, immediate steps were taken for the betterment of the public and to ensure adequate cash supply. It is submitted that various measures were taken in order to alleviate the genuine grievances of the citizens, which have been enumerated in paragraphs 11 to 17 of the affidavit dated 19th December 2018 filed on behalf of the RBI. It is, therefore, submitted that the proportionality test would not be applicable in the present case. 83. Shri Gupta relying on the judgment of this Court in the case of Small Scale Industrial Manufactures Association (Registered) v. Union of India and others 51 submits that normally, it is not within the domain of any court to weigh the pros and cons of the policy or to scrutinize it except only when it is found to be arbitrary and violative of any constitutional or any statutory provisions of law. 84. Shri Gupta further submits that a similar provision providing for a specified time for
exchange of notes has already been found to be valid by the Constitution Bench of this Court in the case of Jayantilal Ratanchand Shah (supra). He submits that the time provided in the present case is almost similar to the time provided under the 1978 Act. The said period has been found to be reasonable having regard to the purpose sought to be achieved by the said Act. It is, therefore, submitted that the challenge that the period provided was not sufficient is without any substance. It is submitted that everybody had sufficient opportunity either to deposit the notes in their banks or to exchange the same. He further submits that it was not necessary even for the individuals to go to Banks to exchange notes and on the prescribed procedure being followed, an authorized representative could also exchange the notes on their behalf. 85. Shri Gupta further submitted that the provisions of subsection (2) of Section 4 of the 2017 Act cannot be read in isolation. He submits that if it is read in isolation, it will lead to an anomalous situation where the RBI has an independent power to act in violation of the provisions of Section 3 and subsection (1) of Section 4 of the 2017 Act. He submits that Section 3 and sub-sections (1) and (2) of Section 4 of the 2017 Act will have to be read together to hold that the power available to the RBI under sub-section (2) of Section 4 of the 2017 Act is with regard to the grace period as provided under sub-section (1) of Section 4 of the 2017 Act. It is submitted that the power vested in the Central Government under clause (ii) of sub-section (1) of Section 4 of the 2017 Act is to provide grace period to such class of persons and for such reasons as may be specified by notification. However, such power has not been exercised by the Central Government and, therefore, it cannot be construed that the RBI will have an independent power in this regard. 86. Shri Gupta reiterated the submission made by the learned A.G. that since the relief sought in the petitions cannot be granted, no declaration as sought should be granted by
this Court. In this respect, he relies on the judgment of this Court in the case of Bholanath Mukherjee and others v. Ramakrishna Mission Vivekananda Centenary College and 87. Shri P. Chidambaram, learned Senior Counsel, in rejoinder, almost reiterated his earlier submissions. He submitted that there are two methods of demonetization of currency, one is by legislative method and the other under subsection (2) of Section 26 of the RBI Act. He reiterated that the word “any” will always have to be read in the context of the provisions and if read in that manner, the only meaning that can be given to the word “any” in sub-section (2) of Section 26 of the RBI is “some”. In this respect, he relies on the judgment of this Court in the case of Union of India v. A.B. Shah and others53. 88. Shri Chidambaram further submitted that from the perusal of the affidavit filed on behalf of the Central Government as well as the RBI, it is clear that the procedure emanated from the Central Government, which was through the advice given by the Government to the RBI in its communication dated 7th November 2016. The affidavit would clearly show that the RBI acted on the advice of the Central Government and gave its recommendation in a mechanical manner. He reiterated that, as per sub-section (2) of Section 26 of the RBI Act, the proposal has to emanate from the RBI and not from the Central Government. It is reiterated that the procedure is in total breach of sub-section (2) of Section 26 of the RBI Act. 89. Shri Chidambaram submits that unless the documents, to which he had already referred in his arguments while opening the case, are placed for perusal of this Court, the Court cannot come to a satisfaction about the correctness of the decisionmaking process. Relying on the judgment of this Court in the case of R.K. Jain v. Union of India54, he submits that unless the respondents plead privilege and the issue is decided, the respondent cannot withhold the said documents, at least from this Court.
90. Relying on an excerpt from “Forks in the Road: My Days at RBI and Beyond”, a book by former RBI Governor C. Rangarajan, Shri Chidambaram submits that demonetization has nothing to do with monetary policy. Emphasizing on the judgment of this Court in the case of Internet and Mobile Association of India (supra), the learned Senior Counsel submits that the proportionality test will have to be satisfied in the present case. It is submitted that the 2017 Act does not validate the action taken under the impugned Notification. It only extinguishes the liabilities of the Issue Department of the RBI. The learned Senior Counsel, therefore, submits that this is a fit case wherein this Court should decide the scope of subsection (2) of Section 26 of the RBI Act and declare that the exercise of power by the Central Government under sub-section (2) of Section 26 of the RBI Act was not valid in law. In this respect, he relies on the judgment of this Court in the case of S.R. Bommai and others v. Union of India and others55. 91. Shri Shyam Divan, learned Senior Counsel, in rejoinder, submits that the perusal of sub-section (1) of Section 26 of the RBI Act would reveal that, though the tendering of any series of bank notes of any denomination ceases to be a legal one under sub-section (2) of Section 26 of the RBI Act, the guarantee of the Central Government continues to exist. It is submitted that it would be clear from the provisions contained in the 2016 Ordinance, which became the 2017 Act, that Section 3 of the 2017 Act which provides that the SBNs which have ceased to be legal tender in view of the impugned notification, shall cease to be liabilities of the RBI under Section 34 of the RBI Act and shall cease to have the guarantee of the Central Government under sub-section (1) of Section 26 of the said Act. It is submitted that this is also clear from the affidavit dated 16th November 2022 filed on behalf of the Union of India. 92. Shri Divan further submitted that the 2017 Act can neither be construed to validate
the impugned notification nor can it be held that it is a piece of incorporation by reference. It is submitted that the argument with regard to the impugned notification having merged in the 2017 Act is also without substance. The learned Senior Counsel submits that it is simply a plenary parliamentary declaration. 93. Taking further his argument, Shri Divan submits that clause (i) of sub-section (1) of Section 4 of the 2017 gives a power to the Central Government which is coupled with a duty. It is submitted that genuine cases like that of the applicants/petitioners viz., Malvinder Singh and Sarla Shrivastav, who is the applicant/petitioner in I.A. No. 152009 of 2022, should be given some window to exchange the SBNs. It is submitted that there is a large section of NRIs who, during the period between 8th November 2016 and 30th December 2016, were not in India. It is submitted that they could have also not travelled to India since either the tickets were not available or the rates were prohibitively expensive. 94. Shri Divan, in the alternative, submitted that the proviso to the Notification dated 30 December, 2016 has to be read in a manner that it is silent on NRIs who have kept their money in India. It is submitted that exclusion of NRIs who have left their money in India would be manifestly arbitrary and in order to save the proviso, it will have to be read in the manner making it inapplicable to such NRIs who had kept their money in India while residing abroad during that period. 95. Though nine important questions have been framed by the Bench of learned three Judges vide order dated 16th December 2016 in Writ Petition (Civil) No.906 of 2016, upon hearing the submissions advanced before us on behalf of the petitioners as well as the respondents, we find that only the following questions of law arise for consideration. As such, the questions are reframed as under: (i) Whether the power available to the Central Government under sub-section (2) of Section 26 of the RBI Act can be restricted to mean that it can be exercised only for “one” or “some” series
of bank notes and not “all” series in view of the word “any” appearing before the word “series” in the said subsection, specifically so, when on earlier two occasions, the demonetization exercise was done through the plenary legislations? (ii) In the event it is held that the power under subsection (2) of Section 26 of the RBI Act is construed to mean that it can be exercised in respect of “all” series of bank notes, whether the power vested with the Central Government under the said sub-section would amount to conferring excessive delegation and as such, liable to be struck down? (iii) As to whether the impugned Notification dated 8th November 2016 is liable to be struck down on the ground that the decision making process is flawed in law? (iv) As to whether the impugned notification dated 8th November 2016 is liable to be struck down applying the test of proportionality? (v) As to whether the period provided for exchange of notes vide the impugned notification dated 8th November 2016 can be said to be unreasonable? (vi) As to whether the RBI has an independent power under sub-section (2) of Section 4 of the 2017 Act in isolation of provisions of Section 3 and Section 4(1) thereof to accept the demonetized notes beyond the period specified in notifications issued under subsection (1) of Section 4? 96. Before we proceed to consider the various issues reframed by us, we find it appropriate to refer to the scheme of the RBI Act. 97. The preamble of the RBI Act would itself reveal that the RBI Act was enacted since it was found expedient to constitute a Reserve Bank of India to regulate the issue of Bank notes and for the keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage. The preamble of the RBI Act would also show that it was amended in the year 2016 with effect from 27th June 2016 by Act No. 28 of 2016. Post amendment, it was stated in the preamble that, whereas it was essential to have a modern monetary policy framework to
meet the challenge of an increasingly complex economy, and whereas the primary objective of the monetary policy is to maintain price stability while keeping in mind the objective of growth and whereas the monetary policy framework in India shall be operated by the RBI, the RBI Act was enacted. 98. Section 3 of the RBI Act would reveal that the RBI was constituted for the purposes of taking over the management of the currency from the Central Government and of carrying on the business of banking in accordance with the provisions of the RBI Act. 99. Section 8 of the RBI Act deals with composition of the Central Board and term of office of the Directors. It will be relevant to refer to sub-sections (1) and (5) of Section 8 of “8. Composition of the Central Board, and term of office of Directors.-- (1) The Central Board shall consist of the following Directors, namely:- (a) a Governor and not more than four Deputy Governors to be appointed by the Central (b) four Directors to be nominated by the Central Government, one from each of the four Local Boards as constituted by section 9; (d) two Government officials to be nominated by the Central Government. (5) No act or proceeding of the Board shall be questioned on the ground merely of the existence of any vacancy in, or any defect in the constitution of, the Board.” 100. Section 17 of the RBI Act would reveal that the RBI has been authorised to carry on and transact several kinds of business specified therein. 101. Section 22 of the RBI Act would reveal that the RBI shall have the sole right to issue bank notes in India and may, for a period which shall be fixed by the Central Government on the recommendation of the Central Board, issue currency notes of the Government of India supplied to it by the Central Government. It further provides that the provisions of the RBI Act applicable to bank notes shall, unless a contrary intention appears, apply to all currency notes of the Government of India issued either by the Central Government or by the RBI in like manner as if such currency notes were bank notes. Sub-section (2) of Section 22 of the RBI Act specifically provides that on and from the date on which Chapter
III of the RBI Act comes into force, the Central Government shall not issue any currency 102. Section 23 of the RBI Act would reveal that the issue of bank notes shall be conducted by the RBI through an Issue Department which shall be separated and kept wholly distinct from the Banking Department, and the assets of the Issue Department shall not be subject to any liability other than the liabilities of the Issue Department as defined in Section 34. Sub-section (2) of Section 23 provides that the Issue Department shall not issue bank notes to the Banking Department or to any other person except in exchange for other bank notes or for such coin, bullion or securities as are permitted by the RBI Act to form part of the Reserve. 103. Sub-section (1) of Section 24 of the RBI Act provides that, subject to the provisions of sub-section (2), bank notes shall be of the denominational values to two rupees, five rupees, ten rupees, twenty rupees, fifty rupees, one hundred rupees, five hundred rupees, one thousand rupees, five thousand rupees and ten thousand rupees or of such other denominational values, not exceeding ten thousand rupees as the Central Government may, on the recommendation of the Central Board, specify in this behalf. Sub-section (2) of Section 24 of the RBI Act provides that the Central Government may, on the recommendation of the Central Board, direct the non-issue or the discontinuance of issue of bank notes of such denominational values as it may specify in this behalf. 104. Section 25 of the RBI Act provides that the design, form and the material of bank notes shall be such as may be approved by the Central Government after consideration of the recommendations made by the Central Board. 105. Section 26 of the RBI is the provision which directly falls for consideration. The same “26. Legal tender character of notes. (1) Subject to the provisions of subsection (2), every bank note shall be legal tender at any place in India in payment, or on account for the amount expressed therein, and shall be guaranteed by the Central Government.
(2) On recommendation of the Central Board the Central Government may, by notification in the Gazette of India, declare that, with effect from such date as may be specified in the notification, any series of bank notes of any denomination shall cease to be legal tender save at such office or agency of the Bank and to such extent as may be specified in the notification.” 106. It can thus be seen that sub-section (1) of Section 26 of the RBI Act provides that, subject to the provisions of subsection (2), every bank note shall be legal tender at any place in India in payment, or on account for the amount expressed therein, and shall be guaranteed by the Central Government. Sub-section (2) of Section 26 of the RBI Act provides that on recommendation of the Central Board, the Central Government may, by notification in the Gazette of India, declare that, with effect from such date as may be specified in the notification, any series of bank notes of any denomination shall cease to be legal tender save at such office or agency of the Bank and to such extent as may be specified in the notification. 107. Section 34 of the RBI Act provides that the liabilities of the Issue Department of the RBI shall be an amount equal to the total of the amount of the currency notes of the Government of India and bank notes for the time being in circulation. 108. Perusal of the aforesaid provisions of the RBI Act would reveal that insofar as monetary policy and specifically with regard to the matters of management and regulation of currency are concerned, the RBI plays a pivotal role. As a matter of fact, both the sides are ad idem on the said issue. 109. The importance of the role assigned to the RBI in such matters would be amplified from the various judgments of this Court, which we will refer to in the paragraphs to follow. In this background, we will consider the issues that fall for our consideration. 110. It is strenuously urged by the learned Senior Counsel appearing on behalf of the petitioners that the word “any” used in sub-section (2) of Section 26 of the RBI Act will have to be given a restricted meaning to mean “some”. It is submitted that if sub-section
(2) of Section 26 of the RBI Act is not read in such manner, the very power available under the said subsection will have to be held to be invalid on the ground of excessive delegation. It is submitted that it cannot be construed that the legislature intended to bestow uncanalised, unguided and arbitrary power to the Central Government to demonetize the entire currency. It is, therefore, the submission of the petitioners that in order to save the said Section from being declared void, the word “any” requires to be interpreted in a restricted manner to mean “some”. 111. Per contra, it is submitted on behalf of the respondents that the word “any” under sub-section (2) of Section 26 of the RBI Act, cannot be interpreted in a narrow manner and it will have to be construed to include “all”. 112. A Constitution Bench of this Court in the case of The Chief Inspector of Mines and another v. Lala Karam Chand Thapar etc. (supra) was considering the question as to whether the phrase “any one of the directors” as found in Section 76 of the Mines Act, 1952 could mean “only one of the directors” or could it be construed to mean “every one of the directors”. In the said case, all the directors of the Company were prosecuted for the offences punishable under Sections 73 and 74 of the Mines Act, 1952. The High Court had held that any ‘one’ of the directors of the Company could only be prosecuted. The Constitution Bench of this Court observed thus: “It is quite clear and indeed not disputed that in some contexts, “any one” means “one only it matters not which one” the phrase “any of the directors” is therefore quite capable of meaning “only one of the directors, it does not matter which one”. Is the phrase however capable of no other meaning? If it is not, the courts cannot look further, and must interpret these words in that meaning only, irrespective of what the intention of the legislature might be believed to have been. If however the phrase is capable of another meaning, as suggested, viz., “every one of the
directors” it will be necessary to decide which of the two meanings was intended by the legislature. If one examines the use of the words “any one” in common conversation or literature, there can be no doubt that they are not infrequently used to mean “every one” — not one, but all. Thus we say of any one can see that this is wrong, to mean “everyone can see that this is wrong”. “Any one may enter” does not mean that “only one person may enter”, but that all may enter. It is permissible and indeed profitable to turn in this connection to the Oxford English Dictionary, at p. 378, of which, we find the meaning of “any” given thus: “In affirmative sentences, it asserts, concerning a being or thing of the sort named, without limitation as to which, and thus collectively of every one of them”. One of the illustrations given is — “I challenge anyone to contradict my assertions”. Certainly, this does not mean that one only is challenged; but that all are challenged. It is abundantly clear therefore that “any one” is not infrequently used to mean “every one”. But, argues Mr Pathak, granting that this is so, it must be held that when the phrase “any one” is used with the preposition “of”, followed by a word denoting a number of persons, it never means “every one”. The extract from the Oxford Dictionary, it is interesting to notice, speaks of an assertion “concerning a being or thing of the sort named”; it is not unreasonable to say that, the word “of” followed by a word denoting a number of persons or things is just such “naming of a sort” as mentioned there. Suppose, the illustration “I challenge any one to contradict my assertions” was changed to “I challenge any one of my opponents to contradict my assertion”. “Any one of my opponents” here would mean “all my opponents” — not one only of the opponents. While the phrase “any one of them” or any similar phrase consisting of “any one”, followed
by “of” which is followed in its turn by words denoting a number of persons or things, does not appear to have fallen for judicial construction, in our courts or in England — the phrase “any of the present directors” had to be interpreted in an old English case, Isle of Wight Railway Co. v. Tahourdin [25 Chancery Division 320] . A number of shareholders required the directors to call a meeting of the company for two objects. One of the objects was mentioned as “To remove, if deemed necessary or expedient any of the present directors, and to elect directors to fill any vacancy on the Board”. The directors issued a notice to convene a meeting for the other object and held the meeting. Then the shareholders, under the Companies Clauses Act, 1845, issued a notice of their own convening a meeting for both the objects in the original requisition. In an action by the directors to restrain the requisitionists, from holding the meeting, the Court of Appeal held that a notice to remove “any of the present directors” would justify a resolution for removing all who are directors at the present time. “Any”, Lord Cotton, L.J. pointed out, would involve “all”. It is true that the language there was “any of the present directors” and not “any one of the present directors” and it is urged that the word “one”, in the latter phrase makes all the difference. We think it will be wrong to put too much emphasis on the word “one” here. It may be pointed out in this connection that the Permanent Edition of Words and Phrases, mentions an American case Front & Hintingdon Building & Loan Association v. Berzinski where the words “any of them” were held to be the equivalent of “any one of them”. After giving the matter full and anxious consideration, we have come to the conclusion that the words “any one of the directors” is ambiguous; in some contexts, it means “only one of the directors, does not matter which one”, but in other contexts, it is capable of meaning “every one of the directors”. Which of these two meanings was intended by the legislature in any particular statutory phrase has to be decided by the
courts on a consideration of the context in which the words appear, and in particular, the scheme and object of the legislation.” 113. The Constitution Bench found that the words “any one” has been commonly used to mean “every one” i.e. not one, but all. It found that the word “any”, in affirmative sentences, asserts, concerning a being or thing of the sort named, without limitation. It held that it is abundantly clear that the word “any one” is not infrequently used to mean “every one”. 114. It could be seen that the Constitution Bench, after giving the matter full and anxious consideration, came to the conclusion that the words “any one of the directors” was an ambiguous one. It held that in some contexts, it means “only one of the directors, does not matter which one”, but in other contexts, it is capable of meaning “every one of the directors”. It held that which of these two meanings was intended by the legislature in any particular statutory phrase has to be decided by the courts on consideration of the context in which the words appear, and in particular, the scheme and object of the legislation. 115. After examining the scheme of the Mines Act, 1952, the Constitution Bench of this “But, argues Mr Pathak, one must not forget the special rule of interpretation for “penal statute” that if the language is ambiguous, the interpretation in favour of the accused should ordinarily be adopted. If you interpret “any one” in the sense suggested by him, the legislation he suggests is void and so the accused escapes. One of the two possible constructions, thus being in favour of the accused, should therefore be adopted. In our opinion, there is no substance in this contention. The rule of strict interpretation of penal statutes in favour of the accused is not of universal application, and must be considered along with other wellestablished rules of interpretation. We have already seen that the scheme and object of the statute makes it reasonable to think that the legislature intended to subject all the directors of a company owning coal mines to prosecution and penalties, and not one only of the directors. In the face of these considerations there is no scope here of the application of
the rule for strict interpretation of penal statutes in favour of the accused. The High Court appears to have been greatly impressed by the fact that in other statutes where the legislature wanted to make every one out of a group or a class of persons liable it used clear language expressing the intention; and that the phrase “any one” has not been used in any other statute in this country to express “every one”. It will be unreasonable, in our opinion, to attach too much weight to this circumstance; and as for the reasons mentioned above, we think the phrase “any one of the directors” is capable of meaning “every one of the directors”, the fact that in other statutes, different words were used to express a similar meaning is not of any significance. We have, on all these considerations come to the conclusion that the words “any one of the directors” has been used in Section 76 to mean “every one of the directors”, and that the contrary interpretation given by the High Court is not correct.” 116. It could thus be seen that though it was sought to be argued before the Court that since the rule of strict interpretation of penal statutes in favour of the accused has to be adopted and that the word “any” was suffixed by the word “one”, it has to be given restricted meaning; the Court came to the conclusion that the words “any one of the directors” used in Section 76 of the Mines Act, 1952 would mean “every one of the directors”. It is further to be noted that the word “any” in the said case was suffixed by the word “one”, still the Court held that the words “any one” would mean “all” and not “one”. It is to be noted that in the present case, the legislature has not employed the word “one” after the word “any”. It is settled law that it has to be construed that every single word employed or not employed by the legislature has a purpose behind it. 117. On the very date on which the judgment in the case of The Chief Inspector of Mines and another v. Lala Karam Chand Thapar etc. (supra) was pronounced, the
same Constitution Bench also pronounced the judgment in the case of Banwarilal Agarawalla (supra), wherein the Constitution Bench observed thus: “The first contention is based on an assumption that the word “any one” in Section 76 means only “one of the directors, and only one of the shareholders”. This question as regards the interpretation of the word “any one” in Section 76 was raised in Criminal Appeals Nos. 98 to 106 of 1959 (Chief Inspector of Mines, etc.) and it has been decided there that the word “any one” should be interpreted there as “every one”. Thus under Section 76 every one of the shareholders of a private company owning the mine, and every one of the directors of a public company owning the mine is liable to prosecution. No question of violation of Article 14 therefore arises.” 118. Another Constitution Bench of this Court in the case of Tej Kiran Jain and others (supra) was considering the provisions of Article 105 of the Constitution of India and, particularly, the immunity as available to the Member of Parliament “in respect of anything said…….. in Parliament”. The Constitution Bench observed thus: “8. In our judgment it is not possible to read the provisions of the article in the way suggested. The article means what it says in language which could not be plainer. The article confers immunity inter alia in respect of “anything said ... in Parliament”. The word “anything” is of the widest import and is equivalent to “everything”. The only limitation arises from the words “in Parliament” which means during the sitting of Parliament and in the course of the business of Parliament. We are concerned only with speeches in Lok Sabha. Once it was proved that Parliament was sitting and its business was being transacted, anything said during the course of that business was immune from proceedings in any Court this immunity is not only complete but is as it should be. It is of the essence of parliamentary system of Government that people's representatives should be free to express themselves without fear of legal consequences. What they say is only subject to the discipline of the rules of Parliament, the
good sense of the members and the control of proceedings by the Speaker. The Courts have no say in the matter and should really have none.” 119. This Court held that the word “anything” is of the widest import and is equivalent to “everything”. The only limitation arises from the words “in Parliament” which means during the sitting of Parliament and in the course of the business of Parliament. It held that, once it was proved that Parliament was sitting and its business was being transacted, anything said during the course of that business was immune from proceedings in any Court. 120. This Court, in the case of Lucknow Development Authority (supra), was considering clause (o) of Section (2) of the Consumer Protection Act, 1986 which defines “service”, wherein the word “any” again fell for consideration. This Court observed thus: “4. …… The words ‘any’ and ‘potential’ are significant. Both are of wide amplitude. The word ‘any’ dictionarily means ‘one or some or all’. In Black's Law Dictionary it is explained thus, “word ‘any’ has a diversity of meaning and may be employed to indicate ‘all’ or ‘every’ as well as ‘some’ or ‘one’ and its meaning in a given statute depends upon the context and the subject-matter of the statute”. The use of the word ‘any’ in the context it has been used in clause (o) indicates that it has been used in wider sense extending from one to all……” 121. This Court held that the word “any” is of wide amplitude. It means “one or some or all”. Referring to Black’s Law Dictionary, the Court observed that the word “any” has a diversity of meaning and may be employed to indicate “all” or “every” as well as “some” or “one”. However, the meaning which is to be given to it would depend upon the context and the subject-matter of the statute. 122. In the case of K.P. Mohammed Salim (supra), this Court was considering the power of the Director General or Chief Commissioner or Commissioner to transfer any
case from one or more assessing officers subordinate to him to any other assessing officer or assessing officers. This Court observed thus: “17. The word “any” must be read in the context of the statute and for the said purpose, it may in a situation of this nature, means all. The principles of purposive construction for the said purpose may be resorted to. (See New India Assurance Co. Ltd. v. Nusli Neville Wadia [(2008) 3 SCC 279 : (2007) 13 SCR 598]) Thus, in the context of a statute, the word “any” may be read as all in the context of the Income Tax Act for which the power of transfer has been conferred upon the authorities specified under Section 127.” 123. The Court again reiterated that the word “any” must be read in the context of the statute. The Court also applied the principles of purposive construction to the term “any” to mean “all”. 124. In the case of Raj Kumar Shivhare (supra), an argument was sought to be advanced that since Section 35 of the Foreign Exchange Management Act, 1999 uses the words “any decision or order”, only appeals from final order could be filed. Rejecting the said contention, this Court observed thus: “19. The word “any” in this context would mean “all”. We are of this opinion in view of the fact that this section confers a right of appeal on any person aggrieved. A right of appeal, it is well settled, is a creature of statute. It is never an inherent right, like that of filing a suit. A right of filing a suit, unless it is barred by statute, as it is barred here under Section 34 of FEMA, is an inherent right (see Section 9 of the Civil Procedure Code) but a right of appeal is always conferred by a statute. While conferring such right a statute may impose restrictions, like limitation or predeposit of penalty or it may limit the area of appeal to questions of law or sometime to substantial questions of law. Whenever such limitations are imposed, they are to be strictly followed. But in a case
where there is no limitation on the nature of order or decision to be appealed against, as in this case, the right of appeal cannot be further curtailed by this Court on the basis of an interpretative 20. Under Section 35 of FEMA, the legislature has conferred a right of appeal to a person aggrieved from “any” “order” or “decision” of the Appellate Tribunal. Of course such appeal will have to be on a question of law. In this context the word “any” would mean “all”. 26. In the instant case also when a right is conferred on a person aggrieved to file appeal from “any” order or decision of the Tribunal, there is no reason, in the absence of a contrary statutory intent, to give it a restricted meaning. Therefore, in our judgment in Section 35 of FEMA, any “order” or “decision” of the Appellate Tribunal would mean all decisions or orders of the Appellate Tribunal and all such decisions or orders are, subject to limitation, appealable to the High Court on a question of law.” 125. While holding that the word “any” in the context would mean “all”, this Court observed that a right of appeal is always conferred by a statute. It has been held that, while conferring such right, a statute may impose restrictions, like limitation or pre-deposit of penalty or it may limit the area of appeal to questions of law or sometime to substantial questions of law. It has been held that whenever such limitations are imposed, they are to be strictly followed. It has been held that in a case where there is no limitation, the right of appeal cannot be curtailed by this Court on the basis of an interpretative exercise. 126. Shri P. Chidambaram, learned Senior Counsel relied on the judgment of this Court in the case of Union of India v. A.B. Shah and others (supra). In the said case, the High Court was considering an appeal preferred by the Union of India wherein it had challenged the acquittal of the accused by the learned trial court, which was confirmed in appeal by the High Court. The learned trial court and the High Court had held that the complaint filed
was beyond limitation. This Court reversed the judgments of the learned trial court and the High Court. This Court while interpreting the expression “at any time” observed thus: “12. If we look into Conditions 3 and 6 with the object and purpose of the Act in mind, it has to be held that these conditions are not only relatable to what was required at the commencement of depillaring process, but the unstowing for the required length must exist always. The expression “at any time” finding place in Condition 6 has to mean, in the context in which it has been used, “at any point of time”, the effect of which is that the required length must be maintained all the time. The accomplishment of object of the Act, one of which is safety in the mines, requires taking of such a view, especially in the backdrop of repeated mine disasters which have been taking, off and on, heavy toll of lives of the miners. It may be pointed out that the word ‘any’ has a diversity of meaning and in Black's Law Dictionary it has been stated that this word may be employed to indicate ‘all’ or ‘every’, and its meaning will depend “upon the context and subjectmatter of the statute”. A reference to what has been stated in Stroud's Judicial Dictionary Vol. I, is revealing inasmuch as the import of the word ‘any’ has been explained from pp. 145 to 153 of the 4th Edn., a perusal of which shows it has different connotations depending primarily on the subject-matter of the statute and the context of its use. A Bench of this Court in Lucknow Development Authority v. M.K. Gupta [(1994) 1 SCC 243] , gave a very wide meaning to this word finding place in Section 2(o) of the Consumer Protection Act, 1986 defining ‘service’. (See para 4)” 127. Shri Chidambaram rightly argued that the word “any” will have to be construed in its context, taking into consideration the scheme and the purpose of the enactment. There can be no quarrel with regard to the said proposition. Right from the judgment of the Constitution Bench of this Court in the case of The Chief Inspector of Mines and another
v. Lala Karam Chand Thapar etc. (supra), the position is clear. What is the meaning which the legislature intended to give to a particular statutory provision has to be decided by the Court on a consideration of the context in which the word(s) appear(s) and in particular, the scheme and object of the legislation. 128. We find that for deciding the present issue, it will also be necessary to refer an important principle of interpretation of statutes i.e. of purposive interpretation. 129. “Legislation has an aim, it seeks to obviate some mischief, to supply an inadequacy, to effect a change of policy, to formulate a plan of government. That aim, that policy is not drawn, like nitrogen, out of the air; it is evidenced in the language of the statute, as read in the light of other external manifestations of purpose [Some Reflections on the Reading of Statutes, 47 Columbia LR 527, at p. 538 (1947)].” 130. This is how Justice Frankfurter succinctly propounds the principle of purposive interpretation. It is thus necessary to cull out the legislative policy from various factors like the words in the statute, the preamble of the Act, the statement of objects and reasons, and in a given case, even the attendant circumstances. After the legislative policy is found, then the words used in the statute must be so interpreted such that it advances the purpose of the statute and does not defeat it. 131. Francis Bennion in his treatise Statutory Interpretation, at page 810 described purposive construction in an equally eloquent manner as under: “A purposive construction of an enactment is one which gives effect to the legislative purpose (a) following the literal meaning of the enactment where that meaning is in accordance with the legislative purpose (in this Code called a purposive-andliteral construction), or (b) applying a strained meaning where the literal meaning is not in accordance with the legislative purpose (in the Code called a purposive-and-strained construction).”
132. A statute must be construed having regard to the legislative intent. It has to be meaningful. A construction which leads to manifest absurdity must not be preferred to a construction which would fulfil the object and purport of the legislative intent. 133. Aharon Barak, the former President of the Supreme Court of Israel, whose exposition of “doctrine of proportionality” has found approval by the Constitution Bench of this Court in the case of Modern Dental College and Research Centre and Others (supra), to which we will refer to in the forthcoming paragraphs, in his commentary on “Purposive Interpretation in Law”, has summarized ‘the goal of interpretation in law’ as “At some point, we need to find an Archimedean foothold, external to the text, from which to answer that question. My answer is this: The goal of interpretation in law is to achieve the objective – in other words, the purpose – of law.56 The role of a system of interpretation in law is to choose, from among the semantic options for a given text, the meaning that best achieves the purpose of the text. Each legal text – will, contract, statute, and constitution – was chosen to achieve a social objective. Achieving this objective, achieving this purpose, is the goal of interpretation. The system of interpretation is the device and the means. It is a tool through which law achieves self-realization. In interpreting a given text, which is, after all, what interpretation in law does, a system of interpretation must guarantee that the purpose of the norm trapped in the – in our terminology, the purpose of the text – will be achieved in the best way. Hence the requirement that the system of interpretation be a rational activity. A coin toss will not do. This is also the rationale – which is at the core of my own views – for the belief that purposive interpretation is the most proper system of interpretation. This system is proper because it guarantees the achievement of the purpose of law. There is social, jurisprudential, hermeneutical, and constitutional support for my claim that the proper criterion for interpretation is the search for
law’s purpose, and that purposive interpretation best fulfills that criterion. A comparative look at the law supports it, as well. I will discuss each element of that support below.” 134. The learned Judge emphasized that purposive interpretation is the most proper system of interpretation. He observed that this system is proper because it guarantees the achievement of the purpose of law. The proper criterion for interpretation is the search for law’s purpose, and that purposive interpretation best fulfills that criterion. 135. The principle of purposive interpretation has also been expounded through a catena of judgments of this Court. A Constitution Bench of this Court in the case of M. Pentiah and others v. Muddala Veeramallappa and others57 was considering a question, as to whether the term prescribed in Section 34 would apply to a member of a “deemed” committee under the provisions of the Hyderabad District Municipalities Act, 1956. An 56 D. Brink, “Legal Theory, Legal Interpretation, and Judicial Review,” 17 Phil. And Pub. Aff. 105, 125 (1988). argument was put forth that, upon a correct interpretation of the provisions of Section 16, the same would be permissible. Rejecting the said argument, K. Subba Rao, J, observed “Before we consider this argument in some detail, it will be convenient at this stage to notice some of the well established rules of Construction which would help us to steer clear of the complications created by the Act. Maxwell on the Interpretation of Statutes, 10th Edn., says at p. “… if the choice is between two interpretations, the narrower of which would fail to achieve the manifest purpose of the legislation, we should avoid a construction which would reduce the legislation to futility and should rather accept the bolder construction based on the view that Parliament would legislate only for the purpose of bringing about an effective result”. It is said in Craies on Statute Law, 5th Edn., at p. 82— “Manifest absurdity or futility, palpable injustice, or absurd inconvenience or anomaly to be
Lord Davey in Canada Sugar Refining Co. v. R. [(1898) AC 735] provides another useful guide of correct perspective to such a problem in the following words: “Every clause of a statute should be construed with reference to the context and the other clauses of the Act, so as, so far as possible, to make a consistent enactment of the whole statute or series of statutes relating to the subjectmatter.”” “There is no doubt that the Act raises some difficulty. It was certainly not intended that the members elected to the Committee under the repealed Act should be given a permanent tenure of office nor that there would be no elections under the new Act. Yet such a result would appear to follow if the language used in the new Act is strictly and literally interpreted. It is however well established that “Where the language of a statute, in its ordinary meaning and grammatical construction, leads to a manifest contradiction of the apparent purpose of the enactment, or to some inconvenience or absurdity, hardship or in justice, presumably not intended, a construction may be put upon it which modifies the meaning of the words, and even the structure of the sentence.…Where the main object and intention of a statute are clear, it must not be reduced to a nullity by the draftsman's unskilfulness or ignorance of the law, except in a case of necessity, or the absolute intractability of the language used. Nevertheless, the courts are very reluctant to substitute words in a Statute, or to add words to it, and it has been said that they will only do so where there is a repugnancy to good Sense.”: see Maxwell on Statutes (10th Edn.) p. 229. In Seaford Court Estates Ltd. v. Asher [(1949) 2 AER “when a defect appears a judge cannot simply fold his hands and blame the draftsman. He must set to work on the constructive task of finding the intention of Parliament … and then he must supplement the written word so as to give “force and life” to the intention of the legislature …. A judge should ask himself the question how, if the makers of the Act had themselves come across
this ruck in the texture of it, they would have straightened it out? He must then do as they would have done. A judge must not alter the material of which the Act is woven, but he can and should 137. Another Constitution Bench Judgment of this Court in the case of Chief Justice of Andhra Pradesh and others v. L.V.A. Dixitulu and others58 reiterated the position in “67. Where two alternative constructions are possible, the court must choose the one which will be in accord with the other parts of the statute and ensure its smooth, harmonious working, and eschew the other which leads to absurdity, confusion, or friction, contradiction and conflict between its various provisions, or undermines, or tends to defeat or destroy the basic scheme and purpose of the enactment. 138. In the case of M/s Girdhari Lal and Sons v. Balbir Nath Mathur and others59, O. Chinnappa Reddy, J. explained the position as under: “9. So we see that the primary and foremost task of a court in interpreting a statute is to ascertain the intention of the legislature, actual or imputed. Having ascertained the intention, the court must then strive to so interpret the statute as to promote or advance the object and purpose of the enactment. For this purpose, where necessary the court may even depart from the rule that plain words should be interpreted according to their plain meaning. There need be no meek and mute submission to the plainness of the language. To avoid patent injustice, anomaly or absurdity or to avoid invalidation of a law, the court would be well justified in departing from the so-called golden rule of construction so as to give effect to the object and purpose of the enactment by supplementing the written word if necessary.” 139. After referring to various earlier judgments of other jurisdictions, His Lordship “16. Our own court has generally taken the view that ascertainment of legislative intent is a basic rule of statutory construction and that a rule of construction should be preferred which advances the purpose and object of a legislation and that though a construction, according to plain language, should ordinarily be adopted, such a construction should not
be adopted where it leads to anomalies, injustices or absurdities, vide K.P. Varghese v. ITO [(1981) 4 SCC 173 : 1981 SCC (Tax) 293] , State Bank of Travancore v. Mohd. M. Khan [(1981) 4 SCC 82] , Som Prakash Rekhi v. Union of India [(1981) 1 SCC 449 : 1981 SCC (L&S) 200] , Ravula Subba Rao v. CIT [AIR 1956 SC 604 : 1956 SCR 577] , Govindlal v. Agricultural Produce Market Committee [(1975) 2 SCC 482 : AIR 1976 SC 263 : (1976) 1 SCR 451] and Babaji Kondaji 140. M.N. Venkatachaliah, J. speaking for the Constitution Bench of this Court in the case of Tinsukhia Electric Supply Co. Ltd. v. State of Assam and others60 observed “118. The courts strongly lean against any construction which tends to reduce a statute to futility. The provision of a statute must be so construed as to make it effective and operative, on the principle “ut res magis valeat quam pereat”. It is, no doubt, true that if a statute is absolutely vague and its language wholly intractable and absolutely meaningless, the statute could be declared void for vagueness. This is not in judicial review by testing the law for arbitrariness or unreasonableness under Article 14; but what a court of construction, dealing with the language of a statute, does in order to ascertain from, and accord to, the statute the meaning and purpose which the legislature intended for it. In Manchester Ship Canal Co. v. Manchester Racecourse Co. [(1904) 2 Ch 352 : 16 TLR 429 : 83 LT 274] Farwell J. said: (pp. 360-61) “Unless the words were so absolutely senseless that I could do nothing at all with them, I should be bound to find some meaning and not to declare them void for uncertainty.” 119. In Fawcett Properties Ltd. v. Buckingham County Council [(1960) 3 All ER 503] Lord
Denning approving the dictum of Farwell, J., said:(All ER p. 516) “But when a Statute has some meaning, even though it is obscure, or several meanings, even though there is little to choose between them, the courts have to say what meaning the statute to bear rather than reject it as a nullity.” 120. It is, therefore, the court's duty to make what it can of the statute, knowing that the statutes are meant to be operative and not inept and the nothing short of impossibility should allow a court to declare a statute unworkable. In Whitney v. IRC [1926 AC 37] Lord Dunedin said: (AC p. 52) “A statute is designed to be workable, and the interpretation thereof by a court should be to secure that object, unless crucial omission or clear direction makes that end unattainable.”” 141. In the case of State of Gujarat and another v. Justice R.A. Mehta (Retired) and others61, this Court held as under: “98. The doctrine of purposive construction may be taken recourse to for the purpose of giving full effect to statutory provisions, and the courts must state what meaning the statute should bear, rather than rendering the statute a nullity, as statutes are meant to be operative and not inept. The courts must refrain from declaring a statute to be unworkable. The rules of interpretation require that construction which carries forward the objectives of the statute, protects interest of the parties and keeps the remedy alive, should be preferred looking into the text and context of the statute. Construction given by the court must promote the object of the statute and serve the purpose for which it has been enacted and not efface its very purpose. “The courts strongly lean against any construction which tends to reduce a statute to futility. The provision of the statute must be so construed as to make it effective and operative.” The court must take a pragmatic view and must keep in mind the purpose for which the statute was enacted as the purpose of law itself provides good guidance to courts as they interpret the true meaning of the Act and thus legislative futility must be ruled out. A statute
must be construed in such a manner so as to ensure that the Act itself does not become a dead letter and the obvious intention of the legislature does not stand defeated unless it leads to a case of absolute intractability in use. The court must adopt a construction which suppresses the mischief and advances the remedy and “to suppress subtle inventions and evasions for continuance of the mischief, and pro privato commodo, and to add force and life to the cure and remedy, according to the true intent of the makers of the Act, pro bono publico”. The court must give effect to the purpose and object of the Act for the reason that legislature is presumed to have enacted a reasonable statute. (Vide M. Pentiah v. Muddala Veeramallappa [AIR 1961 SC 1107] , S.P. Jain v. Krishna Mohan Gupta [(1987) 1 SCC 191 : AIR 1987 SC 222] , RBI v. Peerless General Finance and Investment Co. Ltd. [(1987) 1 SCC 424 : AIR 1987 SC 1023] , Tinsukhia Electric Supply Co. Ltd. v. State of Assam [(1989) 3 SCC 709 : AIR 1990 SC 123] , SCC p. 754, para 118, UCO Bank v. Rajinder Lal Capoor [(2008) 5 SCC 257 : (2008) 2 SCC (L&S) 263] and Grid Corpn. of Orissa Ltd. v. Eastern Metals and Ferro Alloys [(2011) 11 SCC 334]. )” 142. The principle of purposive construction has been enunciated in various subsequent judgments of this Court. However, we would not like to burden this judgment with a plethora of citations. Suffice it to say, the law on the issue is very well crystalized. 143. It is thus clear that it is a settled principle that the modern approach of interpretation is a pragmatic one, and not pedantic. An interpretation which advances the purpose of the Act and which ensures its smooth and harmonious working must be chosen and the other which leads to absurdity, or confusion, or friction, or contradiction and conflict between its
various provisions, or undermines, or tends to defeat or destroy the basic scheme and purpose of the enactment must be eschewed. The primary and foremost task of the Court in interpreting a statute is to gather the intention of the legislature, actual or imputed. Having ascertained the intention, it is the duty of the Court to strive to so interpret the statute as to promote or advance the object and purpose of the enactment. For this purpose, where necessary, the Court may even depart from the rule that plain words should be interpreted according to their plain meaning. There need be no meek and mute submission to the plainness of the language. To avoid patent injustice, anomaly or absurdity or to avoid invalidation of a law, the court would be justified in departing from the so-called golden rule of construction so as to give effect to the object and purpose of the enactment. Ascertainment of legislative intent is the basic rule of statutory 144. Applying the aforesaid pronouncements on the construction of the term “any” and the principle of purposive construction, we will now consider the scope of the term “any” used in sub-section (2) of Section 26 of the RBI Act. 145. Sub-section (2) of Section 26 of the RBI Act empowers the Central Government to issue a notification in the Gazette of India thereby declaring that, with effect from such date as may be specified in the notification, any series of bank notes of any denomination shall cease to be legal tender. It further provides that such an action has to be taken by the Central Government on the recommendation of the Central Board. 146. As already discussed herein above, the RBI Act is a special Act, vesting all the powers and functions with regard to monetary policy and all matters pertaining to management and regulation of currency with the RBI. The Central Government is required to take its decision on the basis of the recommendation of the Central Board. 147. It could thus be seen that power is vested with the Central Government and that power has to be exercised on the recommendation of the RBI. Both sides agree that RBI plays a unique role in the matter of monetary policy and issuance of currency. The Central
Government is empowered under subsection (2) of Section 26 of the RBI Act to notify any series of bank notes of any denomination to cease to be a legal tender. The effect of such a notification would be that the liabilities as provided under Section 34 of the RBI Act and the guarantee as provided under sub-section (1) of Section 26 of the RBI Act shall cease to have effect on such notification being issued thereby demonetizing the bank notes. 148. As already discussed herein above, the RBI Act has been enacted to regulate the issue of bank notes and generally to operate the currency and credit system of the country. Section 3 of the RBI Act provides that the RBI has been constituted for the purposes of taking over the management of the currency from the Central Government and carrying on the business of banking in accordance with the provisions of the RBI Act. Subsection (1) of Section 22 of the RBI Act provides that the RBI shall have the sole right to issue bank notes in India. However, for a period which is to be fixed by the Central Government on the recommendation of the Central Board, it can issue currency notes of the Government of India supplied to it by the Central Government. Further, sub-section (2) of Section 22 of the RBI Act specifically prohibits the Central Government from issuing any currency notes on and from the date on which Chapter III of the RBI Act comes into effect. 149. It can thus clearly be seen that a primary and very important role is assigned to the RBI in the matter of issuance of bank notes. As held by this Court in the case Peerless General Finance and Investment Co. Limited and another (supra), the RBI has a large contingent of expert advice available to it. The Central Government would exercise its power on the recommendation of the Central Board. When the legislature itself has provided that the Central Government would take a decision after considering the recommendation of the Central Board of the RBI, which has been assigned a primary role in matters with regard to monetary policy and management and regulation of currency, we are of the view that the legislature could not have intended to give a restricted power under sub-section (2) of Section 26 of the RBI Act. In any case, if the argument that the
provisions of sub-section (2) of Section 26 of the RBI Act have to be interpreted in a restricted manner, is to be accepted, it may, at times, lead to an anomalous situation. 150. For example, if there are 20 series of a particular denomination, and if the argument of the petitioners is to be accepted, the Central Government would be empowered to demonetize 19 series of a particular denomination, leaving one series of the said denomination to continue to be a legal tender, which would lead to a chaotic situation. 151. As discussed hereinabove, the policy underlining the provisions of Section 26 of the RBI Act is to enable the Central Government on the recommendation of the Central Board, to effect demonetization. The same can be done in respect of any series of bank notes of any denomination. The legislative policy is with regard to management and regulation of currency. Demonetization of notes would certainly be a part of management and regulation of currency. The legislature has empowered the Central Government to exercise such a power. The Central Government may take recourse to such a power when it finds necessary to do so taking into consideration myriad factors. No doubt that such factors must have reasonable nexus with the object sought to be achieved. If the Central Government finds that fake notes of a particular denomination are widely in circulation or that they are being used to promote terrorism, can it be said, for instance, that out of 20 series of bank notes of a particular denomination, it can demonetize only 19 series of bank notes but not all 20 series? In our view, this will result in nothing else but absurdity and the very purpose for which the power is vested shall stand frustrated. An interpretation which, in effect, nullifies the purpose for which a power is to be exercised, in our view, would be opposed to the principle of purposive interpretation. Such an interpretation, in our view, rather than advancing the object of the enactment, would defeat the same. 152. Another line of argument that is sought to be advanced with regard to the submission that the power under subsection (2) of Section 26 of the RBI Act has to be
construed to restricting it to “one” or “some” series of bank notes, is that the Parliament also meant the same inasmuch as on earlier two occasions i.e. in 1946 and 1978 the demonetization exercise in respect of “all” series was done by resorting to plenary legislations. Shri Chidambaram has taken us through various volumes of the history of the RBI. Perusal of Volume I thereof would reveal that, in 1946, it is not known when the Government Authorities started thinking on the demonetization measure, but the final consultation could take place with the Governor and Deputy Governor. It appears that the RBI authorities were not enthusiastic about the scheme. It appears that in spite of the opposition by the then Governor of the RBI, Shri C.D. Deshmukh, the Government went ahead with the scheme and issued an ordinance on 12th January 1946. 153. Further, perusal of Volume III would reveal that the then Governor I.G. Patel was not in favour of the demonetization scheme of 1978. However, in spite of the opposition of the Governor of the RBI, the Government went ahead with the demonetization scheme and issued an ordinance in the early hours of 16th January 1978 and the news was announced on All India Radio’s news bulletin at 9 am on the same day. 154. It could thus be seen that on earlier two occasions, since the RBI was not in favour of the demonetization, the Government resorted to promulgating ordinances for the said 155. It is to be noted that after the ordinance of 1946 was promulgated, the RBI Act was amended vide Act No.62 of 1956 and Section 26A was added, thereby specifically providing that no bank note of the denominational value of Rs.500/-, Rs. 1,000/- and Rs.10,000/- issued before the 13th day of January 1946 shall be legal tender in payment or on account for the amount expressed therein. 156. After the ordinance was issued on 16th January 1978, the same transformed into an Act of Parliament upon the President of India giving his assent to the Act on 30th March 157. Merely because on earlier two occasions the Government decided to take recourse
to plenary power of legislation, this, by itself, cannot be a ground to give a restricted meaning to the word “any” in sub-section (2) of Section 26 of the RBI Act. As already discussed herein above, in our considered view, the legislative intent could not have been to give a restricted meaning to the word “any” in sub-section (2) of Section 26 of the RBI 158. We are, therefore, unable to accept the contention that the word “any” has to be given a restricted meaning taking into consideration the overall scheme, purpose and the object of the RBI Act and also the context in which the power is to be exercised. We find that the word “any” would mean “all” under sub-section (2) of Section 26 of the RBI Act. 159. The second limb of argument on behalf of the petitioners is that, if the word “any” used in sub-section (2) of Section 26 of the RBI Act is not given a restricted meaning, then sub-section (2) of Section 26 of the RBI Act will have to be held invalid on the ground that it confers excessive delegation upon the Central Government. 160. It is submitted that sub-section (2) of Section 26 of the RBI Act vests uncanalised, unguided and arbitrary powers in the Central Government and as such, on this ground alone, the said provision is liable to be struck down. 161. Shri P. Chidambaram, learned Senior Counsel has relied on the Constitution Bench judgment of this Court in the case of Hamdard Dawakhana (Wakf) Lal Kuan, Delhi and another (supra) to buttress his submissions. 162. In the case of Hamdard Dawakhana (Wakf) Lal Kuan, Delhi and another (supra), the Constitution Bench of this Court while considering the validity of clause (d) of Section 3 of the Drug and Magic Remedies (Objectionable Advertisement) Act, (21 of 1954) “33. The interdiction under the Act is applicable to conditions and diseases set out in the various
clauses of Section 3 and to those that may under the last part of clause (d) be specified in the Rules made under Section 16. The first subsection of Section 16 authorises the making of rules to carry out the purposes of the Act and clause (a) of sub-section (2) of that section specifically authorises the specification of diseases or conditions to which the provisions of Section 3 shall apply. It is the first sub-section of Section 16 which confers the general rule-making power i.e. it delegates to the administrative authority the power to frame rules and regulations to subserve the object and purpose of the Act. Clause (a) of the second sub-section is merely illustrative of the power given under the first sub-section; King-Emperor v. Sibnath Banerji [(1945) LR 72 IA 241] . Therefore, sub-section 2(a) also has the same object as sub-section (1) i.e. to carry out the purposes of the Act. Consequently, when the rule-making authority specifies conditions and diseases in the Schedule it exercises the same delegated authority as it does when it exercises powers under sub-section (1) and makes other rules and therefore it is delegated legislation. The question for decision then is, is the delegation constitutional in that the administrative authority has been supplied with proper guidance. In our view the words impugned are vague. Parliament has established no criteria, no standards and has not prescribed any principle on which a particular disease or condition is to be specified in the Schedule. It is not stated what facts or circumstances are to be taken into consideration to include a particular condition or disease. The power of specifying diseases and conditions as given in Section 3(d) must therefore be held to be going beyond permissible boundaries of valid delegation. As a consequence the Schedule in the rules must be struck down. But that would not affect such conditions and diseases which properly fall within the four clauses of Section 3 excluding the portion of clause (d) which has been declared to be unconstitutional. In the view we have taken it is unnecessary to consider the applicability of Baxter v. Ah Way [(1957) SCR 604].”
163. In the said case, this Court found that sub-section (1) of Section 16 conferred a power on the Central Government to make rules for carrying out the purposes of the Act. The Court further found that, it is the first sub-section of Section 16 which confers the general rule-making power i.e. it delegates to the administrative authority the power to frame rules and regulations to subserve the object and purpose of the Act. The Court found that the question, therefore, was, as to whether the delegation to the administrative authority without supplying proper guidance was constitutional or not. The Court held that the words impugned were vague and Parliament had established no criteria, no standards and had not prescribed any principle on which a particular disease or condition was to be specified in the Schedule. The Court, therefore, held clause (d) of Section 3 to be amounting to excessive delegation and as such unconstitutional. 164. In the case of Harakchand Ratanchand Banthia and others (supra), the Constitution Bench of this Court was considering the power given to the Administrator under the Gold (Control) Act, 1968. Section 5 of the Gold (Control) Act, 1968, which confers power on the Administrator to issue directions and orders, fell for consideration, “5. Power of Administrator issue directions and orders.-- (1) The Administrator may, if he thinks fit, make orders, not inconsistent with the provisions of this Act, for carrying out the provisions of (2) The Administrator may, so far as it appears to him to be necessary or expedient for carrying out the provisions of this Act, by order— (a) regulate, after consultation with the Reserve Bank of India, the price at which any gold (b) regulate by licences, permits or otherwise, the manufacture, distribution, transport, acquisition, possession, transfer, disposal, use or consumption of gold.” 165. It can be seen that under clause (b) sub-section (2) of Section 5 of the Gold (Control) Act, 1968, the Administrator was conferred with the power to regulate by licences, permits or otherwise, the manufacture, distribution, transport, acquisition, possession, transfer,
disposal, use or consumption of gold. In this premise, this Court observed thus: “20. It is manifest upon a review of all these provisions that the power conferred upon the Administrator under Section 5(2)(b) is legislative in character and extremely wide. A parallel power of subordinate legislation is conferred to the Central Government under Section 114(1) and (2) of the Act. But Section 114(3) however makes it incumbent upon the Central Government to place the Rules before each House of Parliament while it is in session for a total period of thirty days which may be comprised in one session or in two successive sessions. It is clear that the substantive provisions of the Act namely Sections 8, 11, 21, 31(3), 34(3) confer powers on the Administrator similar to those contemplated by Section 5(2)(b) of the Act. In these circumstances we are of opinion that the power of regulation granted to the Administrator under Section 5(2)(b) of the Act suffers from excessive delegation of legislative power and must be held to be constitutionally invalid.” 166. This Court in the case of Harakchand Ratanchand Banthia and others (supra), therefore, was considering the delegation of power to the Administrator under clause (b) of sub-section (2) of Section 5 of the Gold (Control) Act, 1968. The Court found that a parallel power of subordinate legislation was conferred to the Central Government under Section 114(1) and (2) of the said Act. However, under sub-section (3) of Section 114 of the said Act it is incumbent upon the Central Government to place the Rules before each House of Parliament. This Court further held that the substantive provisions of the Act namely Sections 8, 11, 21, 31(3) and 34(3) of the said Act also confer powers on the Administrator which was similar to the one contemplated by Section 5(2)(b) of the said Act. In these circumstances, the Court held that the power of regulation granted to the Administrator under Section 5(2)(b) of the said Act suffers from excessive delegation and as such unconstitutional.
167. It could thus be seen that clause (b) of sub-section (2) of Section 5 of the Gold (Control) Act, 1968 conferred a power on the Administrator which was legislative in nature, to regulate the transactions with regard to use and consumption of gold. 168. It is to be noted that clause (a) of sub-section (2) of Section 5 of the Gold (Control) Act, 1968 also empowered the Administrator to regulate, after consultation with the RBI, the price at which any gold may be bought or sold. It was also argued before the Court that the said provision is also invalid amounting to excessive delegation inasmuch as the power conferred was unguided. This Court specifically rejected the said contention. It will be apposite to refer to the following observations of this Court: “..…As the power to fix the price may also be exercised not only in respect of primary gold but also in respect of articles and ornaments the business of the petitioners and similarly other persons will be adversely affected. But the section provides the safeguard that the regulation of the price should be made by the Administrator after consultation with the Reserve Bank of India. It was argued that the phrase “so far as it appears to him to be necessary or expedient for carrying out the provisions of this Act” was a subjective formula and action of the Administrator in making the orders under Section 5 (2)(a) may be arbitrary and unreasonable. But in our opinion the formula is not subjective and does not constitute the Administrator the sole judge as to what is in fact necessary or expedient for the purposes of the Act. On the contrary we hold that in the context of the scheme and object of the legislation as a whole the expression cannot be construed in a subjective sense and the opinion of the Administrator as to the necessity or expediency of making the order must be reached objectively after having regard to the relevant considerations and must be reasonably tenable in a court of law. It must be assumed that the Administrator will generally address himself to the circumstances of the situation before him and not try to promote purposes alien to the object of the Act….”
169. It is thus clear that though the Court found the power under Section 5(2)(b) of the Gold (Control) Act, 1968 suffered from excessive delegation and, therefore, constitutionally invalid; it, however, categorically rejected the contention insofar as Section 5(2)(a) of the Gold (Control) Act, 1968 is concerned, inasmuch as it provided a safeguard that the regulation of the price should be made by the Administrator after consultation with 170. This Court rejected the argument that the phrase “so far as it appears to him to be necessary or expedient for carrying out the provisions of this Act” was a subjective formula and as such, the action of the Administrator under Section 5(2)(a) was arbitrary and unreasonable. Rejecting the said contention, the Court held that in the context of the scheme and object of the legislation as a whole, the expression cannot be construed in a subjective sense and the opinion of the Administrator as to the necessity or expediency of making the order must be reached objectively after having regard to the relevant considerations and must be reasonably tenable in a court of law. 171. It could thus be seen that though the Court found the power under Section 5(2)(b) of the Gold (Control) Act, 1968 to be invalid on the ground of excessive delegation, yet it found the power under Section 5(2)(a) of the Gold (Control) Act, 1968 to be valid since it provides an inbuilt safeguard that the Administrator has to act after consultation with the 172. A Seven-Judge Bench of this Court in the case of Birla Cotton, Spinning and Weaving Mills Delhi (supra) was considering the validity of Section 150 of the Delhi Municipal Corporation Act, 1957, which reads thus: (1) The Corporation may, at a meeting, pass a resolution for the levy of any of the taxes specified in sub-section (2) of Section 113, defining the maximum rate of the tax to be levied, the class or classes of persons or the description or descriptions of articles and properties to be taxed, the system of assessment to be adopted and the exemptions, if any, to be granted.
(2) Any resolution passed under subsection (1) shall be submitted to the Central Government for its sanction, and if sanctioned by that Government, shall come into force on and from such date as may be specified in the order of sanction. (3) After a resolution has come into force under sub-section (2), the Corporation may, subject to the maximum rate, pass a second resolution determining the actual rates at which the tax shall be leviable; and the tax shall come into force on the first day of the quarter of the year next following the date on which such second resolution is passed. (4) After a tax has been levied in accordance with the foregoing provisions of this section, the provisions of subsection (2) of Section 109, shall apply in relation to such tax as they apply in relation to any tax imposed under subsection (1) of Section 113.” 173. It was sought to be argued that Section 150(1) delegates completely unguided power to the Corporation in the matter of optional taxes and suffers from the vice of excessive delegation and, therefore, is unconstitutional. 174. This Court after considering various earlier cases including Hamdard Dawakhana (Wakf) Lal Kuan, Delhi and another (supra) observed thus: “A review of these authorities therefore leads to the conclusion that so far as this Court is concerned the principle is well established that essential legislative function consists of the determination of the legislative policy and its formulation as a binding rule of conduct and cannot be delegated by the legislature. Nor is there any unlimited right of delegation inherent in the legislative power itself. This is not warranted by the provisions of the Constitution. The legislature must retain in its own hands the essential legislative functions and what can be delegated is the task of subordinate legislation necessary for implementing the purposes and objects of the Act. Where the legislative policy is enunciated with sufficient clearness or a standard is laid down, the courts should not interfere. What guidance should be given and to what extent and whether guidance has been given in a particular case at all depends on a consideration of the provisions of the particular Act with which the Court has to deal including its preamble.
Further it appears to us that the nature of the body to which delegation is made is also a factor to be taken into consideration in determining whether there is sufficient guidance in the matter of delegation. What form the guidance should take is again a matter which cannot be stated in general terms. It will depend upon the circumstances of each statute under consideration; in some cases guidance in broad general terms may be enough; in other cases more detailed guidance may be necessary.” 175. K.N. Wanchoo, CJ, speaking for himself and J.M. Shelat, J. held that where the legislative policy is enunciated with sufficient clarity or a standard is laid down, the courts should not interfere. What guidance should be given and to what extent and whether guidance has been given in a particular case at all depends on a consideration of the provisions of the particular Act with which the Court has to deal, including its preamble. They further held that the nature of the body to which delegation is made is also a factor to be taken into consideration in determining whether there is sufficient guidance in the matter of delegation. The Court further held that what form the guidance should take is again a matter which cannot be stated in general terms. It will depend upon the circumstances of each statute under consideration. It further held that in some cases guidance in broad general terms may be enough, in other cases more detailed guidance may be necessary. “The first circumstance which must be taken into account in this connection is that the delegation has been made to an elected body responsible to the people including those who pay taxes. The councillors have to go for election every four years. This means that if they have behaved unreasonably and the inhabitants of the area so consider it they can be thrown out at the ensuing elections. This is in our opinion a great check on the elected councillors acting unreasonably and fixing unreasonable rates of taxation. This is a democratic method of bringing to book the elected representatives who act unreasonably in such matters….” 177. It was thus found that the delegation was made to an elected body responsible to the people including those who pay taxes. It has been observed that if the councillors
behave unreasonably and the inhabitants of the area so consider it, they can be thrown out at the ensuing elections. As such, there is a great check on the elected councillors acting unreasonably and fixing unreasonable rates of taxation. This is a democratic method of bringing to book the elected representatives who act unreasonably in such 178. The Court further found that another guide or control on the limit of taxation is to be found in the purposes of the Act. After careful consideration of the various provisions of the Delhi Municipal Corporation Act, 1957, the Court held that the power conferred by Section 150 thereof on the Corporation is not unguided and cannot be said to be amounting to excessive delegation. 179. It will also be apposite to refer to the concurring judgment of S.M. Sikri, J., wherein “But assuming I am bound by authorities of this Court to rest the validity of Section 113(2)(d) and Section 150 of the Act by ascertaining whether a guide or policy exists in the Act, I find adequate guide or policy in the expression “purposes of the Act” in Section 113. The Act has pointed out the objectives or the results to be achieved and taxation can be levied only for the purpose of achieving the objectives or the results. This, in my view, is sufficient guidance especially to a self-governing body like the Delhi Municipal Corporation. It is not necessary to rely on the safeguards mentioned by the learned Chief Justice to sustain the delegation.” 180. S.M. Sikri, J. in his concurring judgment also held that he found adequate guide or policy in the expression “purposes of the Act” in Section 113. He observed that the Act has pointed out the objectives or the results to be achieved and taxation can be levied only for the purpose of achieving the objectives or the results. In the view of His Lordship, this was sufficient guidance especially to a self-governing body like the Delhi Municipal 181. It will also be apposite to refer to the following observations of M. Hidayatullah, J., “…..The question always is whether the legislative will has been exercised or not. Once it is
established that the legislature itself has willed that a particular thing be done and has merely left the execution of it to a chosen instrumentality (provided that it has not parted with its control) there can be no question of excessive delegation. If the delegate acts contrary to the wishes of the legislature the legislature can undo what the delegate has done. Even the courts, as we shall show presently, may be asked to intervene when the delegate exceeds its powers and functions…..” “To insist that the legislature should provide for every matter connected with municipal taxation would make municipalities mere tax collecting departments of the Government and not self- governing bodies which they are intended to be. The Government might as well collect the taxes and make them available to the municipalities. That is not a correct reading of the history of Municipal Corporations and other selfgoverning institutions in our country.” 182. Observing thus, M. Hidayatullah, J. also rejected the contention that provisions of Section 150 suffer from excessive delegation. His Lordship has observed that once it is established that the legislature itself has willed that a particular thing be done and has merely left the execution of it to a chosen instrumentality, there can be no question of excessive delegation. This is, however, subject to the proviso that the legislature has not parted with its control. It is observed that if the delegatee acts contrary to the wishes of the legislature the legislature can undo what the delegate has done. 183. Another Constitution Bench of this Court in the case of Gwalior Rayon Silk Mfg. (Wvg.) Co. Ltd. (supra) was considering the validity of Section 8(2)(b) of the Central Sales Tax Act, 1956 on the ground that it suffered from the vice of excessive delegation. In the said case, H.R. Khanna, J., speaking for the majority, after surveying the earlier judgments of this Court including that in the case of Birla Cotton, Spinning and Weaving Mills “13. It may be stated at the outset that the growth of the legislative powers of the Executive is a significant development of the twentieth century. The theory of laissezfaire has been given a go-
by and large and comprehensive powers are being assumed by the State with a view to improve social and economic well-being of the people. Most of the modern socio-economic legislations passed by the Legislature lay down the guiding principles and the legislative policy. The Legislatures because of limitation imposed upon by the time factor hardly go into matters of detail. Provision is, therefore, made for delegated legislation to obtain flexibility, elasticity, expedition and opportunity for experimentation. The practice of empowering the Executive to make subordinate legislation within a prescribed sphere has evolved out of practical necessity and pragmatic needs of a modern welfare State. At the same time it has to be borne in mind that our Constitution-makers have entrusted the power of legislation to the representatives of the people, so that the said power may be exercised not only in the name of the people but also by the people speaking through their representatives. The role against excessive delegation of legislative authority flows from and is a necessary postulate of the sovereignty of the people. The rule contemplates that it is not permissible to substitute in the matter of legislative policy the views of individual officers or other authorities, however competent they may be, for that of the popular will as expressed by the representatives of the people.” 184. The Court observed that the growth of the legislative powers of the Executive is a significant development of the twentieth century. The theory of laissez faire has been given a go-by and large and comprehensive powers are being assumed by the State with a view to improve social and economic wellbeing of the people. It has been held that most of the modern socio-economic legislations passed by the Legislature lay down the guiding principles and the legislative policy. It is not possible for the Legislatures to go into matters of detail. Therefore, a provision has been made for delegated legislation to obtain flexibility, elasticity, expedition and opportunity for experimentation. It has been held that the practice of empowering the Executive to make subordinate legislation within a prescribed sphere has evolved out of practical necessity and pragmatic needs of a modern welfare State. It has been observed that the role against excessive delegation of legislative authority flows from and is a necessary postulate of the sovereignty of the
people. It has been held that the rule contemplates that it is not permissible to substitute in the matter of legislative policy the views of individual officers or other authorities, however competent they may be, for that of the popular will as expressed by the representatives of the people. “15. The Constitution, as observed by this Court in the case of Devi Das Gopal Krishnan v. State of Punjab [AIR 1967 SC 1895 : (1967) 3 SCJ 557 : (1967) 20 STC 430] confers a power and imposes a duty on the Legislature to make laws. The essential legislative function is the determination of the legislative policy and its formulation as a rule of conduct. Obviously it cannot abdicate its functions in favour of another. But in view of the multifarious activities of a welfare State, it cannot presumably work out all the details to suit the varying aspects of a complex situation. It must necessarily delegate the working out of details to the Executive or any other agency. But there is danger inherent in such a process of delegation. An over-burdened Legislature or one controlled by a powerful Executive may unduly overstep the limits of delegation. It may not lay down any policy at all; it may declare its policy in vague and general terms; it may not set down any standard for the guidance of the Executive; it may confer an arbitrary power on the Executive to change or modify the policy laid down by it without reserving for itself any control over subordinate legislation. This selfeffacement of legislative power in favour of another agency either in whole or in part is beyond the permissible limits of delegation. It is for a court to hold on a fair, generous and liberal construction of an impugned statute whether the Legislature exceeded such limits.” 186. It has been held that the essential legislative function is the determination of the legislative policy and its formulation as a rule of conduct. The Legislature cannot abdicate its functions in favour of another. However, in view of the multifarious activities of a welfare State, it cannot presumably work out all the details to suit the varying aspects of a complex situation. It must, therefore, necessarily delegate the working out of details to the
Executive or any other agency. The Court also cautions about the danger inherent in the process of delegation. It observed that an over-burdened Legislature or one controlled by a powerful Executive may unduly overstep the limits of delegation. It may not lay down any policy at all; it may declare its policy in vague and general terms; it may not set down any standard for the guidance of the Executive; it may confer an arbitrary power on the Executive to change or modify the policy laid down by it without reserving for itself any control over subordinate legislation. It has been held that it is for the Court to hold on a fair, generous and liberal construction of an impugned statute to examine whether the Legislature exceeded such limits. 187. We may gainfully refer to the following observations in the concurring judgment of “57. Delegation of “law-making” power, it has been said, is the dynamo of modern Government. Delegation by the Legislature is necessary in order that the exertion of legislative power does not become a futility. Today, while theory still affirms legislative supremacy, we see power flowing back increasingly to the Executive. Departure from the traditional rationalization of the status quo arouses distrust. The Legislature comprises a broader cross-section of interests than any one administrative organ; it is less likely to be captured by particular interests. We must not, therefore, lightly say that there can be a transfer of legislative power under the guise of delegation which would tantamount to abdication. At the same time, we must be aware of the practical reality, and that is, that Parliament cannot go into the details of all legislative matters. The doctrine of abdication expresses a fundamental democratic concept but at the same time we should not insist that law-making as such is the exclusive province of the Legislature. The aim of Government is to gain acceptance for objectives demonstrated as desirable and to realise them as fully as possible. The making of law is only a means to achieve a purpose. It is not an end in itself. That end can be attained by the Legislature making the law. But many topics or subjects of legislation are such that they require expertise, technical knowledge and a degree of adaptability to changing situations which Parliament might not
possess and, therefore, this end is better secured by extensive delegation of legislative power. The legislative process would frequently bog down if a Legislature were required to appraise beforehand the myriad situations to which it wishes a particular policy to be applied and to formulate specific rules for each situation. The presence of Henry VIII clause in many of the statutes is a pointer to the necessity of extensive delegation. The hunt by Court for legislative policy or guidance in the crevices of a statute or the nook and cranny of its preamble is not an edifying spectacle. It is not clear what difference does it make in principle by saying that since the delegation is to a representative body, that would be a guarantee that the delegate will not exercise the power unreasonably, for, if ex hypothesi the Legislature must perform the essential legislative function, it is certainly no consolation that the body to which the function has been delegated has a representative character. In other words, if, no guidance is provided or policy laid down, the fact that the delegate has a representative character could make no difference in principle.” 188. Though the learned Judge cautions against abdication under the guise of delegation, he also emphasizes a necessity to be aware about the practical reality, i.e. Parliament cannot go into the details of all legislative matters. The learned Judge observed that the aim of Government is to gain acceptance for objectives demonstrated as desirable and to realise them as fully as possible. The learned Judge observed that there are many topics or subjects of legislation which are such that they may require expertise, technical knowledge and a degree of adaptability to changing situations which Parliament might not possess and, therefore, this end is better secured by extensive delegation of legislative power. It has been held that the legislative process would frequently bog down if a Legislature were required to appraise beforehand the myriad situations to which it wishes a particular policy to be applied and to formulate specific rules for each situation. The Court further emphasized for a guidance for the delegate to exercise the delegated power. 189. This Court, in the case of The Registrar of Co-operative Societies, Trivandrum
and another v. K. Kunjabmu and others (supra), while reversing the judgment of the Kerala High Court, which had held Section 60 of the Madras Co-operative Societies Act, 1932 to be unconstitutional on the ground of vice of excessive delegation, observed thus: “3. ….Executive activity in the field of delegated or subordinate legislation has increased in direct, geometric progression. It has to be and it is as it should be. Parliament and the State Legislatures are not bodies of experts or specialists. They are skilled in the art of discovering the aspirations, the expectations and the needs, the limits to the patience and the acquiescence and the articulation of the views of the people whom they represent. They function best when they concern themselves with general principles, broad objectives and fundamental issues instead of technical and situational intricacies which are better left to better equipped full time expert executive bodies and specialist public servants. Parliament and the State Legislatures have neither the time nor the expertise to be involved in detail and circumstance. Nor can Parliament and the State Legislatures visualise and provide for new, strange, unforeseen and unpredictable situations arising from the complexity of modern life and the ingenuity of modern man. That is the raison d'etre for delegated legislation. That is what makes delegated legislation inevitable and indispensable. The Indian Parliament and the State Legislatures are endowed with plenary power to legislate upon any of the subjects entrusted to them by the Constitution, subject to the limitations imposed by the Constitution itself. The power to legislate carries with it the power to delegate. But excessive delegation may amount to abdication. Delegation unlimited may invite despotism uninhibited. So the theory has been evolved that the legislature cannot delegate its essential legislative function. Legislate it must by laying down policy and principle and delegate it may to fill in detail and carry out policy. The legislature may guide the delegate by speaking through the express provision empowering delegation or the other provisions of the statute, the preamble, the scheme or even the very subject-matter of the statute. If guidance there is, wherever it may be
found, the delegation is valid. A good deal of latitude has been held to be permissible in the case of taxing statutes and on the same principle a generous degree of latitude must be permissible in the case of welfare legislation, particularly those statutes which are designed to further the Directive Principles of State Policy.” 190. This Court has observed that the executive activity in the field of delegated or subordinate legislation has increased in direct, geometric progression. The Court observed that Parliament and the State Legislatures are not bodies of experts or specialists. It is observed that the legislative bodies function best when they concern themselves with general principles, broad objectives and fundamental issues instead of technical and situational intricacies which are better left to better equipped full time expert executive bodies and specialist public servants. It has been held that Parliament and the State Legislatures cannot visualize and provide for new, strange, unforeseen and unpredictable situations arising from the complexity of modern life and the ingenuity of modern man. It has been further reiterated that guidance could be found from various factors and once it is found, the delegation is valid. It has been held that a good deal of latitude has to be held to be permissible in the case of taxing statutes and welfare 191. This Court in the case of Ramesh Birch and others (supra) again, after referring to the earlier judgments and after considering the views expressed by various learned Judges on the aspect of delegated legislation, observed thus: “23. But, these niceties apart, we think that Section 87 is quite valid even on the “policy and guideline” theory if one has proper regard to the context of the Act and the object and purpose sought to be achieved by Section 87 of the Act. The judicial decisions referred to above make it clear that it is not necessary that the legislature should “dot all the i's and cross all the t's” of its policy. It is sufficient if it gives the broadest indication of a general policy of the legislature…...” 192. Recently, the Constitution Bench of this Court in the case of Rojer Mathew (supra) considered the question, as to whether Section 184 of the Finance Act, 2017, which does
not prescribe qualifications, appointment, term and conditions of service, salary and allowances, etc. suffers from the vice of excessive delegation. Rejecting the contention, “145. Cautioning against the potential misuse of Section 184 by the executive, it was vehemently argued by the learned counsel for the petitioner(s) that any desecration by the executive of such powers threatens and poses a risk to the independence of the tribunals. A mere possibility or eventuality of abuse of delegated powers in the absence of any evidence supporting such claim, cannot be a ground for striking down the provisions of the Finance Act, 2017. It is always open to a constitutional court on challenge made to the delegated legislation framed by the executive to examine whether it conforms to the parent legislation and other laws, and apply the “policy and guideline” test and if found contrary, can be struck down without affecting the constitutionality of the rule-making power conferred under Section 186 of the Finance Act, 2017.” 193. It can thus be seen that this Court has held that a mere possibility or eventuality of abuse of delegated powers in the absence of any evidence supporting such claim, cannot be a ground for striking down such a provision. It has been held that if a challenge is made to the delegated legislation framed by the executive, the same can be examined by the constitutional court. It has been held that applying the “policy and guideline” test, if it is found that the delegated legislation does not satisfy the said test, the legislation can be struck down without affecting the constitutionality of the rule-making power conferred under Section 186 of the Finance Act, 2017. 194. Having adverted to the various judgments on the issue of delegated legislation, we find it necessary to refer to certain judgments of this Court outlining the status of the RBI. 195. The Constitution Bench of this Court in the case of Joseph Kuruvilla Velukunnel (supra) was considering a challenge to Section 38(1) and (3)(b)(iii) of the Banking Companies Act, 1949 being violative of Articles 14, 19 and 301 of the Constitution of India,
and was, therefore, ultra vires the Constitution of India. Though this Court held that Section 38 is an unreasonable restriction on the right of the Palai Bank to carry on its business and, therefore, unconstitutional, it will be relevant to refer to paragraph 46 of the said “46. In the present case, in view of the history of the establishment of the Reserve Bank as a central bank for India, its position as a Bankers' Bank, its control over banking companies and banking in India, its position as the issuing bank, its power to license banking companies and cancel their licences and the numerous other powers, it is unanswerable that between the court and the Reserve Bank, the momentous decision to wind up a tottering or unsafe banking company in the interests of the depositors, may reasonably be left to the Reserve Bank. No doubt, the court can also, given the time, perform this task. But the decision has to be taken without delay, and the Reserve Bank already knows intimately the affairs of banking companies and has had access to their books and accounts. If the court were called upon to take immediate action, it would almost always be guided by the opinion of the Reserve Bank. It would be impossible for the court to reach a conclusion unguided by the Reserve Bank if immediate action was demanded. But the law which gives the same position to the opinion of the Reserve Bank is challenged as unreasonable. In our opinion, such a challenge has no force.….” 196. The Court has referred to the pivotal role that the RBI plays as a Central Bank, as a bankers’ bank and numerous other powers that it exercises. The Court held that the law which gives an important position to the opinion of the Reserve Bank was challenged unreasonably and such challenge had no force. 197. It may also be relevant to refer to the following observations of this Court in the case of Peerless General Finance and Investment Co. Limited and another (supra): “30. Before examining the scope and effect of the impugned paragraphs (6) and (12) of the directions of 1987, it is also important to note that Reserve Bank of India which is bankers' bank
is a creature of statute. It has large contingent of expert advice relating to matters affecting the economy of the entire country and nobody can doubt the bona fides of the Reserve Bank in issuing the impugned directions of 1987. The Reserve Bank plays an important role in the economy and financial affairs of India and one of its important functions is to regulate the banking system in the country. It is the duty of the Reserve Bank to safeguard the economy and financial stability of the country….” 198. It can thus be seen that this Court has noted that the RBI, which is a bankers' bank, is a creature of statute. It has large contingent of expert advice relating to matters affecting the economy of the entire country. It has been held that the RBI plays an important role in the economy and financial affairs of India and one of its important functions is to regulate the banking system in the country. It has been held that it is the duty of the RBI to safeguard the economy and financial stability of the country. 199. It will also further be relevant to refer to the following observations of this Court in the case of Peerless General Finance and Investment Co. Limited and another “The function of the Court is not to advise in matters relating to financial and economic policies for which bodies like Reserve Bank are fully competent. The Court can only strike down some or entire directions issued by the Reserve Bank in case the Court is satisfied that the directions were wholly unreasonable or violative of any provisions of the Constitution or any statute. It would be hazardous and risky for the courts to tread an unknown path and should leave such task to the expert bodies. This Court has repeatedly said that matters of economic policy ought to be left to the government.” 200. The Court has held that it is not permissible for a Court to advise in matters relating to financial and economic policies for which bodies like Reserve Bank are fully competent. It has been held that it would be risky and hazardous for the courts to tread an unknown path and should leave such task to the expert bodies. 201. Recently a three-Judge Bench of this Court, speaking through one of us (V. Ramasubramanian, J. ), in the case of Internet and Mobile Association of India (supra)
“141. But as pointed out elsewhere, RBI is the sole repository of power for the management of the currency, under Section 3 of the RBI Act. RBI is also vested with the sole right to issue bank notes under Section 22(1) and to issue currency notes supplied to it by the Government of India and has an important role to play in evolving the monetary policy of the country, by participation in the Monetary Policy Committee which is empowered to determine the policy rate required to achieve the inflation target, in terms of the consumer price index. Therefore, anything that may pose a threat to or have an impact on the financial system of the country, can be regulated or prohibited by RBI, despite the said activity not forming part of the credit system or payment system. The expression “management of the currency” appearing in Section 3(1) need not necessarily be confined to the management of what is recognised in law to be currency but would also include what is capable of faking or playing the role of a currency.” 202. It can thus be seen that this Court has held that the RBI is the sole repository of power for the management of currency. It is also vested with the sole right to issue bank notes and to issue currency notes supplied to it by the Government of India. It has been held that the RBI has an important role to play in evolving the monetary policy of the 203. It is thus clear that this Court has consistently recognised the role assigned to the RBI in management and issuance of currency notes, so also in evolving monetary policy of the country. We have referred to the aforesaid judgments with regard to the primary status of RBI in dealing with the management and regulation of currency and in evolving the monetary policy of the country. Insofar as the decision to be taken by the Central Government under sub-section (2) of Section 26 of the RBI Act is concerned, it is to be taken on the recommendation of the Central Board. We, therefore, find that there is an inbuilt safeguard in sub-section (2) of Section 26 of the RBI Act inasmuch as the Central Government is required to take a decision on the recommendation of the RBI. 204. As already discussed hereinabove, the RBI has large contingent of expert advice
available to it. It has a pivotal role in issuance and management of and all other matters relating to currency and also in evolving monetary policy of the country. We may gainfully refer to the Constitution Bench Judgment of this Court in the case of Harakchand Ratanchand Banthia and others (supra) wherein, though the Constitution Bench found clause (b) sub-section (2) of Section 5 of the Gold (Control) Act, 1968 to be unconstitutional on the ground of vice of excessive delegation, it upheld the provisions of clause (a) sub-section (2) of Section 5 of the Gold (Control) Act, 1968, finding that there was an inbuilt safeguard inasmuch as the Administrator was required to take a decision after consultation with the RBI. 205. For considering the question as to whether the RBI Act provides guidance to the delegatee or not, the entire scheme, object and the purpose of the Act has to be taken into consideration. The guidance could be sought from the express provision empowering delegation or the other provisions of the statute, the preamble, the scheme or even the very subjectmatter of the statute. If the guidance could be found in whatever part of the Act, the delegation has to be held to be valid. A great amount of latitude has to be given in such matters. It has been consistently held that Parliament and the State Legislatures are not bodies of expert or specialists. They are skilled in the art of discovering the aspirations, the expectations and the needs of the people whom they represent. It has been held that they function best when they concern themselves with general principles, broad objectives and fundamental issues instead of technical and situational intricacies which are better left to better equipped full time expert executive bodies and specialist public servants. 206. As already discussed herein above, the RBI has been constituted to regulate the issue of bank notes. The RBI is an expert body entrusted with various functions with regard to monetary and economic policies. Perusal of the scheme of the RBI Act would reveal that it has a primary role in the matters pertaining to the management and regulation of currency. We, therefore, find that there is sufficient guidance to the delegatee when it
exercises its powers under sub-section (2) of Section 26 of the RBI Act, from the subject matter of the statute, and the other provisions of the Act. In any case, as already discussed herein above, Parliament has provided an inbuilt safeguard i.e. recommendation of the RBI. It is equally settled that insofar as the economic, monetary and fiscal policies are concerned, the same are best left to the experts possessing requisite knowledge. The RBI as well as the Central Government are bodies having contingent of experts in the field. It will, therefore, not be proper for the Court to enter into an area which should be best left to the experts. 207. We are of the considered view that there is sufficient guidance in the preamble as well as the scheme and the object of the RBI Act. As already discussed herein above, there cannot be a straitjacket formula, and the question whether excessive delegation has been conferred or not has to be decided on the basis of the scheme, the object and the purpose of the statute under consideration. 208. One another aspect that needs to be taken into consideration is the nature of the body to which the delegation is to be made. In the present case, the delegation is made to the Central Government and not to any ordinary body. 209. In the case of Birla Cotton, Spinning and Weaving Mills Delhi (supra), the seven- Judge Bench of this Court held that the delegation was made to an elected body, responsible to the people including those who pay taxes. It observed that the councillors have to go for election every four years. It was also observed that if the councillors behave unreasonably, and the inhabitants of the area so consider it, they can be thrown out at the ensuing elections. This Court found that this was a great check on the elected councillors acting unreasonably and fixing unreasonable rates of taxation. It has been held that this was a democratic method of bringing to book the elected representatives who act unreasonably in such matters. 210. In the present case also, the delegation is to the Central Government, i.e. the highest executive body of the country. We have a Parliamentary system in which the
Government is responsible to the Parliament. In case the Executive does not act reasonably while exercising its power of delegated legislation, it is responsible to Parliament who are elected representatives of the citizens for whom there exists a democratic method of bringing to book the elected representatives who act unreasonably in such matters. 211. Taking into consideration all these factors, we are of the considered view that sub- section (2) of Section 26 of the RBI Act does not suffer from the vice of excessive 212. It is sought to be urged on behalf of the petitioners that the decision-making process both at the stage of making recommendations by the Central Board and at the stage of taking decision by the Central Government is flawed inasmuch as the same had been done without considering the relevant factors and eschewing the irrelevant ones. It is also sought to be urged that, as per the scheme of sub-section (2) of Section 26 of the RBI Act, it is incumbent that the procedure should emanate from the Central Board and not from the Central Government. According to the petitioners, in the present case, the procedure has emanated from the Central Government vide its letter dated 7th November 2016 advising the Board to convene a meeting and make a recommendation, which was hurriedly convened on the next day, i.e., 8th November 2016, in which the Board decided to recommend demonetization and, within hours, the decision was announced by the 213. It is submitted that, taking into consideration the hasty manner in which the recommendation was sought by the Central Government, and was then made by the Central Board and the decision was taken thereupon by the Cabinet, there was no scope for the Central Board or the Cabinet to take into consideration the relevant factors and eschew the irrelevant factors. It is, therefore, submitted that the decision was taken in a patently arbitrary manner and as such, the impugned Notification is liable to be set aside on the ground of patent arbitrariness. It is also the contention of the petitioners that, in the meeting of the Central Board, there was no quorum as required in the 1949 Regulations. 214. On the contrary, it is the submission of the respondents that there are twin
requirements in sub-section (2) of Section 26 of the RBI Act, viz., (i) recommendation of the Central Board; and (ii) the decision of the Central Government. It is submitted that both these requirements are satisfied in the present case. It is submitted that, in an action like the present one, confidentiality and speed are of utmost importance. 215. The law with regard to scope of judicial review has been very well crystalized in the case of Tata Cellular (supra). In the said case, it has been held by this Court that the duty of the court is to confine itself to the question of legality. Its concern should be whether a decision-making authority exceeded its powers, committed an error of law, committed a breach of the rules of natural justice, reached a decision which no reasonable tribunal would have reached or abused its powers. The Court held that it is not for the court to determine whether a particular policy or particular decision taken in the fulfillment of that policy is fair. It is only concerned with the manner in which those decisions have been 216. After referring to various pronouncements on the scope of judicial review, the Court “94. The principles deducible from the above are: (1) The modern trend points to judicial restraint in administrative action. (2) The court does not sit as a court of appeal but merely reviews the manner in which the decision was made. (3) The court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible. (4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts. (5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or
quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides. (6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure. Based on these principles we will examine the facts of this case since they commend to us as the correct principles.” 217. Though various authorities are cited at the Bar with regard to scope of judicial review, we do not find it necessary to refer to various judgments. We may gainfully refer to the judgment of this Court in the case of Rashmi Metaliks Limited and Another v. Kolkata Metropolitan Development Authority and Others 62, wherein this Court has deprecated the practice of citing several decisions when the law on the issue is still covered by what has been held in the case of Tata Cellular (supra). 218. Our enquiry, therefore, will have to be restricted to examining the decision-making process on the limited grounds as have been laid down in the case of Tata Cellular Scope of Judicial Interference in matters pertaining to economic policy 219. Since the issue involved is also related to monetary and economic policy of the country, we would also be guided by certain other pronouncements of this Court. 220. We may gainfully refer to the following observations of the Seven-Judge Bench in the case of M/s. Prag Ice & Oil Mills and Another v. Union of India63: “24. We have listened to long arguments directed at showing us that producers and sellers of oil in various parts of the country will suffer so that they would give up producing or dealing in mustard oil. It was urged that this would, quite naturally, have its repercussions on consumers for whom mustard oil will become even more scarce than ever ultimately. We do not think that it is the function of this Court or of any Court to sit in judgment over such matters of economic policy as must necessarily be left to the Government of the day to decide. Many of them,
as a measure of price fixation must necessarily be, are matters of prediction of ultimate results on which even experts can seriously err and doubtlessly differ. Courts can certainly not be expected to decide them without even the aid of experts.” 221. In the case of R.K. Garg v. Union of India and Others64, another Constitution Bench of this Court observed thus: “8. Another rule of equal importance is that laws relating to economic activities should be viewed with greater latitude than laws touching civil rights such as freedom of speech, religion etc. It has been said by no less a person than Holmes, J., that the legislature should be allowed some play in the joints, because it has to deal with complex problems which do not admit of solution through any doctrinaire or strait-jacket formula and this is particularly true in case of legislation dealing with economic matters, where, having regard to the nature of the problems required to be dealt with, greater play in the joints has to be allowed to the legislature. The court should feel more inclined to give judicial deference to legislative judgment in the field of economic regulation than in other areas where fundamental human rights are 222. Again, the Constitution Bench of this Court in the case of Shri Sitaram Sugar Company Limited and Another v. Union of India and Others65, observed thus: “57. Judicial review is not concerned with matters of economic policy. The court does not substitute its judgment for that of the legislature or its agents as to matters within the province of either. The court does not supplant the “feel of the expert” by its own views. When the legislature acts within the sphere of its authority and delegates power to an agent, it may empower the agent to make findings of fact which are conclusive provided such findings satisfy the test of reasonableness. In all such cases, judicial inquiry is confined to the question whether the findings of fact are reasonably based on evidence and whether such findings are consistent with the laws of the land. As stated by Jagannatha Shetty, J. in Gupta Sugar Works [1987 Supp SCC 476, 481] : (SCC p. 479, para 4)
“... the court does not act like a chartered accountant nor acts like an income tax officer. The court is not concerned with any individual case or any particular problem. The court only examines whether the price determined was with due regard to considerations provided by the statute. And whether extraneous matters have been excluded from determination.”” 223. Recently, this Court in the case of Small Scale Industrial Manufactures Association (Registered) v. Union of India and Others66 had an occasion to consider the issue with regard to scope of judicial review of economic and fiscal regulatory measures. This Court observed thus: “69. What is best in the national economy and in what manner and to what extent the financial reliefs/packages be formulated, offered and implemented is ultimately to be decided by the Government and RBI on the aid and advice of the experts. The same is a matter for decision exclusively within the province of the Central Government. Such matters do not ordinarily attract the power of judicial review. Merely because some class/sector may not be agreeable and/or satisfied with such packages/policy decisions, the courts, in exercise of the power of judicial review, do not ordinarily interfere with the policy decisions, unless such policy could be faulted on the ground of mala fides, arbitrariness, unfairness, etc. 70. There are matters regarding which the Judges and the lawyers of the courts can hardly be expected to have much knowledge by reasons of their training and expertise. Economic and fiscal regulatory measures are a field where Judges should encroach upon very warily as Judges are not experts in these matters. 71. The correctness of the reasons which prompted the Government in decision taking one course of action instead of another is not a matter of concern in judicial review and the court is not the appropriate forum for such investigation. The policy decision must be left to the Government as it alone can adopt which policy should be adopted after considering of the points from different angles. In assessing the propriety of the decision of the Government the court cannot interfere even if a second view is possible from that of the Government. 72. Legality of the policy, and not the wisdom or soundness of the policy, is the subject of
judicial review. The scope of judicial review of the governmental policy is now well defined. The courts do not and cannot act as an appellate authority examining the correctness, stability and appropriateness of a policy, nor are the courts advisers to the executives on matters of policy which the executives are entitled to formulate.” 224. This Court observed that the Court would not interfere with any opinion formed by the government if it is based on the relevant facts and circumstances or based on expert’s advice. The Court would be entitled to interfere only when it is found that the action of the executive is arbitrary and violative of any constitutional, statutory or other provisions of law. It has been held that when the government forms its policy, it is based on a number of circumstances and it is also based on expert’s opinion, which must not be interfered with, except on the ground of palpable arbitrariness. It is more than settled that the Court gives a large leeway to the executive and the legislature in matters of economic policy. A reference in this respect could be made to the judgments of this Court in the cases of P.T.R. Exports (Madras) Pvt. Ltd. v. Union of India and others67 and Bajaj Hindustan Limited v. Sir Shadi Lal Enterprises Limited and another (supra). 225. It is not the function of this Court or of any other Court to sit in judgment over such matters of economic policy and they must necessarily be left to the Government of the day to decide since in such matters with regard to the prediction of ultimate results, even the experts can seriously err and doubtlessly differ. The Courts can certainly not be expected to decide them without even the aid of experts. 226. Therefore, while exercising the power of judicial review in a matter like the present one, the scope of interference would be still narrower. Applying the principles laid down in the aforesaid judgments, we will have to examine as to whether the decision-making process in the present case is flawed or not. Our inquiry has to be limited only to find out as to whether there is an illegality in the decision-making process, i.e. whether the decision
makers have understood the law correctly which regulates the decision-making power and as to whether the decision-making process is vitiated by irrationality, i.e. the Wednesbury principles. The test that would have to be applied is that the decision is such that no authority properly conducting itself on the relevant law and acting reasonably could have reached thereat, and as to whether there has been a procedural impropriety. 227. The learned Senior Counsel for the petitioners vehemently submitted that unless the letter dated 7th November 2016, Minutes of the Meeting of the Central Board dated 8th November 2016 and the Note for the Cabinet Meeting dated 8th November 2016 are perused by this Court, it will not be possible for the Court to satisfy itself as to whether the Central Board while deciding to recommend demonetization and the Central Government while deciding to take the decision in favour of demonetization have taken into consideration the relevant factors and eschewed the irrelevant factors. While closing the matters for judgment/order, we had directed the Union of India and the RBI to produce the relevant records for our perusal. Accordingly, the records were produced by the 228. We have scrutinized the entire record, i.e., the communication dated 7th November 2016 addressed by the Secretary, Department of Economic Affairs, Ministry of Finance to the Governor, RBI, the Minutes of the Meeting of the Central Board dated 8 th November 2016, the recommendations by the RBI dated 8th November 2016 and the Note for the Cabinet Meeting held on 8th November 2016. 229. A perusal of the communication dated 7th November 2016 addressed by the Secretary, Department of Economic Affairs, Ministry of Finance, Government of India to the Governor, RBI would reveal that the Government of India has shared its concern with regard to infusion of Fake Indian Currency Notes (FICN) and generation of black money. It has been pointed out that FICN infusion is concentrated in the two highest denominations of Indian banknotes of Rs.500/- and Rs.1000/-. It has also been pointed out that the impact on the economy in the high denomination notes is very adverse. The said communication mentions the White Paper on Black Money by the Department of
Revenue in the year 2012, wherein it is mentioned that cash has always been a facilitator of black money since transactions made in cash do not leave any audit trail. The White Paper also refers to the growth in the size of the shadow economy of the country, and that a parallel shadow economy corrodes and eats into the vitals of the country’s economy. 230. The said communication thereafter refers to the constitution of a Special Investigation Team (SIT) headed by two former Judges of this Court, which has made strong observations against the cash economy. It further refers to the steps taken by the Government to reduce black money in the economy. After pointing out the aforesaid factors, the communication advises the Central Board to take note of the above and consider making necessary recommendations. It also requests the RBI to prepare a draft scheme to implement the above in a non-disruptive manner with as little inconvenience to the public and business entities as possible. 231. We have also perused the Minutes of the Five Hundred and Sixty First (561st) Meeting of the Central Board of Directors of the RBI held on 8th November 2016. The said Minutes would show that the communication dated 7th November 2016 was placed before the Central Board by the Deputy Governor. There was an elaborate discussion on the said proposal. The Central Board has considered the pros and cons of the measure. The Central Board has also considered that the proposed step presents a big opportunity to take the process of financial inclusion further by incentivizing the use of electronic modes of payment, so that people see the benefits of bank accounts and electronic means of payment over use of cash. The Central Board has taken into consideration that the matter had been under discussion between the Central Government and the RBI for the last six months during which most of the issues raised in the meeting were considered. 232. After detailed deliberations, the Central Board resolved to recommend withdrawal of legal tender of bank notes in the denomination of Rs.500/- and Rs.1000/- of existing and any older series in circulation. Thereafter, the Deputy Governor, vide communication dated 8th November 2016, informed the Secretary, Department of Economic Affairs, Ministry of Finance, Government of India about the above recommendations of the Central
Board. Not only that, but a draft scheme for implementation of the same was also enclosed along with the said recommendations. 233. We have also perused the Note for the Cabinet for consideration of the Cabinet Meeting dated 8th November 2016. The Note for the Cabinet contains details about the relevant data available as per Economic Survey for 2014-15 and 201516 and the report of the Intelligence Bureau with regard to infusion of FICN and generation of black money. It also contains the details with regard to the 2012 White Paper on Black Money. It contains the details with regard to the report of the SIT headed by two former Judges of this Court and their recommendations. It considers the recommendation of the RBI. 234. Upon perusal of the material on record, we are of the considered view that the Central Board had taken into consideration the relevant factors while recommending withdrawal of legal tender of bank notes in the denomination of Rs.500/- and Rs.1000/- of existing and any older series in circulation. Similarly, all the relevant factors were placed for consideration before the Cabinet when it took the decision to demonetize. It is to be noted that a draft scheme to implement the proposal for demonetization in a non-disruptive manner with as little inconvenience to the public and business entities as possible was also prepared by the RBI along with the recommendation for demonetization. The same was also taken into consideration by the Cabinet. As such, we are of the considered view that the contention that the decision-making process suffers from non-consideration of relevant factors and eschewing of the irrelevant factors, is without substance. 235. Insofar as the contention of the petitioners that there was no quorum as required under the 1949 Regulations is concerned, in both the affidavits of the RBI dated 15th November 2022 and 19th December 2018, a categorical statement has been made that the requisite procedure as laid down under sub-section (2) of Section 26 of the RBI Act read with Regulations 8 and 10 of the 1949 Regulations was duly followed. 236. A perusal of the Minutes of the Meeting of the Central Board would also show that eight Directors were present in the Meeting whereas the quorum for the meeting is four
Directors of whom not less than three shall be Directors nominated under Section 8(1)(b) or Section 8(1)(c) or Section 12 (4) of the RBI Act. In the affidavit filed before this Court on 6th December 2022, it is specifically averred as under: “6. That the 561st meeting of the Central Board of the answering respondent was held on 08.11.2016 at New Delhi and business was transacted therein with the requisite quorum. During the said meeting, apart from the then Governor and two Deputy Governors, one director nominated under Section 8(1)(b) of RBI Act, two directors nominated under section 8(1)(c) of RBI Act and two directors nominated under section 8(1)(d) of RBI Act were present. Thus, the requisite quorum of four directors of whom not less than three directors nominated under Section 8(1)(b) or 8(1)(c) were present for the meeting.” 237. In that view of the matter, the contention that the Meeting of the Central Board dated 8th November 2016 is not validly held for want of quorum is concerned, is without 238. The next submission in this regard is that the procedure prescribed under sub- section (2) of Section 26 of the RBI Act is breached inasmuch as the proposal has emanated from the Central Government whereas the requirement under subsection (2) of Section 26 of the RBI Act is that the proposal should emanate from the Central Board. The contention is that, since the Central Government is required to act on the recommendation of the Central Board, the proposal should emanate from the Central 239. As already discussed hereinabove, the RBI has a pivotal role insofar as monetary and economic policies are concerned and, particularly, in all the matters pertaining to management and regulation of currency. Moreover, perusal of Sections 22, 24 and 26 of the RBI Act would reveal that in various matters pertaining to currency, the course of action is to be taken by the Central Government on the recommendation of the Central Board. It cannot be disputed that the final say with regard to economic and monetary policies of the
country will be with the Central Government. However, in such matters, it has to rely on the expert advice of the RBI. In a matter like the present one, it cannot be expected that the RBI and the Central Government will act in two isolated boxes. An element of interaction/consultation in such important matters pertaining to economic and monetary policies cannot be denied to the RBI and the Central Government. 240. As already discussed hereinabove, the record would reveal that the matter was under active consideration for a period of six months between the RBI and the Central Government. As such, merely because the Central Government has advised the Central Board to consider recommending demonetization and that the Central Board, on the advice of the Central Government, has considered the proposal for demonetization and recommended it and, thereafter, the Central Government has taken a decision, in our view, cannot be a ground to hold that the procedure prescribed under Section 26 of the RBI Act was breached. The two requirements of sub-section (2) of Section 26 of the RBI Act are (i) recommendation by the Central Board; and (ii) the decision by the Central Government. As already discussed hereinabove, both the Central Board while making recommendation and the Central Government while taking the decision, have taken into consideration all the relevant factors. 241. The dictionary meaning of the word “recommend” is “to advise as to a course of action”, or “to praise or commend”. In P. Ramanatha Aiyar's Law Lexicon, the meaning of the word “recommendation” is “a statement expressing commendation or a message of this nature”. The word “recommendation”, therefore, will have to be construed in the context in which it is used. Reference in this respect would be made to the judgments of this Court in the cases of V.M. Kurian v. State of Kerala and others68 and Manohar s/o Manikrao Anchule v. State of Maharashtra and another69. 242. The power to be exercised by the Central Government under sub-section (2) of Section 26 of the RBI Act is for effecting demonetization. The said power has to be
exercised on the recommendation of the Central Board. As already discussed hereinabove, the RBI has a pivotal role in the matters of monetary policy and issuance of currency. The scheme mandates that before the Central Government takes a decision with regard to demonetization, it would be required to consider the recommendation of the Central Board. We find that, in the context in which it is used, the word “recommendation” would mean a consultative process between the Central Board and the Central 243. In our view, therefore, the enquiry would be limited as to whether there was an effective consultation between the Central Government and the Central Board before the decision was taken. Reference in this respect would be made to the following observations of this Court in the case of State of Gujarat and another v. Justice R.A. Mehta (Retired) “25. In State of Gujarat v. Gujarat Revenue Tribunal Bar Assn. [(2012) 10 SCC 353 : (2012) 4 p. 372, para 34), this Court held that the object of consultation is to render its process meaningful so that it may serve its intended purpose. Consultation requires the meeting of minds between the parties that are involved in the consultative process on the basis of material facts and points in order to arrive at a correct or at least a satisfactory solution. If a certain power can be exercised only after consultation such consultation must be conscious, effective, meaningful and purposeful. To ensure this, each party must disclose to the other all relevant facts for due deliberation. The consultee must express his opinion only after complete consideration of the matter on the basis of all the relevant facts and quintessence. Consultation may have different meanings in different situations depending upon the nature and purpose of the statute. (See also Union of India v. State of Kerala v. A. Lakshmikutty [(1986) 4 SCC 632 : (1986) 1 ATC 735 : AIR 1987 SC 331] , High Court of Judicature of Rajasthan v. P.P. Singh [(2003) 4 SCC 239 : 2003 SCC (L&S) 424 :
AIR 2003 SC 1029] , Union of India v. Kali Dass Batish [(2006) 1 SCC 779 : 2006 SCC (L&S) 225 : AIR 2006 SC 789] , Andhra Bank v. Andhra Bank Officers [(2008) 7 SCC 203 : (2008) 2 SCC (L&S) 403 : AIR 2008 SC 2936] and Union of India v. Madras Bar Assn. [(2010) 11 SCC 1] 26. In Chandramouleshwar Prasad v. Patna High Court [(1969) 3 SCC 56 : AIR 1970 SC 370] (SCC p. 63, para 7), this Court held that consultation or deliberation can neither be complete nor effective before the parties thereto make their respective points of view known to the other or others and discuss and examine the relative merits of their views. If one party makes a proposal to the other, who has a counter-proposal in mind which is not communicated to the proposer, a direction issued to give effect to the counter-proposal without any further discussion with respect to such counter-proposal with the proposer cannot be said to have been issued after 244. As such, the enquiry would be limited to find out whether both the Central Board and the Central Government had made their respective points of view known to each other and discussed and examined the relative merits of their views. It will have to be considered whether each of the party had disclosed to the other all relevant facts and factors for due deliberation, or not. The limited enquiry would be whether the recommendation by the Central Board was made after complete consideration of the matter on the basis of all the relevant facts and material before it, or not. 245. As already discussed herein above, the record itself reveals that the RBI and the Central Government were in consultation with each other for a period of six months before the impugned notification was issued. The record would also reveal that all the relevant information was shared by both the Central Board as well as the Central Government with each other. As such, it cannot be said that there was no conscious, effective, meaningful and purposeful consultation. 246. Another submission that is being made is that the objective with which the impugned
Notification was issued, i.e., to combat fake currency, black money and parallel financing are concerned, the same has utterly failed. It is submitted that immediately after demonetization was effected, currency notes of new series have been seized. It is also submitted that the fake currency is also in vogue. New series of notes have been seized from terrorists. Per contra, it is submitted that the longterm benefits of demonetization have been enormous, direct and indirect. The learned Attorney General has placed on record an elaborate list of the same to which we have already referred to in earlier 247. However, we do not wish to go into the question as to whether the object with which demonetization was effected is served or not or as to whether it has resulted in huge direct and indirect benefits or not. We do not possess the expertise to go into that question and it is best that it should remain in the domain of the experts. 248. The question is succinctly answered by the Supreme Court of United States in the case of Metropolis Theater Company et al., Plffs. In Err., v. City of Chicago and Ernest J. Magerstadt. (supra), which reads thus: “2. The attack of complainants (we so call plaintiffs in error) is upon the classification of the ordinance. It is contended that the purpose of the ordinance is to raise revenue, and that its classification has no relation to such purpose, and therefore is arbitrarily discriminatory, and thereby offends the 14th Amendment of the Constitution of the United States. The character ascribed to the ordinance by the supreme court of the state is not without uncertainty. But we may assume, as complainants assert, that the court considered the ordinance as a revenue measure only. The court said: 'The ordinance may be sustainable under the taxing power alone, without reference to its reasonableness as a regulatory measure.' And, regarding it as a revenue measure, complainants attack it as unreasonable in basing its classification upon the price of admission of a particular theater, and not upon the revenue derived therefrom; and to exhibit the discrimination which is asserted to result, a comparison is made between the seating capacity of
complainants' theaters and the number of their performances within given periods, and the theaters of others in the same respects, and the resulting revenues. But these are accidental circumstances and dependent, as the supreme court of the state said, upon the advantages of the particular theater or choice of its owner, and not determined by the ordinance, It will immediately occur upon the most casual reflection that the distinction the theater itself makes is not artificial, and must have some relation to the success and ultimate profit of its business. In other words, there is natural relation between the price of admission and revenue, some advantage, certainly, that determines the choice. The distinction obtains in every large city of the country. The reason for it must therefore be substantial; and if it be so universal in the practice of the business, it would seem not unreasonable if it be adopted as the basis of governmental action. If the action of government have such a basis it cannot be declared to be so palpably arbitrary as to be repugnant to the 14th Amendment. This is the test of its validity, as we have so many times said. We need not cite the cases. It is enough to say that we have tried, so far as that Amendment is concerned, to declare in words, and the cases illustrate by examples, the wide range which legislation has in classifying its objects. To be able to find fault with a law is not to demonstrate its invalidity. It may seem unjust and oppressive, yet be free from judicial interference. The problems of government are practical ones and may justify, if they do not require, rough accommodations,—illogical, it may be, and unscientific. But even such criticism should not be hastily expressed. What is best is not always discernible; the wisdom of any choice may be disputed or condemned. Mere errors of government are not subject to our judicial review. It is only its palpably arbitrary exercises which can be declared void under the 14 Amendment; and such judgment cannot be pronounced of the ordinance in controversy. Quong Wing v. Kirkendall, 223 U. S. 59, 56 L. ed. 249. It has been held that if the action of the government has a basis with the objectives
to be achieved, it cannot be declared as palpably arbitrary. It has been held that, to be able to find fault with a law is not to demonstrate its invalidity. It has been held that the result of the act may seem unjust and oppressive, yet be free from judicial interference. The problems of government are practical ones and may justify, if they do not require, rough accommodations, illogical, it may be, and unscientific. But even such criticism should not be hastily expressed. It has been held that what is best is not always discernible, and the wisdom of any choice may be disputed or condemned. It has been held that mere errors of government are not subject to judicial review. It is only the palpably arbitrary exercises which can be declared void. 250. We may gainfully refer to the following observations of this Court in the case of R.K. Garg (supra), wherein this Court observed that it should constantly remind itself of what the Supreme Court of the United States said in the case of Metropolis Theater Company “19. ……The Court would not have the necessary competence and expertise to adjudicate upon such an economic issue. The Court cannot possibly assess or evaluate what would be the impact of a particular immunity or exemption and whether it would serve the purpose in view or not. There are so many imponderables that would enter into the determination that it would be wise for the Court not to hazard an opinion where even economists may differ. The Court must while examining the constitutional validity of a legislation of this kind, “be resilient, not rigid, forward looking, not static, liberal, not verbal” and the Court must always bear in mind the constitutional proposition enunciated by the Supreme Court of the United States in Munn v. Illinois [94 US 13], namely, “that courts do not substitute their social and economic beliefs for the judgment of legislative bodies”. The Court must defer to legislative judgment in matters relating to social and economic policies and must not interfere, unless the exercise of legislative judgment appears to be palpably arbitrary……” 251. The Constitution Bench holds that the Court would not have the necessary
competence and expertise to adjudicate upon such an economic issue. The Court cannot possibly assess or evaluate what would be the impact of a particular immunity or exemption and whether it would serve the purpose in view or not. It has been held that it would be wise for the Court not to hazard an opinion where even economists may differ. It has been held that while examining the constitutional validity of such a legislation, the Court must “be resilient, not rigid, forward looking, not static, liberal, not verbal”. 252. We are, therefore, of the considered view that the Court must defer to legislative judgment in matters relating to social and economic policies and must not interfere unless the exercise of executive power appears to be palpably arbitrary. The Court does not have necessary competence and expertise to adjudicate upon such economic issues. It is also not possible for the Court to assess or evaluate what would be the impact of a particular action and it is best left to the wisdom of the experts. In such matters, it will not be possible for the Court to assess or evaluate what would be the impact of the impugned action of demonetization. The Court does not possess the expertise to do so. As already discussed hereinabove, on one hand, the petitioners urged that there has been an adverse effect upon the economy and on the other hand, the learned Attorney General had given a long list of direct and indirect advantages of demonetization. In any case, mere errors of judgment by the government seen in retrospect is not subject to judicial review. In such matters, legislative and quasi-legislative authorities are entitled to a free play, and unless the action suffers from patent illegality, manifest or palpable arbitrariness, the Court should be slow in interfering with the same. 253. Another contention in this regard is that, on account of a hasty decision by the Central Government, citizens had to suffer at large, that many people were required to stand in the queues for hours, that many citizens were deprived of their meals, and that many citizens lost their jobs. 254. As already discussed hereinabove, the Central Government had advised the
Central Board to draft a scheme to implement demonetization in a non-disruptive manner with as little inconvenience to the public and business entities as possible. Accordingly, a draft scheme was also submitted by the Central Board along with its recommendations for demonetization. It is stated in the affidavit that the RBI has subsequently issued relaxations from time to time taking into consideration the difficulties of the people and availability of the new notes. No doubt that on account of demonetization, the citizens were faced with various hardships. However, we may again gainfully refer to the following observations of this Court in the case of R.K. Garg (supra): “8. ……The Court must therefore adjudge the constitutionality of such legislation by the generality of its provisions and not by its crudities or inequities or by the possibilities of abuse of any of its provisions. If any crudities, inequities or possibilities of abuse come to light, the legislature can always step in and enact suitable amendatory legislation. That is the essence of pragmatic approach which must guide and inspire the legislature in dealing with complex economic issues.” 255. Therefore, while adjudging the illegality of the impugned Notification, we would have to examine on the basis as to whether the objectives for which it was enacted has nexus with the decision taken or not. If the impugned Notification had a nexus with the objectives to be achieved, then, merely because some citizens have suffered through hardships would not be a ground to hold the impugned Notification to be bad in law. 256. In this respect, we may gainfully refer to the following observations of this Court in the case of Km. Sonia Bhatia v. State of U.P. and Others70: “29. Lastly, it was urged by Mr Kacker that this is an extremely hard case where the grandfather of the donee wanted to make a beneficial provision for his granddaughter after having lost his two sons in the prime of their life due to air crash accidents while serving in the Air Force. It is true that the District Judge has come to a clear finding that the gift in question is bona fide and has
been executed in good faith but as the gift does not fulfil the other ingredients of the section, namely, that it is not for adequate consideration, we are afraid, however laudable the object of the donor may have been, the gift has to fail because the genuine attempt of the donor to benefit his granddaughter seems to have been thwarted by the intervention of sub-section (6) of Section 5 of the Act. This is undoubtedly a serious hardship but it cannot be helped. We must remember that the Act is a valuable piece of social legislation with the avowed object of ensuring equitable distribution of the land by taking away land from large tenure-holders and distributing the same among landless tenants or using the same for public utility schemes which is in the larger interest of the community at large. The Act seems to implement one of the most important constitutional directives contained in Part IV of the Constitution of India. If in this process a few individuals suffer severe hardship that cannot be helped, for individual interests must yield to the larger interests of the community or the country as indeed every noble cause claims its martyr.” 257. Though, the Court found that the Act caused a serious hardship, it held that the Act is a valuable piece of social legislation. It held that the Act was enacted to implement one of the most important constitutional directives contained in Part IV of the Constitution of India. It further observed that, if in this process, a few individuals suffer severe hardship, that cannot be helped. It further held that individual interests must yield to the larger interests of the community or the country as indeed every noble cause claims its martyr. 258. In any case now, the action which was taken by the Central Government by the impugned Notification, has been validated by the 2016 Ordinance and which has fructified in the 2017 Act. The Central Government is answerable to the Parliament and the Parliament, in turn, represents the will of the citizens of the country. The Parliament has therefore put its imprimatur on the executive action. This is apart from the fact that we have not found any flaw in the decision-making process as required under sub-section (2) of Section 26 of the RBI Act.
259. The decision-making process is also sought to be attacked on the ground that the decision was taken in a hasty manner. We find that the ‘hasty’ argument would be destructive of the very purpose of demonetization. Such measures undisputedly are required to be taken with utmost confidentiality and speed. If the news of such a measure is leaked out, it is difficult to imagine how disastrous the consequences would be. 260. It will be interesting to note again from Volume III of the “History of the Reserve Bank of India” that, on 14th January 1978, one R. Janakiraman, a senior official in the RBI was asked by some officers of the Government of India to come immediately to Delhi for some urgent work. When he asked for what purpose he was called, he was told that the matters relating to exchange control need to be discussed. He, however, took along with him one M. Subramaniam, a senior official of the Exchange Control Department. On reaching Delhi, he was informed that the Government had decided to demonetize the high denomination notes and was required to draft the necessary Ordinance within twenty-four hours. During the said period, no communication was allowed with anyone including the Bank’s central office at Bombay. R. Janakiraman and M. Subramaniam made a request for the 1946 Ordinance on demonetization to get an idea how it was to be drafted, which request was acceded to by the Finance Ministry. The draft Ordinance was completed on schedule. It was finalized and sent for signature of the President of India in the early hours of 16th January 1978 and on the same day, the announcement to that effect was made on All India Radio’s news bulletin at 09.00 a.m. 261. It can thus be seen that confidentiality and secrecy in such sort of measures is of paramount importance. When demonetization was being done in the year 1978, R. Janakiraman, who had drafted the Ordinance, was not permitted to communicate with anyone including the Bank’s central office at Bombay. It would thus show as to what great degree of confidentiality was maintained. In any case, the material placed on record would
show that the RBI and the Central Government were in consultation with each other for at least a period of six months preceding the action. 262. We, therefore, find that the impugned notification dated 8th November 2016 does not suffer from any flaws in the decision-making process. 263. It is sought to be urged on behalf of the petitioners that before taking such a drastic measure, which caused enormous hardship to a number of citizens, the government ought to have found out as to whether there was an alternate course of action which could have resulted in lesser hardship to the citizens. In this respect, reliance is placed on the judgment of this Court in the case of Internet and Mobile Association of India (supra) and K.S. Puttaswamy (Retired) and another (Aadhaar) (supra). 264. In the case of Internet and Mobile Association of India (supra), the RBI had issued a directive to the entities regulated by RBI (i) not to deal with or provide services to any individual or business entities dealing with or settling virtual currencies and (ii) to exit the relationship, if they already have one, with such individuals/business entities, dealing with or settling virtual currencies. 265. The said action came to be challenged by writ petition filed under Article 32 of the Constitution of India. The challenge was on several grounds, including the ground of proportionality. Though the Court did not find favour with the other grounds raised on behalf of the petitioners therein, it held that the concern of the RBI is and ought to be about the entities regulated by it. It found that, till date, RBI had not come out with a stand that any of the entities regulated by it, namely, the nationalized banks/scheduled commercial banks/cooperative banks/NBFCs had suffered any loss or adverse effect directly or indirectly, on account of the interface that the virtual currency exchanges had with any of them. The Court held that there must have been at least some empirical data about the degree of harm suffered by the regulated entities. The Court, therefore, while upholding the power of the RBI to take pre-emptive action, upon testing the proportionality of the
measure, found that in the absence of RBI pointing out at least some semblance of any damage suffered by its regulated entities, the impugned measure was disproportionate. Four-pronged test of proportionality 266. The Constitution Bench of this Court in the case of Modern Dental College and Research Centre (supra), while considering a balance between the right under Article 19(1)(g) and the reasonable restrictions under clause (6) of Article 19 of the Constitution “60. ……Thus, while examining as to whether the impugned provisions of the statute and rules amount to reasonable restrictions and are brought out in the interest of the general public, the exercise that is required to be undertaken is the balancing of fundamental right to carry on occupation on the one hand and the restrictions imposed on the other hand. This is what is known as “doctrine of proportionality”. Jurisprudentially, “proportionality” can be defined as the set of rules determining the necessary and sufficient conditions for limitation of a constitutionally protected right by a law to be constitutionally permissible. According to Aharon Barak (former Chief Justice, Supreme Court of Israel), there are four sub-components of proportionality which need to be satisfied [Aharon Barak, Proportionality: Constitutional Rights and Their Limitation (Cambridge University Press 2012). ], a limitation of a constitutional right will be constitutionally (i) it is designated for a proper purpose; (ii) the measures undertaken to effectuate such a limitation are rationally connected to the (iii) the measures undertaken are necessary in that there are no alternative measures that may similarly achieve that same purpose with a lesser degree of limitation; and finally (iv) there needs to be a proper relation (“proportionality stricto sensu” or “balancing”) between the importance of achieving the proper purpose and the social importance of preventing the limitation on the constitutional right.” 267. The Constitution Bench held that while examining as to whether the impugned provisions of the statute and rules amount to reasonable restrictions and are brought out in the interest of the general public, the exercise that is required to be undertaken is balancing of the fundamental right to carry on occupation on the one hand and the
restrictions imposed on the other hand. The Court refers to four tests of proportionality which need to be satisfied. The first one is that it should be designated for a proper purpose. The second one is that the measures undertaken to effectuate such a limitation are rationally connected to the fulfilment of that purpose. The third one is that the measures undertaken are necessary in that there are no alternative measures that may similarly achieve that same purpose with a lesser degree of limitation. Finally, the fourth one is that there needs to be a proper relation between the importance of achieving the proper purpose and the social importance of preventing the limitation on the constitutional right. The Court held that there has to be a balance between a constitutional right and public interest. It held that a constitutional licence to limit those rights is granted where such a limitation will be justified to protect public interest or the rights of others. It will also be relevant to refer to the following observations of the Constitution Bench: “65. …..At the same time, reasonableness of a restriction has to be determined in an objective manner and from the standpoint of the interests of the general public and not from the point of view of the persons upon whom the restrictions are imposed or upon abstract considerations (see Mohd. Hanif Quareshi v. State of Bihar [Mohd. Hanif Quareshi v. State of Bihar, AIR 1958 SC 731 : 1959 SCR 629] ). In M.R.F. Ltd. v. State of Kerala [M.R.F. Ltd. v. State of Kerala, (1998) 8 SCC 227 : 1999 SCC (L&S) 1] , this Court held that in examining the reasonableness of a statutory provision one has to keep in mind the following factors: (2) Restrictions must not be arbitrary or of an excessive nature so as to go beyond the requirement of the interest of the general public. (3) In order to judge the reasonableness of the restrictions, no abstract or general pattern or a fixed principle can be laid down so as to be of universal application and the same will vary from case to case as also with regard to changing conditions, values of human life, social philosophy of the Constitution, prevailing conditions and the surrounding circumstances.
(4) A just balance has to be struck between the restrictions imposed and the social control envisaged by Article 19(6). (5) Prevailing social values as also social needs which are intended to be satisfied by the (6) There must be a direct and proximate nexus or reasonable connection between the restrictions imposed and the object sought to be achieved. If there is a direct nexus between the restrictions, and the object of the Act, then a strong presumption in favour of the constitutionality of the Act will naturally arise.” 268. It is pertinent to note that in the case of Modern Dental College and Research Centre (supra), the Court was considering the validity of the Act and the Rules which regulated primarily the admission of the students in postgraduate courses in private educational institutions and the provisions made thereunder. Applying the test of proportionality, the Court held that the larger public interest warrants such a measure. It held that, having regard to the malpractices which are noticed in the Common Entrance Test (CET) conducted by such private institutions themselves, it is, undoubtedly, in the larger interest and welfare of the student community to promote merit and excellence and to curb malpractices. The Court held that the impugned provisions which may amount to “restrictions” on the right of the appellants therein to carry on their “occupation”, are clearly “reasonable” and satisfy the test of proportionality. 269. The proportionality doctrine is sought to be placed in service on the ground that in the case of Jayantilal Ratanchand Shah (supra), the Court held the bank notes to be property and as such, impugned Notification imposed unreasonable restrictions, violative of Article 300-A of the Constitution of India. 270. Let us test the four-pronged test culled out by Aharon Barak, former Chief Justice, Supreme Court of Israel which have been reproduced in the case of Modern Dental College and Research Centre (supra). 271. The impugned Notification has been issued with an objective to meet the following (i) Fake currency notes of the SBNs have been largely in circulation and it has been found to
be difficult to easily identify genuine bank notes from the fake ones; (ii) It has been found that high denomination bank notes were used for storage of unaccounted wealth which was evident from the large cash recoveries made by law enforcement agencies; (iii) It has also been found that fake currency is being used for financing subversive activities such as drug trafficking and terrorism, causing damage to the economy and security of the 272. For the purpose of achieving these objectives, the Central Government, on the recommendations of the Central Board, took a decision to demonetize the bank notes of denominational value of Rs.500/- and Rs.1000/-. Assuming that holding bank notes is a right under Article 300-A of the Constitution of India, the limitation that is imposed is designated for a proper purpose. By no stretch of imagination could it be said that the aforesaid three purposes, i.e., elimination of fake currency, black money and terror financing are not proper purposes. As such, the first test is satisfied. 273. The second test is as to whether the measure undertaken to effectuate such a limitation is rationally connected to the fulfilment of that purpose - that would be the nexus test. The question, therefore, is, as to whether the measures taken in the present case have a reasonable nexus with the purpose to be achieved? As already discussed hereinabove, the purpose of demonetization was to eliminate the fake currency notes, black money, drug trafficking & terror financing. Can it be said that demonetizing high denomination bank notes of Rs.500/- and Rs.1000/- does not have a reasonable nexus with the three purposes sought to be achieved? We find that there is a reasonable nexus between the measure of demonetization with the aforesaid purposes of addressing issues of fake currency bank notes, black money, drug trafficking & terror financing. As such, the second test stands satisfied. 274. Insofar as the third test is concerned, it is required to be examined as to whether the measure undertaken is necessary in that there are no alternative measures that may similarly achieve the same purpose with the lesser degree of limitation. As held in the case
of M.R.F. Ltd. v. Inspector Kerala Govt. and Others71, to judge the reasonableness of the restrictions, no abstract or general pattern or a fixed principle can be laid down so as to be of universal application and the same will vary from case to case. As to what measure is required to meet the aforesaid objectives is exclusively within the domain of the experts. The RBI, as already held, plays a material role in economic and monetary policy and issues relating to management and regulation of currency. The Central Government is the best judge since it has all the inputs with regard to fake currency, black money, terror financing & drug trafficking. As such, what measure is required to be taken to curb the menace of fake currency, black money and terror financing would be best left to the discretion of the Central Government, in consultation with the RBI. Unless the said discretion has been exercised in a palpably arbitrary and unreasonable manner, it will not be possible for the Court to interfere with the same. 275. In any case, what alternate measure could have been undertaken with a lesser degree of limitation is very difficult to define. Whether the Courts possess an expertise to decide as to whether demonetization of only Rs.500/- denomination notes ought to have been done or the denomination of only the notes of Rs.1000/- ought to have been done or as to whether particular series of the bank notes ought to have been demonetized. These are all the areas which are purely within the domain of the experts and beyond the arena of judicial review. 276. Insofar as the fourth test, that is the proper relation between the importance of achieving the proper purpose and the social importance of preventing the limitation on the constitutional right is concerned, can it really be said that there is no proper relation between the importance of curbing the menace of fake currency, black money, drug trafficking & terror financing on one hand and demonetizing the Rs.500/- and Rs.1000/- notes, thereby imposing restriction on the use of demonetized currency? 277. In any case, by demonetization, the right vested in the notes was not taken away.
The only restrictions were with regard to exchange of old notes with the new notes, which were also gradually relaxed from time to time. Insofar as deposit of the demonetized notes in banks is concerned, there was no limitation. If a citizen had a ‘Know Your Customer (KYC) compliant bank account’, he could deposit any amount and get to his credit the full value of legitimate currency. As such, the right to property in bank notes was not taken away. A full value of legitimate currency was entitled to be deposited in the bank account, however, up to a particular date. In any case, there was no restriction on non-cash transactions like debit card, credit card, net banking, online transactions etc. 278. We find that the argument that the right to property was sought to be taken away is without substance. In any case, even if there were reasonable restrictions on the said right, the said restrictions were in the public interest of curbing evils of fake currency, black money, drug trafficking & terror financing. As such, we find that applying the four-pronged test, the doctrine of proportionality is fully satisfied. 279. Insofar as reliance on the judgment of the Constitution Bench of this Court in the case of K.S. Puttaswamy (Retired) and another (Aadhaar) (supra) is concerned, in the facts of the said case, the Constitution Bench found that, on account of various measures taken by the Government to give a boost to digital economy, millions of persons, who are otherwise poor, had opened their bank accounts. They were also becoming habitual to the good practice of entering into transactions through their banks and even by using digital modes for operation of their bank accounts. The Court, in this background, found that making the requirement of Aadhaar compulsory for all such and other persons in the name of checking money laundering or black money was grossly disproportionate. The observations made therein were in the context of the factual background that fell for consideration in the said case. In our view, the said observations would not be applicable to the facts of the present case. We have already considered in detail as to how, upon
application of the fourpronged test of proportionality, the impugned notification cannot be struck down. 280. In any case, in our view, there is a direct and proximate nexus between the restrictions imposed and the objectives sought to be achieved. As held by this Court in the case of M.R.F. Ltd. (supra), if there is a direct nexus between the restrictions and the object of the action, then a strong presumption in favour of the constitutionality of the action naturally arises. 281. We, therefore, hold that the impugned notification dated 8th November 2016 does not violate the principle of proportionality and as such, is not liable to be struck down on the said ground. 282. It is sought to be urged that the period provided for exchange of old notes with the new notes under the impugned Notification is unreasonable. 283. Under the 1978 Act, the Ordinance was notified on 16th January 1978, which transformed into the Act on 30th March 1978. Under Section 3 of the 1978 Act, all high denomination bank notes, notwithstanding anything contained in Section 26 of the RBI Act, ceased to be legal tender in payment or on account at any place. Under Section 7 of the 1978 Act, every person desiring to tender for exchange demonetized notes was required to submit a declaration giving the particulars not later than 19th January 1978. 284. Under Section 8 of the 1978 Act, a person who failed to apply for exchange of any demonetized notes within the time provided under Section 7 thereof, was entitled to tender the notes together with a declaration required under Section 7 thereof along with the statement explaining the reasons for his or her failure to apply within the specified time limit. Under sub-section (2) of Section 8 of the 1978 Act, if the RBI was satisfied with the reasons for the failure to submit the notes prior to 19th January 1978 being genuine, it could pay the value of the notes in the manner specified in sub-section (4) of Section 7 thereof. Under sub-section (3) of Section 8 thereof, an appeal was provided before the Central Government against the refusal of the RBI to pay the value of the notes.
285. It could thus be seen that under the 1978 Act, three days’ period was provided for exchanging the demonetized notes. If a person could not avail of the said period, five days’ grace period was made available during which period the money could be exchanged subject to the RBI being satisfied with the genuineness of the reasons for not submitting the same within three days. As such, the period available to everyone was three days which could be further extended by five days. A challenge was raised on the ground that the period was unreasonable and violative of the fundamental rights. Rejecting the said contention, the Constitution Bench in the case of Jayantilal Ratanchand Shah (supra) “10. It was, however, contended on behalf of the petitioners that even if it was assumed that Article 31 had not been violated, the time prescribed for exchange of the high denomination banknotes under Sections 7 and 8 of the Demonetisation Act was unreasonable and violative of their fundamental rights. When the above provisions of the Act are considered in the context of the purpose the Demonetisation Act sought to achieve, namely, to stop circulation of high denomination banknotes as early as possible, the above contention of the petitioners cannot be accepted. Consequent upon the high denomination banknotes ceasing to be legal tender on the expiry of 16-1-1978 and in view of the prohibition in the transfer of possession of such notes from one person to another thereafter as envisaged under Section 4, it was absolutely necessary to ensure that no opportunity was available to the holders of high denomination banknotes to transfer the same to the possession of others. At the same time it was necessary to afford a reasonable opportunity to the holders of such notes to get the same exchanged. However, if the time for such exchange was not limited the high denomination banknotes could be circulated and transferred without the knowledge of the authorities concerned from one person to another and any such transferee could walk into the Bank on any day thereafter and demand exchange of his notes. In that case it would have been wellnigh impossible for the Bank to prove that such a person was not the owner or holder of the notes on 16-1-1978. Needless to say in such an
eventuality the very object which the Demonetisation Act sought to achieve would have been defeated. Obviously, to strike a balance between these competing and disparate considerations Section 7(2) of the Demonetisation Act limited the time to exchange the notes till 19-1-1978. However, even thereafter, in view of Section 8, the high denomination banknotes could be exchanged from the Bank till 24-1-1978 provided the tenderer was able to explain the reasons for his failure to apply for such exchange within the time stipulated under Section 7(2) of the Demonetisation Act. Apart from the above provisions regarding exchange of high denomination banknotes by the Bank within the time stipulated therein, provision has been made in sub-section (7) of Section 7, permitting the Central Government, for reasons to be recorded in writing, to extend in any case or class of cases the period during which high denomination banknotes may be tendered for exchange. From a combined reading of Sections 7 and 8 it is evidently clear that on furnishing a declaration complete in all particulars in accordance with sub-section (2) of Section 7 by 19-1-1978, the holder was entitled to get the exchange value of his notes from the Bank without any let or hindrance; thereafter, till 24-1-1978, he was also entitled to such exchange from the Bank if he could satisfactorily explain the reasons for his inability to apply by 19-1-1978 and after that date the Central Government was empowered to extend the period of such exchange. Such being the scheme of the Act regarding exchange of high denomination banknotes it cannot be said that the time and the manner in which the high denomination banknotes could be exchanged were unreasonable, unjust and violative of the petitioners' fundamental rights.” 286. The Constitution Bench found that if the time for such exchange was not limited, the high denomination bank notes could be circulated and transferred without the knowledge of the authorities concerned, from one person to another and any such transferee could walk into the Bank on any day thereafter and demand exchange of his notes. It was held that, in such an eventuality, the very object which the Demonetization Act sought to
achieve would have been defeated. The Court found that between 16th January 1978 and 19th January 1978, the holder was entitled to get the exchange value of his notes from the Bank without any limit or hindrance. The challenge that the period of three days was unreasonable, unjust and violative of the petitioners’ fundamental rights, stood specifically 287. In the present case, the period for exchanging any amount of SBNs and depositing the same in the KYC compliant bank account without any limit or hindrance was 52 days, whereas the said period in the case of Jayantilal Ratanchand Shah (supra) was only three days, which is much less as compared to the one provided by the impugned Notification. In the light of what has been held by the Constitution Bench in the case of Jayantilal Ratanchand Shah (supra), we fail to understand as to how the said period of 52 days could be construed to be unreasonable, unjust and violative of the petitioners’ fundamental rights. 288. We, therefore, hold that the period provided for exchange of notes vide the impugned Notification dated 8th November 2016 cannot be said to be unreasonable. 289. It is sought to be urged by Shri Divan that the RBI has independent power under sub-section (2) of Section 4 of the 2017 Act. Contextual and harmonious construction of the provisions of the 2017 Act. 290. For appreciating the said contention, it will be appropriate to refer to Sections 3 and 4 of the 2017 Act, which read thus: “3. Specified bank notes to cease to be liability of Reserve Bank or Central Government.— On and from the appointed day, notwithstanding anything contained in the Reserve Bank of India Act, 1934 (2 of 1934) or any other law for the time being in force, the specified bank notes which have ceased to be legal tender, in view of the notification of the Government of India in the Ministry of Finance, number S.O. 3407(E), dated the 8th November, 2016, issued under subsection (2) of section 26 of the Reserve Bank of India Act, 1934, shall cease to be liabilities of the Reserve
Bank under section 34 and shall cease to have the guarantee of the Central Government under sub-section (1) of section 26 of the said Act. (1) Notwithstanding anything contained in section 3, the following persons holding specified bank notes on or before the 8th day of November, 2016 shall be entitled to tender within the grace period with such declarations or statements, at such offices of the Reserve Bank or in such other manner as may be specified by it, namely:— (i) a citizen of India who makes a declaration that he was outside India between the 9th November, 2016 to 30th December, 2016, subject to such conditions as may be specified, by notification, by the Central Government; or (ii) such class of persons and for such reasons as may be specified by notification, by the (2) The Reserve Bank may, if satisfied, after making such verifications as it may consider necessary that the reasons for failure to deposit the notes within the period specified in the notification referred to in section 3, are genuine, credit the value of the notes in his Know Your Customer compliant bank account in such manner as may be specified by it. (3) Any person, aggrieved by the refusal of the Reserve Bank to credit the value of the notes under sub-section (2), may make a representation to the Central Board of the Reserve Bank within fourteen days of the communication of such refusal to him. Explanation.— For the purposes of this section, the expression “Know Your Customer compliant bank account” means the account which complies with the conditions specified in the regulations made by the Reserve Bank under the Banking Regulation Act, 1949 (10 of 1949).” 291. The effect of Section 3 of the 2017 Act is that the SBNs, which have ceased to be legal tender, in view of the impugned Notification, shall cease to be liabilities of the RBI under Section 34 of the RBI Act and shall cease to have the guarantee of the Central Government under sub-section (1) of Section 26 of the RBI Act. The legislative intent under Section 3 of the 2017 Act is to provide clarity and finality to the liabilities of the RBI and the Central Government arising from such bank notes which have ceased to be legal
tender with effect from 9th November 2016. 292. Sub-section (1) of Section 4 of the 2017 Act provides that notwithstanding anything contained in Section 3 of the 2017 Act, a class of persons would be entitled to tender within the grace period with such declarations or statements, at such offices of the RBI or in such other manner as may be specified by it. Clause (i) of sub-section (1) of Section 4 of the 2017 Act deals with a citizen of India who makes a declaration that he was outside India between 9th November 2016 and 30th December, 2016, however, subject to such conditions as may be specified, in the notification, by the Central Government. Clause (ii) of sub-section (1) of Section 4 of the 2017 Act empowers the Central Government to issue a notification with regard to persons holding SBNs who would be entitled to tender within the grace period for such reasons as may be specified in the said notification. 293. It is thus clear that, though in view of the impugned Notification and in view of Section 3 of the 2017 Act, demonetized notes have ceased to be a legal tender and have ceased to be the liabilities of the RBI under Section 34 of the RBI Act and the guarantee of the Central Government under sub-section (1) of Section 26 of the RBI Act, a window is provided by Section 4 of the 2017 Act. Clause (i) of sub-section (1) of Section 4 of the 2017 Act deals with a citizen of India who makes a declaration that he was outside India between 9th November 2016 and 30th December, 2016, subject to such conditions as may be specified, by notification, by the Central Government. Accordingly, a notification is issued by the Central Government on 30th December 2016. In view of clause (ii) of sub- section (1) of Section 4 of the 2017 Act, the Central Government is empowered to provide a window for tendering the SBNs which have otherwise ceased to be a legal tender to such class of persons and for the reasons as may be specified in the notification. Sub- section (2) of Section 4 of the 2017 Act provides that the RBI, if satisfied with the reasons
for failure to deposit the notes within the period specified in the impugned Notification, i.e., prior to 30th December 2016, are genuine, credit the value of the notes in his KYC compliant bank account in such manner as may be specified by it. However, prior to doing so, the RBI is required to make such verifications as it may consider necessary for finding out the genuineness of the reasons for failure to deposit the notes prior to 30th December 2016. The provisions of sub-section (2) of Section 4 of the 2017 Act are somewhat analogous to the provisions in sub-sections (1) and (2) of Section 8 of the 1973 Act. Sub- section (3) of Section 4 of the 2017 Act provides that any person, aggrieved by the refusal of the RBI to credit the value of the notes under subsection (2), can make a representation to the Central Board of the RBI within fourteen days of the communication of such refusal to him. This provision is somewhat analogous with subsection (3) of Section 8 of the 1973 294. It is thus clear that Section 4 of the 2017 Act provides an integrated scheme. Sub- section (1) of Section 4 of the 2017 Act empowers the Central Government to provide a window to the persons holding SBNs on or before 8th November 2016 to tender the same within the grace period with such declarations or statements. Clause (i) thereof is applicable to the citizens who were outside India between 9th November 2016 and 30th December 2016. Clause (ii) thereof enables the Central Government to provide a window to such class of persons and for such reasons as may be specified in the notification by the Central Government. Sub-section (2) of Section 4 of the 2017 Act provides for consideration of the cases covered by subsection (1) thereof. It provides that the RBI, upon its satisfaction, after making such verifications as it may consider necessary that the reasons for failure to deposit the notes prior to 30th December 2016, are genuine, will credit the value of the notes in KYC compliant bank account of such a person. If any person is aggrieved by the refusal of the RBI under sub-section (2), an appellate
opportunity is provided to such a person, under sub-section (3). 295. The Constitution Bench of this Court in the case of Popatlal Shah v. The State of “It is a settled rule of construction that to ascertain the legislative intent, all the constituent parts of a statute are to be taken together and each word, phrase or sentence is to be considered in the light of the general purpose and object of the Act itself.” 296. We may gainfully refer to the following observations of this Court in the case of Peerless General Finance and Investment Company Limited (supra): “33. Interpretation must depend on the text and the context. They are the bases of interpretation. One may well say if the text is the texture, context is what gives the colour. Neither can be ignored. Both are important. That interpretation is best which makes the textual interpretation match the contextual. A statute is best interpreted when we know why it was enacted. With this knowledge, the statute must be read, first as a whole and then section by section, clause by clause, phrase by phrase and word by word. If a statute is looked at, in the context of its enactment, with the glasses of the statutemaker, provided by such context, its scheme, the sections, clauses, phrases and words may take colour and appear different than when the statute is looked at without the glasses provided by the context. With these glasses we must look at the Act as a whole and discover what each section, each clause, each phrase and each word is meant and designed to say as to fit into the scheme of the entire Act. No part of a statute and no word of a statute can be construed in isolation. Statutes have to be construed so that every word has a place and everything is in its place. 297. The interpretation which makes the textual interpretation match the contextual has to be preferred. A statute is best interpreted when the reason and purpose for its enactment is ascertained. The statute must be read first as a whole, and then section by section, clause by clause, phrase by phrase and word by word. It has been held that if the statute is looked at in the context of its enactment with the glasses of the statutemaker,
provided by such context, its scheme, the sections, clauses, phrases and words may take colour and appear different than when the statute is looked at without the glasses provided by the context. With these glasses we must look at the Act as a whole and discover what each section, each clause, each phrase and each word means and what it is designed to say as to fit into the scheme of the entire Act. No part of a statute and no word of a statute can be construed in isolation. 298. If we look at the purpose of the 2017 Act, it is for extinguishing the liabilities of the SBNs which have ceased to be legal tender with effect from 9th November 2016 so as to give clarity and finality to the liabilities of the RBI and the Central Government arising from such bank notes which have ceased to be legal tender. However, in order to provide a grace period to genuine cases, Section 4 of the 2017 Act has been incorporated. Section 5 of the 2017 Act provides for prohibition on holding, transferring or receiving SBNs. Sections 6 and 7 of the 2017 Act are penal sections which provide for penalty for contravention of Sections 4 and 5 of the 2017 Act, respectively. 299. It is thus clear that Section 4 of the 2017 Act provides for an integrated scheme. It is a complete code in itself. Under sub-section (1) of Section 4 of the 2017 Act, the Central Government is entitled to provide grace period. Under sub-section (2) thereof, the RBI is required to satisfy as to whether a person seeking to take benefit of grace period under sub-section (1) is entitled thereto after satisfying that the reasons for not depositing the SBNs prior to 30th December 2016, are genuine, and thereafter, credit the value of the said notes in his ‘KYC compliant bank account’. Sub-section (3) thereof provides for an appeal. We are therefore of the considered view that subsection (2) of Section 4 of the 2017 Act cannot be read independently to provide power to the RBI in isolation of subsections (3) and (4) thereof. It is to be read as a part of the scheme of Section 4 of the
300. Shri Divan and various other learned counsel contended that there were various genuine cases wherein the persons could not deposit the demonetized notes within the specified period. The impugned Notification was sought to be challenged on the ground that it has caused hardship to number of persons. It was therefore urged that this Court should either hold the impugned Notification to be arbitrary or direct the Central Government to exercise the powers under Section 4(1)(ii) of the 2017 Act or by exercising the powers under Article 142 of the Constitution of India to provide a window so as to enable genuine persons to exchange their demonetized notes. We have already referred to the judgment of this Court in the case of Km. Sonia Bhatia (supra) hereinbefore. 301. As such, the contention that the impugned notification is liable to be set aside on the ground that it caused hardship to individual/citizens will hold no water. The individual interests must yield to the larger public interest sought to be achieved by impugned 302. Insofar as the suggestion to frame a scheme and provide a window for a limited period so as to enable citizens having genuine reasons to exchange the notes is concerned, we do not find that it will be appropriate for us in the absence of any expertise in economic, monetary and fiscal matters to frame such a scheme. In our view, it will be encroaching upon the areas reserved for the experts. If the Central Government finds that there exists any such class of persons and there are any reasons for extending the benefit under Section 4 of the 2017 Act, it is within its discretion to do so. In our view, it cannot be done by a judicial mandate. 303. We therefore hold that the RBI does not have independent power under sub-section (2) of Section 4 of the 2017 Act in isolation of the provisions of Sections 3 and 4(1) thereof to accept the demonetized notes beyond the period specified in notifications issued under sub-section (1) of Section 4 of the 2017 Act. (i) The power available to the Central Government under sub-section (2) of Section 26
of the RBI Act cannot be restricted to mean that it can be exercised only for ‘one’ or ‘some’ series of bank notes and not for ‘all’ series of bank notes. The power can be exercised for all series of bank notes. Merely because on two earlier occasions, the demonetization exercise was by plenary legislation, it cannot be held that such a power would not be available to the Central Government under sub-section (2) of Section 26 of the RBI Act; (ii) Sub-section (2) of Section 26 of the RBI Act does not provide for excessive delegation inasmuch as there is an inbuilt safeguard that such a power has to be exercised on the recommendation of the Central Board. As such, sub-section (2) of Section 26 of the RBI Act is not liable to be struck down on the said ground; (iii) The impugned Notification dated 8th November 2016 does not suffer from any flaws in the decision-making process; (iv) The impugned Notification dated 8th November 2016 satisfies the test of proportionality and, as such, cannot be struck down on the said ground; (v) The period provided for exchange of notes vide the impugned Notification dated 8th November 2016 cannot be said to unreasonable; and (vi) The RBI does not possess independent power under sub-section (2) of Section 4 of the 2017 Act in isolation of the provisions of Sections 3 and 4(1) thereof to accept the demonetized notes beyond the period specified in notifications issued under sub-section (1) of Section 4 of the 2017 Act. 305. Having answered the Reference, we direct the Registry of this Court to place the matter before Hon’ble the Chief Justice of India for placing it before the appropriate Bench(es). Needless to state that all other contentions are kept open to be considered by the Bench(es) before which the matters would be placed. 306. Before parting with the judgment, we place on record our deep appreciation for the valuable assistance rendered by Shri R. Venkataramani, learned Attorney General, Shri P. Chidambaram, Shri Shyam Divan and Shri Jaideep Gupta, learned Senior Counsel and
all other counsel appearing for the parties. (i) Deciphering the plain meaning of sub-section (2) of Section 26 of 33 – 36 (ii) Affidavits and Record of the Case: 36 – 40 I have had the benefit of reading the judgment proposed by His Lordship, B.R. 2. However, I wish to differ on the reasoning and conclusions arrived at in his judgement with regard to exercise of power by the Central Government under sub-section (2) of Section 26 of the Reserve Bank of India Act, 1934 (hereinafter referred to as “the Act” for the sake of brevity) by issuance of the impugned notification dated 8th November, 3. By way of a preface, I state that the judgment proposed by His Lordship, Gavai, J. does not recognise the essential fact that the Act does not envisage initiation of demonetisation of bank notes by the Central Government. Sub-section (2) of Section 26 of the Act, contemplates demonetisation of bank notes at the instance of the Central Board of the Reserve Bank of India (hereinafter referred to as “the Bank”). Hence, if demonetisation is to be initiated by the Central Government, such power is derived from Entry 36 of List I of the Seventh Schedule to the Constitution which speaks of currency, coinage and legal tender; foreign exchange. In view of the interpretation given by me to sub-section (2) of Section 26 of the Act in the context of the powers of the Central Board of the Bank and the Central Government vis-à-vis demonetisation of bank notes, my answer is only with regard to question No.1 of the reference order. Incidentally, while considering the same, I would touch upon question No. 7 of the reference order. 4. The questions for consideration of this Constitution Bench framed by the Predecessor Bench on 16th December, 2016 are extracted as under: (i) “Whether the notification dated 8th November 2016 is ultra vires Section 26(2) and Sections 7 ,17,23,24,29 and 42 of the Reserve Bank of India Act, 1934;
(ii) Does the notification contravene the provisions of Article 300(A) of the Constitution; (iii) Assuming that the notification has been validly issued under the Reserve Bank of India Act, 1934 whether it is ultra vires Articles 14 and 19 of the Constitution; (iv) Whether the limit on withdrawal of cash from the funds deposited in bank accounts has no basis in law and violates Articles 14,19 and 21; (v) Whether the implementation of the impugned notification(s) suffers from procedural and/or substantive unreasonableness and thereby violates Articles 14 and 19 and, if so, (vi) In the event that Section 26(2) is held to permit demonetization, does it suffer from excessive delegation of legislative power thereby rendering it ultra vires the Constitution; (vii) What is the scope of judicial review in matters relating to fiscal and economic policy (viii) Whether a petition by a political party on the issues raised is maintainable under (ix) Whether District Co-operative Banks have been discriminated against by excluding them from accepting deposits and exchanging demonetized notes.” Keeping in view the general public importance and the far-reaching implications which the answers to the questions may have, we consider it proper to direct that the matters be placed before the larger Bench of five Judges for an authoritative pronouncement. The Registry shall accordingly place the papers before Hon’ble the Chief Justice for constituting an appropriate Bench.” 5. His Lordship, Gavai, J. has reframed the questions referred to this Constitution Bench and culled out six questions, which have been answered in the erudite judgment proposed by him. My views on each of such questions, as contrasted with those of His Lordship’s have been expressed in a tabular form hereinunder, for easy reference. Question, as reframed by His Lordship’s views My views 1. “Whether the power i) The power available to the i) The Central Government available to the Central Central Government under possesses the power to Government under sub-section (2) of Section 26 initiate and carry out the sub-section (2) of Section 26 of the RBI Act cannot be process of demonetisation
of the RBI Act can be restricted to mean that it can of all series of bank notes, restricted to mean that it can be exercised only for one or of all denominations. be exercised only for "one" or some series of bank notes However, all series of bank "some" series of bank notes and not to all series of bank notes, of all denominations and not "all" series in view of notes. could not be recommended the word "any" appearing ii) The power can be to be demonetised, by the before the word "series" in the exercised for all series of Central Board of the Bank sub-section, specifically so, bank notes. under Section 26 (2) of the when on earlier two iii) Merely because on two Act. occasions, the earlier occasions, the ii) Sub-section (2) of Section demonetisation exercise was demonetization exercise had 26 of the Act applies only done by the plenary done by plenary legislation, it when a proposal for legislations?” cannot be held that such a demonetisation is initiated by power could not be the Central Board of the 2. “In the event it is held that “The power vested with the i) This question does not arise the power under sub-section Central Government under for consideration as it has (2) of Section 26 of the RBI sub-section (2) of Section 26 been held that the power Act is construed to mean "all" of the RBI Act cannot be under sub-section (2) of series, whether the power struck down on the ground of Section 26 of the Act cannot vested with the Central conferring excessive be construed to mean "all" Government under the said delegation.” series or “all” denominations. sub-section would amount to ii) In my view, if the Central 3. “Whether the impugned “The impugned Notification i) That the measure of notification dated 8th dated 8th November, 2016, demonetisation ought to have November, 2016 is liable to be does not suffer from any been carried out by the struck down on the ground flaws in the decision-making Central Government by way process.”
4. “Whether the impugned “The impugned Notification This question need not be notification dated 8th dated 8th November 2016 answered in view of the above November, 2016, is liable to satisfies the test of answers. 5. “Whether the period “The period provided for This question need not be provided for exchange of exchange of notes vide the answered in view of the above notes vide the impugned impugned Notification dated answers. 6. “Whether the RBI has an “The RBI does not possess This question need not be independent power under independent power under answered in view of the above subsection (2) of Section 24 of sub-section (2) of Section 4 answers. the 2017 Act in isolation of the of the 2017 Act in isolation of The reasons for the aforesaid conclusions shall now be discussed. 6. Practices such as hoarding “black” money, counterfeiting, etc., when coupled with corruption, are eating into the vitals of our society and economy. Any measure intended to strike at such practices, and thereby eliminate off shoots thereof, such as, terror funding, drug trafficking, emergence of a parallel economy, money laundering including Havala transactions, must be commended. Such measures are necessary to sanitize the economy and society, and enable it to recover from the plague caused by the evils listed hereinabove. Therefore, it cannot be denied that demonetisation in the instant case was a well-intentioned proposal. However, in my separate opinion I shall proceed to legalistically examine whether demonetisation, as well-intentioned as it may have been, was carried out in accordance with the procedure established under law. 6.1 The controversy in these cases revolves around the exercise of power by the Central Government under sub-section (2) of Section 26 of the Reserve Bank of India Act, 1934. Sub-section (1) of Section 26 of the Act provides that every bank note shall be a legal tender as per the amount expressed therein and shall be guaranteed by the Central Government. However, as per subsection (2) of Section 26 of the Act, bank notes can cease to be legal tender when the Central Government issues a notification in the Gazette
of India declaring that with effect from such date as may be specified in the said notification any series of bank notes of any denomination shall cease to be legal tender. Such a notification may be issued on the recommendation of the Central Board of the Bank. There is a challenge to the vires of the said provision and also the validity of the Notification dated 8th November, 2016 issued by the Central Government. As a result of the said Notification, all series of Rs.500/- and Rs.1,000/- denomination notes were demonetised or ceased to be legal tender by issuance of a notification on the said date. At this stage itself, it may be mentioned that subsequent to the notification there was an Ordinance called “The Specified Bank Notes (Cessation of Liabilities) Ordinance, 2016” (hereinafter referred to as “the 2016 Ordinance” for the sake of brevity) promulgated by the Hon’ble President of India, which was later made an Act of the Parliament, namely, “The Specified Bank Notes (Cessation of Liabilities) Act, 2017” (hereinafter called “2017 Act” for the sake of brevity) and was notified on 1st March 2017 , replacing the Ordinance. The issuance of the aforesaid Notification and the action of the Central Government of demonetisation of all series of Rs.500/- and Rs.1,000/- are assailed in these Writ Petitions. The Reserve Bank of India Act, 1934: An overview 7. Before proceeding further, it would be useful to refer to the provisions of the Act for the sake of convenience. 7.1 The object and purpose of the Act is to constitute a Reserve Bank of India to regulate the issue of bank notes and for keeping reserves with a view to secure monetary stability in India, and to generally operate the currency and credit system of the country to its advantage. 7.2 The Preamble of the Act states that it is essential to have a modern monetary policy framework to meet the challenge of an increasingly complex economy and the primary objective of the monetary policy is to maintain price stability while keeping in mind the objective of growth. The monetary policy framework in India shall be operated by the
Reserve Bank of India. 7.3 The following provisions of the Act are relevant for the purposes of this case and “Section 2- Definitions: In this Act, unless there is anything repugnant in the subject or context, [a(ii)] “the Bank” means the Reserve Bank of India constituted by this Act; [a(iii)] “Bank for International Settlements” mean the body corporate established with the said name under the law of Switzerland in pursuance of an agreement dated the 20th January, 1930, [a(iv)] “bank note” means a bank note issued by the Bank, whether in physical or digital form, (b) “the Central Board” means the Central Board of Directors of the Bank; (cc) “International Monetary Fund” and “International Bank for Reconstruction and Development” means respectively the “International Fund” and the “International Bank”, referred to in the International Monetary Fund and Bank Act, 1945;] xxxx (d) “rupee coin” means (***) rupees which are legal tender in India under the provisions of the 7.4 Chapter II of the Act deals with Incorporation, Capital, Management and Business. Section 3 speaks of establishment and incorporation of the Reserve Bank while Section 7 deals with Management of the Bank. Section 8 prescribes the composition of the Central Board, and term of office of Directors of the Bank. Section 30 pertains to the powers of the Central Government to supersede the Central Board of the Bank. 7.5 Chapter III of the Act which is relevant for the purpose of these cases deals with Central Banking Function. For the purposes of these cases, Sections 22, 23, 24, 25, 26, 26A, 27, 28 and 34 are relevant and the same read as under: “22. Right to issue Bank notes. -(1) The Bank shall have the sole right to issue Bank notes in 1[India], and may, for a period which shall be fixed by the [ Central Government] on the recommendation of the Central Board, issue currency notes of the Government of India supplied to it by the [Central Government], and the provisions of this Act applicable to Bank notes shall,
unless a contrary intention appears, apply to all currency notes of the Government of India issued either by the [Central Government] or by the Bank in like manner as if such currency notes were Bank notes, and references in this Act to Bank notes shall be construed accordingly. (2) On and from the date on which this Chapter comes into force the 5[Central Government] shall not issue any currency notes.” “23. Issue Department - (1) The issue of Bank notes shall be conducted by the Bank in an Issue Department which shall be separated and kept wholly distinct from the Banking Department, and the assets of the Issue Department shall not be subject to any liability other than the liabilities of the Issue Department as hereinafter defined in Section 34. (2) The Issue Department shall not issue Bank notes to the Banking Department or to any other person except in exchange for other Bank notes or for such coin, bullion or securities as are permitted by this Act to form part of the Reserve.” “[24. Denominations of notes - (1) Subject to the provisions of sub-section (2), Bank notes shall be of the denominational values of two rupees, five rupees, ten rupees, twenty rupees, fifty rupees, one hundred rupees, five hundred rupees, one thousand rupees, five thousand rupees and ten thousand rupees or of such other denominational values, not exceeding ten thousand rupees, as the Central Government may, on the recommendation of the Central Board, specify in this behalf. (2) The Central Government may, on the recommendation of the Central Board, direct the non-issue or the discontinuance of issue of Bank notes of such denominational values as it may “25. Form of Bank notes - The design, form and material of Bank notes shall be such as may be approved by the [Central Government] after consideration of the recommendations made by “26. Legal tender character of notes - (1) Subject to the provisions of sub-section (2), every Bank note shall be legal tender at any place in [India] in payment or on account for the amount
expressed therein, and shall be guaranteed by the [Central Government]. (2) On recommendation of the Central Board the [ Central Government] may, by notification in the Gazette of India, declare that, with effect from such date as may be specified in the notification, any series of Bank notes of any denomination shall cease to be legal tender [save at such office or agency of the Bank and to such extent as may be specified in the notification].” “[26A. Certain Bank notes to cease to be legal tender- Notwithstanding anything contained in section 26, no Bank note of the denominational value of five hundred rupees, one thousand rupees or ten thousand rupees issued before the 13th day of January, 1946, shall be legal tender in payment or on account for the amount expressed therein. ]” “27. Re-issue of notes- The Bank shall not re-issue Bank notes which are torn, defaced or “34. Liabilities of the Issue Department- (1) The liabilities of the Issue Department shall be an amount equal to the total of the amount of the currency notes of the Government of India and Bank notes for the time being in circulation.” 7.6 Section 22 states that the Bank has the sole right to issue bank notes in India, and may, for a period which shall be fixed by the Central Government on the recommendation of the Central Board of the Bank, issue currency notes of the Government of India supplied to it by the Central Government. On and from the date on which Chapter III comes into force, the Central Government shall not issue any currency notes except the denomination 7.7 The issue of bank notes shall be by the Issue Department of the Bank which shall be separated and kept wholly distinct from the Banking Department, and the assets of the Issue Department shall not be subject to any liability other than the liability of the Issue Department as defined under Section 34 of the Act, vide Section 23 of the Act. The liabilities of the Issue Department under Section 34 of the Act shall be an amount equal to the total of the amount of the currency notes of the Government of India and bank notes for the time being in circulation.
7.8 Sub-section (1) of Section 24 states that, subject to the provisions of sub-section (2) of Section 24, the bank notes shall be of the denominational values of two rupees, five rupees, ten rupees, twenty rupees, fifty rupees, one hundred rupees, five hundred rupees, one thousand rupees, five thousand rupees and ten thousand rupees or of such other denominational values, not exceeding ten thousand rupees, as the Central Government may, on the recommendation of the Central Board of the Bank, specify in this behalf. However, this provision is subject to sub-section (2) of Section 24 which states that the Central Government may on the recommendation of the Central Board of the Bank, direct the non-issue or the discontinuance of issue of bank notes of such denominational values as it may specify in that behalf. The Central Government has to approve the design for all the bank notes after consideration of the recommendation made by the Central Board vide Section 25 of the Act. 7.9 Sub-section (1) of Section 26 of the Act states that every bank note shall be legal tender at any place in India in payment, or on account for the amount expressed therein and shall be guaranteed by the Central Government. This is, however, subject to sub-section (2) of Section 26 of the Act, which states that the Central Government on the recommendation of the Central Board may, by issuance of a notification in the Gazette of India, declare that with effect from such date as may be specified in the notification, any series of Bank notes of any denomination shall cease to be legal tender, save at such office or agency of the Bank and to such extent as may be specified in the notification. Further discussion on this provision shall be made at a later stage as the said provision is the centre of the controversy in these cases. 7.10 Pursuant to the demonetisation which was carried out in the year 1946, bank notes of denominational value of Rs.500/-, Rs.1,000/- and Rs.10,000/-, issued before 13th
January, 1946, ceased to be legal tender. Section 26A was inserted into the Act pursuant to the demonetisation which took place in the year 1946 , which was initially by an Ordinance and subsequently by an Act of Parliament. Section 26A was inserted into the Act by Act 62 of 1956, with effect from 01.11.1956. 7.11 Section 27 provides that if a note is torn, defaced or excessively spoiled, the Bank shall not re-issue such a note. Similarly, Section 28 provides that if a currency note of the Government of India or bank note is lost, stolen, mutilated or imperfect, the value of same cannot be recovered from the Central Government or the Bank by any person. 7.12 Section 28A speaks of issue of special bank notes and special one-rupee notes in certain cases. The said provision was inserted by Act 14 of 1959 with effect from 8. We have heard learned senior counsel as well as counsel for the petitioners, and the learned Attorney General for India and learned senior counsel for the respondent-Bank, all assisted by learned counsel. 8.1 According to the learned senior counsel, Shri P. Chidambaram, appearing for some of the petitioners, the Central Government has the power to issue a notification in the Gazette of India declaring any series of bank notes of any denomination as having ceased to be legal tender and demonetise such currency notes, subject to compliance of certain procedural conditions prescribed under sub-section (2) of Section 26 of the Act. According to him, first, there has to be a recommendation of the Central Board of the Bank to the Central Government before the latter can issue a notification in the Gazette of India, demonetising any series of bank note of any denomination. That the Central Government cannot, by a simple notification in the Gazette of India, suo moto and in the absence of any recommendation of the Central Board of the Bank, demonetise any currency note in circulation by issuance of a gazette notification under the said provision. 8.2 Also, the Central Government can demonetise only a particular series of bank notes of a particular denomination on the recommendation of the Central Board of the Bank. In
other words, the expression “any” series of bank notes of “any denomination” cannot be understood as “all” series of bank notes of “all” denominations. That the expression “any” occurring twice in the section must be given the intended meaning and not supposed meaning and interpretation. 8.3 Shri Chidambaram submitted that in the instant case, the Central Government without complying with the procedure envisaged under sub-section (2) of Section 26 of the Act, simply issued a notification in the Gazette of India on 8th November, 2016 demonetising all series of bank notes of the denominations of Rs.500/- and Rs.1,000/-. Consequently, approximately 86 per cent of all notes in circulation were demonetised. The serious effects of demonetisation are well-known and judicial notice of the same may be taken. Even otherwise, carrying out the demonetisation by simply issuing a notification, in the absence of a recommendation made by the Central Board of the Bank, which is a condition precedent, is unlawful. Further, all series of bank notes of Rs.500/- and Rs.1,000/- could not have been demonetised by a stroke of a pen. The expression “any” in sub-section (2) of Section 26 of the Act means, “a particular” series of “a particular denomination” of a bank note, and not “all” series of “all” denominations. He contended that in the instant case, the issuance of the Notification, demonetising the entire currency of Rs.500/- and Rs.1,000/- in circulation at the time, is unlawful and the exercise of power was erroneous and arbitrary and hence, the same ought to be declared so. 8.4 Learned senior counsel emphasized that sub-section (2) of Section 26 of the Act must be given an interpretation which is legally workable and practicable and this Court ought not give a blanket power to the Central Government to demonetise all currency of a particular denomination, as such action would be contrary to the object envisaged under sub-section (2) of Section 26 of the Act.
8.5 Further elaborating on his submission, learned senior counsel for the petitioners contended that the expression “any” ought not be interpreted as “all” as such an interpretation would be disastrous to the Indian economy and contrary to the true letter and spirit of the Act. He contended that the word “any” means “one of the many” and not “all”. Therefore, according to him, any one series of bank notes of a denomination could be demonetised and not all series of notes of a particular denomination or all series of bank notes of all denominations, by issuance of an executive notification. He contended that if the Section is read down, then, it would be saved from the vice of unconstitutionality; otherwise, the power of the Central Government to demonetise all series of bank notes of all denominations would be arbitrary and an excessive power, which is devoid of any guidance. That such power if vested with the Central Government, would be contrary to the provisions of the Act. He further contended that exercise of discretion by the Central Government could be only to the extent of demonetisation of particular series of bank notes of any particular denomination that too on the recommendation of the Central Board of the Bank. Such vast powers so as to recommend demonetisation of all series of bank notes of any or all denominations, cannot also be vested with the Bank. 8.6 Learned senior counsel, Shri Shyam Diwan appearing for the petitioner, namely, Malvinder Singh in Writ Petition ( Civil ) No.149 of 2017, submitted that apart from the guarantee given by the Central Government with regard to every bank note as a legal tender at any place in India, such notes are also the liabilities of the Issue Department of the Bank under Section 34 of the Act to the extent of an amount equal to the total of the value of the currency notes of the Government of India and bank notes for the time being in circulation. 8.7 Learned senior counsel submitted that in the absence of a specific duty with regard to mitigating the long-lasting effects of demonetisation on the Indian economy, the decision of the Central Government to demonetise about 86.4% of the total currency in
circulation is vitiated on account of manifest arbitrariness. 8.8 The learned senior counsel further contended that by applying the test of proportionality, the impugned notification dated 8th November, 2016, is liable to be set 8.9 Reliance was placed on K.S. Puttaswamy (Retired) (Aadhaar) vs. Union of India (2019) 1 SCC 1 to contend that the classical equality test can be applied to the present case to come to the conclusion that the decision of demonetisation had no nexus to the objective sought to be achieved. 8.10 It was further contended that the circular dated 31st December, 2016, is discriminatory, insofar as it prescribed no upper monetary limit applicable to Resident Indians for submission and exchange of Specified Bank Notes, which were declared to have ceased to be legal tender; however, the monetary limit of Rs. 25,000/- per individual was fixed for Non-Resident Indians ( NRIs), depending on when the notes were taken out of India in accordance with the FEMA Rules. That an additional liability was imposed on NRIs as they had to produce a certificate issued by the Indian Customs upon arrival after 30th December, 2016, indicating the import of SBNs and the details and value of the same. 8.11 The learned senior counsel brought to the Court’s notice an article titled “Using Fast Frequency Household Survey Data to Estimate the Impact of Demonetisation on Employment” authored by Mr. Mahesh Vyas, Centre for Monitoring Indian Economy (2018) to contend that owing to the demonetisation carried out, there was a substantial reduction in employment and employment rates were 12 million lower than it was two months’ preceding demonetisation. Relying on the said article, he submitted that demonetisation resulted in a loss of millions of jobs. 9. Per contra, learned Attorney General for India, Shri R.Venkataramani, vehemently countered the arguments of Shri P.Chidambaram, learned senior counsel, by contending that the power vested with the Central Government under sub-section (2) of Section 26 of the Act is not arbitrary or without guidance. That the power to demonetise any currency
note or legal tender is vested with the Central Government and such power is of a wide import and amplitude and this Court may not give an interpretation, restricting the said power. He contended that the power vested with the Central Government is exercised by the issuance of a notification in the Gazette of India which is on the basis of a recommendation of the Central Board of the Bank. 9.1 In this regard, learned Attorney General emphasized that earlier demonetisations were carried out in the years 1946 and 1978 by issuance of Ordinances and thereafter, converting the said Ordinances into Acts of Parliament. But in the instant case, the demonetisation dated 8th November, 2016 was for all series of bank notes of Rs.500/- and of Rs.1,000/- denominations, by the issuance of a gazette notification, which is perfectly valid in the eyes of law and in accordance with sub-section (2) of Section 26 of the Act. 9.2 Learned Attorney General contended that the impugned gazette notification was issued having regard to the salient objectives that had to be achieved by the demonetisation of Rs.500/- and Rs.1,000/- currency notes which are set out clearly in the notification dated 8th November, 2016. The salient objectives of demonetisation in the year 2016 were to eradicate black money, to eliminate fake currency from the Indian economy and to prevent terror funding. He therefore, contended that there is no merit in the submissions made by the learned senior counsel appearing for the petitioners as the impugned notification dated 8th November, 2016 is in accordance with sub-section (2) of Section 26 of the Act and therefore, is valid. 9.3 Shri R.Venkataramani, learned Attorney General, next submitted that the action taken by way of the impugned notification stands ratified by the 2017 Act and as the executive action has been validated by the will of the Parliament, the challenge to the notification would not survive. 9.4 The learned Attorney General contended that the word “any” appearing before the words “series of bank notes” in sub-section (2) of Section 26 of the Act should be
construed to mean “all”. He submitted that the argument of the petitioners that the word “any” would not mean “all” is flawed and if the same is accepted, it would permit the Government to issue separate notifications for each series, however, the Government would be prohibited from issuing a common notification for all series. 9.5 The learned Attorney General submitted that the word “any” has been used in two places in sub-section 2 of Section 26 of the Act and the word “any” preceding the word “series of bank notes” has to be construed to mean “all” whereas the word “any” preceding the word “denomination” may be construed to be a singular or otherwise. The learned Attorney General placed reliance on Maharaj Singh vs. State of Uttar Pradesh (1977) 1 SCC 155 to contend that the same word used in the same provision twice could be permitted to have a different meaning in each of such usages. 9.6 The learned Attorney General contended that the submission made by the petitioners that the powers under sub-section (2) of Section 26 of the Act have not been exercised in the manner provided therein and that the decision-making process was flawed on account of patent arbitrariness, is not tenable. He submitted that sub-section (2) of Section 26 of the Act postulates that the Central Government may take a decision to carry out demonetisation pursuant to the recommendation of the Central Board of the Bank and in the present case, there was a recommendation made by the Central Board to the Central Government, recommending demonetisation. Thus, after considering the proposal of the Central Board, the Central Government took the decision to carry out demonetisation. Thus, the procedure as envisaged in sub-section (2) of Section 26 of the Act was duly complied with. 9.7 The learned Attorney General placed reliance on Bajaj Hindustan Limited vs. Sir Lal Enterprises Limited (2011) 1 SCC 640 wherein it was observed that economic and fiscal regulatory measures are fields on which Judges should encroach upon very warily as Judges are not experts in these matters. The learned Attorney General submitted that
the Bank is an expert body charged with the duty of conceiving and implementing various facets of economic and monetary policy and that there cannot be a straitjacket formula guiding the discharge of its duties. That therefore, it must be allowed to carry out its functions as it deems fit. The learned Attorney General further placed reliance on Rajbir Singh Dalal (Dr.) vs. Chaudhari Devi Lal University, Sirsa (2008) 9 SCC 284 and Secretary and Curator, Victoria Memorial Hall vs. Howrah Ganatantrik Nagrik Samity (2010) 3 SCC 640 to contend that it is settled law that the courts should not interfere with the opinion of experts. 9.8 Shri Jaideep Gupta, learned senior counsel for the Bank contended that the withdrawal of all series of bank notes of the two denominations of Rs.500/- and Rs.1,000/- was well within the jurisdiction and power conferred upon the Bank and the Central Government under sub-section (2) of Section 26 of the Act and it is incorrect to say that the process under sub-section (2) of Section 26 of the Act had not been followed. Thus, the process cannot be criticized on the ground of procedural lapse on part of the Bank or the Central 9.9 Learned senior counsel for the Bank further contended that the submission of the petitioners that unless the phrase “any” in sub-section (2) of Section 26 of the Act is read as “some” or “one”, the power conferred upon the Bank and the Central Government under the said section would be unguided and arbitrary, is without any basis. It was submitted that the expression “any” when construed literally refers to one, several or all of a total number. Thus, the expression “any” used in subsection (2) of Section 26 of the Act is broad enough to include “all”, and consequently, the power of the Government under sub-section (2) of Section 26 of the Act is not limited merely to a specific set or “series” alone. It was thus contended that subsection (2) of Section 26 of the Act is an enabling provision conferring authority on the Central Government to declare that any series of
bank notes of any denomination shall cease to be legal tender on the recommendation of 9.10 Learned senior counsel for the Bank also submitted that the decision of the Central Board of the Bank to recommend the measure of demonetisation and the decision of the Central Government to accept the recommendation cannot be subject to judicial review. It was further contended that in the sphere of economic policy making, the Wednesbury principles are of no or little significance and that the proportionality principle can also not be applied for judicial review of economic policy. Learned senior counsel thus asserted that it is imperative that no restrictions are placed on economic policies formulated by the Bank or by the Central Government. Reliance was placed on Peerless General Finance and Investment Co. Ltd. vs. Reserve Bank of India (1992) 2 SCC 343 and BALCO Employees’ Union (Regd.) vs. Union of India (2002) 2 SCC 333 to contend that courts cannot interfere with economic policy which is the function of experts. 9.11 Learned senior counsel for the Bank further submitted that the contention of the petitioners that the decision-making process was faulty on account of not following the procedure under subsection (2) of Section 26 of the Act, is without substance. Shri Jaideep Gupta, submitted that the procedure under sub-section (2) of Section 26 contemplates two things i.e., recommendation of the Central Board, and the decision by the Central Government and that in the present case, both the requirements have been duly followed, thus, the argument advanced on behalf of the petitioners does not hold any water. 9.12 Learned senior counsel for the Bank placed reliance on Jayantilal Ratanchand Shah vs. Reserve Bank of India (1996) 9 SCC 650 to contend that a similar provision providing for a specified time for exchange of notes was found to be valid by a Constitution Bench of this Court, while adjudicating on the legality of the 1978 demonetisation. He submitted that the time provided in the present case is similar to the time provided under the 1978 Act and the time period provided in the said act was found to be reasonable, having regard to the purpose sought to be achieved by the said Act. The learned senior
counsel further submitted that everybody had sufficient opportunity either to deposit the notes in their banks or to exchange the same. 9.13 Learned senior counsel for the Bank submitted that demonetisation was carried out in furtherance of national economic interest and the same ought to be given deference. That the inconvenience caused to the public cannot be a ground to challenge the validity of such actions, particularly when prompt and adequate measures were taken by the Bank to mitigate the temporary hardships expected to be caused. 9.14 Learned senior counsel for the Bank submitted that the Specified Bank Notes (Cessation of Liabilities) Act, 2017, has given relief to certain categories of persons subject to verification. It was thus contended that individual cases of hardship that have not been provided for in the Specified Bank Notes (Cessation of Liabilities) Act, 2017, cannot be gone into. 9.15 It was further submitted that Section 8 of the RBI Act, 1934, provides for the composition of the Central Board and subsection 1 of Section 4 stipulates that the Central Board shall consist of the following Directors, namely: i) A Governor and not more than four Deputy Governors to be appointed by the ii) Four Directors to be nominated by the Central Government, one from each of the four Local Boards as constituted under Section 9; iv) Two Government officials to be nominated by the Central Government. It was submitted that the 561st meeting of the Central Board of the Bank was held on 08.11.2016 at New Delhi and business was transacted therein with the requisite quorum. That during the said meeting, apart from the then Governor and two Deputy Governors, one Director nominated under Section 8(1)(b) of the Act, two Directors nominated under Section 8(1)(c ) of the Act and two Directors nominated under Section 8(1)(d) of the Act were present. Thus, the requisite quorum of four directors of whom not less than three directors nominated under Section 8(1)(b) or 8(1)(c) were present for the meeting. Thus, the requisite procedure was duly followed by the Bank in the conduct of the 561st meeting of the Central Board.
Other learned senior counsel as well as learned counsel and parties-in-person have also addressed the Court. 10. Before proceeding to consider the rival contentions, it would be useful to delineate on the concept of demonetisation and how it has been carried out, the world over as well as in India. 10.1 In prosaic terms, demonetisation is the process by which a nation’s economic unit of exchange loses its legally enforceable validity. Currencies that are terminated through the process of demonetisation are no more legally considered exchanges and have no financial value. Demonetisation is therefore, the process of eliminating the lawful acceptance status of a monetary unit, by withdrawal of certain kinds or denominations of existing currency from circulation. The currency withdrawn may be supplanted with new 10.2 The French were the first to use the term “Demonetise” in the years between the years 1850-1855. In world history, one can see several instances of demonetisations as many countries have adopted the policy of demonetisation. Some instances of demonetisation globally, may be recorded as under: a) United States of America: One of the oldest examples of demonetisation may be found in the United States, when the Coinage Act of 1873, ordered the elimination of silver as legal tender in favour of the gold standard. Again, in the year 1969, to combat the existence of black money in the country and to restore the country’s economy, President Richard Nixon declared all currencies over $100 to be null. b) Britain: Before the year 1971, the currency of pound and penny used to be in circulation in Britain but to bring uniformity in currency, the government stopped circulation of old currency in 1971, and introduced coins of 5 and 10 pounds. c) Congo: Mobutu Sese Seko made some changes with respect to the currency in circulation in Congo, for the smooth running of its economy during the Nineties. d) Ghana: In the year 1982, Ghana demonetised notes of 50 Cedis denomination to tackle tax evasion and empty excess e) Nigeria: Demonetisation was carried out during the government of Muhammadu
Buhari in the year 1984, when Nigeria introduced new currency and banned old notes. f) Myanmar: In the year 1987, Myanmar’s military invalidated around 80% of the value of money to curb black marketing. g) Russia (formerly U.S.S.R): In the year 1991, in an attempt to combat the parallel economy, 50 and 100 Ruble notes were removed from circulation under the leadership of h) Venezuela: In the year 2016, the Government of Venezuela demonetised 100 Bolívares notes on 11th December, 2016, to achieve economic, monetary and price i) Zimbabwe: In 2015, the Zimbabwean government chose to replace the Zimbabwe Dollar with the US Dollar in order to stabilize hyperinflation. j) The first demonetisation was carried out on 12th January, 1946 . To bring to realisation the first demonetisation that the country witnessed, an Ordinance was promulgated by the Government on 12th January, 1946. The Ordinance demonetised currency notes of Rs.500/-, Rs.1,000/- and Rs.10,000/- which were in circulation, primarily to check the unaccounted hoarding of money, with a directive that they could be exchanged for re-issued bank notes, within ten days. The period of exchange was extended a number of times by both, the Bank and the Central Government. By the end of 1947, out of a total of Rs.143.97 crores of high denomination notes, notes of the value of Rs.134.9 crores had been exchanged. Thus, notes worth Rs.9.07 crores went out of circulation or not exchanged. It is said that this exercise turned out to be more like a currency conversion drive as the government couldn’t achieve much profit in the cash-strapped economy at that time. k) The second demonetisation was carried out in the year 1978 , in pursuance of the recommendation of the Wanchoo Committee, appointed by the Central Government, to recall the re-introduced Rs.1,000/-, Rs.5,000/- and Rs.10,000/notes, entirely from the cash system. The stated objective of such measure was to nullify black money supposedly held
in high denomination currency notes. The government resorted to demonetisation of bank notes of denominations Rs.1,000/-, Rs.5,000/-, and Rs.10,000/- notes on 16th January, 1978, under the High Denomination Bank Notes ( Demonetisation) Ordinance, 1978 (No. 1 of 1978) and people were allowed three days’ time to exchange their notes. During this demonetisation exercise, out of a value of Rs.146 Crores demonetised notes, currency notes of value of Rs.124.45 Crores were exchanged and a sum of Rs.21.55 Crores, or 14.76% of the demonetised currency notes, were extinguished. 11. It would be useful at this stage to discuss briefly the Acts of 1946 and 1978 and the impugned demonetisation having regard to sub-section (2) of Section 26 of the Act. 11.1 The Ordinance of 12th January, 1946 stated that on the expiry of the 12th Day of January, 1946, all high denomination bank notes shall, notwithstanding anything contained in Section 26 of the Act, cease to be legal tender in payment or on account at any place in British India. A provision was made for the exchange of the high denomination bank notes which had ceased to be legal tender, with bank notes of the denominational value of Rs.100/- which continued to be legal tender. 11.2 The High Denomination Bank Notes (Demonetisation) Act, 1978 was enacted in public interest and provided demonetisation of certain high denomination bank notes and for matters connected therewith or incidental thereto. The said Act, interalia, defined a high denomination bank note to be a bank note of the denominational value of Rs.1,000/-, Rs.5,000/- or Rs.10,000/-, issued by the Reserve Bank of India immediately before the commencement of the said Act. The said Act also stated in Section 3 that on the expiry of the 16th Day of January, 1978, all high denomination bank notes shall, notwithstanding anything contained in Section 26 of the Act, cease to be legal tender.
11.3 As noted earlier, the previous demonetisations were not carried out on the strength of sub-section (2) of Section 26 of the Act inasmuch as both the legislations categorically stated that the demonetisation was “notwithstanding anything contained in Section 26 of the Act”. In fact, under the 1978 Act, one of the objects of the demonetisation of high denomination bank notes was that such notes facilitated illicit transfer of money for financial transactions which were harmful to the national economy or were used for illegal purposes and therefore, it was necessary in public interest to demonetise the high denomination bank notes. The use of the non-obstante clause clearly indicates that the Central Government was not demonetising the currency on the recommendation of the Central Board of the Bank under sub-section (2) of Section 26 of the Act. In fact, this position is demonstrated by the fact that in the year 1978, the then Central Government sought an opinion of the Central Board of the Bank regarding the demonetisation of high denomination bank notes. The proposal for demonetisation arose from or was initiated by the Central Government which sought the opinion of the Central Board of the Bank. Therefore, the proposal for demonetisation initiated by the Central Government was de hors sub-section (2) of Section 26 of the Act. 11.4 The fact that the non-obstante clause found a place in Section 3 of the Ordinance of 1946 as well as in Section 3 of the 1978 Act, would clearly indicate that the Central Government, in those cases, did not demonetise the high denomination bank notes on the recommendation made by the Central Board of the Bank under sub-section (2) of Section 26 of the Act but on the other hand, the same was carried out de hors the said provision by plenary legislations. Hence, the Central Government which initiated the process chose the route through legislation for carrying out the demonetisation rather than by issuing an executive notification in the Gazette of India. 11.5 The above is in contrast with the issuance of the gazette notification dated 8th November, 2016, which was followed by the Ordinance of 2016 and then the Act of 2017
was enacted. The said Act, inter alia, provides that the specified bank notes would cease to be the liability of the Reserve Bank of India or the Central Government. 11.6 The demonetisation carried out in the year 2016, of all series of bank notes of denomination Rs.500/- and Rs.1,000/- which forms the subject matter of the controversy at hand was, on the other hand, carried out by the Central Government by issuance of a notification in the Gazette of India on 8th November, 2016. For ease of reference, the impugned notification dated 8th November, 2016 is extracted as under: (Department of Economic Affairs) S.O. 3407(E). — Whereas, the Central Board of Directors of the Reserve Bank of India (hereinafter referred to as the Board) has recommended that bank notes of denominations of the existing series of the value of five hundred rupees and one thousand rupees (hereinafter referred to as specified bank notes) shall be ceased to be legal tender; And whereas, it has been found that fake currency notes of the specified bank notes have been largely in circulation and it has been found to be difficult to easily identify genuine bank notes from the fake ones and that the use of fake currency notes is causing adverse effect to the And whereas, it has been found that high denomination bank notes are used for storage of unaccounted wealth as has been evident from the large cash recoveries made by law And whereas, it has also been found that fake currency is being used for financing subversive activities such as drug trafficking and terrorism, causing damage to the economy and security of the country and the Central Government after due consideration has decided to implement the recommendations of the Board; Now, therefore, in exercise of the powers conferred by sub-section (2) of section 26 of the Reserve Bank of India Act, 1934 (2 of 1934) (hereinafter referred to as the said Act), the Central Government hereby declares that the specified bank notes shall cease to be legal tender with effect from the 9th November, 2016 to the extent specified below, namely: - 1. (1) Every banking company defined under the Banking Regulation Act, 1949 (10 of 1949)
and every Government Treasury shall complete and forward a return showing the details of specified bank notes held by it at the close of business as on the 8th November, 2016, not later than 13:00 hours on the 10 th November, 2016 to the designated Regional Office of the Reserve Bank of India (hereinafter referred to as the Reserve Bank) in the format specified by it. (2) Immediately after forwarding the return referred to in sub-paragraph (1), the specified bank notes shall be remitted to the linked or nearest currency chest, or the branch or office of the Reserve Bank, for credit to their accounts. 2. The specified bank notes held by a person other than a banking company referred to in sub-paragraph (1) of paragraph 1 or Government Treasury may be exchanged at any Issue Office of the Reserve Bank or any branch of public sector banks, private sector banks, foreign banks, Regional Rural Banks, Urban Cooperative Banks and State Cooperative Banks for a period up to and including the 30th December, 2016, subject to the following conditions, namely: — (i) the specified bank notes of aggregate value of Rs.4,000/- or below may be exchanged for any denomination of bank notes having legal tender character, with a requisition slip in the format specified by the Reserve Bank and proof of identity; (ii) the limit of Rs.4,000/- for exchanging specified bank notes shall be reviewed after fifteen days from the date of commencement of this notification and appropriate orders may be issued, (iii) there shall not be any limit on the quantity or value of the specified bank notes to be credited to the account maintained with the bank by a person, where the specified bank notes are tendered; however, where compliance with extant Know Your Customer (KYC) norms is not complete in an account, the maximum value of specified bank notes as may be deposited shall (iv) the equivalent value of specified bank notes tendered may be credited to an account maintained by the tenderer at any bank in accordance with standard banking procedure and on production of valid proof of Identity; (v) the equivalent value of specified bank notes tendered may be credited to a third-party
account, provided specific authorisation therefor accorded by the third party is presented to the bank, following standard banking procedure and on production of valid proof of identity of the (vi) cash withdrawal from a bank account over the counter shall be restricted to Rs.10,000/- per day subject to an overall limit of Rs.20,000/- a week from the date of commencement of this notification until the end of business hours on 24th November, 2016, after which these limits shall (vii) there shall be no restriction on the use of any non-cash method of operating the account of a person including cheques, demand drafts, credit or debit cards, mobile wallets and electronic fund transfer mechanisms or the like; (viii) withdrawal from Automatic Teller Machines (hereinafter referred to as ATMs) shall be restricted to Rs.2,000/- per day per card up to 18th November, 2016 and the limit shall be raised to Rs.4,000/- per day per card from 19th November, 2016; (ix) any person who is unable to exchange or deposit the specified bank notes in their bank accounts on or before the 30 th December, 2016, shall be given an opportunity to do so at specified offices of the Reserve Bank or such other facility until a later date as may be specified by it. 3. (1) Every banking company and every Government Treasury referred to in sub-paragraph (1) of paragraph 1 shall be closed for the transaction of all business on 9th November, 2016, except the preparation for implementing this scheme and remittance of the specified bank notes to nearby currency chests or the branches or offices of the Reserve Bank and receipt of bank notes having legal tender character. (2) All ATMs, Cash Deposit Machines, Cash Recyclers and any other machine used for receipt and payment of cash shall be shut on 9th and 10th November, 2016. (3) Every bank referred to in sub-paragraph (1) of paragraph 1 shall recall the specified bank notes from ATMs and replace them with bank notes having legal tender character prior to reactivation of the machines on 11th November, 2016. (4) The sponsor banks of White Label ATMs shall be responsible to recall the specified bank
notes from the White Label ATMs and replacing the same with bank notes having legal tender character prior to reactivation of the machines on 11th November, 2016. (5) All banks referred to in sub-paragraph (1) of paragraph 1 shall ensure that their ATMs and White Label ATMs shall dispense bank notes of denomination of Rs.100/- or Rs.50/-, until further instructions from the Reserve Bank. (6) The banking company referred to in subparagraph (1) of paragraph 1 and Government Treasuries shall resume their normal transactions from 10th November, 2016. 4. Every banking company referred to sub-paragraph (1) of paragraph 1, shall at the close of business of each day starting from 10th November, 2016, submit to the Reserve Bank, a statement showing the details of specified bank notes exchanged by it in such format as may be specified by the Reserve Bank. The said Notification was thereafter followed by an Ordinance issued by the President on 30th December, 2016 and subsequently an Act of Parliament namely, the 12. The contention of the leaned senior counsel for the petitioners is two-fold: firstly, that sub-section (2) of Section 26 of the Act cannot be interpreted as having a very wide import as it would then be lacking in guidance and being unchanneled, would be arbitrary and in violation of Article 14, and hence, unconstitutional. It was further contended that if the provision has to be saved from being declared unconstitutional, then the same has to be “read down” which means that a restrictive interpretation must be given to the words of the provision. The second contention is with regard to the exercise of power by the Central Government by issuance of the Notification dated 8th November, 2016 and the manner in which such power was exercised and the procedure followed. The aforesaid two contentions shall be dealt with together as they are intertwined. The Reserve Bank of India: Bulwark of the Indian Economy: 13. Before considering the aforesaid two contentions, it would be useful to discuss the unique position that the Reserve Bank of India holds in the Indian economy. 13.1 Shri Chidambaram cited a recent judgment of this Court in the case of Internet &
Mobile Assn. of India vs. RBI (2020) 10 SCC 274 (“Internet and Mobile Assn. of India”) wherein one of us, V. Ramasubramanian, J. while dealing with the regulation of crypto-currency and virtual currency (VC) highlighted the importance of the Reserve Bank of India in the Indian economy. The salient observations made in the said judgment may a) That the Bank, established for the objects spelt out under Section 3(1) of the Act, is vested with the duty to operate the monetary policy framework in India; take over the management of currency from the Central Government and carry on the business of banking, in accordance with the provisions of the Act. b) That with a view to enable the Bank to perform the role spelt out above, the Act authorises it to carry on and transact businesses, as enlisted under Section 17 of the Act; confers under Section 22, sole and exclusive right on the Bank to issue bank notes in India, except in relation to notes of denomination, Rs.1; recognises under Section 26 (1) that every note issued by the Bank shall be a legal tender; vests with the Central Board of the Bank the power to recommend to the Central Government to declare any series of Bank notes of any denomination, to cease to be legal tender, under Section 26 (2) of the Act; prohibits under Section 38 any money from being put into circulation by the Central Government, except through the Bank. In short, it was held that the operation/regulation of the credit/financial system of the country rests, almost entirely, on the Bank. c) That the Bank is the sole repository of power for the management of currency in India. As regards the nature, amplitude and inalienability of the power that the Bank wields in the field of currency management, it was observed that what the Bank can do in this regard, the executive acting de-hors the aid of the Bank, is not adequately equipped to do. Recognising the importance of the role played by the Bank in matters pertaining to currency management, this Court declared that any observations/recommendations made
by the Bank to the Central Government in this regard, have to be accorded due deference. The pertinent observations of the Court on this aspect have been usefully extracted “192. But as we have pointed out above, RBI is not just any other statutory authority. It is not like a stream which cannot be greater than the source. The RBI Act, 1934 is a pre-constitutional legislation, which survived the Constitution by virtue of Article 372(1) of the Constitution. The difference between other statutory creatures and RBI is that what the statutory creatures can do, could as well be done by the executive. The power conferred upon the delegate in other statutes can be tinkered with, amended or even withdrawn. But the power conferred upon RBI under Section 3(1) of the RBI Act, 1934 to take over the management of the currency from the Central Government, cannot be taken away. The sole right to issue Bank notes in India, conferred by Section 22(1) cannot also be taken away and conferred upon any other Bank or authority. RBI by virtue of its authority, is a member of the Bank of International Settlements, which position cannot be taken over by the Central Government and conferred upon any other authority. Therefore, to say that it is just like any other statutory authority whose decisions cannot invite due deference, is to do violence to the scheme of the Act. In fact, all countries have Central Banks/authorities, which, technically have independence from the Government of the country. To ensure such independence, a fixed tenure is granted to the Board of Governors, so that they are not bogged down by political expediencies. In the United States of America, the Chairman of the Federal Reserve is the second most powerful person next only to the President. Though the President appoints the seven-member Board of Governors of the Federal Reserve, in consultation with the Senate, each of them is appointed for a fixed tenure of fourteen years. Only one among those seven is appointed as Chairman for a period of four years. As a result of the fixed tenure of 14 years, all the members of Board of Governors survive in office more than three Governments. Even the European Central Bank headquartered in Frankfurt has a President, Vice-President and
four members, appointed for a period of eight years in consultation with the European Parliament. Worldwide, central authorities/Banks are ensured an independence, but unfortunately Section 8(4) of the RBI Act, 1934 gives a tenure not exceeding five years, as the Central Government may fix at the time of appointment. Though the shorter tenure and the choice given to the Central Government to fix the tenure, to some extent, undermines the ability of the incumbents of office to be absolutely independent, the statutory scheme nevertheless provides for independence to the institution as such. Therefore, we do not accept the argument that a policy decision taken by RBI does not warrant any deference.” d) This Court acknowledged the pivotal position of the Bank in the economy of the country. That the powers of the Bank, may be exercised by way of preventive as well as curative measures. That such powers may be exercised to take preemptive action. However, such measures must be proportional and must be prompted by some semblance of any damage suffered by its regulated entities. The relevant observations “224. It is no doubt true that RBI has very wide powers not only in view of the statutory scheme of the three enactments indicated earlier, but also in view of the special place and role that it has in the economy of the country. These powers can be exercised both in the form of preventive as well as curative measures. But the availability of power is different from the manner and extent to which it can be exercised. While we have recognised elsewhere in this order, the power of RBI to take a pre-emptive action, we are testing in this part of the order the proportionality of such measure, for the determination of which RBI needs to show at least some semblance of any damage suffered by its regulated entities. But there is none. When the consistent stand of RBI is that they have not banned VCs and when the Government of India is unable to take a call despite several committees coming up with several proposals including two draft Bills, both of which advocated exactly opposite positions, it is not possible for us to hold that the impugned measure is proportionate.” 13.2 Shri Jaideep Gupta appearing for the Bank has brought to our notice the following
decisions to emphasize on the importance of the Reserve Bank of India: a) In Joseph Kuruvilla Vellukunnel vs. The Reserve Bank of India AIR 1962 SC 1371, this Court observed that the most important function of the Bank is to regulate the banking system. The Bank has been described as a Banker's Bank. Under the Act, the scheduled banks maintain certain balances and the Bank can lend assistance to those banks as a “lender of the last resort”. The Bank has also been given certain advisory and regulatory functions, but in its position as a central bank, it acts as an agency for collecting financial information and statistics. The Bank is also entrusted with the role of advising the Government and other banks on financial and banking matters, and for this purpose, the Bank keeps itself informed of the activities and monetary position of scheduled and other banks and inspects the books and accounts of Scheduled banks and advises the Government after inspection of the said books and accounts as to whether a particular bank should be included in the Second Schedule or not. That the Bank has been created as a central bank with powers of supervision, advice and inspection, over banks, particularly those desiring to be included in the Second Schedule or those already included in the Schedule. The Reserve Bank thus, safeguards the economy and the financial stability of the country. This Court in the said case also sounded a caveat in stating that it cannot be said that the Reserve Bank can never act mistakenly or even b) Subsequently, in Peerless General Finance and Investment Co. Ltd. vs. Reserve Bank of India (1992) 2 SCC 343 this Court once again recognized the status of the Reserve Bank in the Indian economy. In the said case it was observed that the Reserve Bank of India is a Banker’s Bank and a creature of statute. That the Reserve Bank of India has a large contingent of expert advice relating to the matters affecting the economy of the entire country. It was further observed that the Reserve Bank has an important role in the economy and financial affairs of India and one of its many important functions is to regulate the banking system in the country. The aforesaid discussion is relevant for the purpose of interpreting sub-section (2)
of Section 26 of the Act. The said provision clearly states that it is only on the recommendation of the Central Board of the Bank, that any series of bank notes of any denomination shall be declared to have ceased to be legal tender. 13.3 Before proceeding to interpret the said provision, it would be necessary to consider another aspect of the matter which has been emphasized by the learned Attorney General, i.e., with regard to the Court’s deference to the economic and monetary policies of the government and restraint that the Court must exercise in interfering with the said policies, unless the same are so irrational or unreasonable, so as to be declared to be The above submission was made in the context of the contention of the petitioners, that the decision-making process in the present case was deeply flawed as it was contrary to the scheme and procedure contained in sub-section (2) of Section 26 of the Act and hence, this Court may review the same and declare it to be in contravention, inter-alia, of statutory provisions of the Act. The aforesaid contention was vehemently opposed by learned Attorney General who submitted that courts cannot sit in judgment over economic policy matters of the Government. In this regard the following discussions could be made. Judicial Review of Economic Policy: The Indian judiciary has consistently exercised restraint with regard to judicial review of policy decisions. A few instances on which such restraint has been demonstrated, have been discussed as under: (a) In this regard reliance was placed by the learned Attorney General on a judgment of this Court in State of Tamil Nadu vs. National South Indian River Interlinking (b) In Rustom Cavasjee Cooper vs. Union of India AIR 1970 SC 565 (“Bank Nationalization Case”) it was observed that this Court was not the forum where conflicting policy claims may be debated; it is only required to adjudicate the legality of a measure which has little to do with relative merits of different political and economic (c) This Court in the case of State of M.P. vs. Nandlal Jaiswal (1986) 4 SCC 566 observed that the Government, as laid down in Permian Basin Area Rate Cases, 20 L
Ed (2d) 312, is entitled to make pragmatic adjustments which may be called for by particular circumstances. The court cannot strike down a policy decision taken by the Government merely because it feels that another policy decision would have been fairer or wiser or more scientific or logical. That courts could interfere only if the policy decision is patently arbitrary, discriminatory or mala fide. (d) In Peerless General Finance and Investment Co. Ltd. vs. RBI (1992) 2 SCC 343, this Court dithered to indulge itself with matters involving domains of the executive and the legislature concerning economic policy or directions given by Reserve Bank of India. This Court observed that it is unbecoming of judicial institutions to interfere with economic policy which is the prerogative of the Government, in consultation with experts in the field and that it is not the function of the courts to sit in judgment over matters of economic policy and it must necessarily be left to the expert bodies. (e) The validity of the decision of the Government to grant licence under the Telegraph Act, 1885 to non-government companies for establishing, maintaining and working of telecommunication system of the country pursuant to government policy of privatisation of telecommunications was challenged in Delhi Science Forum vs. Union of India AIR 1996 SC 1356. It was contended that telecommunications were a sensitive service which should always be within the exclusive domain and control of the Central Government and under no situation should be parted with by way of grant of license to non-government companies and private bodies. While rejecting this contention, this Court observed that: “... The national policies in respect of economy, finance, communications, trade, telecommunications and others have to be decided by Parliament and the representatives of the people on the floor of Parliament can challenge and question any such policy adopted by the (f) The reluctance of the court to judicially examine the merits of economic policy was again emphasised in Bhavesh D. Parish vs. Union and India (2000) 5 SCC 471. This Court opined that in the context of the changed economic scenario the expertise of people dealing with the subject should not be lightly interfered with. The consequences of such
an interdiction can have large-scale ramifications and can put the clock back for a number of years. That in dealing with economic legislations, this Court, while not jettisoning its jurisdiction to curb arbitrary action or unconstitutional legislation, should interfere only in those few cases where the view reflected in the legislation is not possible to be taken at (g) Buttressing the same aspect, in Balco Employees’ Union (Regd) vs. Union of India AIR 2002 SC 350, it was held that in a democracy, it is the prerogative of each elected Government to follow its own policy. This Court observed that often a change in Government may result in the shift in focus or change in economic policies and any such change may result in adversely affecting some vested interests. Unless any illegality is committed in the execution of the policy or the same is contrary to law or malafide, a decision bringing about change cannot per se be interfered with by the court. (h) In Directorate of Film Festivals vs. Gaurav Ashwin Jain AIR 2007 SC 1640, it was observed that the scope of judicial review of governmental policy is now well defined and the courts do not and cannot act as Appellate Authorities examining the correctness, suitability and appropriateness of a policy. This Court was also of the view that Courts are not Advisors to the executive on matters of policy which the executive is entitled to formulate, thus, the scope of judicial review when examining a policy of the government is to check whether it violates the fundamental rights of the citizens or is opposed to the provisions of the Constitution, or opposed to any statutory provision or manifestly arbitrary. It was thus held that the Courts cannot interfere with policy either on the ground that it is erroneous or on the ground that a better, fairer or wiser alternative is available. Legality of the policy, and not the wisdom or soundness of the policy, is the subject of judicial review. (i) In the case of DDA vs. Joint Action Committee, Allottee of SFS Flats AIR 2008 SC 1343, the Supreme Court held as under: “An executive order termed as a policy decision is not beyond the pale of judicial review. Whereas
the superior courts may not interfere with the nitty-gritty of the policy, or substitute one by the other but it will not be correct to contend that the court shall lay its judicial hands off, when a plea is raised that the impugned decision is a policy decision. Interference therewith on the part of the superior court would not be without jurisdiction as it is subject to judicial review.” “Broadly, a policy decision is subject to judicial review on the following grounds: (b) if it is dehors the provisions of the Act and the regulations; (d) if the executive policy is contrary to the statutory or a larger policy.” (j) In Small Scale Industrial Manufacturers Association (Regd.) vs. Union of India (2021) 8 SCC 511, a writ petition was preferred under Article 32 of the Constitution of India by the Small-Scale Industrial Manufactures Association, Haryana for an appropriate writ, direction or order directing the Union of India and others to take effective and remedial measures to redress the financial strain faced by the industrial sector, particularly, MSMEs due to the COVID-19 pandemic. This Court while considering the submissions of the parties on the issue of whether economic and/or policy decisions taken by the Government in their executive capacity are amenable to the jurisdiction of courts, held that it was the legality of the policy, and not the wisdom or soundness of the policy, that can be the subject of judicial review. This Court observed that courts do not play an advisory role to Government and economic policy decisions should be left to experts. This Court observed that it is not normally within the domain of any Court to weigh the pros and cons of the policy or to scrutinize it and test the degree of its beneficial or equitable disposition for the purpose of varying, modifying or annulling it, based on howsoever sound and good reasoning. It is only when a policy is arbitrary and violative of any Constitutional, statutory or any other provisions of law, that the Courts can interfere. 13.4 What emerges from an understanding of the decisions referred to above on the subject of judicial review of economic policy may be culled out as under:
i) That the court is not to sit in judgment over the merits of economic or financial policy; ii) That the scope of interference by a court is limited to instances where the impugned scheme or legislation in the economic arena has been enacted in violation of any Constitutional or statutory provisions; iii) That the court may not undertake a foray into the merits, demerits, sufficiency or lack thereof, success in realising the objectives etc., of an economic policy, as such an analysis is the prerogative of the Government in consultation with experts in the field. 13.5 Being mindful of the limited scope of judicial review permissible in matters concerning economic policy decisions, I shall limit my examination of the matter to such extent as is necessary for the purpose of determining whether the process concluding in the issuance of the impugned notification was correct or as being contrary to sub-section (2) of Section 26 of the Act and allied aspects of the case. It may be stated at this juncture that the said aspect of the matter is not one of form but of substance. Therefore, examining this aspect of the matter would not amount to interfering with, or sitting in judgment over the merits of the policy of demonetisation, and is therefore well within the limits of the Lakshmanrekha that this Court has carefully drawn for itself. 14. Bearing in mind the important role played by the Bank in shaping the economy of the country, and also the principle that the Constitutional Courts should refrain from interfering in financial and economic policy decisions of the government unless such policies are so irrational as to warrant interference and also having regard to the provisions of the Constitution, the relevant statutes, and considerations of public interest, the two contentions raised by the petitioners shall now be considered in analysing and interpreting Section 26 (2) of the Act. 15. With a view to lend perspective to the discussion to follow, a bird’s eye view of my analysis and conclusions has been expressed in a tabular form as under: Sl. No. Parameters When the proposal for When the proposal for for distinction demonetization originates by demonetization originates from way of a recommendation by the Central Government:
Central on consideration of the Bank’s initiates the proposal for Government recommendation, accept the demonetisation. It consults the same and act on such Bank on the same and seeks the 2. Role of the The Central Board of the Bank The Central Government consults Bank makes a recommendation to the Bank seeking advice on its demonetisation of “any” denomination, has denominations may be declared that may be been interpreted to mean at once, to have ceased to be proposed and “specified” series of legal tender having regard to the carried out “specified” denomination. situation faced by the Central Otherwise, it would be a case Government. 4. Considerations i) To promote general health of i) Sovereignty and Integrity of for proposed the Country’s economy; India; measure of ii) Fiscal policy considerations; ii) Security of the State; demonetisation iii) Monetary policy iii) To promote general health of (Illustrative) considerations. the Country’s economy; 5. Process/Route Issuance of a Notification in Enactment of a Parliamentary to be followed the Gazette of India, indicating Legislation, which may or may to carry out therein that “any” specified not be preceded by an Ordinance demonetisation series of “any” specified issued by the President of India. as specified in the Notification. 6. Applicability of Notification issued by the Sub-section (2) of section 26 of sub-section (2) Central Government, giving the Act is not applicable. of section 26 of effect to the Bank’s Hence, a notification in the the Reserve recommendation, shall be on Gazette of India is not the Bank of India the strength of subsection (2) manner in which demonetisation Act, 1934 of section 26 of the Act. is to be carried out, when the 15.1 Section 26 of the Act deals with legal tender of notes. Subsection (1) of Section 26 declares that every bank note shall be a legal tender at any place in India in payment or on account for the amount expressed therein, and shall be guaranteed by the Central Government. There are two aspects to this provision: the first is, every bank note shall be
a legal tender in any place in India and, secondly, that the Central Government shall guarantee the amount expressed on the bank note. The expression “bank note” is defined in Section 2 (aiv) of the Act to mean, a bank note issued by the Bank whether in physical or digital form, under Section 22 of the Act. Section 22 of the Act categorically states that the Bank has the sole right to issue bank notes in India, on the recommendations of the Central Board of the Bank. The provision further provides that the Bank has the sole right to issue currency notes of the Government of India. The provisions of the Act would be applicable in a like manner, to all currency notes of the Government of India, issued either by the Central Government or by the Bank, as if such currency notes were bank notes. 15.2 Further, it is only on the recommendation of the Central Board of the Bank that the Central Government may direct the nonissue or discontinuation of the issue of bank notes of such denominational value as it may specify in this behalf. Even the design, form and material of bank notes has to be approved by the Central Government, after considering the recommendations made by the Central Board of the Bank. Thus, the scheme of the Act envisages that the issuance of the bank notes, the various denominations of the bank notes, the design and form of the bank notes, are all to be specified by the Central Government only on the recommendation of the Central Board of the Bank. Therefore, on perusal of Sections 24, 25 and 26 of the Act, it is observed that it is only on the recommendation of the Central Board of the Bank that the Central Government would act qua the aforestated matters, on the strength of the respective provisions. It need not be emphasised that the Bank, being the only institution, which carries out the function of currency management and formulates credit rules in the country, is recognised as having a say in the issuance of currency notes, and also in specifying the denominations of the notes, as well as the design and form of the bank notes. 15.3 Further, although, sub-section (1) of Section 26 states that every Bank note shall be
legal tender at any place in India, it acquires legal sanctity because the Central Government has guaranteed the bank note which has legal tender. Thus, a bank note statutorily has dual characteristics when it is issued by the Bank, namely, being a legal tender coupled with the guarantee of the Central Government and the said qualities go hand in hand. This would mean that it is only when the Bank which has the sole right to issue a currency note in India, issues the note and the same has been guaranteed by the Central Government, that such a note is legal tender. Therefore, the Issue Department of the Bank is not subject to any liabilities other than the liabilities under Section 34 of the Act. Section 34 of the Act states that an amount equal to the total of the amount of the currency notes of the Government of India and bank notes for the time being in circulation, would be the liability of the Issue Department. This would imply that as long as the bank notes issued by the Bank are in circulation, the liability of the Government of India would continue. The said liability is owing to the guarantee given by the Central Government in subsection (1) of Section 26 which is in the nature of a statutory guarantee. 15.4 While considering sub-section (1) of Section 26 of the Act, the first question that would arise is, whether, a bank note which has ceased to be a legal tender on the issuance of a notification by the Central Government would also cease to have the guarantee of the Central Government. In other words, whether the guarantee by the Central Government, would continue despite the bank note ceasing to be a legal tender. The answer is in the affirmative, for, a bank note may cease to be a legal tender between citizens but cannot cease to have the guarantee of the Central Government, so long as the liability of the Issue Department continues. The liability of the Issue Department of the Bank is co-extensive with the time period within which a bank note which has ceased to be a legal tender is exchanged at a notified bank. It is because of this reason that a bank note of any denomination which is demonetised or is declared to have ceased to be a legal tender,
can be exchanged as indicated in the notification issued by the Central Government so that the bearer of the bank note receives an equivalent amount as that expressed in the note which has ceased to be a legal tender or demonetised. Therefore, even though such demonetised currency would cease to be legal tender, the same could be exchanged in a bank specified by the Reserve Bank owing to the guarantee of the Central Government. If the guarantee of the Central Government ceases on demonetisation, then the same cannot be exchanged by the bearer of such bank notes. This has also been the argument of learned senior counsel Shri Shyam Divan. 15.5 Sub-section (2) of Section 26 of the Act states that on the recommendation of the Central Board of the Bank, the Central Government may, by notification in the Gazette of India, declare that with effect from such date as specified in the notification, any series of bank notes of any denomination shall cease to be a legal tender, save at such office or agency of the Bank and to such extent as may be specified in the said notification. The Central Government derives the power to issue a notification in the Gazette only on the recommendation of the Central Board of the Bank. The issuance of such a notification is an executive act which is backed by the recommendation of the Central Board of the Bank which has been accepted by the Central Government. The notification has to indicate the date from which any series of bank notes of any denomination shall cease to be a legal tender, save at such office and to such extent as may be specified in the notification. 15.6 The essential ingredients of sub-section (2) of Section 26 of the Act can be i) on the recommendation of the Central Board of the Bank; ii) the Central Government by notification in the Gazette of India; iii) may declare any series of bank notes of any denomination to cease to be legal tender; iv) with effect from such date as may be specified in the notification; v) to such extent as may be specified in the notification; Therefore, under sub-section (2) of Section 26 of the Act, the Central Government would act only on the recommendation made by the Central Board of the Bank, which is
the initiator of demonetisation of bank notes. 15.7 Learned Attorney General made a pertinent submission that it is not necessary that only on a recommendation of the Central Board of the Bank, the Central Government can demonetise any currency. That the Central Government has the power or jurisdiction to demonetise any bank note by the issuance of a gazette notification. He further contended that the powers of the Central Government cannot be denuded to such an extent that unless and until a recommendation of the Central Board of the Bank is made to the Central Government, the latter cannot demonetise any currency. According to learned Attorney General, if such a strict interpretation is given to sub-section (2) of Section 26, it would nullify the power of the Central Government to demonetise any bank note, having regard to the economic conditions of the country, the financial health of the economy and the monetary policy of the Government. It was submitted that the provision must be so interpreted so as to give a free play in the joints and empower the Central Government to issue a notification in the Gazette of India, in order to demonetise any bank note. He further contended that the requirement of recommendation of the Central Board of the Bank in order to enable the Central Government to issue a notification to demonetise any currency would imply that the initiation of demonetisation must only be from the Central Board of the Bank and that the Central Government has no power to initiate such an action of demonetisation. 15.8 I find considerable force in the contention of the learned Attorney General inasmuch as the Central Government cannot be said to be without powers in initiating demonetisation of bank notes. This is on the strength of Entry 36 of List I of the Seventh Schedule of the Constitution. The Central Government is not just concerned with the financial health of the country as well as its economy, but it is also concerned with the sovereignty and integrity of India; the security of the State; the defence of the country; its friendly relations with foreign countries; internal and external security and various other aspects of governance. On the other hand, the Bank is only concerned with the regulation of currency notes, monetary policy framework, maintaining price stability and allied
matters. Therefore, if the Central Government is of the considered opinion that in order to meet certain objectives such as the ones stated in the impugned notification, namely, to eradicate black money, fake currency, terror funding etc., it is necessary to demonetise the currency notes in circulation, then the Central Government may initiate a proposal for 15.9 The second prong of the Learned Attorney General’s contention qua the interpretation of sub-section (2) of Section 26 of the Act was that the Central Government has the power to demonetise not just any one series of currency of any one denomination but it has the power to demonetise all series of currencies of all denominations at a time. It was argued that the expression “any” in sub-section (2) of Section 26 of the Act must 15.10 Per contra, it was the submission of the learned senior counsel for the petitioners that, as the said provision stands, in the absence of there being any guidance vis-à-vis the power of the Central Government to issue a notification to demonetise the currency notes in circulation and in order to save such measure from the vice of unconstitutionality, the expression “any series” and “any denomination” in sub-section (2) of Section 26 of the Act must be restricted to mean “one series” and “one denomination”, respectively. Otherwise, it could result in arbitrary exercise of power. He further contended that if subsection (2) of Section 26 of the Act is not read down in this context, it would confer unguided and arbitrary power on the executive Government and it would amount to impermissible delegation of legislative powers. 15.11 It was further contended by Shri Chidambaram that demonetisation is resorted to in rare and exceptional circumstances and there are two justifiable reasons for which demonetisation could be resorted to, namely, 1) to weed out denominations of currency that are in disuse or are practically unusable; 2) to get rid of currency which has become worthless in value because of According to learned senior counsel for the petitioners, if any demonetisation of
currency has to take place, and if the power of the Central Government is not channelised or restricted by reading down sub-section (2) of Section 26 of the Act, it would result in arbitrariness and unconstitutionality. Therefore, to save it from the vice of arbitrariness and unconstitutionality, it is necessary to read down the provision in the following two a) the Central Government has no power to demonetise any currency note except on the recommendation of the Central Board of the Bank under sub-section (2) of Section 26 b) the expression “any” in sub-section (2) of Section 26 of the Act must be restricted to be “any one”, that is, “one series” or “one denomination” of bank notes. That the addition of the words “any series” before the words “of bank notes of any denomination” limits the power of the Government to declare only a specified series of notes as no longer being a legal tender. Thus, “any series” means any specified series and not “all series” of notes of a given denomination. 15.12 Since I have accepted the contention of the learned Attorney General appearing for Union of India vis-à-vis the power of the Central Government for initiating the process of demonetisation, the next question would be, whether, the Central Government can, on initiating the process of demonetisation, proceed to issue a gazette notification to demonetise any or all series of any or all denomination of bank notes, on the strength of subsection (2) of Section 26 of the Act. Consideration of this issue would also answer the contention of learned senior counsel for the petitioners regarding sub-section (2) of Section 26 of the Act being unguided and arbitrary in nature and hence, unconstitutional. To this end, the following aspects have to be examined: (a) Whether demonetisation can be initiated and carried but by the Central Government by issuing a notification in the Gazette of India as per sub-section (2) of Section 26 of the (b) Extent of the Central Government’s power to carry out demonetisation, i.e., whether “all series” of “all denominations” may be demonetised.
15.13 As held hereinabove, the proposal for demonetisation can emanate either from the Central Government or from the Central Board of the Bank. It is however necessary to contrast the proposal for demonetisation initiated by the Central Government, with that initiated by the Central Board of the Bank. When the Central Board of the Bank recommends demonetisation, it is in my view, only for a particular series of bank notes of a particular denomination as specified in the recommendation made under sub-section (2) of Section 26 of the Act. The word “any” in sub-section (2) of Section 26 cannot be read to mean “all”. If read as “specified” or “particular” as against all, in my view, it would not suffer from arbitrariness or suffer from unguided discretion being given to the Central Board of the Bank. On the other hand, in my view, the Central Government has the power to demonetise all series of bank notes of all denominations, if the need for such a measure arises. It cannot be restricted in such powers in such manner as the Central Board of the Bank is, under the above provision. This is because such power is not exercised under sub-section (2) of Section 26 of the Act but is exercised notwithstanding the said provision by the Central Government. Therefore, demonetisation of bank notes at the behest of the Central Government is a far more serious issue having wider ramifications on the economy and on the citizens, as compared to demonetisation of bank notes of a given series of a given denomination on the recommendation of the Central Board of the Bank by issuance of a gazette notification by the Central Government. Therefore, in my considered view, the powers of the Central Government being vast, the same have to be exercised only through a plenary legislation or a legislative process rather than by an executive act by the issuance of a notification in the Gazette of India. It is necessary that the Parliament which consists of the representatives of the People of this country, discusses the matter and thereafter approves and supports the implementation of the scheme of demonetisation. 15.14 The Central Government, as already noted above, could have several compulsions
for initiating demonetisation of the bank notes already in circulation in the economy, and it could do so even in the absence of a recommendation, as per sub-section (2) of Section 26 of the Act, of the Central Board of the Bank. On its proposal to demonetise the bank notes, the advice/opinion of the Central Board of the Bank which has to be consulted may not always be in support of the proposal of the Central Government as in the year 1978. The Central Board of the Bank may give a negative opinion or a concurring opinion. In either of the situations, the Central Government may proceed to demonetise the bank notes but only through a legislative process, either through an Ordinance followed by a legislation, if the Parliament is not in session; or by a plenary legislation before the Parliament and depending upon the passage of the Bill as an Act, carry out its proposal of demonetisation. Of course, depending upon the urgency of the situation and possibly to maintain secrecy, the option of issuance of an Ordinance by the President of India and the subsequent enactment of a law is always available to the Central Government by convening the Parliament. Such demonetisation of currency notes at the instance of the Central Government cannot be by the issuance of an executive notification. The reasons (i) Firstly, because the Central Government is not acting under sub-section (2) of Section 26 of the Act. When the Central Government initiates the process of demonetisation it is de hors sub-section (2) of Section 26 of the Act. (ii) Secondly, the Central Government has the power to demonetise all series of bank notes of all denominations unlike the narrower powers vested with the Central Board of the Bank under the aforesaid provision, if the situation so arises. (iii) Thirdly, the Parliament which is the fulcrum in our democratic system of governance, must be taken into confidence. This is because it is the representative of the people of the Country. It is the pivot of any democratic country and in it rest the interests of the citizens of the Country. The Parliament enables its citizens to participate in the decision-making process of the government. A Parliament is often referred to as a “nation
in miniature”; it is the basis for democracy. A Parliament provides representation to the people of a country and makes their voices heard. Without a Parliament, a democracy cannot thrive; every democratic country needs a Parliament for the smooth conduct of its governance and to give meaning to democracy in the true sense. The Parliament which is at the centre of our democracy cannot be left aloof in a matter of such importance. Its views on the subject of demonetisation are critical and of utmost importance. Dr. Subhash C. Kashyap in his book, “Parliamentary Procedure: Law, Privileges, Practice and Precedents”, 3rd Ed., (2014), while discussing the functions of the Parliament “Over the years, the functions of Parliament have no longer remained restricted merely to legislating. Parliament has, in fact emerged as a multi-functional institution encompassing in its ambit various roles viz. developmental, financial and administrative surveillance, grievance ventilation and redressal, national integrational, conflict resolution, leadership recruitment and training, educational and so on. The multifarious functions of Parliament make it the cornerstone on which the edifice of Indian polity stands and evokes admiration from many a quarter.” It is in the above context that it is observed that on a matter as critical as demonetisation, having a bearing on nearly 86% of the total currency in circulation, the same could not have been carried out by way of issuance of an executive notification. A meaningful discussion and debate in the Parliament on the proposed measure, would have lent legitimacy to the exercise. When an Ordinance is issued or a Bill is introduced in the Parliament and enacted as a law, it would mean that it has been done by taking into confidence the Members of Parliament who are the representatives of the people of India, who would meaningfully discuss on the proposal for demonetisation made by the Central Government. In such an event, demonetisation would be by an Act of Parliament and not a measure carried out by the issuance of a gazette notification by the Central Government in exercise of its executive power. Such demonetisation through an Ordinance or a legislation through the Parliament
would be “notwithstanding what is contained in sub-section (2) of Section 26 of the Act”. This is because in such a situation, the Central Government is not acting on the basis of a recommendation received from the Central Board of the Bank but it would be proposing the demonetisation. Precedent for the same may be found in the earlier demonetisations which were also through a legislative process and not through the issuance of a gazette notification by the Executive/Central Government. When the process of demonetisation is carried out through a Parliamentary enactment and after being the subject of scrutiny by the Members of Parliament, any opinion sought by the Central Government from the Central Board of the Bank before initiating the promulgation of the Ordinance or placing the Bill before the Parliament may also be additional material which could be considered by the Parliament. When the Central Government initiates the proposal for demonetisation and thereafter consults the Bank on such proposal, then it could be said that the necessary safeguards were taken, as the Central Government would be fortified in its proposal for demonetisation having taken the advice of not only an expert body but the highest financial authority in the country, which handles not only the monetary policy but is also the sole authority vested with the power of issuance of bank notes or currency notes in India. When the Central Government proposes to demonetise the currency notes, not only the view of the Central Board of the Bank is relevant and important but also that of the representatives of the people in the Parliament. The Members of the Parliament hold the sovereign powers of “We, the People of India” in trust. 15.15 Of course, by contrast, there would be no difficulty if the proposal for demonetisation is initiated by the Central Board of the Bank by making a recommendation under sub-section (2) of Section 26 of the Act, which the Central Government in its wisdom may consider and either act upon the recommendation or for good reason, decline to act on the same. That is a matter left to the wisdom of the Central Government. However, as noted above such recommendation by the Bank cannot relate to “all” series of a denomination or “all” series of “all” denominations of bank notes. That is a prerogative of
only the Central Government. 15.16 It is nobody’s case that the impugned gazette notification dated 8th November, 2016, of the Central Government was published on the initiation of the proposal of demonetisation by the Central Board of the Bank. The proposal for demonetisation was initiated by the Central Government by a letter dated 7th November, 2016 addressed by the Finance Secretary to the Governor of the Bank. The Central Government, having “obtained” the advice of the Bank on its proposal, proceeded to issue the impugned gazette notification on the very next day, dated 8th November, 2016. The same was followed by an Ordinance and thereafter, an enactment was passed. 15.17 The contention of the petitioners could now be considered and answered. The words in sub-section (2) of Section 26 of the Act would have to be interpreted/construed in their normal parlance. It is already observed that issuance of such a notification under sub-section (2) of Section 26 of the Act must be preceded by a recommendation of the Central Board of the Bank and such recommendation is a condition precedent. The Central Government in its wisdom may accept the recommendation of the Central Board of the Bank and issue a notification in the Gazette of India or it may decline to do so. This position is evident from the use of the word “may” in subsection (2) to Section 26 of the Act. However, what is significant is that if demonetisation of any bank note is to take place under sub-section (2) of Section 26 of the Act, it is only by issuance of a notification in the Gazette of India and not by any other method or manner. In other words, the Central Board of the Bank must first initiate the process by recommending to the Central Government to declare that any series of bank notes of any denomination shall cease to be a legal tender by the issuance of a notification. If the Central Government accepts the recommendation of the Central Board of the Bank, it issues a notification in the Gazette of India carrying out the same, which is in the nature of an executive function and the publication of the notification in the Gazette of India is only a ministerial act.
15.18 Therefore, under sub-section (2) of Section 26 of the Act, the initiation of the process of demonetisation and the exercise of power originates from the Central Board of the Bank which has to recommend to the Central Government and the latter may accept the recommendation and in such event it would issue a gazette notification. In case the Central Government does not accept the recommendation, there will be no further action on the recommendation of the Central Board of the Bank. Thus, sub-section (2) of the Section 26 of the Act has inherently a very restricted operation, and is limited only to the initiation of demonetisation by the Central Board of the Bank and making a recommendation in that regard. Issuance of the notification, in the Gazette of India, would imply that the Central Government has accepted the recommendation of the Central Board of the Bank and therefore, has declared that the specified series of Bank notes of the specified denomination shall cease to be legal tender from the date to be specified in the notification. The operation of sub-section (2) of Section 26 of the Act is thus in a very narrow compass and it is reiterated that the said power is exercised by the Central Government on acceptance of the recommendation of the Central Board of the Bank. 15.19 The reason as to why a wide interpretation as contended by the Union of India cannot be given to sub-section (2) of Section 26 of the Act is because a plain reading of the provision as well as a contextual understanding, would suggest that it is only when the initiation of a proposal for demonetisation is by the Central Board of the Bank by making a recommendation to the Central Government that the provision would apply. 15.20 This position, however, does not imply that the Central Government is bereft of any power or jurisdiction to declare any bank note of any denomination to have ceased to be a legal tender. As already observed while accepting the contention of learned Attorney General, the Central Government in its wisdom may also initiate the process of demonetisation as has been done in the instant case. But what is important and to be noted is that the said power cannot be exercised by the mere issuance of an executive
notification in the Gazette of India. In other words, when the proposal to demonetise any currency note is initiated by the Central Government with or without the concurrence of the Central Board of the Bank, it is not an exercise of the executive power of the Central Government under sub-section (2) of Section 26 of the Act. In such a situation, as already held, the Central Government would have to resort to the legislative process by initiating a plenary legislation in the Parliament. 15.21 What is being emphasised is that the Central Government cannot act in isolation in such matters. The Central Government has to firstly, take the opinion of the Central Board of the Bank for the proposed demonetisation. The Central Board of the Bank may not accept the proposal of the Central Government or may partially concur with the proposal on specific aspects. In fact, in 1978, when the then Governor of the Bank did not accept the proposal of the Central Government to demonetise Rs.5,000/- and Rs.10,000/- bank notes, the Central Government initiated the said process through the Parliament and this culminated in the passing of the Act of 1978. In drafting the said legislation, the expert assistance of two officers of the Bank was taken so as to fortify the legislation. The said legislation was also challenged before this Court in the case of Jayantilal Ratanchand Shah, Devkumar Gopaldas Aggarwal vs. Reserve Bank of India (1996) 9 SCC 650 whereby the vires of the 1978 Act was ultimately, upheld by this Court vide judgement dated 9th August, 1996, after eighteen years of its enactment. 15.22 The reasons as to why the Central Government cannot unilaterally issue a gazette notification but has to resort to a legislation when it initiates the proposal for demonetisation have already been discussed. The Central Government may have very valid objectives to do so, as in the instant case, i.e., in order to eradicate black money, fake currency and prevent currency from being utilized for terror funding. But, those objects would not be the objects with which the Central Board of the Bank may make a
recommendation under sub-section (2) of Section 26 of the Act. The reason being, the Central Government would view the entire scheme of demonetisation in a larger perspective, having several objects in mind and in the interest of the sovereignty and integrity of the India, the security of the State, the financial health of the economy, etc. The Central Board of the Bank may not be in a position to visualize such objectives. Under such circumstances the Central Government must consult the Bank but need not mandatorily obtain the imprimatur of the Central Board of the Bank to its proposal. What if the Central Board of the Bank, when consulted by the Central Government, gives a negative opinion? Would it mean that the Central Government would then not resort to demonetisation in deference to the opinion of the Central Board of the Bank? It may do so if it finds that the opinion tendered by the Bank is just and proper, but the Central Government may have its own reasons for not accepting the opinion of the Central Board of the Bank and therefore, in such a situation the Central Government will have to resort to initiate the proposal for demonetisation through a plenary legislation, by way of introduction of a Bill in the Parliament resulting in an Act of Parliament. 15.23 Therefore, the sum and substance of the discussion is that when the Central Board of the Bank initiates or originates the proposal for demonetisation of any series of bank notes of any denomination, it has to make a recommendation to the Central Government as per sub-section (2) of Section 26 of the Act. The Central Government may act on such recommendation by issuing a gazette notification. On the other hand, when the Central Government is the originator of the proposal for demonetisation of any currency note as in the instant case, it has to seek the advice of the Central Board of the Bank, for, it cannot afford to proceed in isolation and without bringing the said proposal to the notice of the Central Board of the Bank having regard to the important position the Bank holds in the Indian economy. Irrespective of the opinion of the Central Board of the Bank to the Central Government’s proposal, the legislative route would have to be taken by the Central
Government for furthering its objective/s of demonetisation of bank notes. Thus, the same cannot be carried out by the issuance of a simple notification in the Gazette of India declaring that all bank notes or currency notes are demonetised. This is because when the Central Government is the originator of a proposal for demonetisation, it is acting de hors sub-section (2) of Section 26 of the Act. 15.24 Such an interpretation is necessary as it is the contention of the Union of India that the Central Government has the power to demonetise “all” series of bank notes of “all” denominations which would mean that every Rs.1/-, Rs.5/-, Rs.10/-, Rs.20/-, Rs.50/-, Rs.100/-, Rs.500/-, Rs.1,000/-, Rs.5,000/-, Rs.10,000/-, could be demonetised. Since the same is possible theoretically, in my view, such an extensive power cannot be exercised by issuance of a simple gazette notification in exercise of an executive power of the Central Government as if it is one under sub-section (2) of Section 26 of the Act. The same can only be through a plenary legislation, by way of an enactment following a meaningful debate in Parliament, on the proposal of the Central Government. This would also answer the other contention of the learned senior counsel for the petitioners that sub-section (2) of Section 26 of the Act cannot be interpreted to mean “all series” of bank notes of “all denominations” when the words used in the provision are “any series” of “any 15.25 The reason why power is vested only with the Central Board of the Bank under sub-section (2) of Section 26 of the Act to recommend to the Central Government to declare specified series of specific denomination of bank notes as having ceased to be legal tender, becomes clear when the plain meaning of the words of the said provision is recognised. When interpreted as such, no power to demonetise currency notes at the behest of the Central Government is envisaged under the said provision. This is because
the power of the Central Government to do so is vast and has a wider spectrum. Such a power is not traceable to sub-section (2) of Section 26 of the Act which operates in a narrower compass. Hence, to save sub-section (2) of Section 26 from the vice of unconstitutionality, it must be given an interpretation appropriate to the object for which the provision is intended. In this context, the following principles become relevant. 15.26 When the words of a statute are clear, plain or unambiguous, i.e., they are reasonably susceptible to only one meaning, the court is bound to give effect to that meaning and admit only one meaning and no question of construction of a statute arises, for, the provision/Act would speak for itself. The judicial dicta relevant to the above principle of interpretation are as follows: (i) In Kanailal Sur vs. Paramnidhi Sadhu Khan AIR 1957 SC 907 at Page 910 this Court observed that if the words used are capable of only one “construction” then it would not be open to the courts to adopt any other hypothetical construction on the ground that such hypothetical construction is more consistent with the purported object and policy of the Act. Reference was made to Section 162 of the Code of Criminal Procedure, 1898 and interpretation of the expression “any person” by Lord Atkin, speaking for the Privy Council who observed that the expression “any person” includes any person who may thereafter be an accused, and he observed that “when the meaning of the words is plain, it is not the duty of Courts to busy themselves with supposed intentions” vide Pakala Narayanaswami vs. Emperor AIR 1939 PC 47. (ii) Similarly, while construing Sections 223 and 226 of the Indian Succession Act, 1925 which contain a prohibition in relation to grant of Probate or Letters of Administration “to any association of individuals unless it is a company”, this Court in Illachi Devi vs. Jain Society Protection of Orphans India (2003) 8 SCC 413, applied the plain meaning rule and held that said expression would not include a society registered under the Societies Registration Act as a society even after registration does not become distinct from its
members and does not become a separate legal person like a company. (iii) For a proper application of the plain meaning rule to a given statute, it is necessary, to first determine, whether the language used is plain or ambiguous. “Any ambiguity” means that a phrase is fairly and equally open to diverse meanings. A provision is not ambiguous merely because it contains a word which in different contexts is capable of different meanings. It is only when a provision contains a word or phrase which in a particular context is capable of having more than one meaning that it would be ambiguous. (iv) Hence, in order to ascertain whether certain words are clear and unambiguous, they must be studied in their context. Context in this connection is used in a wide sense as including not only other enacting provisions of the same statute, but its preamble, the existing state of the law, other statutes in pari materia and the mischief which by those and other legitimate means can be discerned that the statute was intended to remedy. [Source: Interpretation of Statutes by Justice G.P. Singh, 15th Edition] 15.27 Applying the above rule, if sub-section (2) of Section 26 of the Act is read as per the plain meaning of the words of the provision, then it does not lead to any ambiguity. The plain meaning rule is the golden rule of construction of statutes and it does not lead to any absurdity in the instant case. On a plain reading of the provision, it is observed that the Central Government can issue a notification in the Gazette of India to demonetise any series of bank notes of any denomination but only on the recommendation of the Central Board of the Bank. In my view sub-section (2) of Section 26 is not vitiated by unconstitutionality. This is for two reasons: firstly, the plain meaning of the words “any” series of bank notes of “any denomination” would not imply “all series” of bank notes of “all denominations”. The word “any” means specified or particular and not “all” as contended by the respondents. If the contention of the Union of India is accepted and the
word “any” is to be read as “all”, it would lead to disastrous consequences as the Central Board of the Bank cannot be vested with the power to recommend demonetisation of “all series of currency of all denominations”. The interpretation suggested by learned Attorney General would lead to vesting of unguided power in the Central Board of the Bank whereas giving a wider power to the Central Government to initiate such a demonetisation wherein all series of a denomination could be demonetised is appropriate as it is expected to consider all pros and cons from various angles and then to initiate demonetisation on a large scale through a legislative process. Such a power is vested only in the Central Government by virtue of Entry 36 of List I of the Seventh Schedule of the Constitution which of course has to be exercised by means of a plenary legislation and not by issuance of a gazette notification under sub-section (2) of Section 26 of the Act. Hence, the word “any” cannot be interpreted to mean “all” having regard to the context in which it is used in the said provision. 15.28 Secondly, any recommendation of the Central Board of the Bank under sub-section (2) of Section 26 is not binding on the Central Government. If the Central Government does not accept the recommendation of the Bank then no notification would be published in the Gazette of India by it. In fact, the Central Government is not bound by the recommendation made by the Central Board of the Bank to demonetise any bank note, although, the Central Board of the Bank may comprise of experts in matters relating to finance, having knowledge and experience of economic affairs of the country and such knowledge may be reflected in the recommendation made to the Central Government. As already noted, the Central Government has the option to accept the said recommendation and accordingly issue a gazette notification or elect not to act on the same. However, the Central Government should consider the recommendation with all seriousness and in its wisdom take an appropriate decision in the matter. 16. In the instant case, on perusal of the records submitted by Union of India and the Bank, it is noted that the proposal for demonetisation had been initiated by the Central
Government by writing a letter to the Bank on 7th November, 2016 and not by the Central Board of the Bank. On the very next evening i.e., on 8th November, 2016 at 05:30 p.m., there was a meeting of the Central Board of the Bank at New Delhi and a Resolution was passed and a little while thereafter on the same evening, the notification was issued invoking sub-section (2) of Section 26 of the Act by the Central Government. Such a procedure is not contemplated under sub-section (2) of Section 26 of the Act when the proposal for demonetisation is initiated by the Central Government. 16.1 Hence, it is held that in the instant case the Central Government could not have exercised power under sub-section (2) of Section 26 of the Act in the issuance of the impugned gazette Notification dated 8th November, 2016. It is further held that in the present case, the object and the purpose of issuance of an Ordinance and thereafter, the enactment of the 2017 Act by the Parliament was, in my view, to give a semblance of legality to the exercise of power by issuance of the Notification on 8th November, 2016. In fact, Section 3 of the Ordinance as well as Section 3 of the Act makes this explicit. The same is extracted as under for immediate reference: “3. On and from the appointed day, notwithstanding anything contained in the Reserve Bank of India Act, 1934 or any other law for the time being in force, the specified bank notes which have ceased to be legal tender, in view of the notification of the Government of India in the Ministry of Finance, number S.O. 3407(E), dated the 8th November, 2016, issued under sub-section (2) of section 26 of the Reserve Bank of India Act, 1934 , shall cease to be liabilities of the Reserve Bank under section 34 and shall cease to have the guarantee of the Central Government under sub-section (1) of section 26 of the said Act.” The said Section has an inherent contradiction inasmuch as the Section has a non-obstante clause vis-à-vis the Act or any other law for the time being in force but at the
same time, the said provision refers to Sections 26 as well as Section 34 of the Act. A non-obstante clause such as “notwithstanding anything contained in the Act or in any law for the time being in force”, is sometimes appended to a section, with a view to give the enacting part of that section in case of conflict, an overriding effect over the provision or Act mentioned in the non obstante clause. The following are the judicial dicta on the point which bring out the use of a non-obstante clause: a) In T.R. Thandur vs. Union of India (1996) 3 SCC 690, this Court observed that a non-obstante clause may be used as a legislative device to modify the ambit of the provision or law mentioned in the non-obstante clause or to override it in specified circumstances. That while interpreting a non-obstante clause, the Court is required to find out the extent to which the legislature intended to give it an overriding effect. b) In Central Bank of India vs. State of Kerala (2009) 4 SCC 94, this Court held that while interpreting a nonobstante clause the court is required to find out the extent to which the legislature intended to give it an overriding effect. c) Further, this Court in A.G. Varadarajulu and Anr. vs. State of Tamil Nadu (1998) 4 SCC 231, observed that it is well-settled that while dealing with a non-obstante clause under which the legislature wants to give overriding effect to a section, the court must try to find out the extent to which the legislature had intended to give one provision overriding effect over another provision. The effect of insertion of a non-obstante clause into a provision in a legislation, is that the very consideration arising from the provisions sought to be excluded, shall be excluded, vide Madhav Rao Scindia vs. Union of India (1971) 1 SCC 85. Applying the aforesaid principles to interpret Section 3 of the 2017 Act, it is observed that the non-obstante clause contained in the said provision has the effect of overriding the
provisions of the Act as they are not applicable to the provisions and processes under the 2016 Ordinance and the 2017 Act. It is significant to note that the said Section contains a nonobstante clause which reads, “notwithstanding anything contained in the Act or any other law for the time being in force”. This is rightly so as the demonetisation is not in exercise of the powers under sub-section (2) of Section 26 of the Act. However, Section 3 of the 2017 Act goes on to state that the specified bank notes which have ceased to be legal tender, in view of the notification dated 8th November, 2016 issued under sub-section (2) of Section 26 of the Act, shall cease to impose liabilities on the Bank under Section 34 of the Act and shall cease to have the guarantee of the Central Government under sub-section (1) of Section 26 of the Act. Therefore, while the impugned gazette notification dated 8th November, 2016 has been admittedly issued exercising powers under sub-section (2) of Section 26 of the Act, Section 3 of the 2017 Act also states that it is notwithstanding anything contained in the Act. If it is so, then the impugned notification could not have been issued invoking sub-section (2) of Section 26 of the Act. The liability could have so ceased, if the power that had been exercised by the Central Government for the issuance of the notification dated 8th November, 2016 impugned herein, under sub-section (2) of Section 26 of the Act on the recommendation made by the Central Board of the Bank. That is, when the initiation of demonetisation or the proposal came from the Central Board of the Bank, leading to the issuance of the notification by the Central Government. Had the measure of demonetisation been carried out by way of enactment of a plenary legislation, then the non-obstante clause could have been employed to exclude the applicability of the Act. However, having sought to rely on sub-section (2) of Section 26 of the Act to issue the Notification, not only is the non-obstante clause misplaced but it also gives rise to a contradiction as to on what basis the Notification dated
8th November, 2016 has been issued. 17. It has been observed in the preceding paragraphs that when the proposal to carry out demonetisation originates from the Central Government, irrespective of whether or not the Bank concurs with or endorses such proposal, the Central Government would have to take the legislative route through a plenary legislation and cannot proceed with demonetisation by simply issuing a notification. 17.1 Having observed so, it is necessary to examine the proposal to carry out demonetisation, in the present case, which originated from the Central Government. For this purpose, reference may be had to the recitals of the affidavits filed by the Union of India and the Bank, and to the extent permissible, to the records submitted by the Union of India and the Bank in a sealed cover. 17.2 I have perused the following photocopies of the original records submitted on behalf of the Union of India and the Reserve Bank of India: i) Letter by the Secretary, Department of Economic Affairs, Ministry of Finance, dated 7th November, 2016, bearing F. No. 10.03/2016 Cy.I, addressed to the Governor of the Bank; ii) Draft Memorandum of the Deputy Governor of the Bank, placed before the Central Board of the Bank at its 561st Meeting; iii) Minutes of the 561st Meeting of the Central Board of the Bank, convened at New Delhi, on 8th November, 2016, at 05:30 p.m., and signed on 15th November, 2016; iv) Letter addressed by the Deputy Governor of the Bank to the Central Government on 17.3 On a reading of the records listed hereinabove, the following facts emerge: 1) A letter bearing F. No. 10.03/2016 Cy.I dated 7th November, 2016 was addressed by the Secretary, Ministry of Finance, Department of Economic Affairs, Government of India, to the Governor of the Bank, referring to certain facts and figures to indicate the following two major threats to the security and financial integrity of the country: i) Fake Infusion of Currency Notes (FICN); The desire of the Central Government to proceed with the measure of
demonetisation was expressed in the said letter and a request was made to the Bank to consider recommending the such measure, in terms of the relevant clauses of the Act. 2) Further, the Draft Memorandum of the Deputy Governor of the Bank, placed before the Central Board of the Bank, categorically states that the need for a meeting to deliberate on the proposed measure of demonetisation, had arisen pursuant to the letter addressed to the Bank from the Central Government dated 7th November, 2016. The Draft Memorandum further records that the Government had “recommended” that the withdrawal of the tender character of existing Rs.500/- and Rs.1,000/- notes, is apposite. Further, the said document records that “as desired” by the Central Government, a draft scheme for implementation of the scheme of demonetisation had also been 3) In view of the contents of the Draft Memorandum, the Central Board of the Bank in its 561st Meeting commended the Central Government’s proposal for demonetisation and directed that the same be forwarded to the Central Government. 4) Accordingly, a letter was addressed by the Deputy Governor of the Bank to the Central Government on 8th November, 2016, stating therein that the proposal of the Central Government pertaining to withdrawal of legal tender of bank notes of denominational values of Rs. 500/and Rs. 1,000/- was placed before the Central Board of the Bank in its 561st meeting. It was also stated that necessary recommendation to proceed with the said proposal, had been “obtained” from the Central Board of the Bank. 17.4 On a comparative reading of the records submitted by the Union of India as well as the Reserve Bank of India, it becomes crystal clear that the process of demonetisation of all series of bank notes of denominational values of Rs. 500/- and Rs. 1 ,000/-, commenced/originated from the Central Government. The said fact is crystalised in the communication addressed by the Secretary, Department of Economic Affairs, Ministry of Finance, dated 7th November, 2016 to the Governor of the Bank. The phrases and words emphasized hereinabove clearly indicate that the proposal for demonetisation was from the Central Government. In substance, the Central
Government sought the opinion/advice of the Bank on such proposal. The use of the words/phrases such as, “as desired” by the Central Government; Government had “recommended” the withdrawal of the legal tender of existing Rs.500/- and Rs.1,000/- notes; recommendation has been “obtained”; etc., are self-explanatory. This demonstrates that there was no independent application of mind by the Bank. Neither was there any time for the Bank to apply its mind to such a serious issue. This observation is being made having regard to the fact that the entire exercise of demonetisation of all series of bank notes of Rs.500/- and Rs.1,000/- was carried out in twenty four hours. A situation where an independent authority such as the Bank, based on its own appreciation of the economic climate of the country, recommends a measure to the Central Government, must be contrasted with another situation where a measure which originates from the Central Government is simply placed before such independent authority for seeking its advice or opinion on such proposed measure. A proposal of the Central Government on a certain scheme having serious economic ramifications has to be placed before the Bank to seek its expert opinion as to the viability of such a scheme. The Bank as an expert body may render advice on such a proposal and on some occasions may even concur with the same. However, even such concurrence to a proposal originating from the Central Government is not akin to an original recommendation of the Central Board of the Bank, within the meaning of Section 26 (2) of the Act. 17.5 The following points emerge on perusal of the affidavits submitted on behalf of the 1) That the Central Board of the Bank made a specific recommendation to the Central Government on 8th November, 2016, for the withdrawal of legal tender character of the existing series of Rs.500/- and Rs.1,000/- bank notes which could tackle black money, counterfeiting and illegal financing. That the Bank also proposed a draft scheme for the implementation of the recommendation. 2) That the consultations between the Central Government and the Bank began in
February, 2016; however, the process of consolidation and decision making were kept 3) That the Bank and the Central Government were together engaged in the finalization of new designs, development of security inks and printing plates for the new designs, change in specifications of printing machines and other critical aspects. 17.6 The following points emerge upon perusal of the affidavits submitted on behalf of the 1) That a letter dated 7th November, 2016 was received by the Bank, from the Ministry of Finance, Government of India, which contained a proposal to withdraw the character of legal tender of existing Rs.500/- and Rs.1,000/- bank notes. 2) The said proposal was considered, together with a draft scheme for implementing the withdrawal of existing Rs.500/- and Rs.1,000/- bank notes, at the 561st meeting of the Central Board of Directors of the Bank, held on 8th November, 2016, at 05:30 p.m. at New 3) That the Central Board of Directors was assured that the matter had been the subject of discussion between the Central Government and the Bank for six months. The said Board was also assured that the Central Government would take adequate mitigating measures to contain the use of cash. 4) That the Board, having observed that the proposed step presents a big opportunity to advance the objects of financial inclusion and incentivising use of electronic modes payment, recommended the withdrawal of legal tender of old bank notes in the denomination of Rs.500/and Rs.1,000/-. 17.7 On a conjoint reading of the affidavits submitted by the Union of India and the Bank, the following deductions may be drawn: 1) That the Central Government in its letter addressed to the Bank, dated 7th November, 2016 proposed to withdraw the character of legal tender of existing Rs.500/- and Rs.1,000/- bank notes. 2) The Central Board of the Bank, at its 561st meeting held on 8th November, 2016 resolved that the withdrawal of legal tender of old bank notes in the denomination of Rs.500/and Rs.1,000/- be made.
3) The objects guiding the Board’s opinion were two-fold: first, pertaining to financial inclusion, and second, being to incentivise the use of electronic modes of payment. 4) The object guiding the Government’s proposal to withdraw currency of the specified denominations, was to tackle black money, counterfeiting and illegal financing. 17.8 In my view, there is contradiction as to the subject of demonetisation, as well the object thereof, as stated by the Bank vis-à-vis the Central Government as discernible from the affidavits. The same may be expressed as follows: Subject of Demonetisation Old bank notes in the Existing Rs.500/- and denomination of Rs.500/- Rs.1,000/- bank notes The object of the measure and the subject are of relevance, in assessing the resolution of the Bank dated 8th November, 2016 because, the said considerations would have a bearing on the question, whether, the Bank’s opinion was in consonance with the object sought to be achieved through demonetisation by the Central Government’s 17.9 On a close reading of the Notification dated 8th November, 2016, in juxtaposition with the records, the following aspects emerge: i) One aspect of the matter which emerges with no ambiguity is that the proposal for demonetisation originated from the Central Government, by way of its letter addressed to the Bank, dated 7th November, 2016. This aspect forms the central plank of the controversy at hand. That the recommendation did not originate from the Bank under subsection (2) of Section 26 of the Act, but was “obtained” from the Bank in the form of an opinion on the proposal for demonetisation submitted by the Central Government. Such an opinion, could not be considered to be a recommendation as required by the Central Government in order to proceed under sub-section (2) of Section 26 of the Act. ii) Even if it is to be assumed for the sake of argument that the said opinion, was in fact a “recommendation” under subsection (2) of Section 26 of the Act, in light of the interpretation given by me hereinabove to the phrase “any” series or “any” denomination,
to mean a specified series/specified denomination, the recommendation itself is void inasmuch as it pertained to demonetisation of “all” series of Bank notes of denominational values of Rs.500/- and Rs.1,000/-. As has already been observed, the term “any” as appearing in sub-section (2) of Section 26 of the Act could not be interpreted to mean “all” as such an interpretation would vest unguided and expansive discretion with the Central Board of the Bank. iii) The Notification expressly states that it is issued under subsection (2) of Section 26 of the Act. Therefore Section 3 of the Ordinance and Act could not, in the non-obstante clause, state that sub-section (2) of Section 26 is not applicable to the Act. iv) Having observed that demonetisation could not have been carried out by issuing a Notification as contemplated under sub-section (2) of Section 26 of the Act and that the Parliament does indeed have the competence to carry out demonetisation, on the strength of Entry 36 of List I of the Seventh Schedule of the Constitution, the Central Government could not have exercised the power by issuance of an executive notification. Legal Principles applicable to the case: 18. There are certain legal principles which are applicable in this case: one is expressed in the maxim “to do a thing a particular way or not at all”; this principle has also been expressed in terms of the latin maxim “expressio unius est exclusio alterius”, which means that when a manner is specified for doing a certain thing, then all other modes for carrying out such act are expressly excluded; and the other principle is, exercise of discretion which is a well known principle in Administrative Law. The same would be discussed at this 18.1 The first principle which is of relevance to the controversy at hand is that, where a power is given to do a certain thing in a certain way, the thing must be done in that way or not at all and other methods of performance are necessarily forbidden vide, Taylor vs. Taylor (1875) 1 Ch D 426. Hence, when a statute requires a particular thing to be done
in a particular manner, it must be done in that manner or not at all and other methods of performance are necessarily forbidden, vide Nazir Ahmed vs. King Emperor (1936) L.R. 18.2 This Court too, has applied this maxim in the following cases: (i) Parbhani Transport Co-operative Society Ltd. vs. The Regional Transport Authority, Aurangabad (1960) (3) S.C.R. 177: AIR 1960 SC 801, wherein it was observed that the rule provides that an expressly laid down mode of doing something necessarily implies a prohibition of doing it in any other way. (ii) In Dipak Babaria vs. State of Gujarat AIR 2014 SC 1972, this Court set aside the sale of agricultural land, on the ground that the sale was not in compliance with the statutory procedure prescribed in that regard under the Bombay Tenancy and Agricultural Lands (Vidarbha Region) Act, 1958. The matter was examined on the anvil of the aforestated maxim and it was held that alienation of agricultural land by adopting any alternate procedure to the one prescribed under the Act, was necessarily forbidden. (iii) In Kameng Dolo vs. Atum Welly AIR 2017 SC 2859, election of an unopposed candidate was declared as invalid on the ground that the nomination of his opponent was not withdrawn as per the procedure statutorily mandated. That the nomination of the opposite candidate ought to have been withdrawn in the manner provided for under the relevant statute and withdrawing the same in any other manner was necessarily forbidden. That withdrawal of the nomination, not carried out in accordance with the procedure established under the relevant statute, enabled the successful candidate to win unopposed. Hence, his election was declared as void. (iv) Similarly, in The Tahsildar, Taluk Office, Thanjore vs. G. Thambidurai AIR 2017 SC 2791, assignment of land was cancelled on the ground that statutory requirements were not followed in assigning the land. It was held that when a statute prescribes that a certain Act is to be carried out in a given manner, the said Act could not be carried out through any mode other than the one statutorily prescribed.
(v) It may also be apposite to refer to the decision of this Court in Union of India vs. Charanjit S. Gill (2000) 5 SCC 742, wherein this Court held that any provisions introduced by way of “Notes” appended to the Sections of the Army Act, 1950, could not be read as a part of the Act and therefore such notes could not take away any right vested under the said Act. It was observed that issuance of an administrative order or a “Note” pertaining to a special type of weapon to bring it within the ambit of the Army Act, which was hitherto not included therein, could not be said to have been included in the manner in which it was supposed to be included. That the Army Act empowers the Central Government to make rules and regulations for carrying into effect the provisions of the Act; however, no power is conferred upon the Central Government of issuing “Notes” or “issuing orders” which could have the effect of the Rules made under the Act. That rules and Regulations or administrative instructions can neither be supplemented nor substituted by “Notes”. That administrative instructions issued or the “Notes” attached to the Rules which are not referable to any statutory authority cannot be permitted to bring about a result, which is supposed to be achieved through enactment of Rules. What emerges from the above discussion is that when a statute contemplates a specific procedure to be adhered to in order to arrive at a desired end, such procedure cannot be substituted by an alternative procedure which is not contemplated under the statute. Further, if an action is to be carried out by way of issuance of a particular statutory instrument on the basis of certain requirements, such action cannot be validly carried out by way of issuance of an instrument when the same is not contemplated under the Act. This is particularly so when the instrument enacted stands on a different footing than the one meant to be enacted. Applying the said principle to the facts of the present case, it is observed that what ought to have been done through a Parliamentary enactment or plenary legislation, could not have been carried out by simply issuing a notification under subsection (2) of Section
26 of the Act by the Central Government. As noted hereinabove, the said provision does not apply to cases where the proposal for demonetisation originates from the Central Government and the same is not envisaged under the Act. Hence, issuance a notification to give effect to the Central Government’s proposal for demonetisation, was clearly based on an incorrect understanding of sub-section (2) of Section 26 of the Act. The Central Government did not follow the procedure contemplated under law to give effect to its proposal for demonetisation. This is not a matter of form but one of substance as in law, the powers of the Central Board of the Bank and the Central Government are totally distinct in the matter of demonetisation of bank notes. 19. The other legal principle is concerning exercise of discretion in Administrative Law. Lords Halsbury in Sharp vs. Wakefield 1891 AC 173 described the concept of discretion “When it is said that something is to be done within the discretion of the authorities that something is to be done according to the rules of reason and justice, not according to private opinion ...according to law and not humour. It is to be, not arbitrary, vague and fanciful, but legal and regular. And it must be exercised within the limit, to which an honest man competent to the discharge of his office ought to confine himself.” 19.1 It is a well-established rule of administrative law that discretionary power is to be exercised and a decision has to be made, by the very authority to whom the discretion is entrusted by the statute in question. The situation of an authority not exercising its discretion arises when any authority does not itself consider a particular matter before it on merits but still takes a decision, as if it is directed to do so, by another authority, most often, by a higher authority. When an authority exercises the discretion vested in it by law at the behest of another authority in a specific matter, this would in law amount to non-exercise of its discretionary power by the authority itself, and consequently, such action or decision is invalid. 19.2 The petitioners have contended that it is implicit in sub-section (2) of Section 26 of
the Act that adequate time and attention must be devoted by both the Central Board of the Bank and the Central Government before proceeding with a measure of such magnitude and consequences, as demonetisation. It was further submitted that the facts and records of the present case would show that the procedure with such implicit obligations was abandoned and the process contemplated was not as per the said provision. That the proposal emanated from the Central Government and was not initiated by the Bank. The Central Board of the Bank passed a resolution in a hurried manner. No adequate care and consideration were bestowed on such a crucial matter by the Central Board of the Bank having regard to the severe ramifications that the proposed demonetisation would have on almost every citizen of the country. Possibly, the Central Board of the Bank acted on the “assurances” of the Central Government which is evident on a perusal of the records and not on an independent application of mind owing to lack of time. As noted from the records submitted by the Central Government as well as the Reserve Bank of India in the instant case, the Central Government wrote to the Central Board of the Reserve Bank of India on 7th of November, 2016 about its proposal to demonetise all series of bank notes of denominations of Rs.500/- and Rs.1,000/-, which were in circulation, and on the very next day i.e., 8th November, 2016, a meeting of the Central Board of the Bank was held at New Delhi at 05:30 p.m. and shortly thereafter, the gazette notification was issued. Such a swift action would indicate that the Central Board of the Bank had hardly twenty-four hours to consider the proposal of the Central Government and hence, hardly any time to apply its mind independently to the proposal. It is clear from the records submitted that the Central Government “assured” the Central Board of the Bank that sufficient safeguards would be taken while embarking on the process of demonetisation and that it would also result in reducing bank notes in the economy and a switch over to the digitalisation of the economy. The Central Board of the Bank, in resolving to opine on the measure of demonetisation to the Central Government, acted only on such “assurances”.
19.3 Further, the Central Government cannot in the guise of seeking an opinion on its proposal to demonetise bank notes, “obtain” a “recommendation from the Central Board of the Bank” as if it is acting under sub-section (2) of Section 26 of the Act, and consequently, issue a gazette notification by which demonetisation of bank notes would be given effect to. Such a procedure, in my view, would be contrary to the import of subsection (2) of Section 26 of the Act, inasmuch as the Central Government cannot act under the said provision by the issuance of a notification, as if a “recommendation” has been made by the Central Board of the Bank when in fact, what actually transpired in the instant case, was that the Central Government initiated the process of demonetisation by formulating a proposal in this regard and subsequently secured the imprimatur of the Bank on such proposal. In fact, the Central Board of the Bank has no jurisdiction to “recommend” demonetisation of bank notes of “all series” of “all denomination” to the Central Government, as already held above. 19.4 The powers of the Central Board of the Bank are restrictive in nature inasmuch as it can only recommend that a particular series of a particular denomination would cease to be legal tender. Hence, the Central Government cannot rely on the semblance of a “recommendation made to it by the Central Board of the Bank under sub-section (2) of Section 26 of the Act” when it initiates the process of demonetisation. The Central Government also cannot “obtain” any recommendation to that effect, and if it has done so, it would imply that the Central Board of the Bank is acting at the behest of the Central Government, only to concur with what the Central Government intends to do. Such an opinion would not be on the basis of any independent application of mind of the experts who form the Central Board of the Bank. Moreover, when the Central Government seeks the opinion of the Central Board of the Bank to its proposal for demonetisation, the latter would have to be given some time to consider the pros and cons and the impact that it
would have on the citizens of India, as bank notes are a species of negotiable instruments and a medium through which goods and services are traded and therefore, they are the lifeline of the economy. The Central Government also failed to indicate that the demonetised currency had lost the guarantee provided vide sub-section (1) of Section 26 of the Act in the impugned notification. Hence, an Ordinance had to be issued on 30th December, 2016. Moreover, it is not known whether the Bank had made arrangements for printing sufficient new notes for exchange of demonetised currency. It is also not known whether the Department of Legal Affairs was consulted in the matter as the procedure of demonetisation involves legal implications. 19.5 Hence, in my considered view, the action of demonetisation initiated by the Central Government by issuance of the impugned notification dated 8th November, 2016 was an exercise of power contrary to law and therefore unlawful. Consequently, the 2016 Ordinance and 2017 Act are also unlawful. But, having regard to the fact that the demonetisation process was given effect to from 8th November, 2016 onwards, the status quo ante cannot be restored at this point of time. 20. In view of the above conclusion, the question of moulding the relief shall now be considered. According to the petitioners, around 86 per cent of the volume of currency notes of the total currency in circulation in the Indian economy was demonetised. They also stated that the people of India were exposed to undue hardships owing to the lack of financial resources and had to undergo not only a severe financial crunch but were also exposed to other socio-economic and psychological hardships. The problems associated with the measure of demonetisation would make one wonder whether the Central Board of the Bank had visualised the consequences that would follow. Whether the Central Board of the Bank had attempted to take note of the adverse effects of demonetisation of such a large volume of bank notes in circulation? The objective of the Central Government may have been sound, just and proper, but the manner in which the said objectives were achieved and the procedure followed for the same, in my view was not in accordance with law having regard to the interpretation given above.
It has also been brought on record that around 98% of the value of the demonetised currency have been exchanged for bank notes which continues to be legal tender. Also, a new series of bank notes of Rs.2,000/- was released by the Bank. This would suggest that the measure itself may not have proved to be as effective as it was hoped to be. However, this Court does not base its decision on the legality of a legislation, qua the effectiveness of such action in achieving the stated objectives. Therefore, it is clarified that any relief moulded in the present cases is de hors considerations of success of the 20.1 I have borne in mind the submissions of learned Attorney General appearing on behalf of the Union of India to the effect that the objectives of the Central Government have been sound, just and proper, but in my view, the manner in which the said objectives were achieved and the procedure followed for the same was not in accordance with law having regard to the interpretation given above. Learned Attorney General appearing on behalf of the Union of India also contended that the issues raised in these petitions have become infructuous and wholly academic as the action of demonetisation has been acted upon and therefore, the present cases are only of academic significance. It is necessary to examine the nature of relief that could be moulded by the Court in this matter. 20.2 There are several judgments which could be relied upon in this context: (i) This Court acknowledged in S.R. Bommai vs. Union of India AIR 1994 SC 1918, that although substantive relief may be granted only if the issue remains live in cases which are justiciable, this Court may prospectively declare a law, for posterity. Notwithstanding the fact that no substantive relief could be granted in the said case for the reason that following the Presidential proclamation, fresh elections had been held and new Houses had been constituted, this Court went on to declare the law, for posterity, as to the federal character of the Constitution, the nature of the power conferred on the President under Article 356 of the Constitution and the manner in which such power is to be exercised for imposing President’s Rule in a State by dissolution of the Legislative
(ii) In Golak Nath vs. State of Punjab (1967) 2 SCR 762, this Court declared that it is open to the Court, to find and declare the law, but restrict the operation of such law to the (iii) Further, the observations made by this Court in Orissa Cement Ltd. vs. State of Orissa 1991 Supp (1) SCC 430, while determining what relief that could be granted following a declaration of a provision of an enactment as invalid, are also relevant. This Court held that declaration of invalidity of a provision, and determination of the relief to be granted as a consequence of such invalidity, are two distinct things. That in respect of the relief to be granted as a consequence of declaration of invalidity, the Court has discretion which could be exercised to grant, mould or restrict the relief. 20.3 In the instant case, the elementary question that requires determination is, whether the challenge to the validity of the Central Government’s decision dated 8th November, 2016 to demonetise all Rs.500/- and Rs.1,000/- bank notes, having been adjudicated upon, at this juncture, i.e., after a lapse of over six years since the impugned action was carried out, the nature of relief that could be granted by this Court at this juncture is to be 20.4 Stated very patently, the controversy in the present cases relates to the true meaning and interpretation of sub-section (2) of Section 26 of the Act. Therefore, the question that arises for consideration is, whether, this Court can declare the law as to the validity of an action, even after such action has been given effect to in toto. That is to say, once the action has been completely carried out, and there is no element of such action which is left to be carried out, can there still be a subsequent declaration by this Court as to the validity of such act, having regard to the interpretation accorded to the provisions of the relevant statute. 20.5 As discussed hereinabove, this Court has acknowledged on several occasions that it has the competence to declare the law on a subject for posterity, even though no
substantive relief may be given under the circumstances of a given case, vide S.R. Bommai. The effect of such declaration would apply prospectively. That is, in the present case if a declaration is made to the effect that the impugned action was unlawful, such declaration would only have the effect of deterring future measures from being carried out in a like manner, in order to save such measures, from the vice of unlawfulness. Such declarations as to validity or invalidity of a measure, may be made by this Court in exercise of its power under Article 141 of the Constitution, and the effect of such declaration may be moulded or restricted by exercising the power vested with this Court under Article 142. 20.6 Reference may also be had to the decision of this Court in Jayantilal Ratanchand Shah, Devkumar Gopaldas Aggarwal vs. Reserve Bank of India AIR 1997 SC 370. The said case pertains to the challenge to the Constitutional validity of the High Denomination Bank Notes (Demonetisation) Act, 1978. Although the enactment related to the year 1978 and its effects were immediate, as in the present case, the validity of the same was conclusively declared by this Court only in the year 1997. This Court, while upholding the validity of the legislation impugned therein, authoritatively clarified and declared the law on the Parliamentary power to enact such a legislation. A declaration of a similar nature, i.e., as to the validity or invalidity of the impugned actions and Notification, is what is sought for in the present petitions. 21. In view of the aforesaid discussion, the following conclusions are arrived at: (i) According to sub-section (1) of Section 26 of the Act, every bank note shall be legal tender at any place in India in payment or on account for the amount expressed therein and shall be guaranteed by the Central Government. This provision is subject to sub-section (2) of Section 26 of the Act. (ii) Sub-section (2) of Section 26 of the Act applies only when a proposal for demonetisation is initiated by the Central Board of the Bank by way of a
recommendation being made to the Central Government. The said recommendation can be in respect of any series of bank notes of any denomination which is interpreted to mean any specified series of bank notes of any specified denomination. (iii) The expression any series of bank notes of any denomination has been given its plain, grammatical meaning, having regard to the context of the provision and not a broad meaning. Thus, the word “any” will mean a specified series or a particular series of bank notes. Similarly, “any” denomination will mean any particular or specified denomination of bank notes. (iv) If the word “any” is not given a plain grammatical meaning and interpreted to mean “all series of bank notes” of “all denominations”, it would vest with the Central Board of the Bank unguided and unlimited powers which would be ex-facie arbitrary and suffer from the vice of unconstitutionality as this would amount to excessive vesting of powers with the Bank. In order to save the provision from being declared unconstitutional, the meaning of the provision is read down to the context of the Central Board of the Bank initiating a proposal for demonetisation by making a recommendation to the Central Government under subsection (2) of Section 26 of the Act of a particular series of bank note of any (v) On receipt of the said recommendation made by the Central Board of the bank under sub-section (2) of Section 26 of the Act, the Central Government may accept the said recommendation or may not do so. If the Central Government accepts the recommendation, it may issue a notification in the Gazette of India specifying the date w.e.f. which any specified series of bank notes of any specified denomination shall cease to be legal tender and shall cease to have the guarantee of the Central Government. (vi) The provisions of the Act do not bar the Central Government from proposing or initiating demonetisation. It could do so having regard to its plenary powers under Entry 36 of List I of the Seventh Schedule of the Constitution of India. However, it has to be done only by an Ordinance being issued by the President of India followed by an Act of Parliament or by plenary legislation through the Parliament. The Central Government
cannot demonetise bank notes by issuance of a gazette notification as if it is exercising power under sub-section (2) of Section 26 of the Act. In such circumstances when the Central Government is initiating the process of demonetisation, it would not be acting under subsection (2) of Section 26 of the Act but notwithstanding the said provision through a legislative process. (vii) When such power is exercised by the Central Government by means of a legislation, it is by virtue of Entry 36, List I of the Seventh Schedule of the Constitution of India which deals with currency, coinage and legal tender; foreign exchange which is a field of legislation. Hence, the power of the Central Government to demonetise any currency is notwithstanding anything contained in Section 26 of the Act. (viii) When the Central Government proposes demonetisation of any bank note, it must seek the opinion of the Central Board of the Bank having regard to the fact that the Bank is the sole authority to regulate circulation of bank notes and secure monetary stability and generally to operate the currency and credit system of the country and to maintain price stability. (ix) The opinion of the Central Board of the Bank ought to be an independent and frank opinion after a meaningful discussion by the Central Board of the Bank which ought to be given its due weightage having regard to the ramifications it may have on the Indian economy and the citizens of India although it may not be binding on the Central Government. On receipt of a negative opinion from the Central Board of the Bank, the Central Government which has initiated the demonetisation process may still intend to go ahead with the said process after weighing the pros and cons only by means of an Ordinance and/or Parliamentary legislation but not by issuance of a gazette notification. In other words, the Central Government in such circumstances cannot resort to exercise of power under subsection (2) of Section 26 of the Act by issuing a notification in the Gazette of India as if it were exercising executive powers. Even if the Central Board of the Bank concurs with the proposal of the Central Government, the Central Government would have to undertake a legislative process and not carry out the measure by simply issuing a gazette notification.
(x) In view of the aforesaid conclusions, I am of the considered view that the impugned notification dated 8th November, 2016 issued under sub-section (2) of Section 26 of the Act is unlawful. In the circumstances, the action of demonetisation of all currency notes of Rs.500/- and Rs.1,000/- is vitiated. (xi) Further, the subsequent Ordinance of 2016 and Act of 2017 incorporating the terms of the impugned notification are also unlawful. (xii) However, having regard to the fact that the impugned notification dated 8th November, 2016 and the Act have been acted upon, the declaration of law made herein would apply prospectively and would not affect any action taken by the Central Government or the Bank pursuant to the issuance of the Notification dated 8th November, 2016. This direction is being issued having regard to Article 142 of the Constitution of India. Hence, no relief is being granted in the individual matters. (xiii) In view of the above conclusions, I do not think it is necessary to answer the other questions raised in the reference order. 22. Before parting, I wish to observe that demonetisation was an initiative of the Central Government, targeted to address disparate evils, plaguing the Nation’s economy, including, practices of hoarding “black” money, counterfeiting, which in turn enable even greater evils, including terror funding, drug trafficking, emergence of a parallel economy, money laundering including Havala transactions. It is beyond the pale of doubt that the said measure, which was aimed at eliminating these depraved practices, was well-intentioned. The measure is reflective of concern for the economic health and security of the country and demonstrates foresight. At no point has any suggestion been made that the measure was motivated by anything but the best intentions and noble objects for the betterment of the Nation. The measure has been regarded as unlawful only on a purely legalistic analysis of the relevant provisions of the Act and not on the objects of 23. In view of the answer given by me to question no.1 of the reference order, I do not
deem it necessary to answer all other questions of the reference order or even the questions reframed by His Lordship B.R. Gavai, J. during the course of the judgment except to the extent discussed above. 24. In the result, the writ petitions, special leave petitions and transfer petitions are directed to be posted before the appropriate Bench after seeking orders from Hon’ble the Chief Justice of India. I would like to acknowledge and place on record my appreciation for the learned Attorney General for India, all learned senior counsel, learned instructing counsel as well as the learned counsel, for their assistance in the matter.
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In her disagreement with the main ruling on the cases challenging demonetisation, Supreme Court judge Justice BV Nagarathna said that the Reserve Bank of India (RBI) did not think for itself. Instead, it simply followed the Central Government's idea to cancel all Rs.500 and Rs.1000 notes. Justice Nagarathna formed this opinion after looking at the official documents about the decision, which were provided by both the government and the RBI. Justice Nagarathna pointed to phrases in the RBI's own records, like "as desired by the Central Govt" and "recommendation has been obtained." She said these phrases clearly show that the RBI did not think independently. She also noted that the bank didn't have enough time to properly consider such an important issue, since the whole demonetisation process for all Rs.500 and Rs.1000 notes happened within 24 hours. Justice Nagarathna explained that the idea for demonetisation came from the Central Government in a letter on November 7, 2016, sent to the bank. She said this suggestion didn't start with the RBI itself, as required by Section 26(2) of the RBI Act. Instead, the government asked the RBI for it. She added that an idea from the government is different from an idea that truly comes from the RBI's own board. Justice Nagarathna believed that the RBI's agreement to the government's idea should not be considered a proper "recommendation" as outlined in Section 26(2) of the RBI Act. Even if we were to assume the RBI had the power to make such a suggestion, Justice Nagarathna said that this recommendation would still be invalid. She explained that Section 26(2) only allows the RBI to cancel specific "series" of notes, not all notes of a certain value (like all Rs.500 notes). She disagreed with the other judges who thought "any series" in the law could mean "all series." She stated that removing all types of notes from circulation because the government wants to is a much bigger deal than the RBI removing just certain types. Therefore, she believed it should have been done through a law passed by Parliament, rather than just an order from the government. Justice Nagarathna wrote that "Parliament represents the country... Parliament, which is key to our democracy, should not be kept out of such an important decision."
Justice Nagarathna also questioned whether the RBI's main board had truly considered all the problems that would arise from demonetisation. She wondered if they had thought about the negative effects of removing so many notes from use. She acknowledged that the goals of demonetisation might have been good and fair. However, she said that the way these goals were carried out and the steps taken did not follow the law. She also noted that records show about 98% of the cancelled notes were exchanged for new valid money, and a new Rs.2000 note was released. This might suggest demonetisation didn't work as well as expected. However, she made it clear that the court's decision was about whether the action was legal, not whether it was successful in meeting its goals. So, any solution given in this case would not depend on how well demonetisation actually worked. The judge stated that the RBI's opinion should be honest and independent, coming after a good discussion with its board. This opinion should be given serious consideration because of its major effects on India's economy and its people. She further said that even if the RBI did recommend such a step, the Central Government cannot remove all notes from circulation just by issuing an order. It must be done through a proper law-making process, either by a law passed by Parliament or a temporary law called an ordinance. For all these reasons, Justice Nagarathna declared that the government's order from November 8, 2016, was "against the law" and "illegal." She concluded that because of this, the demonetisation of all Rs.500 and Rs.1000 notes was invalid. She also said that the later temporary law (Ordinance) of 2016 and the permanent law (Act) of 2017, which included the terms of the original order, were also illegal. However, because the demonetisation had already happened and these laws were put into action, her legal ruling would only apply going forward. It would not undo any actions taken by the government or the RBI since the November 8, 2016 order. Therefore, she said, no specific relief or help would be given in the individual cases challenging demonetisation. Justice Nagarathna did add that the demonetisation plan had good intentions. It aimed to fight problems like black money, funding for terrorism, and fake currency, which were harming the country's economy.
Finally, she stated that demonetisation was a government plan meant to deal with various serious problems affecting India's economy. These included storing black money, making fake currency, which then led to bigger issues like funding terrorism, drug dealing, a hidden economy, and money laundering. She had no doubt that this plan, aimed at stopping these bad practices, was well-intended. She felt it showed care for the country's economic well-being and security. She added that no one had suggested the government had any bad intentions. She concluded that the action was deemed illegal only after carefully looking at the specific legal rules, not because its goals were bad.
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Civil Appeal No. 2281 of 1969 Appeal by Special Leave from the Judgment and Order dated 6th December, 1965 of the Allahabad High Court in Special Appeal No. 978/62. Shiv Pujan Singh and M. V. Goswami for the Appellant. B. P. Maheshwari and Suresh Sethi for the Respondent. The Judgment of the Court was delivered by KAILASAM, J. This appeal is by the State of U.P. by special leave granted by this Court against the judgment and order of the High Court at Allahabad in Special Appeal No. 978 of 1962. Two companies, the Raza Sugar Co. Ltd. and the Buland Sugar Co. Ltd., were incorporated under the Rampur State Companies Act, 1932. Messrs. Govan Brothers (Rampur) Ltd. were the common managing agents of the two companies. On 10th May, 1933 the Raza Ltd. and on 11th December, 1934, the Buland Ltd. entered into agreements with the erstwhile State of Rampur. The agreements provided that the Rampur State should grant to the companies leases of the agricultural land with adequate irrigation facilities suitable for cultivation of sugar cane. The companies were required to pay fair and equitable land revenue which was to be agreed upon by the com 421 panies and the Rampur State. On 5th May, 1935, a partnership deed was a executed by the Raza Ltd. and the Buland Ltd. constituting a partnership firm of the two companies in equal shares known as the Agricultural Company, Rampur. In the year 1939 the Rampur State leased 2,000 acres of land and in the year 1946 another 2,000 acres of land to the Agricultural Company, Rampur. In 1949 the State of Rampur acceded to the Union of India and was merged with the State of Uttar Pradesh with effect from Ist December, 1949. The Rampur State had agreed to exempt the Raza Ltd. and the Buland Ltd. from all taxes for a period of 15 years from the date of commencement of their business. The U.P. Agricultural Income Tax Act was applied to the areas which formed part of the erstwhile State of Rampur on Ist July, 1950. The Assessing Authority issued notices under section 16(4) of the U.P. Agricultural Income Tax Act to the Raza Ltd. and the Buland Ltd. for furnishing returns of their agricultural incomes for the years 1357 F to 1361 F. It may be noted that the notice was not issued to the Agricultural Company, Rampur. The Raza Ltd. and the Buland Ltd. submitted their returns. The Assessing Authority assessed the two companies to agricultural income tax for the years concerned. The companies preferred an appeal against the assessment to the Commissioner, Rohikhand Division, and also filed writ petition No. 2385 of 1959 in the High Court of Allahabad challenging the assessment orders. On 17th April, 1961 the writ petition was allowed and the order of assessment was quashed with a direction that fresh assessments may be made. The Commissioner also directed the Assessing Authority to make fresh assessments in the light of the observations made by the High Court in its judgment dated 17th April, 1961, allowing the writ petition No. 2385 of 1959. When the Assessing Authority started fresh hearing in pursuance of the order of the High Court an objection was raised with regard to the assessability of the two companies on the ground that no notice had been sent to the Agricultural Company, Rampur. The Assessing Authority negatived the plea and assessed the Raza Ltd. and the Buland Ltd. for the years 1357 F to 1361 F and also for the years 1362 F to 1363 F. Against the order of the Assessing Authority the two companies which in the meantime became amalgamated as the Raza Buland Sugar Co. Ltd., Rampur, filed a writ petition No. 1982 of 1962 in the High Court of Judicature at Allahabad and prayed for the quashing of the assessment order dated 29th June, 1962, made by the Assessing Authority against the Raza Ltd. and the Buland Ltd. for the assessment years 1357 F to 1363 F. 422 The writ petition was heard by a single Judge of the High Court who by his order dated 4th October, 1962 allowed the writ petition on the ground that the Assessing Authority committed an error of law in assessing the two partners of the Agricultural Company, Rampur, and not assessing the firm as such. Aggrieved by the order the State filed Special Appeal No. 978 of 1962 before the Division Bench of the High Court at Allahabad. The Division Bench of the High Court by its order dated 6th December, 1965, dismissed the Special Appeal. An application for leave to appeal to the Supreme Court was dismissed by the High Court. The appellants then preferred Special Leave Petition No. 1724 of 1969 to this Court and on the leave being granted this appeal is now before us. The main contention that has been raised before us by the appellants is that there being no express prohibition under the U.P. Agricultural Income Tax Act an assessment can be validly and legally made on the individual partners, in the present case the two companies, without proceeding against the firm. It was pleaded that the tax could be assessed either on the partnership firm or on the partners invididually and that the view of the High Court that the tax can only be recovered from the firm is erroneous. The facts of the case disclose that on receipt of a notice by the Assessing Authority under section 16(4) of the U.P. Agricultural Income Tax Act, the two companies Raza Ltd. and the Buland Ltd. submitted their returns relating to the income of the two companies. In the return it was stated that the income was half of the income received from the partnership firm, the Agricultural Company, Rampur. The assessment was made on the basis of the returns. The assessment was questioned before the Commissioner and in the writ petition before the High Court of Allahabad on the ground that the lands were neither assessed to land revenue in the United Provinces nor were they subject to local rate or cess assessed and collected by an officer of the Provincial Government. This contention was accepted by the High Court which directed the Assessing Authority to determine the question whether the lands were assessed to land revenue, in the United Provinces or they were subject to local rate or cess assessed and collected by an officer as required under section 2(a) of the U.P. Agricultural Income Tax Act, 1948. After remand the Assessing Authority found that the lands from which the income accrued satisfied the requirements of the section. For the first time before the Assessing Authority the point was raised that as no notice was issued to the partnership firm, the partners i.e. two companies cannot be proceeded with for assessment of the tax. When this plea was rejected by the 423 Assessing Authority the matter was taken up before the High Court, first before a single Judge and then before the Division Bench, which accepted the contention of the two companies and held that in the absence of notice to the partnership firm proceedings cannot be taken against the two companies for assessment of the tax. The relevant provisions under the United Provinces Agricultural Income Tax Act, 1948, may be noticed. Section 2(5) defines "Assessee" as meaning a person by whom agricultural income tax is payable. "Company" is defined under section 2(8) as meaning a company as defined in the Indian Income tax Act, 1922. The Indian Income tax Act, 1922, section 2(5A) defines a company as follows: "(5A) "company" means (i) any Indian company, or (ii) any association, whether incorporated or not and whether Indian or non Indian, which is or was assessable or was assessed as a company for the assessment for the year ending on the 31st day of March, 1948, or which is declared by general or special order of the Central Board of Revenue to be a company for the purposes of this Act;" "Firm" is defined in section 2(9) as having the same meaning assigned to it in the . Section 4 of the , states that "Persons who have entered into partnership with one another are called individually 'partners ' and collectively a firm and the name under which their business is carried on is called the 'firm name '". "Person" is defied in section 2(11) as meaning an individual or association of individuals, owning or holding property for himself or for any other, or partly for his own benefit and partly for that of another, either as owner, trustee, receiver, manager, administrator or executor or in any capacity recognized by law, and includes an undivided Hindu family, firm or company but does not include a local authority. It may be noted that by the definition the word "person" means an individual and includes a firm or a company. The liability of the person whether he be an individual, partner or the company for the agricultural income tax is therefore beyond question. The only point that is raised in this case is as to when there is a registered firm of which the two companies were partners the assessment proceedings cannot be taken against the two partners, namely the two companies, without proceeding against the 424 firm. In support of this contention section 18 of the U.P. Agricultural Income Tax Act was strongly relied on. Section 18 confers the power to assess individual members of certain firms, associations and companies. Sub section (1) of section 18 enables the Assistant Collector with the previous approval of the Collector of the disrict concerned to pass order under the circumstances stated in the sub Sec. that the sum payable as agricultural income tax by the firm or association shall not be determined, and thereupon the share of each member in the agricultural income of the firm or association shall be included in his total agricultural income for the purpose of his assessment thereon. Section 18(2) states that under certain circumstances the Collector may, with the previous approval of the Commissioner of the area concerned, pass an order that the sum payable as agricultural income tax by the company shall not be determined and thereupon the proportionate share of each member in the agricultural income of the company, whether such agricultural income has been distributed to the members or not, shall be included in the total agricultural income of such member for the purpose of his assessment thereon. The submission of the learned counsel for the respondent which was accepted by the High Court was that if the Agricultural Income tax authorities wanted to proceed against the individual members of the firm they ought to have taken proceedings under section 18(1) and in the absence of such proceedings the partners, in this case the two companies, could not have been proceeded with. The argument thus presented though looks attractive does not stand scrutiny. There is nothing in the provisions of the Act prohibiting the Assessing Authority from proceeding against the individuals forming the partnership. Section 18 enables the authorities while proceeding with the assessment of a firm or a company not to determine the tax payable by the firm or the company but proceed to determine the agricultural income of each member of the fir. The provisions do not apply to a case where the returns are submitted by the partners, as in this case, and the assessment made on that basis. The section would undoubtedly be applicable if assessment proceeding against the firm is stopped and the share of the individual is to be determined under the provisions of section 18. Our attention was not drawn to any provision in the Act which would bar the income tax authorities from proceeding against the individual partners on the returns submitted by the partners as such. Under the Indian Income tax Act it has been held that where a firm has not made a return and has not offered its income for assessment, the Department may assess a partner directly in respect of his share of the firm 's income without resorting to the machinery provided under the Act and without making an assessment on the firm, (CIT vs Murlidhar Jhawar & Purna Ginning 425 & Pressing Factory(1). It has been further held that once the Department has exercised its option and assessed the partners individually it cannot thereafter assess the same income in the hands of the firm as an unregistered firm. It is not necessary for us to refer to the distinction that is maintained under the Income tax Act between a registered and unregistered firm for no such distinction is maintained under the U.P. Agricultural Income Tax Act. The only prohibition is against double taxation. In this case no assessment proceedings have been taken against the firm much less any tax imposed on it. The principle that is applicable in tax statutes is that the income is subject to tax in the hands of the same person only once. Thus, if an association or a firm is taxed in respect of its income the same income cannot be charged again in the hands of the members individually and vice versa. The trust income cannot be taxed in the hands of the settlor and also in the hands of the trustee or beneficiary or in the hands of both the trustee as well as the beneficiary. These principles are, of course, subject to any special provision enabling double taxation in the statute. In the circumstances, we are unable to share the view of the High Court that without proceeding against the firm the Assessing Authority was in error in proceeding against the two partners of the firm on the basis of the returns submitted by them. There is yet another objection to the upholding of the plea of the respondents. Apart from submitting the returns their only plea in the earlier writ petition before the High Court was that the lands did not satisfy the requirements of the provisions of the U.P. Agricultural Income Tax Act in that they were not assessed to land revenue in the United Provinces nor were they subject to local rate or cess. This plea was accepted but the High Court remanded it for the determination of the question whether the land was assessed to land revenue or was subject to local rate or cess. The plea that the assessment proceedings ought to have been taken against the firm was not taken. This plea cannot be allowed to be taken in proceedings after remand. The objection was taken only before the Assessing Authority after remand. It is true that in the proceedings before the Assessing Authority the assessment relating to two Fasli years 1362 and 1363 which did not form part of the proceedings before the High Court was also taken up. But here again the returns were submitted by the two companies on the basis of their respective income. In the circumstances, it cannot be said that the tax authorities were in error in assessing a tax on the returns submitted by the two companies. The plea, therefore, that the 426 assessment on the two companies, in the absence of proceedings against the firm of which the companies were partners, is not legal cannot be upheld. The second contention that was raised before us was that it has not been established that the lands were either assessed to land revenue in the United Provinces or were subject to local rate or cess assessed and collected by an officer of the Provincial Government. As the Single Judge of the High Court and the Division Bench of the High Court accepted the plea of the assessees that the assessment proceedings against them could not be sustained because of the failure of the authorities to take proceedings against the firm, they considered it unnecessary to go into this question. It is unfortunate that this aspect of the matter was not considered either by the Single Judge or by the Division Bench of the High Court. We do not think it desirable to remit the case to the High Court for the determination of this question as the matter has been long pending. This plea has been elaborately considered by the Assessing Authority which has pointed out that agreements with the Raza Sugar Co. Ltd. and the Buland Sugar Co. Ltd. show that it was stipulated that the Rampur State shall from time to time grant to the Company lease of agricultural land. It was further provided that such fair equitable land revenue as may be agreed between the Rampur State and the Company shall be payable in respect of such land and shall be subject to revision by agreement every 15 years. The lease also provided that fair and equitable water rates and cesses shall be payable in respect of the land. In section 4(7) of the U.P. Land Revenue Act it is mentioned that the word "Mal Guzari" will be applicable where it has been duly assessed or has been determined by means of an auction or by any other means. On a consideration of all the relevant facts the Assessing Authority came to the conclusion that the agreement in favour of the companies provided for payment of land revenue and the word "rent" used in the leases has to be considered in relation to the original agreements and as such it is seen that the agreement provided for payment of land revenue. The learned counsel appearing for the respondents was unable to challenge the correctness of the finding of the Assessing Authority. On a consideration of all the facts that were placed before the Assessing Authority, we do not see any reason for not accepting the conclusion arrived at by the Authority. This issue also we find against the assessee. In the result we hold that the High Court was in error in coming to the conclusion that the assessment proceedings against the respon 427 dent were unsustainable. We set aside the judgment and order of the High Court and restore the order of the Assessing Authority. N.V.K. Appeal allowed.
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Two businesses that were owned by stockholders made deals with a former kingdom. The deals allowed the businesses to use farmland if they paid a fair amount of tax on the land. Later, the two businesses joined together to form a partnership. When the kingdom became part of India, the tax office in Uttar Pradesh sent the two businesses notices. The notices asked them to report how much money they made from farming. The businesses did so. The businesses filed legal papers challenging the tax orders. They argued that they shouldn't have to pay the tax because the land wasn't taxed as farmland, or any local tax, as required by the law. The High Court agreed and sent the cases back to the tax office to figure out if the land was taxed correctly. When the cases went back to the tax office, the businesses argued for the first time that the tax was invalid. They said that the tax office didn't send a notice to the partnership they had formed. The tax office disagreed. The tax office also said that the land did meet the requirements of the law. The law stated that the land had to be taxed as farmland, or any local tax. The two businesses filed more legal papers. A single judge in the High Court agreed with the businesses. The judge said that the tax office made a mistake by taxing the two partners without taxing the partnership. A group of judges in the High Court agreed with this view on appeal. The case was appealed to a higher court. It was argued that the law didn't say the tax office couldn't tax the two businesses without taxing the partnership. The higher court allowed the appeal, saying: 1. The tax office was correct to tax the businesses based on the reports they sent in. So, the argument that it was illegal to tax the businesses without taxing the partnership is not valid. 2. The word "person" in the law means an individual, a partnership, or a business. 3. The law doesn't stop the tax office from taking action against the individuals in a partnership. The law allows the tax office to figure out the income of each member of the partnership when assessing a partnership or a business. But, these rules don't apply when the partners submitted the reports and the tax was based on those reports. The rules would apply if the tax office stopped taxing the partnership and needed to figure out each person's share. 4. According to the Income Tax Act (a national tax law), if a partnership hasn't sent in a report, the tax office can tax a partner directly on their share of the partnership's income. They can do this without using the specific steps outlined in the law and without taxing the partnership. However, they can't tax the income twice. C.I.T. vs Murlidhar Jhawar & Purna Ginning & Pressing Factory, SC; was referenced. Also, the businesses didn't argue that the tax office should have taken action against the partnership at the beginning. They didn't make this argument before the tax office or the High Court. They can't make this argument later. The businesses submitted their reports based on their own income. 6. The tax office correctly decided that the agreement between the parties said that they had to pay tax on the land.
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Appeal No. Appeal by special leave from the judgment and order dated August 2, 1966 of the Allahabad High Court in Special Appeal No. 4 and 5. The Judgment of the Court was delivered by VAIDIALINGAM, J. The short question that raises for consideration in this appeal, by special leave, is whether the State Government has power under section 6G of the U.P. (hereinafter to be referred to as the Act) to withdraw an order already passed referring a dispute for adjudication. The State Government by Notification No. 785/LC/XVIII/LA 97(GR)/1959 dated October 25, 1960, referred the said dispute to the Labour Court, Gorakhpur, for adjudication. This reference (hereinafter to be referred to as Reference, No. 1) was registered by the Labour Court as Adjudication Case No. This award was published in the U.P. Gazette dated May 6, 1961, by the State Government 's Notification dated April 4, 1961, No. 1176(EIO)36/ A/46(ST) 59. There were similar disputes regarding the retirement of several other workmen and accordingly that dispute was referred by the State Government to the same Labour Court for adjudication by Notification No. This reference (hereinafter to be, referred to as Reference No. 11) was registered by the Labour Court as Adjudication Case No. At this stage it must be mentioned that Reference No. The three workmen covered by Reference No. Though the appellant opposed this application, the Labour Court by its order dated February 21, 1961, accepted the prayer of the three workmen and as such they ceased to have anything to do further in Reference No. Adjudication Case No. 98 of 1960, arising out of Reference No. 98 of 1960, arising out of Reference No. This award dated February 27, 1961, was published in the State Gazette on April 4, 196f. We have earlier mentioned that the award dated February 26, 1961, in Adjudication Case No. 93 of 1960, arising out of Reference No. After the award was made on February 26, 1961, the State Government issued a Notification on February 28, 1961, withdrawing the Notification dated October 25, 1960, making Reference No. No. ' No. No. 912(LC)/XVIII LA115(GR)/1959, dated November 21, 1960, referring the same question of retirement of workmen to Labour Court at Gorakhpur; Now, therefore, in exercise of the powers conferred by sub section (1) of section 6 G of the U.P. Act No. No. 785(LC)/ XVIII LA 97(GR)/1959, dated October 25 1960, referring the said dispute for adjudication, shall be and is hereby withdrawn." It will be noted from the above Notification that the State Government had withdrawn its previous order referring the dispute by Virtue of powers stated to be conferred under subsection (1) of section 6 G of the Act. We have also referred to the fact that the award in Reference No. It will be noted that the material dates to be considered with regard to Reference No.1 are as follows : (a) The dispute was referred for adjudication by Notification dated October 25, 1960. (b) The award was made on February 26, 1961. 70 (c) The Notification dated October25, 1960, referring the dispute was withdrawn by Notification dated February 28, 1961. (d) The award was published in the State Gazette dated May 6, 1961. It will be noted from these dates that the order withdrawing the original reference was made two days after the Tribunal had passed the award. The publication of the award was after the State Government had withdrawn its original order making the reference. The appellant filed the Writ Petition in the High Court under Article 226 for the issue of writ of certiorari quashing the award dated February 26, 1961 and also for a mandaus directing the State Government to withdraw its Notification dated May 6, 1961, publishing the award. The proceedings before the High Court related to the matters arising out of Reference No. According to the appellant, the, award dated February 28, 1961, had become ineffectual and useless in view of the State Government having withdrawn the Notification dated October 25, 1960, referring the dispute for adjudication. Its further contention was that having withdrawn on February 28, 1961, its previous order referring the dispute, the State Government had no power to publish the award, as it had done on May 6, 1961 and that the said order publishing the award had to be revoked. The union contested the Writ Petition on the ground that the State Government has no power under section 6 G to withdraw an order already passed referring a dispute for adjudication and that, in any event, it has no such power after an award has been made by a Labour Court or Tribunal. According to the union, the order of withdrawal dated February 28, 1961, is of no effect and that the publication of the award on May 6, 1961, was valid and that the State Government cannot be called upon to revoke the same. The learned single Judge posed two questions for consideration (1) whether the power to withdraw under section 6 G of the Act is confined to withdrawal for purposes of transferring the proceedings to another Court or Tribunal; and (2) whether the power under section 6 G can be exercised at any stage until the award of the Labour Court or Tribunal has become enforceable under section 6 A of the Act. The learned single Judge did not consider the first question and proceeded on the assumption that under section 6 G the State Government has power to Withdraw a reference already made. In this view, the learned single Judge held that the order of withdrawal dated February 28, 1961, was of no effect and that tie publication of the award on May 6, 1961, was according to law. The Division Bench of the Allahabad High Court has held that the State Government has power under section 6 G to withdraw any proceedings pending before a. Labour Court or Tribunal. But it held that as the award had been made on February 26, 1961, there were no proceedings pending before the Labour Court on February 28, 1961, when the order of withdrawal was passed by the State Government. In this view the Division Bench held that it was not open to the State Government to withdraw the proceedings after the award had been made by the Tribunal and, therefore, the Notification dated February 28, 1961, is of no effect. By judgment and order dated August 2, 1966, the learned Judges confirmed the order of the single Judge and dismissed the Special Appeal. The management has come to this Court in this appeal. Mr. G. B. Pai, learned counsel for the appellant, placed considerable stress on the language of section 6 G of the Act and pointed out that in addition to the power of transferring a proceeding from one Labour Court or Tribunal to another, the said section, has conferred an absolute right on the State Government to withdraw an order already passed referring a dispute for adjudication. The counsel very heavily relied on section 6 D of the Act and urged that this power of withdrawing a reference can be exercised till the date when the award becomes enforceable. In the case before us, the counsel pointed out that the award had been made only on February 26, 1961 and the reference had been withdrawn by the State Government on February 25, 1961, long before the award had become enforceable. The counsel urged that, in view of the circumstances pointed out above, the view of the High Court that the State Government has no power to withdraw the reference, as the award has been made, is erroneous. Mr. Daniel Latifi, learned counsel for the workmen concerned, on_ the other hand, urged that the view of the High Court that there is a power under section 6 G in the State Government to withdraw a reference is erroneous. The counsel pointed out that section 6 G confers on the State Government only a power to transfer a proceeding from one Labour Court or Tribunal to another. The counsel also pointed out that section 6 D has no bearing in the construction of section 6 G of the Act. When there is no power in the State Government to Withdraw a reference, the counsel pointed out, the question at what stage the proceedings can be withdrawn is purely academic. Even assuming that there is a power under section 6 G an the State Government to withdraw an order of reference already made, that section, the counsel pointed out, does not give power to order such withdrawal after an award has been passed. According to him once an award has been made by a Labour Court or Tribun proceedings before it come to a close and there is nothing for being withdrawn by the State Government. The counsel supported the reasoning of the High Court that section 6 G does not confer any Power on the State Government to 72 withdraw an order of reference after an award had been made by the Labour Court or Tribunal concerned. ' In our opinion, the first and foremost question that should have been considered by the High Court is whither section 6 G confers a power on the State Government to withdraw an order earlier passed referring a dispute for adjudication. We have already referred to the fact that the relief that was asked for by the appellant was by way of writ of mandamus directing the State Government to withdraw the publication, made in the Gazette of May 6, 1961, of the award by its order dated April 4, 1961. This relief was asked for by the appellant on the ground that the order dated February 28, 1961, of the State, Government withdrawing the reference was well within its power. Section 2(c) states : " ' Award ' means an interim or final determination of any industrial dispute or of any question relating thereto by, any Labour Court or Tribunal and includes an arbitration award made under Section 5 B." 'Section 4 K gives power to the State Government to refer for adjudication an industrial dispute to the Labour Court or an Industrial Tribunal under the circumstances mentioned therein. Section 6 dealing with the proceedings before a Tribunal, Submission of the award and its publication runs as follows : "6. Awards and action to be taken thereon (1)Where an industrial dispute, has been referred to a Labour Court or Tribunal for adjudication, it shall hold its proceedings expeditiously 'and shall as soon as it is practicable on the conclusion thereof. 73 (3)Subject to the provisions of sub section (4) every arbitration award and the award of a Labour Court or Tribunal, shall within a period of thirty days from the date of its receipt by the State Government, be published in such manner as the State Government thinks fit. (4)The State Government may before publication of an award of a Labour Court or Tribunal under sub section (3), remit the award for reconsideration of the adjudicating authority , and that authority shall, after reconsideration submit its award to the State Government, and the State Government shall publish the award in the manner provided in sub section (3). (5)Subject to the provisions of section 6 A, an award published under sub section (3) shall be final and shall not be called in question in any court in any manner whatso ever. The above section clearly indicates that when once an industrial dispute has been referred for adjudication, the Labour Court or Tribunal has to conduct its proceedings expeditiously and it has to submit its award to the State Government. The award has to be published within thirty days of its receipt by the State Government. Power has no doubt been given to the State Government, before publication of an award, to remit the same for reconsideration. An award published under sub section (3) is final subject to the provisions of section 6 A. The general rule, as provided under sub section (1) is that an award becomes enforceable on the expiry of thirty days from the date of its publication under section 6. Sub ,section (3) provides for a slightly different period depending upon the circumstances mentioned, therein. Sections 6 D and 6 G are as follows "6 D. Commencement and conclusion of proceedings, Proceedings before a Labour Court or Tribunal shall be deemed to have commenced on the date of reference of a 74 dispute, to adjudication, and such proceedings shall be deemed to have concluded on the date on which the award becomes enforceable under section 6 A." "6 G. Power to transfer certain proceedings (1)The State Government may, by order in writing and for reasons to be stated therein, withdraw any proceeding under this Act, pending before a Labour Court or Tribunal or transfer a proceeding from one Labour Court or Tribunal to another Labour Court or Tribunal, as the case may be, for the disposal of the proceeding and the Labour Court or Tribunal to which the proceeding is so transferred may, subject to any special directions in the order of transfer, proceed either de novo or from the stage at which it was so transferred; Provided that where a proceeding under section 6 E or section 6 F is pending before a Tribunal, the proceeding may also be transferred to a Labour Court. (2) Without prejudice to the provisions of sub section (1) any Tribunal, if so authorized by the State Government, may transfer any proceeding under section 6 E or section 6 F pending before it to any one of the Labour Courts specified for the disposal of such proceedings by the State Government by notification in the Official Gazette and the Labour Court to which the proceeding is so transferred shall dispose of the same." Sections 6 D and 6 G substantially correspond to sub section (3) of section 20 and section 33 B respectively of the (Central Act XIV of 1947). It must be stated that a superficial reading of sub section (1) of section 6 G in isolation will give the impression that the State Government has got two distinct and separate powers, namely (a) to withdraw any proceedings under the Act pending before a Labour Court or Tribunal,; or (b) to transfer the proceedings from one Labour Court or Tribunal to another Labour Court or Tribunal for disposal of the same. It is on the basis of such a reading of the section that Mr. Pai, the learned counsel, urged that there is an absolute power in the State Government to withdraw an order already passed referring a dispute for adjudication. This power ' according to the learned counsel, is distinct and separate front the power given under the same section to the State Government to transfer a proceeding from one Labour Court or Tribunal to another. 75 We have already pointed out that section 6 casts a duty on the Tribunal, when a dispute has been referred to it, to deal with it expeditiously and to submit its award to the State Government. No doubt sub section (4) of section 6 gives power to the State Government, before publishing the award, to remit the same for reconsideration. Section 6 A also gives certain powers toy the State Government regarding the award, which normally becomes enforceable under sub section (1) on the expiry of thirty days from the date of its publication. Section 6 G, in our opinion, deals only with the power of the State Government to transfer a proceeding from one Labour Court or Tribunal to another and for purposes of such transfer to withdraw the proceedings from the Labour Court or Tribunal from whom it is being transferred. We are free to admit that the wording of sub section (1) is capable of being construed as conferring on the State Government a power to withdraw any proceedings or to transfer a proceeding from one Labour Court or Tribunal to another. But having regard to the scheme of section 6 G, read in the light of the other provisions referred to earlier, the section will have to be interpreted as giving to the ,State Government only a power to transfer a proceeding from one Labour Court to another. When section 6 makes it obligatory that an award has to be made by the Tribunal concerned, and that it has to, be published by the State Government within thirty days of its receipt and declare that the award on publication becomes final, it is idle to expect that the legislature intended to nullify the entire proceedings. by conferring an absolute power of withdrawal on the State Government under section 6 G. The proper way of reading section 6 G is to limit the power of withdrawal, referred to therein, only for the purpose of transferring the proceedings from one Labour Court or Tribunal to another. So read, the power conferred under section 6 G on the State Government is that of withdrawing any proceedings from one Labour Court or Tribunal and transferring the same to another. (1) Adopting the same principle and having due regard to the object of section 6 G, which essentially is only to confer in the State Government a power to transfer a proceeding from one Labour Court or Tribunal to another, the expression 'or ' has to be read in section 6 G as 'and ', If so read, sub section (1) of section 6 G confers on the State Government only a power to withdraw a proceeding from one Labour Court or Tribunal and transfer the same to another. It is needless to state that transfer of a proceeding can only be when it is pending before A Labour Court or Tribunal. Similarly under section 6 F a question may arise whether an employer has contr avened the provisions of section 6 E during the pendency of proceeding before a Labour Court or Tribunal. For the purpose of considering the question whether ,any proceedings were pending, the Act has created a fiction under section 6 D by indicating the starting point of a proceeding before a Labour Court as well as its conclusion. During this period broadly it has to be considered that proceedings are pending before a Labour Court or Tribunal. But it does not come into the picture, as mentioned earlier, in construing section 6 G. Mr. Pai referred us to the decision of this Court in The Sirsilk Ltd., and Others vs Government of Andhra Pradesh & Another(2), where the provisions of section 17 and 18 of the Central Act were read in harmony and the State Government was directed not to publish the award though its publication was mandatory. We have already referred to the fact that in Adjudication Case No. 98 of 1960, arising out of Reference No. 11, respondents 4 to 6 herein had requested the Labour Court to exclude them from the said adjudication on the ground that they are already covered by Adjudication Case No. 93 of 1960, arising out of Reference No. The Labour Court passed an order on February 21, 1961, excluding the said three workmen from Adjudication Case 'No. That means the said three workmen had no further interest in the said Adjudication Case. If that is so, the award passed on February 26, 1961, in the case arising out of Reference No. 1 was perfectly correct and the publication of the said award on May 6, 1961, was also in pursuance of the mandatory provisions of the Act. Hence the appellant cannot seek any assistance from the decision of this (1) (2) 77 Court in The Sirsilk Ltd., and Others vs Government of Andhra Pradesh& Another(1) and it cannot ask for a writ of mandamus directing the State Government to cancel the publication of the award. We are in agreement with the view of the High Court that the appellant is not entitled to any relief, though for different reasons.
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The company appealed because of a problem with three workers who were retired. The problem was sent to the Labour Court in Gorakhpur to be decided. The Labour Court called it Case No. 93 of 1960. Both sides wrote down their arguments, and the Labour Court looked at everything. On February 26, 1961, the Labour Court said that retiring the three workers was wrong and not fair. There were similar problems with other workers being retired. These problems were also sent to the same Labour Court and were called Case No. 98 of 1960. The three workers from the first case were also included in the second case. They asked the Labour Court to take their names out of the second case, and the Labour Court did. The Labour Court made a decision in the second case on February 27, 1961. In this decision, the Labour Court said it was not making any decisions about the three workers from the first case. The company asked the state government to do something about the first case. On February 28, 1961, the state government said it was taking back the first case about the three workers. This was supposed to be done according to a specific rule (section 6 G) in the U.P. Act. But even after that, the state government announced the Labour Court's decision in the first case on May 6, 1961. The company asked the High Court to issue a special order (writ of certiorari) to cancel the Labour Court's decision from February 26, 1961. They also wanted the High Court to order (mandamus) the state government to take back its announcement from May 6, 1961. This request was made under article 226 of the Constitution. Both the first judge and a group of judges decided against the company. The company then appealed to this Court, which HELD: (i) The way section 6 G (1) is written could mean that the state government has the power to take back any case or move a case from one Labour Court or Tribunal to another. But when you look at the whole plan of section 6 G, along with the other rules in the Act, the section should be understood to only give the state government the power to move a case from one Labour Court to another. Section 6 says that the tribunal must make a decision (award) and the state government must announce it within 30 days. So, it doesn't make sense that the government would also have the power to completely take back a case, according to section 6 G. The right way to understand section 6 G is that it only allows the government to take back a case to move it to a different Labour Court or Tribunal. [75D] Sections 33B and 6 D of the Act do not change this conclusion. The case of Sirsilk Ltd. and Others vs Government of Andhra Pradesh & Another was different. (ii) The word 'or' in section 6 G (1), between 'withdraw any proceedings' or 'transfer a proceeding,' should be understood to mean 'and.' [75H] This is based on the case of Mazagaon Dock Ltd. vs The Commissioner of Income Tax and Excess Profits Tax.
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No. 151 of 1967. M. C. Chagla and Mohan Behari Lal, for the petitioner. O. P. Rana, for respondent No. P. M. Mukhi, Bishamber Lal and H. K. Puri, for the intervener. The Judgment of WANCHOO, C.J., SIKRI, SHELAT and VAIDIALINGAM, JJ. was delivered by SHELAT, J. BHARGAVA, J., delivered a separate opinion. Shelat, J. On August 17, 1934 the Governor in Council of the then United Provinces, in exercise of powers under section 3 (1) of the Indian Electricity Act, IX of 1910 issued three licences to M/s. In 1937 the licences were assigned by the said M/s. The petitioner company has since then been supplying under the said licences electricity to consumers within the said areas of the licences. It is an admitted 314 position that though the petitioner company had the said licences assigned to it it did not acquire any exclusive or monopolistic right of supplying electrical energy within the said areas. Clause (e) of sec. 3(2) of 1910 Act which governed the said licences provides that the grant of a licence thereunder shall not in any way hinder or restrict the grant of a licence to another person within the same area of supply for a like purpose. The Electricity (Supply) Act, LIV of 1948 (hereinafter referred to as 1948 Act) by sec. 19(1) provides that the Board may, subject to the provisions of this Act, supply electricity to any licensee or person requiring such supply in any area in which a scheme sanctioned under Chapter V is in force. 19(1), however, lays down that the Board shall not : "(b) supply electricity for any purpose to any person, not being a licensee for use in any part of the area of supply of a licence without the consent of the licensee, unless the maximum demand of the licensee, being a distributing licensee and taking a supply of energy in bulk is, at the time of the request, less than twice the maximum demand asked for by any such person; or the licensee is unable or unwilling to supply electricity for such purpose in the said part of such area on reasonable terms and conditions and within a reasonable time. " Section 26 provides that "Subject to the provisions of this Act, the Board shall, in respect of the whole State, have all the powers and obligations of a licenses, under the , and this Act shall be deemed to be the licence of the Board for the purposes of that Act. " Though the Board is not a licensee for the purposes of the 1948 Act the Act being deemed to be the licence for the Board under Sec. 26 it is a licensee under the 1910 Act. 26 however is subject to the provisions of the Act which means that it is inter alia subject to the provisions of sec. Therefore, in the absence of a scheme under Chapter V, the Board, though a licensee under the 1910 Act, was not competent to supply directly electrical energy to consumers such as the 3rd respondent. Section 2 of the Amendment Act substituted the following, for cl. (e) of sec. 3(2) of the 1910 Act: 315 "(e) grant of a licence under this Part for any purpose shall not in any way hinder or restrict (i) the grant of licence to another person within the same area of supply for a like purpose; or (ii) the supply of energy by the State Government or the State Electricity Board wihin the same area, where the State Government deems such supply necessary in public interest. " It also added after sub sec. 2, the following sub sec. 3: "(3) Where the supply of energy in any area of the State Electricity Board is deemed necessary under subclause (ii) of clause (e) of sub section (2), the Board may, subject to any terms and conditions that may be laid down by the State Government, supply energy in that area notwithstanding anything to the contrary contained in this Act or the Electricity Supply Act, 1948. " Sec. 3 of the Amendment Act also added a new sub sec. (1 B) in sec. 28 of the 1910 Act. The State Government may notwithstanding that sanction for engaging in the business of supplying energy to the consumer in an area has been given to any person under sub section (1), whether before or after coming into force of the Indian Electricity (U.P. This sub section has no application to the licensees for, it empowers the State Government either to supply directly or authorise the Board to directly supply energy even in an area for which it has given sanction to a person other than a licensee to engage in the business of supplying energy to the public in such area. A perusal of these provisions makes it clear that the Board can directly supply electricity to the consumers and the State Government also can authorise the Board to do so provided the State Government deems it necessary in public interest that it should be so done. The condition precedent for the direct supply by the Board to the consumers in the area where a licence has been granted to a licensee is that such supply by the Board must be deemed necessary by the State Government in public interest. These were to apply to both the licensees obtaining bulk supply from the Board and to consumers to whom electrical energy was being supplied direct by the Board in the area covered by the said Grid. According to these rates, consumers to whom electrical energy was being supplied direct by the Board would pay a demand charge at the rate of Rs. 8/ per KVA and on energy charge at the rate of 4.5nP per KWH for the first 170 KWH per KVA, at the rate of 3.5nP for the next 170 KWH per KVA and at the rate of 3.0 nP per KWH for the remaining KVA consumed during the month. For the licensees, the rates were Rs. 12.75 per KVA for the demand charge for the first 500 KVA, Rs. 10 per KVA for the next 1500 KVA and Rs. 8.50 per KVA for above 2000 KVA of the chargeable demand during the month. For energy charge, the rates were 5 nP per KWH for the first 170 KVM per KVA, 4nP per KWH for the next 170 KWH per KVA and 3nP per KWH for the remaining KWH per KVA of chargeable demand consumed during the month. As the Board was not yet authorised by the State Government to supply electricity directly to the consumers within the areas of the petitioner company 's licences the 3rd respondent entered into an agreement in 1964 for a period of 3 years under which the petitioner company was to supply electricity to it. On September 21, 1966 the State Government issued a notification which stated that the Governor deemed it necessary in public interest that the State should supply energy to the 3rd respondent and in exercise of the power under sec. 3 (2) (e) of the 1910 Act as amended by Act XXX of 1961 directed the Board to give direct supply of energy to the 3rd respondent on the same terms and conditions on which the Board was supplying energy I to other consumers. It seems that the Board was still not ready to supply energy direct to the 3rd respondent and therefore on April 18, 1967, only one day before the said agreement would have ended, the 3rd respondent withdrew the said notice. The result of the notification dated September 21, 1966 was two fold : (1) that notwithstanding the subsistence of the petitioner company 's licences and its right thereunder to supply energy to consumers within the areas of its licences, the Board 317 was directed to supply energy to the 3rd respondent and (2) that the Board was directed to supply energy to the 3rd respondent at rates lower than the rate charged by the Board from the petitioner company as the licensee. Mr. Chagla appearing for the petitioner company raised the following three contentions : ( 1 ) that the amended sec. 3 (2) (e) was invalid on the ground that it amounted to acquisition of the petitioner company 's property and as no compensation has been provided for such acquisition cl. (e) of section 3 (2) was in violation of article 31(2) of the Constitution; (2) that the notification dated September 21, 1966 was ultra vires sec. 3 (2) (e) as the direction by the State Government to the Board to supply electricity directly to the 3rd respondent was not founded on public interest; and (3) that the said direction to supply electricity at rates chargeable from the consumers as against the rates chargeable to the licensees was discriminatory. The respondents, on the other hand, contended that the 3rd respondent was a concern in which the Government has an interest to the extent of 51 % of its share capital, that therefore, it was almost a public utility concern, that supply by the petitioner company to the 3rd respondent was found to be defective resulting in lay off of labour on several occasions and consequent loss in production and that therefore the Government was justified in public interest to issue the said notification. It was alleged that owing to defective and short supply by the petitioner company there Were high tension trappings on numerous occasions resulting in low voltage, the consequence Whereof was that the 3rd respondent was obliged to stop the working of the Mills sometimes for several hours. The petitioner company 's case, however, was that these allegations were an afterthought and that the real object in issuing the notification dated September 21, 1966 was to subvert the petitioner company 's rights under the said licences. Though the allegation was that supply of energy by the petitioner company to the 3rd respondent suffered from shortage and other defects the 3rd respondent does not seem to have at any time made any complaint about such shortage or defects either to the petitioner company or to the Board or to the State Government. Even when the petitioner company, after the said notification was issued, made a representation to the State Government to reconsider its decision the Government did not, while rejecting it, rely upon the fact that the petitioner company was not in a position to give full and proper supply of energy to the 3rd respondent or that supply by it was, as now alleged, short or defective. It is an undisputed fact that the petitioner company has been throughout all these years supplying high tension energy to the 3rd respondent and the 3rd respondent has been converting such high tension energy into low tension energy through its own transformers. The aforesaid annexure shows that though the high tension trippings were only for a few minutes except on three or four occasions low voltage was for several hours. In some cases though there was no tripping at all there was low voltage for as long as sixteen hours. It is clear, therefore, that the petitioner company had no difficulty in maintaining supply of high tension electrical energy to the 3rd respondent and there must have been some defect in the stepping down system of. It is impossible thus to find from the annexure that the petitioner company was guilty in any manner of shortage or defective supply of high tension energy to the 3rd respondent. The allegation therefore that the 3rd respondent suffered in production and losses as a result of short or defective supply by the petitioner company is not borne out by the record in this case. If there was any justification for the allegation now made by the respondents it is inconceivable that for all these years the 3rd respondent would not have made any complaint for such defective supply either to the Board or to the State Government. It is certain that but for the amendment of sec. 3 (2) (e) of 1910 Act, the Board, though a licensee under that Act, could not have supplied energy directly to the 3rd respondent in the absence of a scheme under sec. 19 of 1948 Act. Under the proviso to that section the Board would not have been entitled to supply energy for any purpose to any person not being a licensee for use in any part of the area of supply of a licensee without the consent of such licensee. It is true that under its licences the petitioner company was not conferred monopolistic rights to supply energy to the consumers and the Government could have granted another licence to another licensee. But the Government has not granted such licence to any other person. But it was said that the Board was another such licensee. As already stated the Board could not have distributed energy to the consumers though it is a licensee under 1910 Act unless (a) there was a scheme or (b) that it was authorised in public interest under the amended sec. Neither of these two conditions having been fulfilled it 319 is clear that the notification of September 21, 1966 and the direction contained therein to the Board to supply energy to the 3rd respondent were in breach of the petitioner company 's rights under its licences and the requirements of the amended sec. Apart from its being in breach of the amended sec. 3 (2) (e) and the petitioner company 's rights under its licences, the notification and the Government 's direct on to the Board therein results in clear discrimination. If the Board were to supply energy directly to the 3rd respondent it has to do so at rates lower than the rates at which electricity is supplied by it to the petitioner company. It follows therefore that the notification of September 21, 1966 cannot be sustained as a valid notification as it is discriminatory and is also in breach of the amended sec. 3 (2) (e) of 1910 Act. In that view the Board is not entitled to supply directly electricity to the 3rd respondent as the direction contained in the said notification which is the only authority under which it could so supply is invalid in law. In this view, it is not necessary for us to decide the question whether the amended sec. The said notification being thus invalid respondents 1 and 2 are directed not to, supply electrical energy directly to the 3rd respondent. Bhargava, J. I agree with my brother Shelat J. that the notification of September 21, 1966 cannot be sustained as a valid notification because it is discriminatory and consequently I concur in the order proposed by him. I am, however, not prepared to hold that that notification is also invalid, on the other two grounds, viz., that the notification and the directions contained therein to he Electricity Board to supply energy to the third respondent were in breach of the petitioner Company 's rights under its licence and of The requirements of the amended section 3 (a) (e). It is admitted on all hands that under its licences, the petitioner company was not conferred monopolistic rights to supply energy 320 to the consumers in the area covered by the licences and that Government could have granted another licence to another licensee to supply energy in the same areas without violating any provision of the Electricity Act of 1910 or of the conditions or which licences were granted to the petitioner Company. It in true that the Government has not granted any such licences to any other person but, in my opinion the effect of the subsequent legislation is to bring into existence another statutory licencee viz., the Electricity Board and any directions permitting the Elec tricity Board to supply electricity in the areas covered by the petitioner Company 's licences cannot be held to be in violation of the conditions of those licences. By the Electric Supply Act 1948, the Board 'was constituted a licensee for purposes of the Electricity Act of 1910, though section 26, which brought about this result, provided that in that capacity, the Board was subject to other provisions of the Electric Supply Act 1948. One such provision is contained in section 19(1) of the Act of 1948. The U.P. Electricity Amendment Act 1961, however, introduced provi sions in the Act of 1910 the result of which was that the Board, in acting as a licensee under the Act of 1910, was no longer subject to the limitation laid down in section 19(1) of the Act of 1948. It has not been contended that either the Supply Act of 1948 or 'the U.P. Electricity Amendment Act of 1961 was not competently enacted by the appropriate legislature. The Supply Act of 1948 was no doubt passed by the Central Legislature in respect of a concurrent subject but the U.P. The result of that legislation was that the Electricity Board became a licensee under the Electricity Act of 1910 and was no longer subject to the limitation laid down in section 19(1) of the Electricity Supply Act of 1948. Electricity Amendment Act 1961 that remained was that the Board could supply electricity only after the Stat Government issued a valid notification under clause (e) of section 3(2) of the Act of 1910. If the State Government was competent under the original section 3(2) (e) of the Act of 1910 to grant a licence to any person for supply of electricity in the areas covered by the licences issued to the petitioner Company, I do not see why v similar result could not be validly brought about by legislation, by the appropriate legislatures creating a statutory licensee for purposes of the Act of 1910. Consequently, the power granted to the Electricity Board by the notification of September 21, 1966 to supply electricity to a consumer in the area covered by one of the licences of "he petitioner Company cannot be, held to be in violation of the conditions of the licence. 321 I further considered that, in view of the language of the provisions contained in the amended section 3(2) (e) of the Act of 1910, it is not competent for this Court in this writ petition, on the material available, to declare that the notification of September 21, 1966 is invalid because the direction contained therein was not made by the State Government in public interest. The power under the amended section 3 (2) (e) is to be exercised when Government deems it necessary in public interest. The notification, on the face of it, shows that the State Government did apply its mind before issuing that notification and form the opinion that in this particular case it was necessary in public interest that the Board should be directed to supply electricity to respondent No. 3 in the area covered by one of the licences of the petitioner Company. State Government on material which I do not think can be said to be totally irrelevant for the purpose of forming such opinion. As long as the State Government based its order on an opinion formed on relevant material, it is not open to the courts to examine and take a different view on the basis of other material such as want of complaints by respondent No. 3 to the Government that the supply of energy by the petitioner Company was not satisfactory. It is not for courts to sit in judgment over the view of the State Government which the State Government is required to form in order to make an order under the amended section 3 (2) (e). Consequently, I cannot hold that the notification of September 21, 1966 was invalid on the ground that it was issued in breach of the amended section 3(2) (e) of the Act of 1910.
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A company that had a license to sell electricity was supplying it to a business. The Electric Supply Act of 1948 created an Electricity Board. Later, a change to the law allowed the Board to sell electricity directly to customers, like the business mentioned above. The state government told the Board to start selling electricity directly to that business. The Board charged companies that sold electricity to others more than they charged customers who bought electricity directly from the Board. The business ended its agreement with the company that had the license. The company with the license then filed a legal challenge under Article 32 of the Constitution. The court decided that the government's order was not valid because it was unfair. If the Board sold electricity directly to the business, it had to charge less than what it charged the company with the license. Since the company with the license paid more for electricity, it had to charge its customers higher prices. This meant the business would get electricity at a much lower price than other customers, including other businesses in the area. The court said the order unfairly favored the business over other customers and the company with the license. (Justices Wanchoo, Sikri, Shelat, and Vaidialingam agreed on this.) The Board could not sell electricity to customers unless there was a specific plan in place or it was authorized to do so in the public interest. Since neither of these conditions was met, the court said the order telling the Board to supply electricity to the business violated the company's rights under its license. The court also said there was no proof that the business had problems with its production or suffered losses because the company with the license provided poor service. If there was a good reason for the business to complain, it would have complained to the Board or the state government a long time ago. (Justice Bhargava disagreed with part of the decision.) He said the order should not be considered invalid just because it may have violated a specific section of the law. If the state government could give a license to someone else to sell electricity in the area covered by the company's license, then the government could also create a "statutory licensee" (someone licensed by law) to do the same thing. Therefore, the order allowing the Electricity Board to sell electricity to a customer in the area covered by the company's license did not violate the terms of the license. Because of the way the law is written, the court could not declare the order invalid just because the state government did not make the order in the public interest. As long as the state government based its decision on relevant information, the courts should not question that decision.
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ition (Civil) No. 849 of 1987. (Under Article 32 of the Constitution of India). Petitioner in person and M.S.Ganesh for the petitioner. 442 K. Parasaran, Attorney General and Ms. A. Subhashini for the Respondents. The following order of the Court was delivered: O R D E R This application has been filed by an Advocate of this Court by way of a public interest litigation. It had been listed earlier and learned Attorney General had entered appearance on behalf of the Union of India. We have heard the petition. It has been couched in unsavoury language and the petitioner seems to have made an intentional attempt to indulge in mud slinging against the advocates, this Court in particu lar as also other constitutional institutions. Many of the allegations in his writ petition are likely to lower the prestige of this Court as the apex judicial institution. At one place in the writ petition, he has alleged: "Thus the working of the Judges are cocktail based on Western Common Laws and American techniques, as such unproductive and out dated according to socio economic conditions of the country. " At one another place, the petitioner has stated that: "This Court has become a constitutional liability without having control over the illegal acts of the Government . Thus the people for whom the Constitution is meant have now turned down their faces against it which is a did illusionment for fear that justice is a will of the Wisp." Yet at another place the petitioner has stated that this Court is sleeping over the issues like 'Kumbhkarna. ' The reading of the writ petition gives the impression that it is clearly intended to denigrate this Court in the esteem of the people of India. We are of the priam facie view that the petition has been drawn up with a designed purpose of bringing the Court into contempt and the petitioner is, therefore, prima facie guilty of contempt. The writ petition has been drafted in a careless manner. At several places the pleadings are meaningless. At several other places 443 they are contradictory. The allegations are clumsy and several irrelevant facts have been put into the petition to inflate its size. The petitioner has left out no institution from his attempt of mud slinging. We have a feeling that while drawing up the petition the petitioner has considered himself to be the only blemishless person and everyone else including social institutions to be blame worthy. We are surprised that an advocate practising in this Court with considerable experience has choosen to act in such an irresponsible manner. The writ petition, in our opinion, therefore, deserves to be dismissed. We, accordingly, dismiss the writ petition. We direct the Registry to draw up an appropriate proceeding for contempt and issue notice to the petitioner calling upon him to show cause in person on 9.11.1987 as to why he may not be proceeded under the Contempt of Court Act. At page 41 of his petition, the petitioner has stated. "This is a public interest litigation in the interest of independence of judiciary and social justice . " We are of the view that the petition is an act against public interest. The petitioner has certainly over stepped the limit of self restraint, so much necessary in a public interest litigation. We direct the Registry not to entertain any application by way of public interest litigation by the petitioner in future.
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A lawyer filed a lawsuit saying the Supreme Court justices were mixing up Western and American legal ideas. He also claimed the Court wasn't stopping the government's illegal actions and was ignoring important problems. The Court rejected the lawsuit and said the lawyer was likely guilty of contempt of court. The Court felt the lawsuit was meant to make the Indian people think badly of the Court. The Court said the lawyer's claims were poorly made. They believed he was trying to damage the Court's reputation as the highest court in the country. The Court ordered the court staff to start a contempt of court case against the lawyer and notify him. The Court said the lawsuit was against the public good. The Court felt the lawyer had gone too far and hadn't shown the proper restraint needed in this type of case. The Court ordered the court staff not to accept any more lawsuits from this lawyer in the future.
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From the Judgment and Order dated 17.3.1978 of the Bombay High Court in Second Appeal Nos. Litigation, between two sisters, by way of cross suits, one, for permanent injunction by the appellant basing her claim on gift deed executed in 1954 by her mother, a Hindu widow, of the entire estate inherited by her from her husband, and another for declaration and partition by respondent assailing validity of the gift deed and claiming reversioner 's right after death of the mother in 1968, has reached this Court by grant of special leave against judgment of the Bombay High Court in Second Appeal raising a legal issue of seminal importance as to nature of right and title of female donee of Hindu widow 's estate after coming into force of Hidnu Succession Act (hereinafter refferred to as the Act). Did she become an owner of a widow 's 605 estate, a limited owner, an owner with some right or title, so as to acquire rights of absolute ownership under section 14 of Act or a trespasser and if trespasser then whether she acquired rights by adverse possession by perfecting her rights against the donor only or it was essential to prescribe rights against reversioners as well? The appellate court while affirming the finding on section 14 of the Act allowed the appeal and dismissed the suit as `adverse possession against the widow is not adverse against reversioners, and the next reversioner is entitled to recover the possession of the property or his share in it within 12 years from the date of the death of the widow '. It was further held that the appellant could not acquire, any right by, `estoppel under section 41 of the Transfer of Property Act against the reversioners by reason of the widow 's conduct '. But before doing so the claim of the appellant that she became an absolute owner under section 14 of the Act, reiterated, once again, in this Court, may be examined as it is a question of law. A full bench of the Delhi High Court in Smt. Daultu, AIR 1968 Delhi 264 held that possession of a female donee in pursuance of gift deed executed by her mother could not be characterised as illegal or of trespasser, therefore, she being a female Hindu `possessed ' of the property on the date came into force became an absolute owner under section 14 of the Act. Thus according to Delhi Court a donee of even entire Hindu widow 's estate became absolute owner under section 14 of the Act whereas according to Patna, Calcutta, Punjab, Madras and Andhra Pradesh High Courts, rights of a female donee under Hindu Law, prior to coming into force of the Act did not get enlarged under section 14 of the Act and it did not preclude reversioners from assailing validity of the gift deed. To ascertain which view accords more to the objective sought to be achieved by the Act it appears necessary to extract section 14 which reads as under: (1) Any property possessed by a female Hindu,whether acquired before or after the commencement of this Act, shall be held by her as full owner thereof and not as a limited owner. Explanation In this sub section, "property" includes both movable and immovable property acquired by a female Hindu by inheritance or devise, or at a partition, or in lieu of maintenance, or arrears of maintenance, or by gift from any person, whether a relative or not, before, at or after her marriage, or by her own skill or exertion, or by purchase or by prescription, or in any other manner what 607 soever, and also any such property held by her as Stridhana immediately before the commencement of this Act. (2) Nothing contained in sub section (1) shall apply to any property acquired by way of gift or under a will or any other instrument or under a decree or order of a civil court or under an award where the terms of the gift, will or other instrument or the decree, order or award prescribe a restricted estate in such property. In Eramma vs Verrupana, , this Court observed, "The object of the section is to extinguish the estate called `limited estate ' or `widow 's estate ' in Hindu Law and to make a Hindu woman, who under the old law would have been only a limited owner, a full owner of the property with all powers of disposition and to make the estate heritable by her own heirs and not revertible to the heirs of the last male holder". But did the legislature intend to extend same benefit, namely, enlarge the estate, held, on the date the Act came into force by any or every female Hindu into full and absolute estate irrespective of whether she was a limited owner or not. Relying on the explanation, to the section, it was urged that it not only explained meaning of the word `property ' but it left no room for doubt that a female Hindu possessed of any property, which satisfied the extended meaning on the date the Act came into force, became an absolute owner. It was further argued that the expression `limited owner ' has been used in the section not to whittle down the otherwise simple and plain meaning of the words `female Hindu ' by introducing narrow concept of widows ' estate or limited owner but to put beyond doubt the nature and status of rights of females after the Act. Support was also drawn from the marginal note of the section and it was urged that the words, `property of a female Hindu to be her absolute property ', was yet another indication to interpret the word `female Hindu ' widely, so as to include in its ambit a donee from a limited owner. Mere provision that any property possessed by a female Hindu on the date the Act came into force shall be held by her would have been incomplete and insufficient to achieve the objective of removing inequality amongst male and female Hindus unless it was provided that the otherwise limited estate of such a female would become enlarged into full or absolute estate. Whereas if it is read in its entirety with one part throwing light on another then the conclusion is irresistible that a limited owner became a full owner provided she was 609 in possession of the property on the date of enactment of the Act. Property acquired by a female Hindu before the Act came into force comprised, broadly, of inherited property or stridhana property acquired by her from a male or female. Nature of her right in either class of property, unlike males, depended on the school by which she was governed as well as whether it came to her by devolution or transfer from a male or female. A female Hindu who but for the Act would have been a limited owner become full owner. To put it differently a limited owner become a full owner provided she was a female Hindu who was possessed of any property acquired before the commencement of the Act. Further the Act being applicable by virtue of section 2 to not only Hindus by religion but also to Buddhists, Jains or Sikhs and to any person who was not a Muslim, Christian, Parsi or Jew it was but necessary to use an expression of such wide connotation as female Hindu because by virtue of sub section (3) of the section the word `Hindu ' in any portion of the Act, which includes section 14, the word had to be understood as including not only a person who was Hindu by religion but even others. Its effect was that a female Hindu became absolute owner not only in respect of inherited property but even of property received by way of gift or on partition or in lieu of maintenance etc. And not that it enlarged the estate of even those who were not limited owner. Since in every case whether it was decided for or against it was the widow who was alive on the date the Act came into force and she being a limited owner the decision turned on if she was `possessed ' of the property so as to become full owner. 1 SCR 968=AIR the widow was held to have acquired rights as the adoption made by her having been found to be invalid she was deemed to be in constructive possession and thus `possession ' of the property on the date the Act came into force. Rattno, ; was another case where widow 's constructive possession enured to her benefit as she having been dispossession by her collaterals in 1954 and filed a suit for recovery of possession before the Act came into force was held to be `possession ' of the property so as to entitle her to become full owner. In Sukhram vs Gauri Shankar, ; it was held that a widow was full owner in joint Hindu family property as she became entitled to the interest which her husband had by virtue of Hindu Women Right to Property Act. V. Tulsamma vs Shesha Reddy; , and Bai Vijia vs Thakorbhai Chelabhai, were cases where the widow was `possessed ' of the property in lieu of maintenance, and therefore, she was held to be full owner. In all these cases since the widow was in possession, actual or constructive, on the date the Act came into force she was held to be a female Hindu `possessed ' of the property, and consequently, her limited ownership stood converted into full ownership by operation of law. in Eramma 's case (supra) the benefit was denied as Hindu Women 's Right to Property Act being not applicable on the date the succession opened she could not be held to be possessed of the property. And in 611 Kuldeep Singh 's case (supra) she had been divested of her interest as a result of transfer made by her. mention is necessary to be made in this connection about observation in Gulwant Kaur vs Mohinder Singh, ; that the Court in Bai Vijia 's case did not support, to lay down, that, "what was enlarged by sub section (1) of section 14 into a full estate was the Hindu woman 's estate known to Hindu Law. When the Court uses the word, `limited estate ', the words are used to connote a right in the property to which possession of the female Hindu may be traced, but which is not a full right of ownership". Gulwant Kaur 's case was concerned with acquisition of right by wife, on entrustment of property in lieu of maintenance, after 1956, when the concept of widows ' estate or limited estate or even stridhana had ceased to exist. Therefore, what was necessary was being possessed of property, actual or constructive, by female Hindu under some right or title. Therefore a female Hindu could become absolute owner only if she was limited owner. Sub section of section 14 deals with right of female Hindu both before and after the Act came into force. Female Hindu could become absolute owner of property possessed by her on the date the Act came into force only if she was a limited owner whereas she would become absolute owner after 1956 of the property of which she would otherwise have been a limited owner. Reference may be made to Maharaja Pallai Lakshmi Ammal vs Maharaja Pillai T. Pilllai, ; where this Court while examining right of wife put in exclusive possession of the property with the right to take the income for her maintenance was held to have become full owner under section 14(1) as she entered into possession after the death of her husband in 1955 and was in possession in 1956. On this finding the property being possessed on the date the Act came into force as contemplated in the explanation, the widow being a limited owner became a full owner and the gift executed by her in favour of her daughter after 1956 was unexceptionable. "that the limited estate or limited ownership of a Hindu female would enlarge into an absolute estate or full ownership of the property in question in th following fact situation: `Where she acquired the limited estate in the property before or after the commencement of the Act provided she was in possession of the property at the time of the coming into force of the Act on June 17, 1956 '. " Thus on plain reading of the Section, and its interpretation by this Court in various decisions a female possessed of the property on the date the Act came into force could become absolute owner only if she was a limited owner. This being the legal position it may now be seen if a Hindu widow could transfer or alienate widow 's estate by way of gift prior to 1956 and if so to what extent. And in such alienation what right or interest was created in the alienee. A Hindu widow succeeding or inheriting any property from her husband or as widow of predeceased son, held limited interest known as Hindu women 's estate, prior to coming into force of 1956 Act, under the Hindu Women 's Right to Property Act, 1937. The Delhi High Court assumed that a female donee was a limited owner, consequently, of she was possessed of the property on the date the Act came into force and her possession was not `without title ', she became an absolute owner. Basis for the decision was construction of the word `possessed ' by this Court in Gummalapura Taggina 's case (supra) wherein it was held that the word was used in widest connotation so that a widow, even if in constructive possession, was entitled to absolute ownership under Section 14 of the Act. Support was also drawn from converse case of Eramma (supra) this Court negatived the claim of widow under Section 14 as her possession on the date the Act came into force was not legal but that of a trespasser. What the High Court lost sight of was that the claim of widow in Gummalapura 's case (supra) was upheld because the adoption made by her having been found to be invalid she was deemed to be in constructive possession on the date the ACt came into force. Consequently, it was held that ``the 614 provisions of Section 14 of the Act cannot be attracted in the case of a Hindu female who is in possession of the property of the last male holder on the date of the commencement of the Act when she is only a trespasser without any right to property ' '. ``In other words, Section 14(1) of the Act contemplates that a Hindu female who in absence of this provision, would have been limited owner of the property, will now become full owner of the same by virtue of this Section. ' For instance restriction on enjoyment of property or its alienation. A Hindu widow, according to different schools, Banaras, Bengal or Mithila and even in Bombay inherited or succeeded to property whether of male or female as a limited owner and held a limited estate only. A. p. 207 to be, ``her right is of the nature of a right to property, her powers in that character are limited ' '. And the restriction on her power to alienate except for legal necessity is imposed, ``not for the benefit of reversioners but is an incident of estate ' '. Thus a Hindu widow prior to 1956 held the property fully with right to enjoy or even destroy or dispose it of or alienate it but such destruction or alienation should have been impressed with legal or for religious or charitable purposes or for spiritual welfare of the husband. But what right or title is acquired by the alienee if transfer is against legal necessity or contrary to law? Such transfer is invalid in Hindu Law, but the widow being the grantor herself, cannot derorate from the grant and the transfer cannot also be impeached so long as a person does not come into existence who can claim a present right to possession of the property." Thus if prior to 1956 any alienation was made by a Hindu widow of widow 's estate prohibited by law or being beyond permissible limits, it stripped the widow of her rights and she could not acquire any rights under section 14. So far as the male alienees from limited owners, that is female Hindu prior to 1956, are concerned, it was held by this Court in Radhey Krishan Singh & Ors. She did not become limited owner or holder of a limited estate as understood in Hindu Law. If the alienation was valid i.e., it was for legal necessity or permitted by law then the donee became an owner of it and the right and title in the property vested in her. But if it was contrary to law, as in this case the gift being of entire widow 's estate, then it did not bind the reversioner who could file a suit after the death of the widow. And the appellant cannot claim to have acquired title to the property under the gift deed. Nor had she become a limited owner under Hindu Law which could mature into full ownership when the Act came into force. Reliance was placed on observations in Jagannathan Pillai vs Kunjithapadam Pillai & Ors., ; that, ``To obviate hair splitting, the legislature has made it abundantly clear that whatever be the property possessed by a Hindu female, it will be of absolute ownership and not of limited ownership notwithstanding the position under the traditional Hindu Law ' ', and it was submitted that the appellant satisfied the criteria to entitle her to claim that her estate irrespective of its nature Hindu Law got enlarged under section 14 of the Act. An observation without reference to facts discloses neither the law nor the ratio de cedindi which could be taken assistance of. And the answer was that, ``When the transaction was reversed and what belonged to her was retransmitted to her, what the concerned Hindu female acquired was a right which she herself once possessed namely, a limited ownership (as it was known prior to the coming into force of the Act) which immediately matures into or enlarges into a full ownership in view of Section 14(1) of the Act on the enforcement of the Act. It is thus clear that an alienee from a Hindu widow prior to 1956 did not acquire limited estate or widow 's estate nor she was a limited owner who could get any benefit under section 14 of the Act. And under section 4(2) any law in force immediately before the commencement of the Act ceased to have effect if it was inconsistent with any provision of the Act. In Radha Rani vs Hanuman Prasad, AIR 1966 SC 216 this Court overruled the decisions of the Allahabad and Patna High Courts that there were no reversioners or reversionary rights after 1956 and held, ``it is open to reversioner to maintain a suit for declaration that an alienation made by a Hindu female limited owner before the coming into force of was without legal necessity and was not binding upon reversioners ' '. Possession under a gift deed which was found to be invalid, as it was not permitted under Hindu Law was on general principle contrary to law, and as such could be adverse. When did it become adverse to the donor and what circumstances constitute adverse possession against the donor is an aspect which does not arise for consideration as, even assuming in favour of the appellant, the question is, if adverse possession against donor was sufficient to clothe her with right or title in the property so as to deprive the reversioners of their right to claim the property after the death of the widow? We are thankful to Sri Parekh and Sri Narasimhulu also for their assistance.
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A Hindu widow made a gift in 1954 of all the property she inherited from her husband. She gave it to her daughter, the appellant in this case. She wanted the gift declared invalid and the property divided, claiming that as a relative who would inherit after the mother's death in 1968, she had rights. The trial court ruled for the daughter who received the gift (the appellant), based on the idea that she had taken possession of the property and the other daughter should have challenged it sooner (estoppel). However, the court didn't base the ruling on a specific law (Section 14), because it thought the widow couldn't legally give away the property permanently in 1954. But it said that the daughter who received the gift couldn't gain any rights because the other daughter didn't act sooner. It allowed the other daughter's appeal and dismissed the gift receiver’s case. The court said taking possession of the property against the widow wasn't the same as taking possession against the relatives who would inherit later. It decided that the daughter who received the gift was considered to be holding the property for all the daughters, unless there was clear evidence that she had excluded the other sister. The daughter who received the gift (the appellant) disagreed and appealed to this Court. The questions were: (1) Could a Hindu widow give away all the property she inherited from her husband to one of her female relatives who would inherit later, before a certain law (Act 30 of 1956) was passed? and (2) Did the receiver become the full owner, a limited owner, or just someone living on the property illegally? Did she gain ownership only against the giver, or also against the relatives who would inherit later? The Court dismissed the appeals, and decided: 1.1 Before 1956, a Hindu widow who inherited property from her husband had limited rights. This was under the Hindu Women's Right to Property Act, 1937. But, she could only sell it if it was a legal necessity, for religious or charitable reasons, or for her husband's spiritual well-being. If she sold the property for a legal necessity, the buyer got the property and the relatives who would inherit later couldn't challenge the sale. 1.2 The term "limited owner" has a specific meaning in Hindu Law. In Hindu law, a female Hindu's limited ownership came from the law. A Hindu widow had limited ownership of property she inherited. 1.3 Before 1956, if a Hindu widow sold property in a way that wasn't allowed, the buyer only got temporary ownership. This ownership was uncertain and could be challenged if it threatened the rights of the relatives who would inherit later. Because it was invalid, the relatives who would inherit later could challenge it. 2.1 Someone who bought property from a Hindu widow before 1956 didn't get a limited ownership. 2.2 In this case, the gift of the widow's entire property was against the law. So, it didn't bind the relative who would inherit later. The daughter who received the gift couldn't claim ownership based on the gift. Her possession of the property wasn't based on any valid right against the relative who would inherit later. Taking possession under a gift that wasn't allowed under Hindu Law was against the law. The daughter who received the gift couldn't gain any rights against the relative who would inherit later while her mother was alive. Even if she had taken possession against her mother, that wasn't enough to take away the rights of the relatives who would inherit later. 4.1 Section 14(1) of the Act applies to the rights of female Hindus both before and after the Act. Before 1956, the meaning of "female Hindu" must be understood according to Hindu Law at that time. A limited owner became a full owner if she had possession of property before the Act started. She had to be the kind of female Hindu who could become a full owner under certain conditions. A female Hindu could become the full owner of property she possessed when the Act came into force *only* if she was previously a limited owner. 4.2 Section 14(1) means that a limited owner became a full owner if she possessed the property when the Act was passed. The explanation attached to the section means that a female Hindu became the full owner of inherited property, property received as a gift, or property received in place of maintenance, *if* she was a limited owner. The law didn't expand the ownership of those who were *not* limited owners. The Act didn't erase all of Hindu Law. There is no part of the Act that takes away the rights of relatives who would inherit later, except as mentioned in Section 14.
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N: Criminal Appeal No. 386 of 1983. From the Judgment and order dated the 23rd June, 1981 of the High Court of Bombay in Crl. Appeal No. 1138 and 1144 of 1980. section N. Jha, Amicus Curiae for the Appellant. M. N. Shroff for the Respondent. The order of the Court was delivered by CHINNAPPA REDDY, J. Special Leave granted. The appeal of the accused to the High Court was 'dismissed ', summarily with the one word 'dismissed ', placing this Court in a most embarrassing position in dealing with the special leave petition under article 136 of the Constitution. Such summary rejection of appeals by the High Court has been disapproved by this Court more than thirty years ago in Mushtaq Hussain vs State of Bombay(13 and thereafter, over the year;, in a series of cases from the same High Court: Ramayya vs State of Bombay( '), Vishwanath Shankar Beldar vs State of Mahatashtra(3), Siddanna Appa Rao vs State of Maharashtra(4). Narayan Nathu Naik vs State of Maharashtra(5), Govinda kadutji Kadam vs State of Maharashtra(6), Shaik Mohamed Ali vs State of Maharashtra(7), K. K. Jain vs State of Maharashtra(8), Jeewan 653 Prakash vs State of Maharashtra(l), Mushtaq Ahmed v State of Maharashtra(2), Krishna Vithu Suroshe vs State of Maharashtra(3), Sampata Tatyada Shinde vs State of Maharashtra(4), Dagadu vs State of Maharashtra(s). We are pained, and not a little perturbed, that despite the long series of judgments all arising from cases from the same High Court, the High Court has not chosen to correct itself and continues in the error of its ways. Except in certain cases when an accused person has pleaded guilty and in petty cases, every person convicted of an offence has a right of appeal under the Criminal Procedure Code. An appeal may be both against conviction and sentence and on facts and law. A convicted person is entitled to ask an appellate Court to reappraise the evidence and come to its own conclusion. An appellate Court has the undoubted power to dismiss an appeal in limine. Section 384 of the Criminal Procedure Code provides for it. But, it is a power which must be exercised sparingly and with great circumspection. One would think a conviction for murder and a sentence of imprisonment for life, as in the case before us, were serious enough matters for the High Court to warrant b 'admission ' of the appeal and fair and independent consideration of the evidence by the High Court. Summary rejection of the appeal with the laconic expression 'dismissed ' seems to be a drastic step in such cases. To so reject an appeal is to practically deny the right of appeal. We cannot also over emphasis the importance of the High Court making a speaking order when dismissing a Criminal Appeal in limine. "The requirement of recording reasons for summary dismissal, however concise, serves to ensure proper functioning of the judicial process". There must be some indication that the High Court addressed itself to the questions at issue and had the record before it. In the present case there. is not even an indication whether the record had been called for and whether it was before the Court. We have little option but to set aside the order of the High Court. The High Court may now 'admit ' the appeal and deal with it according to law.
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The person asking for the appeal (the petitioner) was found guilty of a crime under section 302 of the Indian Penal Code. The Sessions Judge (a type of judge) sentenced him to prison for life. He tried to appeal the decision, but the Bombay High Court quickly dismissed it (in limine). This means the court didn't even fully consider the appeal. So, he asked for a special permission to appeal to a higher court. The court agreed with him. They told the High Court to accept the appeal and handle it according to the law. The court said that an appeals court can dismiss an appeal quickly, as allowed by section 384 of the Criminal Procedure Code. However, this power should be used carefully, especially when someone is convicted of murder and sentenced to life in prison. These are serious cases, and the High Court should fully consider the evidence. Rejecting the appeal with just the word "dismissed" is too harsh. It's like denying the person's right to appeal. Usually, anyone found guilty has the right to appeal, unless they pleaded guilty or it's a minor case. They can appeal based on the facts of the case or the law. A person who is found guilty can ask an appeals court to look at the evidence again and make its own decision. Therefore, when a criminal appeal is dismissed, the court needs to explain why.
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WPA(P) 299 of 2021 ... for the State Election Commission ...for the State ... for Union of India 1. CAN 7 of 2022 has been filed by the petitioner seeking a direction to the respondent No. 4 State Election Commissioner to deploy central paramilitary forces in the elections of 108 Municipalities in the State scheduled on 27.02.2022. Further prayers have been made seeking direction for effective CCTV surveillance, to appoint independent impartial general observer and micro-observer, to direct verification of EPIC cards/photo identity cards before entry inside the polling stations by CRPF, to hold respondent No. 4 personally liable to discharge his duty as directed by the earlier order. 2. The above prayers have been made by pleading that the State Election Commission vide notification dated 03.02.2022 has declared that the election for 108 Municipalities in the State will be held on 27.02.2022. The last date of filing nomination was 09.02.2022. It is alleged that large number of BJP candidates were forcibly prevented by the goons of the ruling party from filing their nominations. In respect of one Rakesh Majumdar from Ward No. 6 of Guskara Municipality, it is alleged that though he had reached on time but his nomination paper was not accepted on the ground that he had reached the office of the concerned authority late. It is further alleged that there is a state of terror prevailing in the State and in almost 10% of the Municipalities which are going for polls, the ruling party candidates have won uncontested as the nominations were not allowed to be filled up by other candidates. Further allegation has been made that State Election Commission is acting in partisan manner and that despite the announcement of the date of elections, acting against Model Code of Conduct, the Government of the State through its Chief Minister is undertaking new schemes to woo its voters. Alleged incidents of violence during the polls for Municipal Corporation Bidhannagar, Asansol, Siliguri and Chandernagore which took place
on 12.02.2022 have been stated in the application. 3. The respondents have filed their affidavit in opposition and the affidavit in reply has also been filed. 4. Submission of Counsel for the petitioner is that the candidates have been prevented from filing nomination forms in the forthcoming elections which resulted into uncontested victory of the candidates of the ruling party and that the State Government after declaration of elections by violating the Model Code of Conduct has floated two new schemes. Referring to the various newspaper reports filed along with the applications he has submitted that in the Elections of four Municipal Corporations already held, there was large scale violence and that the complaints in this regard have not been considered. He has also submitted that in respect of Contai Municipality, notice dated 19.02.2022 has been issued stating that Mauve Paper Seals will not be used in 150 ballot units and that in terms of the earlier order of this Court dated 10.02.2022 the Election Commission did not take any decision for deployment of the paramilitary forces, therefore, now the direction be issued by this Court to deploy Paramilitary Forces in forthcoming Municipality Elections. He has also submitted that earlier Division Bench judgment in the matter of Basabi Raichoudhury vs. State of West Bengal & Ors., 2013 SCC OnLine Cal 15463 has no application in the facts of the present case. In support of his submission to deploy paramilitary forces he has placed reliance upon the orders dated 23.11.2021 in the matter of All India Trinamool Congress & Anr. vs. Manik Das & Ors., CONMT. PET. (C) No. 884/2021 in W.P. (Crl.) No. 455/2021 and the order dated 25.11.2021 passed in All India Trinamool Congress & Anr. vs. State of Tripura and Ors., Writ Petition Criminal No. 455/2021. He has pressed his prayer for appointment of independent observer. 5. Learned Counsel for the Election Commission has opposed the prayer and has submitted that earlier
direction of this Court dated 10th of February, 2022 was duly complied with and assessment of ground situation to deploy paramilitary forces was done and no need for the same was found. He has denied the allegations that any candidate has been illegally prevented from filing the nomination form and has submitted that the dispute which the petitioners are raising is factual in nature for which proper remedy will be to file election petition. He has also referred to the order of the Single Judge of this Court in WPA No. 2466 of 2022 filed by Rakesh Majumdar. In respect of the Elections of the Bidhannagar, Asansol, Siliguri and Chandernagore Municipal Corporations, he has submitted that only stray incidents of violence had placed and that the newspaper reports are conflicting. He has referred to the newspaper reports enclosed along with the affidavit-in- opposition in support of his submission that the earlier elections were held peacefully. In respect of the detailed allegations about irregularities in four Municipal Corporation Elections already held, he has referred to the reports filed along with affidavit-in-opposition and has submitted that each of the allegation has been replied in these reports indicating that the allegations are incorrect. He has referred to the minutes of meeting dated 10th of February, 2022 held by the Election Commission with the State official and submitted that direction issued by this Court in the order dated 10.02.2022 was duly complied with. He has also submitted that two schemes were floated by the State Government earlier and they are not new schemes, therefore, not covered by the Model Code of Conduct, hence permitted by the Election Commission. He has also submitted that there is no need for appointing the observers by this Court as the Election Commission itself is an independent body. 6. Learned Advocate General has submitted that in view of Article 243-ZA(1) of the Constitution it is for the Election Commission to take a decision about calling the paramilitary forces and this issue has also been considered by this Court in the earlier orders. He has submitted that in respect of 108 Municipalities no evidence of any violence on any candidate has been
placed on record and that the only grievance pleaded in the CAN is that the candidates were prevented from filing the nomination form but even the particulars thereof have not been placed on record. He has objected to the pleadings contained in paragraph 5 to 7 of CAN 7 by referring to the affidavits sworn in support thereof. He has also submitted that the complaints enclosed with the affidavit-in-reply were made between the period 14th of February to 17th of February which was after filing of CAN 7 on 14th of February. He has also submitted that whenever any complaint of violence was received, the same was duly looked into. He has also submitted that the complaints enclosed from page 61 to 72, CAN are of the same date by the same person, hence they are suspicious and that the Model Code of Conduct itself provide for appointment of the observer by the Election Commission. He has also submitted that the photographs enclosed at page 87 of the CAN were prior to the issuance of the election notification and that the person shown therein was the administrator of the Municipality and that photograph was taken during the community outreach programme. He has also submitted that the two schemes were floated by the State prior to the declaration of election and were stopped during the COVID and restarted, therefore, Code of Conduct will not apply. He has fairly stated that it is necessary to have Mauve Paper Seals for all ballot units during the elections and that the necessary notice dated 20th of February, 2022 has also been issued in this regard. 7. Learned Counsel for the respondent No. 2 has submitted that the allegation against the respondent No. 2 is in respect of distribution of title deeds violation of Model Code of Conduct but these title deeds were registered much prior to publication of election notification on 3rd of February, 2022 and formal felicitation programme for the beneficiaries was also announced prior to 1st of February, 2022, hence there is no violation of Code of Conduct. 8. We have heard the learned Counsel for the parties and perused the records. The first issue raised by the petitioner is in respect of deployment of paramilitary
forces in forthcoming 108 Municipality Elections. This Court on earlier two occasions, i.e, at the stage of Kolkata Municipal Corporation and at the stage of Bidhannagar, Asansol, Siliguri and Chandernagore Municipal Corporation elections had considered this prayer. After duly considering the Division Bench judgment of this Court in the matter of Basabi Raichoudhury (supra) and orders of the Hon’ble Supreme Court in the case of All India Trinamool Congress (Supra), before the elections of the four Municipal Corporations this Court had passed the order dated 10.02.2022 to the following effect: “14. The issue relating to deployment of paramilitary forces had come up before this Court during the Kolkata Municipal Corporation elections when this Court taking note of the Division Bench judgment in the matter of Basabi Raichoudhury (Supra) in the order dated 17th December, 2021 passed in MAT 1354 of 2021 had held as under: “The deployment of Central Paramilitary Forces during the elections has been opposed by learned Advocate General placing reliance upon the Division Bench judgment of this Court in the matter of Basabi Raichoudhury (supra) wherein it has been held that: “After hearing the learned length, we are of the considered opinion that the petition is premature. Apart from that, we find that in the matter of holding election, law and order situation has to be considered by the State Election Commission and there are various factors for requisition of the Central Paramilitary Forces, such as, law and order situation and paucity of State Forces etc. Such a matter has to be considered by the State Election Commission and the State Government and, in case of any dispute between them, the State Election Commission had approached this Court earlier. In judicial review, the Court cannot decide whether Central Paramilitary forces are necessary in any of the election. These are the decisions to be taken by the constitutional bodies like the State Election Commission, the State
Government, etc. Ordinarily, it is not for the Court to interfere with such matter. It is the duty of the Election Commission to ensure that free and fair election is held and for that, necessary step to be taken by them. in the writ petition, we find that the same is not only premature but on merits this writ petition is misconceived also.” So far, no instance of violence has been pointed out nor along with the writ petition, any such material has been enclosed which furnishes a ground for deployment of the Central Paramilitary Forces in the forthcoming Kolkata Therefore, at this stage, we do not find sufficient material to accept the prayer. However, we take note of the submission of the learned Additional Solicitor General that within six hours, the Central Paramilitary Forces can be sent to avoid any untoward incident. Hence, we direct the Election Commission to take an appropriate decision having due regard to the ground situation in consultation with the State authorities for deployment of Central Paramilitary Forces, in case, if the need so arises, to ensure free and fearless elections. So far as the judgment of the Hon’ble Supreme Court relied upon by the learned Counsel for the parties in the case of deployment of Paramilitary Forces in the Municipal Election in the State of Tripura, the fact situation noted therein was different and even otherwise, the Hon’ble Supreme Court by order dated 23rd November, 2021 had directed the DGP and IGP (Law and Order, Tripura) to hold a meeting with the State Election Commission for the purpose of assessing requirement of sufficient strength of Paramilitary Forces and further directed that after making an assessment of the situation, if so required, requisition should be submitted to the CRPF or to the Ministry of Home Affairs. Hence, a decision in this regard is required to be taken by the concerned State authorities and the State Election Commission, keeping in view the ground situation.” 15. It is essentially for the State Election
Commission, which has been vested with the responsibility to ensure free, fair and fearless elections, to assess the ground situation and to take a decision in respect of deployment of paramilitary forces if the circumstances so demand. Instances have been pointed out to this Court about the violence during election and post-poll violence on the earlier occasions during elections in Bidhannagar. Hence, the Election Commission along with the State Authorities is required to do reappraisal of the ground situation prevailing in Bidhannagar and take a decision to deploy the paramilitary forces if required. 16. Therefore, we hereby direct that the Commissioner, State Election Commission will hold the joint meeting with the Chief Secretary and Home Secretary of the State and the Director General and Inspector General of Police within 12 hours and will do the reappraisal of the ground situation in Bidhannagar Municipal Corporation area and ascertain if deployment of paramilitary forces is necessary for ensuring the peaceful conduct of election of Bidhannagar Municipal Corporation and if require, he will submit and requisition to the Union Ministry of Home Affairs or the competent authority for deployment of paramilitary forces and any request in this regard will be duly considered having regard to the ground situation and in the interest of ensuring peace, security and orderly conduct of the forthcoming Bidhannagar Municipal Corporation Election without any delay. In case, if the Commissioner, State Election Commission forms an opinion that deployment of the paramilitary forces during Bidhannagar Municipal Corporation election is not necessary, then he will be personally liable to ensure that no violence takes place and free, fearless and peaceful elections are held in 9. We find that the above direction of this Court dated 10th of February, 2022 was almost in terms of the order of the Hon’ble Supreme Court dated 23rd of November, 2021 in the case of All India Trinamool Congress (supra). So far as further reliance upon the order of the Hon’ble Supreme Court dated 25.11.2021 in All India Trinamool Congress & Anr. vs. State of
Tripura and Ors., W.P. (Crl.) No. 455/2021 by the Counsel for the petitioner is concerned, a perusal of the said order indicates that as per the earlier direction of the Hon’ble Supreme Court, after considering the ground situation, a decision was already taken to deploy the paramilitary forces and subsequently the issue was only to provide additional companies of CRPF. But in the present case the Election Commission has yet to take the decision to deploy the paramilitary forces after assessing the ground situation. 10. In respect of elections of 108 Municipal Council, though an allegation has been made that the candidates have been prevented from filing their nomination paper but neither the names of those candidates are disclosed nor their supporting affidavits have been filed. The name of only one candidate, i.e., Rakesh Majumdar from Ward No. 6 of Guskara Municipality has been disclosed with the allegation that he was not permitted to file his nomination by the concerned authority but the record reflects that the said candidate had filed WPA No. 2466 of 2022 raising this grievance and Single Bench of this Court by order dated 11.02.2022 has held that the petition involves disputed questions of facts and in view of the constitutional bar the petition was not entertained. In respect of the four Municipal Corporations where elections have already held conflicting material has been placed on record about the violence. Even otherwise that material cannot form the basis for issuing direction in respect of remaining 108 Municipalities, as decision for deployment of the paramilitary forces in a particular Municipality is to be taken on the basis of the ground situation existing 11. At this juncture it would be worth mentioning that by the order dated 10th of February, 2022 this Court had directed the State Election Commissioner to hold a meeting and ascertain if deployment of paramilitary forces is necessary during elections in Bidhannagar Municipal Corporation. The minutes of the meeting dated 10th of February, 2022 have been placed before us but those minutes only reflect certain discussions based on oral information submitted by the State authorities.
The Election Commission is required to ascertain the ground situation after calling the reports and also gathering the information from relevant sources about the conditions prevailing in the concerned Municipality where election is scheduled. 12. Hence, we direct that the Commissioner, State Election Commission will collect information in respect of the conditions prevailing in each of the Municipalities where the elections are scheduled and will hold the joint meeting with the Home Secretary of the State and the Director General and Inspector General of the Police within 24 hours and will examine the ground situation of each of the 108 Municipalities and take a decision in writing in respect of deployment of paramilitary forces by mentioning the relevant circumstances in support of his decision to deploy/not to deploy the paramilitary forces. If the Commissioner, State Election Commission takes the decision not to deploy the paramilitary forces, then he will be personally liable to ensure no violence takes place and free, fair and fearless elections take place in the municipality where paramilitary forces are not 13. The next issue raised by the Counsel for the petitioner is about the order dated 19.02.2022 issued by the Municipality returning officer Contai Municipality to the effect that Mauve Paper Seals for 150 ballot units will not be used in the given number of ballot units. Subsequent order dated 20th of February, 2022 has been placed on record which clarifies that for 138 ballot units mentioned in the order dated 11.02.2022 Mauve Paper Seals will be used. It is not disputed by the learned Advocate General that Mauve Paper Seals should be used in all ballot units. That is also required for fair election process. Therefore, the Election Commission is directed to ensure that Mauve Paper Seals are used in all the ballot units. 14. Further issue has been raised by the Counsel for the petitioner in respect of deployment of the observers and micro-observers in the forthcoming Municipality Elections. The Model Code of Conduct has been placed before this Court which provide that: State Election Commission shall appoint Observers to oversee the entire election process as well as the conduct of poll at the Polling Station. In case of any complaint about the
conduct of poll, the candidates or the concerned political parties may bring it the notice of the Observers.” 15. In terms of the above the State Election Commission is required to appoint the observers. Needless to say that observers should be an independent person. Having regard to the nature of allegations which have been made in this petition we are of the opinion that Election Commission should appoint impartial officers of IAS cadre as observers. 16. An issue has also been raised by the Counsel for the petitioner in respect of floating of two schemes, namely Duare Sarkar (DS) and Paray Samadhan (PS) by the notification dated 25th of January, 2022 in violation of Model Code of Conduct and in this regard the communication of the Election Commission dated 18.02.2022 has been referred to stating that the Election Commission had no objection in continuation of the schemes. Sub-clause (viii) of Clause VIII of Model Code of Conduct provides that: “VIII(viii) From the time the elections to a Municipality are announced and till the elections are over, no authority of the Central or State Government or board of a councillors of Municipality shall, in the municipal area or for the benefit of the Municipal area (a) Announce or promise any financial (b) allow laying of foundation stone etc. of projects or schemes of any kind, (c)make any promises of construction of roads, provision of drinking water facilities etc., or (d) announce or promise or commence any new scheme or project: Provided that this restriction shall not affect continuing schemes, essential repair works, measures necessary for public health and sanitation and public utility interests and relief measures necessitated by calamities and disasters and any other emergency measures that may be (e)Make any appointment for temporary 17. In terms of the above clause, announcement or promise or commencement of any new scheme or project is not permissible but continuation of scheme is not affected. The proviso makes it clear that the restriction does not apply to continuing scheme, measures
necessary for public health etc. If any scheme was stopped earlier then restarting that scheme during the Model Code of Conduct cannot be said to be covered by “continuing schemes”. The communication of the District Municipal Election Officer dated 03.02.2022 is also on record seeking clarification about implementation of above two schemes in areas where the elections are to be held. Hence, we direct the State Election Commission to examine if the schemes have been allowed to operate violating the Model Code of Conduct and not to permit their implantation till the elections are over if they violate the Code of Conduct. Same is the position in respect of the distribution of title deeds. Though it has been stated before us that title deeds were registered prior to declaration of the elections but their distribution during the elections may influence the voters, therefore, the Election Commission is also required to examine it and take a decision. Let this exercise be completed within 24 18. So far as the issue of installation of CCTV camera, etc. are concerned, this Court by order dated 23rd December, 2021 passed in MAT 1354 of 2021 and connected applications had issued following directions:- “(i) The respondent State Election Commission is directed to preserve CCTV footage of all polling stations of Kolkata Municipal Corporation Elections held on 19th December, (ii) The State Election Commission is also directed to preserve the diaries of the presiding officer and register containing the thumb impression/signature of voters of all the polling booths in a sealed cover with immediate effect. (iii) The State Election Commission is directed to preserve the control unit of EVM machines in terms of Rules 61N of the Rules of 1995 without any delay. (iv) State Election Commission is also directed to preserve voting record prepared from the EVM in terms of Rules 61N until further orders. (v) For the forthcoming elections of the remaining Municipal Corporations/Municipal Councils, local bodies, in order to maintain the transparency and fairness, we direct that the State Election Commission shall take steps to install CCTV cameras at conspicuous spots in all main and ancillary booths across the State
and will preserve the CCTV footages so that in case of need it can be sent for audit.” 19. We direct that above directions will apply mutatis mutandis in the forthcoming 108 Municipality 20. A prayer for cancellation of the elections held on 12.02.2022 in Municipal Corporations Bidhannagar, Asansol, Siliguri and Chandernagore has also been made but this prayer has not been pressed at this stage, therefore, liberty is granted to file a separate application in this regard if so desired. 21. CAN 7 of 2022 filed in WPA (P) 299 of 2021 is accordingly disposed of.
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On Wednesday, the Calcutta High Court ordered the State Election Commission (SEC) to meet with West Bengal government officials within 24 hours. They need to decide if central police forces should be sent to ensure peaceful elections in the 108 towns (municipalities) remaining. These elections are set for February 27. The Court stressed that if the State Election Commission decides not to send central forces, then its head, the State Election Commissioner, will be personally responsible. This means he must ensure no violence happens and the elections run peacefully. The Bharatiya Janata Party (BJP) had filed a complaint claiming there was much violence and cheating in the recent town elections in West Bengal. Because of this, the BJP asked for central forces to be sent for the upcoming elections in the other 108 towns. Elections in four major cities – Siliguri, Bidhannagar, Asansol, and Chandernagore – happened on February 12. These elections were put off because the High Court advised it. This was due to a sudden increase in COVID-19 cases a few weeks earlier. The Court had not yet announced its decision on this issue on Monday. On Wednesday, a panel of judges, including Chief Justice Prakash Shrivastava and Justice Rajarshi Bharadwaj, again ordered the State Election Commission to hold a joint meeting. This meeting, within 24 hours, must include the state's Home Secretary, the Inspector General of Police, and other officials. They must decide if central police forces are needed for peaceful elections in the 108 towns. The Court specifically ordered: "The head of the State Election Commission will gather information about the current situation in each town where elections are planned. Within 24 hours, he will hold a joint meeting with the state's Home Secretary, and the Director General and Inspector General of Police. They will check the local situation in all 108 towns. Then, he must write down his decision about sending in central police forces, explaining the reasons for his choice to send them or not." The Court further stated its view that the State Election Commissioner would be personally responsible if violence occurs, ruling: "If the head of the State Election Commission decides not to send central police forces, then he will be personally responsible. He must make sure that no violence happens and that elections are free, fair, and safe in the towns where these forces are not present."
The Court also rejected the argument made by the BJP, which referred to an earlier Supreme Court ruling. In that case, All India Trinamool Congress vs. State of Tripura, the top court had ordered central armed police (CAPF) to be sent for local elections in Tripura. The High Court explained that in that specific case, after looking at the situation, a decision was already made to send central forces. Later, the only question was about sending more groups of CRPF officers. However, in this current case, the Election Commission still needs to decide whether to send central police forces, after checking the situation on the ground, the Court pointed out. Names of upset BJP candidates have not been shared The Court observed that while it was claimed BJP candidates were stopped from signing up to run in the election, their names were not shared, and no sworn statements were provided to support these claims. The Court also noted that only one candidate, Rakesh Majumdar, was named. It was claimed that the authorities did not allow him to file his nomination. However, the Court found that Majumdar had already filed a legal complaint with a single judge of this Court. But that complaint was turned down. This was because it involved facts that were argued over and went against a rule in the constitution. Different information about claimed violence It was also stated that for the elections already finished in four cities, different information about the reported violence had been presented. The Court added that this information, even if true, could not be used to give orders for the remaining 108 towns. This is because the decision to send central police for a specific town must be based on the local situation in that town itself. Assigning IAS officers as independent supervisors Importantly, the Court ordered the State Election Commission to assign independent supervisors as required by the election rules (Model Code of Conduct). The Court noted that because of the types of complaints in the lawsuit, the SEC should appoint fair officers from the Indian Administrative Service (IAS) as these supervisors. Using Mauve Paper Seals for all voting slips
At the last court session, Paramjit Patwalia, a main lawyer for the BJP, claimed that the Election Commission, in an order from February 11, 2022, decided to use special "Mauve Paper Seals" for only 138 voting machines in Contai town. The lawyer argued that this makes it easier to cheat in the voting. To deal with this worry, the judges on Wednesday ordered the Election Commission to make sure that Mauve Paper Seals are used on all voting machines during the elections in Contai town. Ongoing government programs do not break election rules The BJP had argued that the Election Commission allowed different state government programs, like "Duare Sarkar" (government at doorsteps) and "Paray Samadhan" (solve issues in the neighborhood), to continue in towns where elections were happening. The BJP said this broke the election rules. It was also claimed that Chief Minister Mamata Banerjee held an event to give ownership documents for land to almost 2000 refugee families. This, too, was said to break the election rules. The Court noted that making new announcements, promises, or starting new programs is not allowed. However, existing programs can continue, according to the election rules. The Court also mentioned a message from the local election officer dated February 3, 2022. This message asked for a clearer understanding of how the two programs could be run in areas where elections were planned. So, the Court ordered: "We order the State Election Commission to check if these programs have been allowed to run in a way that breaks the election rules. If they do break the rules, the Commission must not allow them to continue until the elections are finished. The same applies to giving out land ownership documents. Even though we were told these documents were registered before the elections were announced, giving them out during the elections might affect voters. So, the Election Commission also needs to look into this and make a decision. This must all be done within 24 hours." Keeping CCTV recordings and other important documents safe The Court also repeated its earlier orders about keeping safe the CCTV recordings from all voting places. This also includes the notes from the head election officers and the register with voters' fingerprints or signatures from all voting booths, all in a sealed envelope. The Court had given similar orders before in This summary covers the Kolkata city elections, which happened on December 19.
The court gave permission to file a separate request to cancel four other city elections that had already taken place. The Court explained that the request to cancel elections held on February 12 in the cities of Bidhannagar, Asansol, Siliguri, and Chandernagore could not be handled right then. But, the court allowed people to file a separate request about these elections later if they still wanted to. Background In a formal request, or 'plea,' filed by the BJP political party, many specific actions were asked for regarding the elections in the other 108 cities. These included sending in central government police forces, having good CCTV camera monitoring, setting up a fair and unbiased person to oversee the elections, checking photo IDs before people entered voting booths, and making the head of the State Election Commission personally responsible if any violence occurred. The plea also asked to cancel the elections that took place on February 12. The Court had previously ordered the State Election Commission to hold a meeting within 12 hours. This meeting was to include the state's Chief Secretary, Home Secretary, and top police officers (the Director General and Inspector General of Police). They needed to decide if central government police forces would be required to keep the upcoming Bidhannagar city elections peaceful. The Court believed that the head of the State Election Commission would be personally responsible for making sure no violence happened. So, the Court also ordered: "If the Commissioner of the State Election Commission decides that central police forces are not needed for the Bidhannagar city election, then he will be personally responsible. He must ensure that no violence occurs and that the elections in Bidhannagar are fair, safe, and peaceful." Later, the State Election Commission decided not to send in central forces for the elections in the four cities. It is important to know that in December 2021, the High Court had turned down a request made by the BJP political party. This request was a challenge to an earlier decision by a single judge of the High Court. In that earlier decision, the BJP's formal request to send in Central Forces for the Kolkata city elections had been rejected. The Kolkata city elections took place on December 19.
Even earlier, the Supreme Court had refused to hear a similar formal request from the BJP. This request also asked for central forces to be sent for the Kolkata city elections. The Supreme Court told the BJP to go to the Calcutta High Court instead for that kind of help. Two Supreme Court judges, Justices L. Nageswara Rao and B.R. Gavai, told the BJP's lawyer, Maninder Singh: "We cannot decide if central forces are needed. The High Court will better understand the situation."
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From the Judgment and Decree dated 14.3.1973 of the Rajasthan High Court in S.B. Civil Second Appeal No. This appeal by special leave is from the judgment of the Rajasthan High Court dated March 14, 1973 in S.B. (Civil) 2nd Appeal No. According to them 359 it is known as 'Baghichi Darjian ' since it belongs to Darji community. One Narayan was admittedly 'Pujari ' of the Temples. There was allegation that Narayan purported to have sold the Baghichi in favour of one Khawas Bala Bux. The Panchas of Darjian community filed a suit for cancellation of the sale deed and posses sion of the baghichi. Narayan was the first defendant in that suit. He was, however, summoned and his statement was recorded on July 8, 1925, wherein he admitted that he was only the Pujari of the temples. The other defendants in the suit set up rival title to the property relying upon the sale deed of Samvat 1932 in the name of Raghunath. The trail court dismissed the suit but on appeal the District Judge decreed it. Thereafter, for about 23 years there was no problem and there was no rival claimant to the property. It appears that Bhonrilal after the death of his father was acting as Pujari of the temples. The Darjian community authorised Kalyan Singh, the appellant herein, as well as one khawas Suraj Narayan to bring an action for ejectment of Bhonrilal. In that suit Bhonrilal admitted the Panchayat 's right to the baghichi but raised a number of other pleas including his title by adverse possession. In 1958 the appeal against that decree was dismissed by the senior civil Judge, Jaipur City. On September 15, 1960, the High Court dismissed the second appeal. On December 12, 1959, he brought a declaratory suit claiming that he is owner of the property consisting of baghichi and temples. In this appeal we are concerned with the fight claimed by him. Raghunath had only one son called Gaurilal and he was issueless. Garuilal executed a will giving all his properties to Ganga Ram. It was alleged that the earlier suit against Bhonrilal was collusive between the parties. 1 and 2 had obtained on 20.8. The appellant the first defendant in the suit denied plaintiff 's title to the baghichi. It was maintained that the baghichi was community property of Darjees and Narayan was only a 'Pujari ' of the temples. Narayan continued as Pujari till his death in 1950 and thereafter his eldest son Bhonrilal was acting as Pujari. Reference was made to the judgment of the Chief Court of Jaipur in the first suit against Narayan and judgments in the second suit against Bhonrilal. It was also specifically stated that the suit against Bhonrilal was not collusive but brought on behalf of the Darjee community in a representative capacity. The trial Judge on considering the evidence produced by the parties decreed the suit declaring the plaintiff as owner of the suit property. It was also declared that the plaintiff is not bound by the judgment and decree dated September 15, 1928 of the Chief Court of the erstwhile State of Jaipur. But no reference was made to the judgment and decree obtained in the suit against Bhonrilal. No declara tion was given that it was not binding on the plaintiff though that relief was specifically sought for. He also did not refer to the judgment in the suit against Bhonrilal. He only examined the validity of the said Sale deed and Will and held that they were proved to have been executed. They moved an application under Order 41 Rule 27 C.P.C. to accept a certified copy of the judgment dated September 15, 1928 of the Chief Court of the erstwhile Jaipur State and a copy of the statement of Narayan recorded in that suit. The High Court accepted the judgment of the Chief Court of Jaipur State, but rejected the Statement of Narayan. During the pendency of the appeal in the High Court Suraj Narain died and his name was deleted from the appeal memo. Ganga Ram also died and his wife and son were brought on record as his legal representatives. The principal question argued before the High Court related to the validity of sale deed (exhibit 3) and will (exhibit 4) which formed the foundation of Gangaram 's title to the suit property. The sale deed exhibit 3 was rejected as inadmissible in evi dence. But the High Court did not do that and instead rounded off the discussion as follows: "The plaintiff is undoubtedly in possesion of the Baghichi and it cannot be gainsaid that he was not a party to the previous litigation and he is not claiming the property though his father Narayan or his brother Bhonrilal. Apart from everything, the suit does not seem to have been filed against Kalyan Singh and another in a representative capacity in ac cordance with Order 1 Rule 3 Civil Procedure Code. There was no application for permission to sue them in their representative capacity. Therefore, in spite of my having reached the conclusion regarding the document exhibit 3 and 4 against the plaintiff respondents I am not inclined to interfere with the decree of the court below though I do feel that the litiga tion against Kalyan Singh and another in their individual capacity was a fruitless exercise. ' ' 362 Kalyan Singh the defendant has now appealed challenging the decree of the High Court. Counsel for the appellant has a two fold contention. In the first place, it was argued that the Darjee community in their representative suit against Bhonrilal has obtained a decree declaring their title to the property and that decree could not be nullified by the present suit against individu als. Secondly, it was urged that the High Court after discarding the sale deed exhibit 3 and will exhibit 4 ought to have non suited the plaintiff since there is no other material whatever to support his title to the property. Normally, these contentions would have been accepted without much discussion, but we have to consider the submis sions of counsel for the respondents. We will first consider whether the previous suit against Bhonrilal was a representative suit on behalf of the Darjee community. It was argued for the respondents that it was only a suit on behalf of the 'Panchayat Darjian ' and not a representative suit on behalf of the Darjee community. 1962 in the present suit. It was observed that the defendants in the affidavit have not denied allegations of the plaintiff that the suit against Bhonrilal was not in a representative capacity. In fact, the court has not framed any issue on that controversy although the defendant in the written statement has asserted that it was a representative suit on behalf of the Darjee community. Counsel for the appellant however, relied upon state ments from judgments in the previous suit in support of his contention that it was representative suit on behalf of the Darjee community. exhibit A 2 is the judgment of the trial court. It begins with a sentence: "This is a representative suit by the plaintiffs Kalyan Singh and Suraj Narayan on behalf of the Panchayat Darjian for recovery of possession of the 363 baghichi. " But this statement may not help counsel for the appellant, since the suit was said to be on behalf of the 'Panchayat Darjian ' and not Darjee community. exhibit A 4 is the High court judgment in the second appeal arising out of that suit. There the High court has stated: "That the suit was brought by Kalyan Singh and another against Bhonrilal by the representatives of Darjee community. " The suit might have been instituted by representatives of the Darjee community, but that by itself was not sufficient to constitute the suit as a representative suit. One does not know whether any such permission was obtained. The pleading in that suit or the order obtained under Order 1 Rule 8 has not been produced. There is no other evidence to support the contention of either of the parties. But that does not mean that the plaintiff could succeed ignoring the judgment and decree in the suit against Bhonri lal. It must be stated that any member of a community may successfully bring a suit to assert his right in the commu nity property or for protecting such property by seeking removal of encroachments thereform. The suit against Bhonrilal even if it was not a representative suit on behalf of the Darjee community would be a suit of this category. Kalyan Singh and another claimed that the baghichi was their community property and Bhonrilal was a trespasser. They brought the suit to recover possession from Bhonrilal. The rival title claimed by Bhonrilal by adverse possession was negatived. So long as that decree operates it would be futile to decree the present suit. The observation of the High Court that the present suit is a fruitless exercise could therefore, be sustained on this ground if not for the reasons stated. On this question, the High Court said: "Having read the evidence of these witnesses I am satisfied that according to the ordinary standard of proving a document the document exhibit 4 can be said to have been proved. The first striking feature of this will is that even though the wife of Gaurilal was living at 364 the time as she had survived him, no provision whatsoever had been made regarding her by Gaurilal in the alleged will exhibit 4. Then the second striking feature is that even though litigation had been going on almost for years this will had not been referred to by anyone. However, he was called by the Court and his statement was recorded. The judgment of the Jaipur Chief Court shows that he had laid no claim to the property and took the position that he was a Pujari at the baghichi. Then subsequently when suit was filed by the Darzi community against Bhonrilal, no reference came to be made to this will exhibit 4 Learned counsel for the re spondents, as I have already observed, sug gested that Narain or Bhonrilal could not be expected to make any reference to the will as that would be detrimental to the stand taken by them. Gangaram had referred to the earlier litigation in the plait, but when he entered the witnesses box he had taken a somersault. He was asked wheth er he was aware of the previous litigation and he said, he did not know of it. He was then questioned with reference to para 5 of the plaint as to how the facts had been mentioned by him therein and he kept mum and had no answer. He also admitted that it was Narain who had given him the document, exhibit 4 some 5 or 7 years after the death of Gaurilal i.e. some 30 or 35 years back. In that situation there was no mention of the alleged will in any of the two previous suits. It is also remarkable that even upto the High Court Bhonrilal had asserted his own possession over the property and had also obtained a stay order on payment of mesne profits vide exhibit A 7. Counsel for the respondents however, urged that the plain tiff has 365 proved its execution by producing one of the attestors and the scribe and their evidence has not been disbelieved by the High Court. We have perused their testimony and we are of the opinion that it is far from satisfactory. The plaintiff has deposed that Gaurilal was issueless and hence executed the will bequeathing the property to him. He has stated that the plain tiff was 10 11 years old when the will was executed. But the plaintiff himself has deposed that he was then a boy of 2 3 years. Ramdeo has given his age as 55 years when he deposed in the court on January 5, 1962. If we go by that age Ramdeo must have been a boy of 9 years when he attested the will in 19 16 Sham Sundar claims to be the scribe of the will. He has deposed that after he wrote the will attestation was made by witnesses but he has not named any one of them. He has not even referred to Ramdeo as an attesting witness. But there is no reference in the will that he was the adopted son. It is now not in dispute that Gaurilal 's wife was living at the time of execution of the will, but no provision was made for her maintenance. In the normal course, the wife would be the first to be thought of by the husband executing a will. But there is no such evidence and it was not even the plaintiff 's case that their relationship was strained. The will purports to have been executed in 1916 and Gangaram instituted the suit in 1959. It is not as if Gangaram or his brother or father had no opportunity to produce the will to assert rights over the property in question. The plaintiff has stated in his evidence that his father Narayan handed over the will to 366 him. Narayan was therefore, aware of the execution of the will. Yet he did not disclose it to the court in the suit against him. His statement was recorded on July 8, 1925 wherein he had admitted that he was only the Pujari of the temple and the wife of Baldeo sold the property. He did not say that his son Gangaram became owner of the property under the will executed by Gaurilal. It cannot be said that Gangaram was ignorant of that litigation till he filed the suit. Gangaram, however, made no attempt to produce the will in that suit. In the long period of 43 years, none made any attempt to rely upon the will against the claim of the Darji community when the community representatives have successfully brought two suits. This would not have been the natural conduct of person if the will had been really in existence. The executant of the will cannot be called to deny the execution or to explain the circumstances in which it was executed. It is, therefore, essential that trustworthy and unimpeachable evidence should be produced before the court to establish genuineness and authenticity of the will. It must be stated that the factum of execution and validity of the will cannot be determined merely by considering the evidence produced by the propounder. It would be open to the court to consider circum stances brought out in the evidence or which appear from the nature and contents of the documents itself. It would be also open to the court to look into surrounding circum stances as well as inherent improbabilities of the case to reach a proper conclusion on the nature of the evidence adduced by the party. Thimmajamma & Ors., [1959] Supp. Where there are suspicious circumstances, the onus would be on the propounder to explain them to the satisfac tion of the court before the will could be accepted as genuine. vs V. Kumar Khagendra Narayan Dev & Anr., and Smt. vs Manindra Chandra Bose & Anr., ; The Privy Council in Mr. Biro vs Atma Ram & Ors., AIR 1937 PC 10 1 had an occasion to consider an analogous case where the wife was practically disinherited and there was unexplained delay in producing the will in public. There the alleged will by a testator gave only a life estate to his daughter who was the only child and who was to get some property at her marriage. The bulk of the estate was vested in the widow of the testator and three other women, namely, his mother, his step mother and his paternal aunt. The widow of the testator would not get her husband 's estate, if she predeceased any of her co devisees. The will was not pro duced until 22 years after its execution though there were occasions to produce it, had it been in existence. Consider ing these circumstances, the Privy Council observed (at 104): "It is most unlikely that a person having a wife and a minor unmarried daughter, who should be the objects of his affection, would make a will which would practically disinherit them. During this long period of 22 years, which inter vened, there were occasions when the widow or her advisers could have produced the document, if it had been in existence; but they did not do so . " 368 ,The will in the present case, constituting the plaintiff as a sole legatee with no right whatever to the testator 's wife seems to be unnatural. The will has not been produced for very many years before the court or public authorities even though there were occasions to produce it for asserting plaintiff 's title to the property. We therefore, concur with the conclusion of the High Court and reject the will as not genuine. The High Court rejected the document with the following observations: "exhibit 3 is neither a certified copy given under any of the provisions of the Evidence Act nor is it a copy made from the original by any mechanical process. It also does not appear to have been made or compared from the original as there is no verification or endorsement of the kind and it does not come under clauses 1 or 5 of section 63 ei ther. If in place of primary evidence secondary evidence is admitted without any objection at the proper time then the parties are precluded from raising the question that the document has not been proved by primary evidence but by second ary evidence. But where there is no secondary evidence as contemplated by Section 66 of the Evidence Act then the document cannot be said to have been proved either by primary evidence or by secondary evidence. " It was said to be a registered sale deed by which Bhagala Girdhari purported to have sold the baghichi to Raghunath Brahmin. The plaintiff has not produced the original sale deed. Nor a certified copy of it has been produced. All that we find from the record is an ordinary copy of a sale deed exhibit 3 produced by Gopal Prasad PW 1. Gopal Prasad has stated that exhibit 3 was a copy submitted by the parties along with the original sale deed for registration. The original sale deed was said to have been returned to the party after its registration and a copy was kept in the file. But Gopal Prasad has no personal knowledge about the registration of the sale deed, nor he has produced the register to indicate that that sale deed was registered and a copy was kept in the record. exhibit 3 produced 369 by him does not bear any endorsement to the effect that it was a true copy of the original. The High Court said, and in our opinion very rightly, that exhibit 3 could not be regarded as secondary evidence. Correctness of certified copies referred to in clause (1) is presumed under Section 79; but that of other copies must be proved by proper evidence. A certified copy of a registered sale deed may be produced as secondary evidence in the absence of the original. But in the present case exhibit 3 is not a certified copy. It is just an ordinary copy. There is also no evidence regarding contents of the original sale deed. exhibit 3 cannot, therefore, be considered as secondary evidence. In the result, the appeal is allowed, modifying the judgment and decree of the High Court. The judgment and decree of the trial court as affirmed by the District Court are set aside and the plaintiff 's suit is dismissed.
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This case is about a garden in Jaipur with temples and buildings. Different people made claims to the garden at different times and for different reasons. Narayan, who took care of the temples, supposedly sold the garden to Khawas Bala Bux. The Darjee community sued to cancel the sale and declare their right to manage the property. The trial court said no to the Darjee community's case. But a District Judge disagreed and ruled in their favor on appeal. The Chief Court of Jaipur agreed with the District Judge. The person representing the Darjee community (the appellant) and Khawas Suraj Narayan sued in 1951 to remove Bhonrilal from the property. The court ruled in favor of the Darjee community. Bhonrilal appealed, but the Senior Civil Judge in Jaipur dismissed his appeal. His second appeal to the High Court also failed. He claimed he owned the garden and temples based on a sale document from about 1875 and a will (a legal document stating who gets his property after he dies) supposedly made in his favor in 1916. The trial judge ruled in favor of Gangaram. The defendants (the Darjee community) appealed, but the District Judge said the sale document and the will were valid. On further appeal, the High Court said that the sale document and the will were not valid, which meant Gangaram's claim to the property was based on nothing. But instead of overturning the lower court's decision and dismissing Gangaram's case, the High Court refused to change the lower court's ruling, even though they said Gangaram's case was pointless. Kalyan Singh, the defendant, challenged the High Court's decision in this Court (likely the Supreme Court) for two reasons. This means it was a lawsuit on behalf of the whole Darjee community, and so it could not be undone by this new lawsuit against individual members of the community. Second, he argued that since the High Court rejected the sale document and the will, it should have ruled against Gangaram because there was no other evidence to support his claim to the property. While agreeing to the appeal and changing the High Court's judgment, this Court stated: If someone wants to file a representative lawsuit (a lawsuit on behalf of a group), they must get permission under Order I Rule 8 CPC (a section of a law). Without this permission, which is required, any member of the community can file a lawsuit to assert their right to the community property or protect that property. The lawsuit against Bhonrilal, even if it wasn't a representative lawsuit on behalf of the Darjee Community, would still be a lawsuit of this type. It is very important to have good, trustworthy evidence to prove that a will is real. Just looking at the evidence presented by the person claiming the will is valid is not enough. The Court can also consider other evidence and the nature of the documents themselves. The Court can also look at the surrounding circumstances and whether the case makes sense to reach a proper conclusion about the evidence. In this case, the will seems strange because it makes the plaintiff (Gangaram) the only person to inherit, and gives nothing to the testator's (the person who wrote the will) wife. The will was not shown to the Court or other official groups for many years, even when it could have been used to prove Gangaram's claim to the property. Gangaram needed to provide good reasons for these suspicious facts. This Court agrees with the High Court and rejects the will as not real. Section 63 of the Evidence Act (a law about evidence) lists five types of secondary evidence (copies or other evidence used when the original is not available). Clauses (1), (2), and (3) refer to copies of documents. Clause (4) refers to duplicate copies of documents. Clause (5) refers to someone giving an oral account of the contents of documents. If a certified copy (a copy officially confirmed as accurate) is used (as mentioned in clause (1)), it is assumed to be correct under section 79. But other types of copies must be proven to be correct with proper evidence. A certified copy of a registered sale deed can be used as secondary evidence if the original is not available. H. Venkatachala lyengar vs B.N. Thimmajamma & Ors., [1959] Supp. I SCR 426; Rani Purnima Devi & Anr. vs V. Kumar Khagendra Narayan Dev & Anr., ; Smt. Indu Bala Bose & Ors. vs Manindra Chandra Bose & Anr., ; and Mst. Biro vs Atma Ram & Ors., AIR 1937 PC 101.
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(Judgment of the Court was delivered by T.S. SIVAGNANAM, J.)
1. This intra Court appeal at the instance of the department
is directed against the order dated 1st March, 2022 in W.P.A.
No.11085 of 2021. In the said writ petition, the respondent
herein challeged the order passed by the Joint Commissioner
(Appeal), CGST and CX, Kolkata Appeal – I Commissionerate dated
18th March, 2021. The said appeal filed before the Joint
Commissioner was directed against the order of demand of tax and
penalty in Memo dated 11th September, 2019 issued by the
Assistant Commissioner of State Tax, Durgapur Range and summary
of order under reference dated 11th September, 2019 passed by the
Assistant Commissioner of State Tax, Kolkata South.
2. The learned single Bench while noting the fact found that
the detention of the vehicle along with the goods and the demand
of tax and penalty not to be justified on the ground that the e-
way bill, which was being carried in the vehicle transporting
the goods had expired on the midnight of 8 th September, 2019 and
the goods were being transported on 9 th September, 2019 and the
vehicle was intercepted at 1.30 p.m.(noon) and according to the
writ petitioner the vehicle transporting goods had broken down
and on account of which, there was delay and there was no
willful intention to evade payment of tax. The learned single
Bench was convinced with the factual position and has disposed
of the writ petition by setting aside the order dated 11 th
September, 2019 as well as the order of the appellate authority
dated 18th March, 2021 and consequently held that the
respondent /writ petitioner will be entitled to get refund of
penalty and tax paid on protest subject to compliance of all
legal formalities. The department is aggrieved by such order.
Hence, this appeal.
3. The learned counsel appearing for the appellant would
submit that neither before the appellate authority nor in the
pleadings in the writ petition, the respondent had stated
anything about the vehicle being broken down or that non-
extension of the validity of the e-way bill was not deliberate
and willful but due to the circumstances as stated. When such
was the factual position, the learned single Bench ought not to
have allowed the writ petition by accepting the said argument,
which was placed for the first time when the writ petition was
moved before the Court.
4. Further, on fact, the learned counsel appearing for the
appellant had elaborately referred to the findings recorded by
the appellate authority and argued that the learned writ Court
ought not to have interfered with the order of demand of tax and
5. The learned counsel appearing for the respondent / writ
petitioner submitted that the bona fides of the writ petitioner
has to be considered and this was taken note of by the learned
writ Court and relief was granted. In order to show the bona
fides of the writ petitioner, the learned counsel had referred
to the documents, which formed part of the records of the writ
Court, more particularly, the tax invoice raised by M/s. Bhaskar
Steel and Ferro Alloy Private Limited dated 7th September, 2019,
e-way bill dated 7th September, 2019, which was valid upto
midnight of 9th September, 2019 giving the details of the
despatch from SRMB Srijan Private Limited to Shubham Steels, the
writ petitioner having its registered office in Kolkata. It is
further submitted that he writ petitioner had raised a tax
invoice in favour of Om Dayal Educational and Research Society,
which had its registered office at Kolkata but the goods had to
be delivered as per the instruction of the purchaser at Delhi
Public School, Sector – 2D, Bidhannagar, Durgapur and in this
regard, the writ petitioner had raised a second e-way bill dated
7th September, 2019 since the distance between SRMB Srijan Pvt.
Ltd. and the place of delivery was 9 kilometers, the e-way bill
was valid upto 8th September, 2019. Furthermore, it is submitted
that the vehicle number in both the e-way bills will clearly
show that it is the same vehicle.
6. We have elaborately heard Md. T. M. Siddique, learned
advocate for the appellant and Mr. Ankit Kanodia, learned
advocate appearing for the respondent.
7. After hearing the learned Advocates for the parties, we are
of the view that in the instant case, the bona fides of the writ
petitioner has to be tested on the documents, which were
available on record. Firstly, we find that the tax invoice has
been raised by Bhaskar Steel and Ferro Alloy Pvt. Ltd. dated 7 th
September, 2019. There is no dispute as regards the quantity
and description of the goods. The said vendor had raised the e-
way bill dated 7th September, 2019 as the goods were to be
despatched from SRMB Srijan Pvt. Ltd. to the writ petitioner,
who had its registered office at Kolkata. The said e-way bill
was valid upto 9th September, 2019 since the approximate distance
was about 168 kilometers. The writ petitioner’s case was that
they are traders and they had a supply order from Om Dayal
Educational and Research Society, which also has its registered
office at Kolkata but, however the goods had to be shifted to a
place in Durgapur. Therefore, the writ petitioner raised a
second e-way bill on 7th September, 2019 and since the distance
from SRMB Srijan Pvt. Ltd., Durgapur to the Delhi Public School,
Durgapur was only 9 kilometers, the e-way bill was valid only
for one day, i.e. 7th September, 2019 to 8th September, 2019
8. We need not go into the controversy as to whether there was
a break down of the vehicle, etc. The case has to be approached
by considering the bona fides of the transaction as to whether
the case warrants detention of the goods and collection of tax
and penalty. Admittedly, the first e-way bill dated 7 th
September, 2019 was valid upto 9th September, 2019. Therefore,
in the absence of second e-way bill, the tax authorities at
Durgapur could not have intercepted or detained the vehicle.
Therefore, the explanation offered by the respondent / writ
petitioner was an acceptable explanation and a case cannot be
made out that there was a deliberate and willful attempt on the
part of the respondent / writ petitioner to evade payment of tax
so as to justify invocation of the power under Section 129 of
9. Thus, we are of the view that the relief granted by the
learned writ Court is fully justified. However, we substantiate
the said conclusion by the reasons which we have assigned to the
preceding paragraphs.
10. In the result, the appeal and the application filed by the
department are dismissed and the appellant is directed to
process the application for refund filed by the respondent on 7 th
March, 2022 and orders be passed thereon in terms of the
direction issued by the learned writ Court within a period of
two weeks from the date of receipt of the server copy of this
judgment and order.
11. We make it clear that we have examined the facts of the
case on hand, the bona fides of the respondent / writ petitioner
and then arrived at a conclusion that it is not a case of
willful attempt to evade payment of tax and therefore, the
decision having been rendered on the peculiar facts cannot be
treated as a precedent.
12. Urgent photostat certified copy of this order, if applied
for, be furnished to the parties expeditiously upon compliance
of all legal formalities.
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A panel of judges from the Calcutta High Court, Justice T.S. Shivagnanam and Justice Hirnmay Bhattacharyya, decided that the GST department could not stop and hold vehicles just because a second e-way bill was missing. This was because the first e-way bill was still good when the vehicle was stopped.
The company involved, known as the assessee, argued that it was not fair to stop their vehicle and goods, or to demand tax and a fine. The special permit, called an e-way bill, that was with the goods expired at midnight on September 8, 2019. However, the goods were still being moved on September 9, 2019, when the vehicle was stopped at 1:30 in the afternoon.
The assessee claimed that the vehicle carrying the goods had broken down. This breakdown caused the delay, and they had not purposely tried to avoid paying taxes.
The department then challenged this by appealing to a single judge. This single judge closed the case, cancelling a previous decision from September 11, 2019. The judge ruled that the assessee had a right to get back the fine and tax they had paid, even though they disagreed with it, as long as they followed all legal steps. The department was unhappy with this ruling and appealed it to a larger panel of judges.
The department argued that the assessee had never mentioned the broken-down vehicle before. They also had not said that the e-way bill was not extended because of the circumstances, and not on purpose. The department claimed this information was not given to the appeal board or in the official court papers. Because of this, the department felt the single judge should not have accepted this argument, as it was brought up for the very first time when the case went to court.
The assessee argued that they had created a tax bill for Om Dayal Educational and Research Society, whose main office was in Kolkata. However, the buyer had asked for the goods to be delivered to Delhi Public School in Durgapur. The assessee said they had prepared a second e-way bill for the short 9-kilometer distance between these places, and that this e-way bill was good until September 8, 2019. They also pointed out that the vehicle number on both e-way bills was the same.
The court decided that the honesty and good intentions of the company that brought the case needed to be judged based on the official documents available.
The court stated that "the first e-way bill, dated September 7, 2019, was actually valid until September 9, 2019." Because of this, the tax officials in Durgapur had no right to stop or hold the vehicle just because there was no second e-way bill. The court found the reason given by the assessee to be acceptable. They concluded that there was no purposeful or willful attempt by the company to avoid paying tax. Therefore, the authorities could not rightly use their power under Section 129 of the Act (a law about holding goods), and the court ruled in favor of the assessee.
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The principal question for decision 5 in this appeal by Special Leave is whether the father in exercise of his right as Patria Potestas or otherwise can effect a partial partition between himself and his minor sons of joint family properties of a Hindu joint family governed by the Mitakshara School of Hindu Law. The members of the H.U.F. made an application to the Income Tax officer for recognising partial partition under section 171 of the Income Tax Act, 1961 (hereinafter referred to as the Act), claiming that two partial partitions bad taken place amongst the members of the said family, one on 24.12.1973 in respect of 200 shares of Gujarat Steel Tubes Ltd. and the other on 29.12.1973 in respect of 1777 shares of the same company. The I.T O. however, refused to record that there had been a partial partition of joint family properties, as he was of the view that partial partitions in question could not be recognised inasmuch as the remaining shares, after making certain allocations in favour of the two minor sons were not allotted in their entirety to the remaining third coparcener, namely, Shri Apoorva separately or to Shri Apoorva and his wife Karuna jointly, describing them as members of the H.U.F. hinted in the order that the distribution of the shares had not been made equally either amongst the three members including the two minor sons or amongst the four members of the H.U.P., as Apoorva 's wife Karuna also became entitled to an equal share on partition between the father and the sons. allowed the appeal and held that there had been genuine partial partitions between the coparceners in respect of the said shares. The Tribunal held for reasons recorded in the order that partial partitions in the instant case were outside the framework of the Hindu Law and as such they could not be recognised as valid for the purposes of section 171 of the Act. Under section 256 (1) of the Act, the Tribunal referred the following question to the High Court: (1) Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that Shri Apoorva Shanti1al could not himself have given consent on behalf of his minor sons to the partitions proposed by him in his individual capacity as father ? (3) Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that the partial partitions could not be recognized as valid for the purpose of section 171 of the Income tax Act, 1961 ? (4) Whether on the facts and circumstances of the case, the Tribunal was right in holding that partial partitions made by a Hindu father in exercise of his patria potestas cannot be recorded as a valid partitions under section 171 of the Income tax Act, 1961 ? (5) Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that the partial partition did not amount to a family arrangement in which the father acted as a natural guardian of the two minors sons after he had exercised his patria potestas ? The High Court in its judgment has held that the father under the Hindu Law has no power or authority to effect any partial partition of Joint family properties between himself and his minor sons. The High Court has observed that apart from the decision of the Madhya Pradesh High Court in the case of Commissioner of Income tax vs Seth Gopaldas H.U.F (1) there was no decision of any court on the point. From the stand point of ancient Hindu Law, what was recognised was only a partition in respect of all the 498 properties of the H.U.F., upon disruption of the status of H.U.F. Such a partial partition was so recognised only if it was made by consent of all the coparceners. Tn respect of a joint family consisting of a father and his sons, the traditional Hindu Law recognised the right of a father in his capacity as patria protestas to exercise his extraordinary power to disrupt the status of HUF and to divide his sons inter se without their consent subject to the rider that 'all ' assets of the HUF were subjected to partition. There is nothing in (I) either ancient Hindu Law or (2) customary or judge made law which authorises the father in exercise of his extraordinary power to effect a partial partition of HUF consisting of himself and his minor sons by dividing some items of properties whilst continuing the joint status in respect of the rest of the properties. What has been contended on behalf of the assessee is that whilst there is no express provision in so many words, either in the ancient Hindu texts or Judge made law, that the power of a Hindu father to effect partition of a HUF consisting of him self and his sons including minor sons in exercise of his power as patria protestas extends even to partition in respect of only some items of property it is required to be inferred by implication. In other words, it is argued that though there is no express reference to the power to effect that partial partition in the sense of division of some items of property while continuing the status of HUF in respect of the rest and though such power is not recognised in terms, it follows as a necessary corollary. " The High Court noted that this contention has been negatived by the Madhya Pradesh High Court in the case of Gopaldas (supra) and the High Court for reasons recorded in "the judgment rejected this contention. Aggrieved by the judgment of the High Court, the assessee with special leave granted by this Court has preferred this appeal. The first contention urged is that the High Court went wrong in holding that the father cannot effect any valid partial partition between himself and his minor sons of joint family property belonging to Hindu undivided family consisting of himself, his wife and minor sons who are governed by the Mitakashra School of Hindu Law. According to the Mitaksbara School of Hindu Law, the father has a power to divide ancestral property among his sons and the partition made by him is binding on his sons provided that the power is exercised bonafide and in accordance with law which regulates and restricts it in the interests of his sons. A father in any such case of ancestral property has the power to separate from all or from even some of his sons remaining joint with the other sons or leaving them to continue as a joint family with each other. at page 443 and 444 reads as follows: "The father of a joint family has the power to divide the family property at any moment during his life, provided he gives his sons equal shares with himself, and if he does so, the effect in law is not only a separation of the father from the sons, but a separation of the sons inter se. It is open to the members of a joint family to sever in interest in respect of a part of the joint estate while retaining their status of a joint family and holding the rest as the properties of an undivided family. Reference is made to the decision of the Bombay High Court in the case of Bapu Hambira Patil vs Shankar Bahu Patil, (1) and to the decision of the Madras High Court in the case of Venkataswara Pattar vs K. In the earlier Act though there was no express reference to partial partitions, the preferable view expressed in deci 502 sions under that Act was that if there was a partial partition of an asset of the family or an asset of the family was divided and a partnership was constituted and the family continued joint as regards other properties, the assessment on the basis of undivided Hindu family would be confined to the income of the properties so remaining undivided and the income of the property partitioned would be excluded from the computation of the income for assessment. The decision of the Privy Council in the case of Appovier vs Ram Subba Aiyan,(2) when it speaks of partial partition of the joint family by agreement of the coparcener cannot possibly be read as restricting the patriarchal and superior power of the father to effect division of the entire joint family properties and to exclude operation in case of exercise of the lesser right of division of only some of the family properties. In the assessment year 1947 48 and 1948 49, Charandas Haridas claimed that the income should no longer be treated as income of Hindu undivided family but as separate income of the divided members. The following question as directed by the High Court on the application of Charandas Haridas was referred to the High Court. : "Whether there were materials to justify the finding of the Tribunal that the income in the share of the com mission agency of the mills was the income of the Hindu undivided family ?" The assessee Charandas Haridas filed an appeal in this Court with special leave granted by this Court. There is then the income tax law, under which a particular income may be treated as the income of the Hindu undivided family or as the income of the separated members enjoying separate shares by partition. There is then no Hindu undivided family as a unit of assessment in point of fact, and the income which accrues cannot be said to be of a Hindu undivided family. There is nothing in the Indian Income tax law or the law of partnership which prevents the members of a Hindu joint family from dividing any asset. Where there has been a partition, it is presumed that it was total one both as to the parties and property but when there is a partition between brothers, there is no presumption that there has been partition between one of them and his descendents. When there is partial partition as to property, the family ceases to be undivided as regards properties in respect of which such partition has taken place but continues to be undivided with regard to the 508 remaining family property. The right of the father to bring about the disruption of the joint family properties in exercise of his superior right as father or of his rights as patria potestas is recongnised in ancient Hindu Law. The High Court appears to have accepted this position but the High Court then proceeds to hold that the proposition laid down by judicial decisions with regard to partial partition will apply only when partial partition is effected with the consent of the members of the joint family and cannot be extended to a case where partial partition is sought to be brought about by father in exercise of his superior rights as father or his right, as patria potestas. as patria potestas is entitled to bring about a complete disruption of the joint family and to effect a complete partition of joint family properties of a Hindu family consisting of himself and his minor sons even against the wishes of the minors and if partial partition be permissible with the consent of sons when they have all become major, we see no reason to limit the power or authority of tho father to effect the partition only to a case where the partition is total. It is also now recognised that partial partition of joint family properties is permissible. When father can bring about a complete partition of joint family properties between himself and his minor sons even against the will of the minor sons and when partial partition under the Hindu Law is now accepted and recognised as valid by judicial decisions, we fail to appreciate on what logical grounds it can be said that the father who can bring about a complete partition of the joint family properties between himself and his minor sons will not be entitled to effect a partial partition of joint family properties between himself and his minor sons if the father in the interest of the joint family and its members feels that partial partition of the properties will be in the best interest of the joint family and its members including the minor sons. Even if the test of consent is to apply, the father as the natural guardian of the minor sons will normally be in a position to give such consent and it cannot be said as a matter of universal application that in all such cases of partition, partial or otherwise, there is bound to be a conflict of interest between the father and his sons. 511 We may point out that in the case of Charandas Haridas to which we have earlier referred and in which this Court recognised the validity of partial partition brought about by the father of some joint family properties, the sons were all minors. The decision of this Court in the case of Charandas Haridas and the observations of this Court in the case of Kalloomal Tapeswari Prasad (supra) which we have earlier quoted, in our opinion, clinch the decision of the question. We must, therefore, hold that partial partition of properties brought about by the father between himself and his minor sons cannot be said to be invalid under the Hindu Law and must be held to be valid and binding. We wish to make it clear that this right of the father to effect a partial partition of joint family properties between himself and his minor sons, whether in exercise of his superior right as father or in exercise of the right as patria potestas has necessarily to be exercised bona fide by the father and is subject to the right of the sons to challenge the partition if the partition is not fair and just. section 171 of the Income tax Act, 1971 provides as follows: (1) A Hindu family hitherto assessed as undivided shall be deemed for the purposes of this Act to continue to be a Hindu undivided family, except where and in as far as a finding of partition has been given under this section in respect of the Hindu undivided family. 143 or section 144, it is claimed by or on behalf of any member of Hindu family assessed as undivided that a partition, whether total or partial, has taken place among the members of such family, the Income Income tax officer shall make an enquiry thereinto after giving notice of the enquiry to all the members of the family. 512 (3) On the completion of the enquiry, the Income tax officer shall record a finding as to whether there has been a total or partial partition of the joint family property, and, if there has been such a partition the date on which it has taken place. (4) Where a finding of total or partial partition has been recorded by Income tax officer under this section, and the partition took place during the previous year (a) the total income of the joint family in respect of the period up to the date of partition shall be assessed as if no partition had taken place; and (b) each member or group of members shall, in addition to any tax for which he or it may be separately liable and notwithstanding anything contained in clause (2) of section 10, be jointly and severally liable for the tax on the income so assessed. (5) Where a finding of total or partial partition has been recorded by the Income tax officer under this section, and the partition took place after the expiry of the previous year, the total income of the previous year of the joint family shall be assessed at as if no partition had taken place; and the provisions of clause (b) of sub section (4) shall, so far as may be, apply to the case. (6) Notwithstanding anything contained in this section if the Income tax officer finds, after completion of the assessment of a Hindu undivided family that the family has already effected a partition, whether total or partial the Income tax officer shall proceed to recover the tax from every person who was a member of the family before the partition, and every such person shall be jointly and severally liable for the tax on the income so assessed: (7) For the purposes of this section, the several liability of any member or group of members thereunder shall be computed according to the portion of the joint family property allotted to him or it at the partition, whether total or partial. (a) "partition" means (i) where the property admits of a physical division, a physical division of the property, but a physical division of the income without a physical division of the property producing the income shall not be deemed to be a partition; or (ii) where the property does not admit of a physical division then such division as the property admits of, but a mere sevence of status shall not be deemed to be a partition; (b) "partial partition" means a partition which is partial as regards the persons constituting the Hindu undivided family, or the properties belonging to the Hindu undivided family, or both. w. e. f. 1st April, 1980 : G (9) Notwithstanding anything contained in the foregoing provisions of this section, where a partial partition has taken place after the 31st day of December, 1978 among the members of a Hindu undivided family hitherto assessed as undivided: 514 (a) no claim that such partial partition has taken place shall be inquired into under sub section (2) and no finding shall be recorded under sub section (3) that such partial partition had taken place and any finding recorded under sub section (3) to that effect whether before or after the 18th day of June, 1980 being the date of introduction of the Finance (No 2) Bill 1980, shall be null and void; (b) such family shall continue to be liable to be assessed under this Act as if no such partial partition had taken place; (c) each member or group of members of such family immediately before such partial partition and the family, shall be jointly and severally liable for any tax, penalty, interest, fine or other sum payable under this Act by the family in respect of any period whether before or after such partial partition; (d) the several liability of any member or group of members aforesaid shall be computed according to the portion of the joint family property allotted to him or it at such partial partition: and the provisions of this Act shall apply accordingly. In the present case, the partial partition of the shares belonging to the Hindu undivided family cannot, therefore, be said to 515 be bad either under the Hindu Law or under the Indian Income tax Act. We must, therefore, hold that the High Court went wrong in deciding that partial partition of the joint family properties of the Hindu joint family by the father was invalid and could not be recognised under the Income tax Act. The other question which falls for determination is whether the partition can be said to be bad at the time of the partition there was no equal division of the shares by the father amongst himself and his minor sons and a part of the share holding had not been distributed to the father or to the father and mother jointly. In our opinion, a partial partition of any joint family property by the father between himself and his sons does not become invalid on the ground that there has been no equal distribution amongst the co sharers. It is not open to the Income tax Authorities to consider a partial partition to be invalid on tho ground that shares have not been equally divided and to refuse to recognise the same. As there is no finding that the partial partition is sham or fictitious or not a genuine one, on enquiries made by the Income tax officer, and as the partial partition is otherwise valid under the Hindu Law, the partial partition has necessarily to be recognised under the provisions of section 171 of the Income tax Act and the assessment must be necessarily made on the basis that there is Partial partition of the said shares. The partial partition is held to be valid and the Income tax Officer is directed to recognise the same and to proceed to make the assessment on the basis that there has been a partial partition of the said shares between the parties.
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A Hindu Undivided Family (HUF) is like a family business under Hindu law. In this case, the HUF had four members: Mr. Apoorva Shantilal Shah, his wife Mrs. Karuna, and their two young sons, Chintan and Tejal. During the tax assessment for the year 1975-76, Mr. Apoorva, as the head (Karta) of the HUF, asked the Income Tax officer to acknowledge a partial split (partition) of the family assets, as allowed under Section 171 of the Income Tax Act of 1961. He claimed that two partial partitions had occurred in December 1973, involving shares of a company. The Income Tax officer refused to acknowledge these splits for three reasons. First, the minor sons didn't request the partitions. Second, after giving some shares to the sons, the remaining shares weren't fully given to the other family member (Mr. Apoorva) or to Mr. Apoorva and Mrs. Karuna jointly. Third, the shares weren't divided equally among the family members, as Mrs. Karuna was also entitled to a share. Mr. Apoorva appealed to the Assistant Appellate Commissioner, who agreed with him. However, the Income Tax Appellate Tribunal (a higher court) disagreed and allowed a further appeal. They believed that these partial partitions, because they were not fully within Hindu Law, couldn't be considered valid under Section 171 of the Income Tax Act. The High Court also disagreed with Mr. Apoorva, answering all questions against him. They stated that a father doesn't have the right to partially divide joint family property between himself and his minor sons under Hindu Law. Mr. Apoorva then made a special appeal. The Court allowed the appeal, stating: 1.1. A partial split of shares within a Hindu Undivided Family is not wrong under either Hindu Law or the Income Tax Act. 1.2. A partial partition of property by a father between himself and his minor sons is valid under Hindu Law. This power of the father must be used honestly and fairly. The sons have the right to challenge the split if it's not fair. 1.3. Ancient Hindu Law recognizes the father's right to separate joint family property. 1.4. The High Court was wrong to say that partial partitions are only allowed with the consent of all family members. A father can make a partial partition, even without full consent, using his rights as a father, but he must be fair. If a father can completely divide joint family property, even against the wishes of his minor sons, and partial partitions are allowed with consent when the sons are adults, then the father's power to divide property shouldn't be limited to only complete divisions. Even if consent is needed, the father, as the children's guardian, can usually give that consent. It can't be assumed that there will always be a conflict of interest between the father and sons in these cases. If the father doesn't act honestly when dividing property, the sons can challenge the split when they become adults. Even during their childhood, the sons, through a guardian, can challenge a split that unfairly hurts their interests. 1.5. The Income Tax Act of 1961, before a later change, also recognized partial partitions. The definition of partial partition makes it clear that splits regarding family members or property are allowed. 2.1. A partial split of family property by the father is not invalid just because the property isn't divided equally. The father is expected to act honestly and in the best interest of the family, especially the minor sons. If a son is harmed by a partial split, he can challenge it in court. The split is considered valid until a court says otherwise. 2.2. Income tax officials cannot invalidate a partial split just because the shares aren't divided equally. However, the Income Tax officer can investigate whether the split is real or not before accepting it. If the officer finds that the split is fake, they can refuse to recognize it. 2.3. In this case, there's no evidence that the partial split was fake. Because the split is valid under Hindu Law, it must be recognized under Section 171 of the Income Tax Act. The tax assessment must be done based on the fact that there was a partial split of the shares.
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1. Having noted that there is a clear conflict between the two decisions of this Court, one in the case of Ch. Tika Ramji & Others, Etc. vs. The State of Uttar Pradesh & Others [AIR 1956 SC 676 = 1956 SCR 393 = 1956 SCJ 625] and another subsequent decision in the case of U.P. Cooperative Cane Unions Federations vs. West U.P. Sugar Mills Association and Others [(2004)5 SCC 430], a three Judge Bench of this Court has referred the matter to a larger Bench proposing the following questions of law to be considered by the larger Bench, preferably of a Bench consisting of seven Judges of this Court: (1) Whether by virtue of Article 246 read with Schedule VII List III Entry 33 of the Constitution the field is occupied by the Central legislation and hence the Central Government has the exclusive (2) Whether Section 16 or any other provision of the U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953 confers any power upon the State Government to fix the price at which (3) If the answer to this question is in the affirmative, then whether Section 16 or the said provision of the U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953 is repugnant to Section 3(2)(c) of the Essential Commodities Act, 1955 and Clause 3 of the Sugarcane (Control) Order, 1966 [hereinafter referred to as “1966 Order”]? And if so, the provisions of the Central enactments will prevail over the provisions of the State enactment and the State enactment to that extent would be void under Article 254 of the Constitution of India. (4) Whether the SAP fixed by the State Government in exercise of powers under Section 16 of the U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953 is arbitrary, without any application of mind or rational basis and is therefore, invalid and (5) Does the State Advised Price (for short “SAP”) constitute a statutory fixation of price? If so, is it within the legislative competence of the State?
(6) Whether the power to fix the price of sugarcane is without any guidelines and suffers from conferment of arbitrary and uncanalised power which is violative of Articles 14 and 19(1)(g) of the 2. The core issue is whether the State of U.P. has the authority to fix the State Advised Price (SAP) [hereinafter referred to as “SAP”], which is required to be paid over and above the minimum price fixed by the Central Government? 3. At the outset it is required to be noted that in Tika Ramji case (supra), a Bench of five Judges of this Court held as under: (i) That, section 16 of the U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953 [hereinafter referred to as “1953 U.P. Act”] does not include the power to (ii) That, the price of cane fixed by the U.P. Government only mean the price fixed by the appropriate Government which would be the Central Government, under Clause 3 of the Sugarcane (Control) Order, 1955 [hereinafter referred to as (iii) That, even the provisions in behalf of the agreement contained in Clauses 3 and 4 of the U.P. Sugarcane (Regulation of Supply and Purchase) Order, 1954 [hereinafter referred to as “1954 U.P. Order”] provided that the price was to be the minimum price to be notified by the Government subject to such deduction, if any, as may be notified by the Government from time to time, meaning thereby the Central Government, the State Government not having made any provision in that behalf at any time (iv) That, there is no power to fix a price for sugarcane under the U.P. Sugarcane Act or Rules and the It is to be noted that in Tika Ramji case(supra), this Court did not comment on whether a power which the State Government exercised under Section 16 of the 1953 U.P. Act would be repugnant to the Central legislation, since this Court
found no such power exercised by the State Government. 4. However, subsequently, another five Judges Bench of this Court in the case of U.P. Coop. Cane Unions Federations (Supra) has specifically gone into the question of repugnancy and held that the inconsistency or repugnancy will rise if the State Government fixes a price which is lower than that fixed by the Central Government. But, if the price fixed by the State Government is higher than that fixed by the Central Government, there will be no occasion for any inconsistency or repugnancy as it is possible for both the orders to operate simultaneously and to comply with both of them. A higher price fixed by the State Government would automatically comply with the provisions of clause 3(2) of 1966 Order. Therefore, any price fixed by the State Government which is higher than that fixed by the Central Government cannot lead to any kind of repugnancy. In the case of U.P. Coop. Cane Unions Federations (Supra), this Court held that the State Government has power to fix the price which may be higher than the minimum price fixed by the This Court in the reference order observed that to the aforesaid extent there is a difference of opinion and/or conflict. 5. We have called upon the learned Counsel appearing on behalf of the respective parties to first address on whether in fact there is any conflict between the decisions of this Court in the case of Tika Ramji (Supra) and U.P. Coop. Cane Unions Federations (Supra) or not and whether there is a need to refer the matter to a larger Bench of seven Judges? 6. Shri Jayant Bhushan, learned Senior Advocate appearing on behalf of the appellants has submitted that this case raises the following important issues. (1) Whether the State Government / Cane Commissioner has any power or authority under the 1953 U.P. Act or the Rules and the Orders made thereunder to fix (2) If the State of U.P. had such a power, would such legislation be repugnant to the Central legislation i.e.
Essential Commodities Act and the 1966 Order? (3) Whether there is any conflict between the Constitution Bench judgment of this Court in the case of Tika Ramji (Supra) and in the case of U.P. 6.1 So far as the question No.1 is concerned, it is submitted that the power to regulate the distribution, sale or purchase of cane under Section 16 of the 1953 U.P. Act does not include the power to fix the price. It is submitted that this aspect has been comprehensively dealt with in the case of Tika Ramji (Supra) which analyzed the legislative history of laws relating to sugar and sugarcane both Central and State and came to the specific conclusion that the power reserved to the State Government to fix the minimum price of sugarcane which existed in U.P. Act 1 of 1938 was deleted from the 1953 U.P. Act since that power was being exercised by the Centre under Clause 3 of Sugar and Gur Control Order, 1950. Reliance is placed upon paragraph 34 of decision in the case of Tika Ramji (Supra). 6.1.1 It is submitted that in the aforesaid decision it has specifically been held that the 1953 U.P. Act or the Rules and the Orders made thereunder made no provision for fixation of price of sugarcane whatsoever and therefore, there was no question of repugnancy with the Central law. It is submitted that in the case of U.P. Coop. Cane Unions Federations (Supra), this Court did not quote paragraph 34 and relevant paragraphs of the decision in the case of Tika Ramji (Supra) and erroneously holds that Tika Ramji (Supra) only held that the State did not in fact exercise the power to fix the price. 6.1.2 It is submitted that the argument that Tika Ramji (Supra) only hold that the State Government did not fix the price as this was fixed for the first time in 1973, is totally misplaced. It is submitted that Tika Ramji case has specifically held that there was no power to fix the price for sugarcane under the 1953 U.P.
Act or the Rules and the Orders made thereunder. It is submitted that although the judgment in Tika Ramji (Supra) does not specifically quote section 16 of the 1953 U.P. Act, it is clear from the judgment that every section and every Rule was examined to see whether there was any power to fix cane price or any provision relating to price of cane. It is urged that the only provision that was found on detailed scrutiny of the 1953 U.P. Act and the Rules was Rule 94 which provided for a notice showing the minimum price fixed by the Government, which was held by the Constitution Bench to mean price fixed by the 6.2 Now, so far as question No.2 is concerned, it is argued that even if such a power exists under Section 16 of the 1953 U.P. Act, such power would be totally repugnant to the power of Central Government to fix the minimum price under Clause 3 of the 1955 Order and thereafter under 1966 Order. It is submitted that although Tika Ramji case (supra) has not commented on whether such a power with the State Government would be repugnant to the Central Legislation, since it found no such power exercised by the State Government, the majority in the later Constitution Bench judgment in the case of U.P. Coop. Cane Unions Federations (Supra) held that this would not be repugnant to the Central Legislation. It is argued that basis for holding that there is no repugnancy is that it is possible for both the orders to operate simultaneously and to comply with both of them. It is argued that in the case of U.P. Coop. Cane Unions Federations (Supra), subsequently it is held that any price fixed by the State Government which is higher than that fixed by the Central Government cannot lead to any kind of repugnancy. It is argued that this conclusion and its use for determining repugnancy is incorrect and contrary to the earlier Constitution Bench judgment including in the case of Tika Ramji (Supra). It is argued that therefore this issue also needs to be referred to a
larger Bench to resolve the conflict. Reliance is placed on some of the observations in the case of Tika Ramji (Supra); in the case of State of Orissa vs. M.A. Tulloch & Co. [1964 (4) SCR 461] and in the case of M. Karunanidhi vs. Union of India [(1979)3 6.2.1 It is argued that therefore there cannot be two minimum prices, one fixed by the Central Government as minimum price and other fixed by the State Government as SAP, which is also a minimum price. It is submitted that once the Centre has fixed a minimum price, any other price whether minimum price or SAP would be repugnant to the Centre’s decision and the Centre’s power and such power of the State Government would therefore have to yield to the Central legislation under Article 254 of the Constitution, both legislations being under the Concurrent List. 6.3 It is urged that there is a direct conflict between the Constitution Bench Judgment of this Court in the case of Tika Ramji (Supra) on one hand and the later Judgment also of the Constitution Bench in the case of U.P. Coop. Cane Unions Federations (Supra), which needs to be referred to the larger Bench of seven Judges. 7. On the other hand, Shri Krishnan Venugopal, learned Senior Advocate appearing on behalf of the State of U.P. has vehemently argued that as such there is no apparent conflict between the two decisions of Constitution Bench of this Court in the case of Tika Ramji (Supra) and U.P. Coop. Cane Unions Federations (Supra). In support, he has made the following (1) That, there is a sea change in the law prevailing and considered by this Court in the case of Tika Ramji (Supra) and thereafter in the case of U.P. Coop. (2) That, by the time of the challenge to the 1953 U.P. Act and the 1954 U.P. Order made under Section 16
of the 1953 U.P. Act in the U.P. Coop. Cane Unions Federations (Supra), there was a fundamental change in the substratum on which Tika Ramji case was decided to the extent that the Central Government had repealed and substituted the 1955 Order by the 1966 Order. The 1966 Order issued under Section 3 of the Essential Commodities Act, 1955 expressly left room for the State to advise a price higher than the minimum price fixed by the Central Government under Clause 3(1) of the 1966 Order at which agreements for cane procurement could be reached between farmers or cooperative societies, especially in the context of the reservation of canegrowing areas for exclusive procurement by sugar factories. (3) That, the ratio of Tika Ramji (Supra) is not premised solely on the complete absence of power under the 1953 U.P. Act to fix prices. It is submitted that if so, there was no need for this Court to hold premise its reasoning on the “fact” that the State of U.P. had not actually fixed the price for sugarcane. (4) That, in the case of Tika Ramji (Supra), though there is a brief mention of section 16 of the impugned 1953 U.P. Act, neither was the issue raised and the issue No. (iii) was whether section 16 of the Essential Commodities Act read with clause 7 of 1955 Order could have purported to repeal Section 16 of the 1953 U.P. Act and the 1954 U.P. Order in light of the proviso to Article 254(2) of the Constitution of India, neither was the issue raised nor was there any argument or discussion on the effect or implications of section 16 of the 1953 U.P. Act on the fixation of the “minimum price” under the 1955 Order in the context of the discussion of repugnancy of 1953 U.P. (5) That, there has been a sea change in the law relating to repugnancy between Central law and State law in the context of laws made under the Concurrent List,
List III in the VII Schedule to the Constitution of India, where both, the Union and the States have power to make law. (6) That, being fully aware of the judgment of this Court in the case of Tika Ramji (Supra), the Central Government retreated from the field of fixing “the price” of sugarcane and only retain the power to fix “the minimum price” while permitting an agreement for fixing higher price for sugarcane. It is submitted that therefore, the Central Government left it open for the State to fix the price above the minimum price for purposes of the agreement to be reached between the sugarcane growers and sugarcane cooperative society, on the one hand, and the sugarcane factories, on the other. It is submitted that therefore the Central Government expressly indicated its intent to vacate a particular portion of the field of price fixation in relation to sugarcane and left it open to the State, the doctrine of occupied field has no application whatsoever. (7) It is submitted that the reliance placed upon the decision of this Court in the case of M.A. Tulloch & Co. (Supra) on the occupied field doctrine shall not be applicable to the facts of the case on hand as that case relates to regulation of mines and mineral development and the regulation which involves the relationship between the Entry 23 in List II and Entry 54 in List I of the Seventh Schedule, both of which make it clear that the field of legislation can be taken over by Parliament by making the declaration to that effect. 7.1 Shri Venugopal, learned Senior Advocate appearing for the respondent State of U.P. has made following submissions in support of his submission that there has been a fundamental change in the provisions of the 1955 Order to the extent that it was repealed by the 1966 Order. (1) That, Clause 3 of the 1955 Order empowered the Central Government to fix “the price or the minimum price” to be paid by a producer of sugar for sugarcane purchased by him. The 1955 Order has been repealed by the 1966 Order and clause 3 of the 1966 Order
provides that the Central Government may fix “the minimum price” of sugarcane to be paid by producers of sugar. (2) That, there is a difference between “the price” which is a fixed amount and “the minimum price” which only indicates the lowestpermissible rate. The 1966 Order was further amended in 1976 and 1978 and clauses 3(3) and 3A were introduced, which now contemplated an “agreed price”. In view of the prohibition in clause 3(2) on transacting below the minimum price, the “agreed price” necessarily had to be higher than the “minimum price” fixed under clause 3(1). (3) That, it is evident from the amended provisions of the 1966 Order, as amended in 1976 and again in 1978, that the Central Government intentionally vacated space in favour of the State Legislature to regulate the price at which agreements could be reached between sugarcane farmers and cooperative societies of sugarcane farmers for procurement of sugarcane, especially in the context of reservation of areas for procurement by sugar factories. (4) That, therefore, it is clear that as long as the State Advised Price fixed by the State Government of Uttar Pradesh by exercising powers under Section 16 of the 1953 U.P. Act remains over and above the minimum price fixed by the Central legislature under the 1966 Order, there is no repugnancy to the extent that both laws can be obeyed without infringing the other. 7.2 It is further argued that in the case of U.P. Coop. Cane Unions Federations (Supra), this Court has rightly observed and held that so long both, the Union law and the State law can be obeyed, the State law does not become repugnant to the Union law when both the laws can operate in the same field without conflict. In support, heavy reliance has been placed upon the decision of this Court in the case of Dr. Preeti Srivastava vs. State of M.P. [(1999) 7 SCC 120]. 7.3 It is further argued that in the case of M. Karunanidhi
(Supra), while examining the issue of repugnancy with respect to State enactment of Tamil Nadu Public Men (Criminal Misconduct) Act, 1973 in light of the Central enactments of Indian Penal Code, 1860, Prevention of Corruption Act, 1988 and the Criminal Law (Amendment) Act, 1952 and after considering the relevant Entries in List I, List II and Concurrent List – List III and Article 254 of the Constitution of India, it is held that so far as Clause (1) of Article 254 is concerned, it clearly lays down that where there is a direct collision between a provision of a law made by the State and that made by the Parliament with respect to one of the matters enumerated in the Concurrent List, then, subject to the provisions of clause (2), the State law would be void to the extent of the repugnancy. It is submitted that it is further held that so far as the Concurrent List is concerned, both, Parliament and the State Legislatures are entitled to legislate in regard to any of the Entries appearing therein, but that is subject to the condition laid down by Article 254(1). It is submitted that in the aforesaid decision it is held that (1)Where the provisions of a Central Act and a State Act in the Concurrent List are fully inconsistent and are absolutely irreconcilable, the Central Act will prevail and the State Act will become void in view of the repugnancy; (2) Where, however a law passed by the State comes into collision with a law passed by the Parliament on an Entry in the Concurrent List, the State Act shall prevail to the extent of the repugnancy and the provisions of the Central Act would become void provided the State Act has been passed in accordance with clause (2) of Article 254; (3) Where, a law passed by the State Legislature while being substantially within the scope of the entries in the State List entrenches upon any of the Entries in the Central List the constitutionality of the law may be upheld by invoking the doctrine of pith and substance if on an
analysis of the provisions of the Act it appears that by and large the law falls within the four corners of the State List an entrenchment, if any, is purely incidental or inconsequential; (4) Where, however, a law made by the State Legislature on a subject covered by the Concurrent List is inconsistent with and repugnant to a previous law made by Parliament, then such a law can be protected by obtaining the assent of the President under Article 254(2) of the Constitution. The result of obtaining the assent of the President would be that so far as the State Act is concerned, it will prevail in the State and overrule the provisions of the Central Act in their applicability to the State only. Such a state of affairs will exist only until Parliament may at any time make a law adding to, or amending, varying or repealing the law made by the State Legislature under the proviso to Article 254. 7.4 It is submitted that therefore applying the law laid down by this Court in the case of M. Karunanidhi (Supra) to the facts of the case on hand, it is clear that in the present case, as the Essential Commodities Act and the 1966 Order, on the one hand, and 1953 U.P. Act and the 1954 U.P. Order, have both been enacted under the Concurrent List, and there is no direct conflict between the fixation of the minimum price by the Central Government under Clause 3 of the 1955 Order and the fixation of a higher SAP by the State of U.P., there is no real and irreconcilable conflict between the provisions of the two Acts to the extent that both can be obeyed without violating the order. Therefore, it is submitted that the decision of this Court in the case of U.P. Coop. Cane Unions Federations (Supra) must be upheld as there is no conflict with the decision in the case of 8. While considering whether there is any apparent conflict between the decisions of the Constitution Bench of this Court in the case of Tika Ramji (Supra) and U.P. Coop. Cane Unions
Federations (Supra) and whether the matter requires to be referred to the larger Bench of seven Judges, the legislative history as well as the chronology of lists and events which led to the controversy in the case of Tika Ramji (Supra) and U.P. Coop. Cane Unions Federations (Supra) and the relevant provisions which fell for consideration before this Court are required to be referred to, which are noted in U.P. Coop. Cane Unions Federations (Supra) , as under: a. On 8th April, 1932, the Central Legislature, in the then British India, passed the Sugar Industry (Protection) Act, 1932 [Act 13 of 1932] to provide for the fostering and development of Sugar Industry in India. This led to a large number of farmers taking up sugarcane cultivation and the establishment of a number of sugar factories coming up, particularly in the then Province of U.P. To protect the interest of the sugarcanegrowers', and for the purpose of assuring them a fair price, the Central Legislature enacted on 1st May, 1934 the Sugarcane Act, 1934, 1934 [Act 15 of 1934] to regulate the price at which sugarcane intended for manufacture of sugar could be purchased by or for the factories. Since, sugarcane was grown in various Provinces and the Sugarcane Act, 1934 left the declaration of controlled areas and the fixing of minimum price for the purchase of sugarcane in any controlled area to the discretion of the Provincial Governments, the Provincial Governments were also empowered to make rules for the purpose of carrying into effect the objects of the b. As a result of the Government of India Act, 1935, there was a distribution of legislative powers between the Dominion Legislature and the Provincial Legislatures. Consequently, the entire subject matter of Act 15 of 1934 fell within the Provincial Legislative List. It was felt that Act 15 of 1934 was not sufficiently comprehensive for dealing with the problems of the sugar industry. The Governments of U.P. and Bihar decided to introduce legislation on similar lines in both the provinces since, between them, they accounted for nearly 85% of production of sugar in India.
c. The U.P. Legislature enacted on 10th February, 1938 the U.P. Sugar Factories Control Act, 1938 [U.P. Act I of 1938]. This Act provided for (i) licensing of sugar factories, (ii) regulation of the supply of sugarcane intended for use in such factories, (iii) the minimum price for sugarcane, (iv) the establishment of Sugar Control Board and Advisory Committee, and (v) a tax on the sale of sugarcane intended for use in factories. Though this Act was to remain in force initially until 30th June, 1947, its life was extended from time to time and finally up to 30th June 1952. Parallel developments during this period were the outbreak of the Second World War and the legislative measures taken to meet the situation by the then Government of India for controlling the production, regulation of distribution and supply of essential commodities. The Dominion Legislature acquired the power to make laws for the Provinces with respect to any of the matters enumerated in the Provincial Legislative List. Under the Defence of India Act, sugar was made a controlled commodity in the year 1942 and its production and distribution as well as the fixation of sugar prices were regulated by the Sugar Controller. The proclamation of emergency was revoked by the Governor General on 1st April 1946. Simultaneously, the laws made by the Dominion Legislature in the field of the Provincial Legislative List were to cease to be effective after 30th September 1946. d. On 26th March 1946, the British Parliament enacted the India (Central Government and Legislature) Act, 1946 [9 & 10 Geo.6, Chapter 39] which provided that, notwithstanding anything in the Government of India Act, 1935, the Indian Legislature shall during the periods specified in Section 4 of the Act have the power to make laws with respect, inter alia, to “foodstuffs”. Though the period provided in Section 4 was one year from the expiration of the declaration of the emergency by the Governor General, this period was extended from time to time and would have ended on 31st March 1948. e. On 18th July 1947, the Indian Independence Act came
to be passed leading to the Indian (Central Government and Legislature) Act, 1946 which by way of adaptation provided that the powers of the Dominion Legislature shall be exercised by the Constituent Assembly. With the Constitution coming into force on 26th January 1950, Article 369 invested Parliament with the power for a period of 5 years from the commencement of the Constitution to make laws with respect to some of the matters as if they were enumerated in the Concurrent List. One such matter was “trade and commerce within a State in, and the production, supply and distribution of, .....foodstuffs (including edible oil seeds and oil), ......” f. On 7th October 1950, the Central Government, in exercise of the powers conferred upon it by Section 3 of the Act, promulgated the Sugar and Gur Control Order, 1950 which, inter alia, empowered it to prohibit movement of sugarcane from any area and also to direct that no gur or sugar should be manufactured from sugarcane except under and in accordance with a licence issued by it. Power was also given to the Central Government to fix the minimum price of sugarcane and no person was to sell or agree to sell sugarcane to a producer and no producer was to purchase or agree to purchase sugarcane at a price lower than that notified. This power of fixing the price of sugarcane was exercised by the Central Government from time to time by issuing notifications which fixed the minimum price to be paid by the producer of sugar by vacuum pan process. An Act for similar purposes, by name, Bihar Sugar Factories Control Act 7 of 1937 came to be enacted in the State of Bihar. As a result of the recommendations of the Khaitan Committee, the report of the Indian Tariff Board in the year 1938 and the U.P. Sugar Industry Enquiry Committee, 1951 [Swaminathan Committee], it was desired that the U.P. Act I of 1938 should be amended in order to make regulation of the supply of sugarcane possible. g. The Industries (Development and Regulation Act, 1951 [Act 65 of 1951] was brought into effect from 8 th
May 1952. In view of this Act coming into force, certain provisions of the U.P. Act I of 1938 became inoperative. The U.P. Legislature passed on 29th June, 1952, the U.P. Sugar Factories Control (Amendment) Act, 1952, deleting those provisions and putting the amended Act permanently on the Statute Book. The U.P. Act I of 1938, thus amended, continued in force till it was repealed by the U.P. Sugarcane Act, 1953. The object of the enactment of the 1953 Act is stated “With the promulgation of the Industries (Development and Regulation Act, 1951 regulation of the sugar industry has become exclusively a Central subject. The State Governments are now only concerned with the supply of sugarcane to the sugar factories. The Bill is being introduced in order to provide for a rational distribution development on organised scientific lines, to protect the interests of the canegrowers and of the industry and to put the new Act permanently on the Statute Book” In exercise of the rule making power conferred by Section 28 of the Act, the U.P. Government made the U.P. Sugarcane Rules, 1954 and also in exercise of the powers conferred by Section 16 of the Act, promulgated the U.P. Sugarcane Order, 1954. h. On 1st April 1955, Parliament enacted the Essential Commodities Act, 1955 [Act 10 of 1955] to provide in the interests of the general public “for the control of production, supply and distribution of, and trade and commerce in, certain commodities”. This Act defines “essential commodity” in Section 2(a)(v) to be any “foodstuffs, including edible oilseeds and oils”. By clause (b), “foodcrops” is defined to include crops of sugarcane. By clause (a)(xi), the definition of “essential commodity” extends to any other class of commodity which the Central Government may declare to be an essential commodity for the purpose of the Act, being a commodity with respect to which Parliament has power to make laws by virtue of Entry
33 in List III in the Seventh Schedule to the i. Section 3(1) empowers the Central Government, if necessary or expedient to do so “for maintaining or increasing the supplies of any essential commodity or for securing their equitable distribution and availability at fair prices”, by an order to provide “for regulating or prohibiting the production, supply and distribution thereof and trade and commerce therein.” Under clause (c) of subsection (2) of Section 3, such an order may provide for controlling the price at which essential commodity may be bought or sold. j. In exercise of the powers conferred by Section 3 of the Essential Commodities Act, the Central Government promulgated on 27th August 1955, the Sugar Control Order, 1955 and the Sugarcane Control Order, 1955. Clause 3(a) of the Sugarcane Control Order, 1955 empowers the Central Government, after consultation with appropriate authorities, to fix in respect of any area 'the price or the minimum price' to be paid by a producer of sugar for sugarcane purchased by him in that area. It also empowers fixation of different prices for different areas or different qualities of sugarcane or on the basis of recovery of sugar from sugarcane having regard to various factors enumerated therein. Clause 3(2) provides that no person shall sell or agree to sell sugarcane to a producer of sugar or factory and no producer or factory shall purchase or agree to purchase sugarcane at a price lower than that notified under this clause. Clause (4) empowers the Central Government to prohibit or restrict or otherwise regulate the export of sugarcane from any area for supply to different factories and also to direct that no gur or sugar shall be manufactured from sugarcane except under and in accordance with the conditions specified in a licence issued in this behalf. Clause (5) requires every producer or factory to comply with the directions made under the order. By clause (7) of this order, the Sugar and Gur Control Order, 1950 was repealed. k. On 16th July, 1966, the Central Government notified the Sugarcane (Control) Order, 1966. Clause 2(g)
defines “price” to mean the price or the minimum price fixed by the Central Government, from time to time, for sugarcane delivered, inter alia, to a sugar factory. Clauses 3 and 3A bear reproduction and “3: Minimum price of sugarcane payable by Government may, after consultation with such authorities, bodies or associations as it may deem fit, by notification in the official Gazette, from time to time, fix the minimum price of sugarcane to be paid by producers of sugar or their agents for the sugarcane purchased by (a) the cost of production of sugarcane; (b) the return to the grower from alternative crops and the general trend of prices of (c) the availability of sugar to the consumer at (d) the price at which sugar produced from sugarcane is sold by producers of sugar; and (e) the recovery of sugar from sugarcane : Provided that the Central Government or, with the approval of the Central Government, the State Government, may, in such circumstances and subject to such conditions as specified in Clause 3A, allow a suitable rebate in the price so fixed.] Explanation (1) Different prices may be fixed for different areas or different qualities or varieties of sugarcane. (2) No person shall sell or agree to sell sugarcane to a producer of sugar or his agent, and no such producer or agent shall purchase or agree to purchase sugarcane, at a price lower than that fixed under subclause (1). (3) Where a producer of sugar purchases any sugarcane from a grower of sugarcane or from a Sugarcanegrower's Cooperative Society, the producer shall, unless there is an agreement in writing to the contrary between the parties, pay within fourteen days from the date of delivery of the sugarcane to the seller or tender to him the price of the cane sold at the rate agreed to between the producer and the sugarcane grower or Sugarcane growers' Cooperative Society or that fixed under sub clause (1), as the case may be, either at the gate of the factory or at the cane collection centre or transfer or deposit the necessary amount in the bank account
of the seller or the cooperative society, as the case may be. [Subs. by G.S.R. 945, dated 18.5.1968] (3A). Where a producer of sugar or his agent fails to make payment for the sugarcane purchased within 14 days of the date of delivery, he shall pay interest on the amount due at the rate of 15 per cent per annum for the period of such delay beyond 14 days. Where payment of interest on delayed payment is made to a canegrowers' society, the society shall pass on the interest to the canegrowers concerned after deducting administrative charges, if any, permitted by the rules of the said society. [Ins. by G.S.R. 62(E) (4) Where sugarcane is purchased through an agent, the producer or the agent shall pay or tender payment of such price within the period and in the manner aforesaid and if neither of them has so paid or tendered payment, each of them shall be deemed to have contravened the provisions of this clause. (5) At the time of payment at the gate of the factory or at the cane collection centre, receipts, if any, given by the purchaser, shall be surrendered by the cane grower or cooperative society. (6) Where payment has been made by transfer or deposit of the amount to the bank account of the seller or the cooperative society as the case may be, the receipt given by the purchaser, if any, to the grower or the co operative society if not returned to the purchaser, shall become invalid. (7) In case, the price of the sugarcane remains unpaid on the last day of the sugar year in which cane supply was made to the factory on account of the suppliers of cane not coming forward with their claims therefore or for any other reason, it shall be deposited by the producer of sugar with the Collector of the district in which the factory is situated, within three months of the close of the sugar year. The Collector shall pay, out of the amount so deposited, all claims, considered payable by him
and preferred before him within three years of the close of the sugar year in which the cane was supplied to the factory. The amount still remaining undisbursed with the Collector, after meeting the claims from the suppliers, shall be credited by him to the Consolidated Fund of the State, immediately after the expiry of the time limit of 3 years within which claims therefore could be preferred by the suppliers. The State Government shall, as far as possible, utilise such amounts, for development of sugarcane in the 3A. Rebate that can be deducted from the price paid for sugarcane A producer of sugar or his agent shall pay, for the sugarcane purchased by him, to the sugarcanegrower or the sugarcane growers' co operative society, either the minimum price of sugarcane fixed under Clause 3, or the price agreed to between the producer or his agent and the sugarcanegrower or the sugarcanegrowers' co operative society, as the case may be (hereinafter referred to as the agreed price)*** [Ins. by G.S.R. 815(E) dated 24.9.1976]” Clause 4 empowers the Central Government “or a State Government, with the concurrence of the Central Government”, to fix the minimum price or the price of sugarcane to be paid by producers of the khandsari sugar for the sugarcane purchased by them with the proviso that the minimum price or the price of sugarcane so fixed shall not exceed the minimum price of sugarcane fixed by producers of sugar in the region with a further proviso that no person shall sell or agree to sell sugarcane to a producer of khandsari sugar or his agent, and no such producer or his agent shall purchase or agree to purchase sugarcane, “at a price lower than that fixed under clause (4)”. Clause 5A provides that where a producer of sugar purchases sugarcane, from a sugarcanegrower during each sugar year, he shall be liable to pay, in addition to the minimum sugarcane price fixed under Clause 3, an additional price, if found due in
accordance with the formula enumerated in Second Schedule to the Order. Under subclause (2) of Clause 5A, an appropriate authority may be authorised to determine the additional price payable under sub clause (1) who shall intimate the same in writing to the producer of sugar and the sugarcanegrower. Under subclause (4), the manner of payment of the additional price may be prescribed as directed by the Central Government or the State Government, from time to time. Under subclause (5), no additional price determined under sub clause (2) or subclause (3) is required to be paid by a producer of sugar who pays a price higher than the minimum price fixed under Clause 3 to the sugarcanegrower, provided that, “the price so paid is not less than the total price comprising the minimum sugarcane price fixed under Clause 3 and the additional price determined under subclause (2) or subclause (3).” Under subclause (6), it is provided that any extra price paid by the producer of sugar to the sugarcane grower over and above the minimum sugarcane price fixed under Clause 3, shall be adjusted against the additional sugarcane price determined under sub clause (2) or subclause (3) and the balance, if any, shall be paid to the sugarcane grower. Subclause (7) provides that, additional price shall be payable to the sugarcanegrower if he, in performance of his agreement with a producer of sugar, has supplied not less than 85% of the sugarcane so Clause 6 empowers the Central Government to: (i) reserve areas where sugarcane is grown to determine the quantity of sugarcane which a factory will require for crushing during any year; (ii) to fix, with respect to any specified sugarcanegrower or sugarcane growers generally in a reserved area, the quantity or percentage of sugarcane which he by himself or as a member of a cooperative society of sugarcane growers operating in such area, shall supply to the
factory concerned; (iii) direct a sugarcanegrower or a sugarcanegrowers' co operative society, supplying sugarcane to a factory, and the factory concerned, to enter into an agreement to supply or purchase the quantity of sugarcane fixed; (iv) direct that no gur or khandsari sugar shall be manufactured from sugarcane except in accordance with the conditions specified in the licence; and (v) “prohibit or restrict or otherwise regulate” the export of sugarcane from any area (including a reserved area) except under and in accordance with a permit issued in his behalf. Sub clause (2) makes it obligatory on every sugarcane grower, Sugarcanegrowers' Cooperative Society and factory, to whom an order is issued under subclause (1), to supply or purchase the quantity of sugarcane covered by the agreement entered into. Any wilful failure on the part of the sugarcanegrower, sugarcanegrowers' co operative society and factory to do so, is constituted a breach of the provisions of Under Clause 11, the powers under the Order shall, subject to specified conditions, be exercisable also by an officer or authority of the Central Government and the State Government or any officer or authority of the State Government. 8.1 The provisions of Section 16 of the Act of 1953 read as 16. Regulation of purchase and supply of cane in the reserved and assigned areas –(1) The State Government may, for maintaining supplies, by order, (a) the distribution, sale or purchase of any case in (b) purchase of cane in any area other than a reserved or assigned area. (2) Without prejudice to the generality of the foregoing powers such order may provide for (a) the quantity of cane to be supplied by each Canegrower or Canegrowers’ Cooperative Society in such area to the factory for which the area has so (b) the manner in which cane grown in the reserved area or the assigned area, shall be purchased by the factory for which the area has been so reserved or assigned and the circumstance in which the cane grown by a canegrower shall not be purchased
except through a Canegrowers’ Cooperative Society; (c) the form and the terms and conditions of the agreement to be executed by the occupier or manager of the factory for which an area is reserved or assigned for the purchase of cane offered for sale; (d) the circumstances under which permission may (i) for the purchase of cane grown in reserved or assigned area by a [Gur, Rab or Khandsari Manufacturing Unit or any person or factory] (Substituted by UP ACT IV of 1964) other than the factory for which area has been reserved or (ii) for the sale of cane grown in a reserved or assigned area to a [Gur, Rab or Khandsari Manufacturing Unit or any person or factory] (Substituted by UP ACT IV of 1964) other than the factory for which the area is reserved or assigned; (e) such incidental and consequential matters as may appear to be necessary or desirable for this purpose. 9. Thus, from the legislative history and the relevant provisions of Essential Commodities Act, 1953 U.P. Act, 1954 U.P. Order, 1955 Order, 1966 Order which fell for consideration by this Court in the case of Tika Ramji (Supra) and U.P. Coop. Cane Unions Federations (Supra), it appears that as such there has been a sea change in the law and the relevant provisions a. That, the Central Government repealed and substituted the 1955 Order by 1966 Order; b. That, in the 1966 Order issued under Section 3 of the Essential Commodities Act, from the word “price and the minimum price”, word “price” came to be deleted and the power to fix “minimum price” came to be c. Clause 3 of the 1955 Order empowered the Central Government to fix “price” or “minimum price” to be paid by the producer of sugar for sugarcane purchased by him. However, 1955 Order came to be repealed by the 1966 Order and Clause 3 of 1966 Order provides that the Central Government may fix the “minimum price” of sugarcane to be paid by the
d. That, 1966 Order came to be further amended in 1976 and 1978 and Clauses 3(3) and 3A came to be introduced which now contemplates “agreed price”; 9.1 Considering the Clause 3 of the 1955 Order by which the Central Government was empowered to fix “price” or the “minimum price” which fell for consideration by this Court in the case of Tika Ramji (Supra) and as even the time when the matter was decided by this Court in the case of Tika Ramji (Supra), no price was determined and/or fixed by the State and therefore, having felt there is no repugnancy and/or conflict, this Court in the case of Tika Ramji (Supra) did not as such enter into the question of repugnancy. Therefore, as such in the case of Tika Ramji (Supra), this Court considered Clause 3 of 1955 Order which specifically empowered the Central Government to fix the “price or minimum price” and also considered that the State Government has not exercised the power by fixing the price and therefore, the question of conflict does not arise. However, in the case of U.P. Coop. Cane Unions Federations (Supra), this Court was considering the subsequent change in law more particularly the 1966 Order and Clause 3 of the 1966 Order and other relevant Clauses of 1966 Order. 10. The relevant observations and findings recorded by this Court in the case of Tika Ramji (Supra) and in the case of U.P. Coop. Cane Unions Federations (Supra) are as under: “..…It is clear, therefore, that all the Acts and the notifications issued thereunder by the Centre in regard to sugar and sugarcane were enacted in exercise of the concurrent jurisdiction. The exercise of such concurrent jurisdiction would not deprive the Provincial Legislatures of similar powers which they had under the Provincial Legislative List and there would, therefore, be no question of legislative incompetence qua the Provincial Legislatures in regard to similar pieces of legislation enacted by the latter. The Provincial Legislatures as well as the
Central Legislature would be competent to enact such pieces of legislation and no question of legislative competence would arise. It also follows as a necessary corollary that, even though sugar industry was a controlled industry, none of these Acts enacted by the Centre was in exercise of its jurisdiction under Entry 52 of List I. Industry in the wide sense of the term would be capable of comprising three different aspects: (1) raw materials which are an integral part of the industrial process, (2) the process of manufacture or production, and (3) the distribution of the products of the industry. The raw materials would be goods which would be comprised in Entry 27 of List II. The process of manufacture or production would be comprised in Entry 24 of List II except where the industry was a controlled industry when it would fall within Entry 52 of List I and the products of the industry would also be comprised in Entry 27 of List II except where they were the products of the controlled industries when they would fall within Entry 33 of List III. This being the position, it cannot be said that the legislation which was enacted by the Centre in regard to sugar and sugarcane could fall within Entry 52 of List I. Before sugar industry became a controlled industry, both sugar and sugarcane fell within Entry 27 of List II but, after a declaration was made by Parliament in 1951 by Act LXV of 1951, sugar industry became a controlled industry and the product of that industry, viz., sugar was comprised in Entry 33 of List III taking it out of Entry 27 of List II. Even so, the Centre as well as the Provincial Legislatures had concurrent jurisdiction in regard to the same. In no event could the legislation in regard to sugar and sugarcane be thus included within Entry 52 of List 1. The pith and substance argument also cannot be imported here for the simple reason that, when both the Centre as well as the State Legislatures were operating in the concurrent field, there was no question of any trespass upon the exclusive jurisdiction vested in the Centre under Entry 52 of List 1, the only question which survived being whether, putting both the pieces of legislation enacted
by the Centre and the State Legislature together, there was any repugnancy, a contention which will be dealt with hereafter. “…..A more effective answer is furnished by comparison of the terms of the U.P. Act I of 1938 with those of the impugned Act. Whereas the U.P. Act I of 1938 covered both sugarcane and sugar within its compass, the impugned Act was confined only to sugarcane, thus relegating sugar to the exclusive jurisdiction of the Centre thereby eliminating all argument with regard to the encroachment by the U.P. State Legislature on the field occupied by the Centre. The U.P. Act I of 1938 provided for the establishment of a Sugar Control Board, the Sugar Commissioner, the Sugar Commission and the Cane Commissioner. The impugned Act provided for the establishment of a Sugarcane Board. The Sugar Commissioner was named as such but his functions under rules 106 and 107 were confined to getting information which would lead to the regulation of the supply and purchase of sugarcane required for use in sugar factories and had nothing to do with the production or the disposal of sugar produced in the factories. The Sugar Commission was not provided for but the Cane Commissioner was the authority invested with all the powers in regard to the supply and purchase of sugarcane. The Inspectors appointed under the U.P. Act I of 1938 had no doubt powers to examine records maintained at the factories showing the amount of sugarcane purchased and crushed but they were there with a view to check the production or manufacture of sugar whereas the Inspectors appointed under the impugned Act were, by rule 20, to confine their activities to the regulation of the supply and purchase of sugarcane without having anything to do with the further process of the manufacture or production of sugar. Chapter 3 of U.P. Act I of 1938, dealing with the construction and extension of sugar factories, licensing of factories for crushing sugarcane, fixing of the price of sugar, etc., was deleted from the impugned Act. The power of licensing new industrial undertakings was thereafter exercised by the Centre under
Act LXV of 1951 as amended by Act XXVI of 1953, vide sections 11(a), 12 and 13, and the power of fixation of price of sugar was exercised by the Centre under section 3 of Act XXIV of 1946 by issuing the Sugar Control Order, 1950. Even the power reserved to the State Government to fix minimum prices of sugarcane under Chapter V of U.P. Act I of 1938 was deleted from the impugned Act the same being exercised by the Centre under clause 3 of Sugar and Gur Control Order, 1950, issued by it in exercise of the powers conferred under section 3 of Act XXIV of 1946. The prices fixed by the Centre were adopted by the State Government and the only thing which the State Government required under rule 94 was that the occupier of a factory or the purchasing agent should cause to be put up at each purchasing centre a notice showing the minimum price of cane fixed by the Government meaning thereby the centre. The State Government also incorporated these prices which were notified by the Centre from time to time in the forms of the agreements which were to be entered between the cane growers, the cane growers cooperative societies, the factories and their purchasing agents for the supply and purchase of sugarcane as provided in the U.P. Sugarcane Supply and Purchase Order, 1954. The only provision which was retained by the State Government in the impugned Act for the protection of the sugarcane growers was that contained in section 17 which provided for the payment of price of sugarcane by the occupier of a factory to the sugarcane growers. It could be recovered from such occupier as if it were an arrear of land revenue. This comparison goes to show that the impugned Act merely confined itself to the regulation of the supply and purchase of sugarcane required for use in sugar factories and did not concern itself at all with the controlling or licensing of the sugar factories, with the production or manufacture of sugar or with the trade and commerce in, and the production, supply and distribution of, sugar. If that was so, there was no question whatever of its
trenching upon the jurisdiction of the Centre in regard to sugar industry which was a controlled industry within Entry 52 of List I and the U.P. Legislature had jurisdiction to enact the law with regard to sugarcane and had legislative competence to enact the impugned Act.” “..…It was next contended that the provisions of the impugned Act were repugnant to the provisions of Act LXV of 1951 and Act X of 1955 which were enacted by Parliament and, therefore, the law made by Parliament should prevail and the impugned Act should, to the extent of the repugnancy, be void. Before dealing with this contention it is necessary to clear the ground by defining the exact connotation of the term "repugnancy". Repugnancy falls to be considered when the law made by Parliament and the law made by the State Legislature occupy the same field because, if both these pieces of legislation deal with separate and distinct matters though of a cognate and allied character, repugnancy does not “…..We are concerned here with the repugnancy, if any, arising by reason of both Parliament and the State Legislature having operated in the same field in respect of a matter enumerated in the Concurrent List, i.e., foodstuffs comprised in Entry 33 of List III.” “…..The Calcutta High Court in G. P. Stewart v. B. K. Roy Chaudhury had occasion to consider the meaning of repugnancy and B. N. Rau, J. who delivered the judgment “It is sometimes said that two laws cannot be said to be properly repugnant unless there is a direct conflict between them, as when one says 'do" and the other “don't”, there is no true repugnancy, according to this view, if it is possible to obey both the laws. For reasons which we shall set forth presently, we think that this is too narrow a test: there may well be cases of repugnancy where both laws say “don't” but in different ways. For
example, one law may say, “No person shall sell liquor by retail, that is, in quantities of less than five gallons at a time” and another law may say, “No person shall sell liquor by retail, that is, in quantities of less than ten gallons at a time”. Here, it is obviously possible to obey both laws, by obeying the more stringent of the two, namely the second one; yet it is equally obvious that the two laws are repugnant, for to the extent to which a citizen is compelled to obey one of them, the other, though not actually disobeyed, is nullified”. The learned Judge then discussed the various authorities which laid down the test of repugnancy in Australia, Canada, and “The principle deducible from the English cases, as from the Canadian cases, seems therefore to be the same as that enunciated by Isaacs, J. in the Australian 44 hour case (37 C.L.R. 466) if the dominant law has expressly or impliedly evinced its intention to cover the whole field, then a subordinate law in the same field is repugnant and therefore inoperative. Whether and to what extent in a given case, the dominant law evinces such an intention must necessarily depend on the language of the particular law”. “…..In the instant case, there is no question of any inconsistency in the actual terms of the Acts enacted by Parliament and the impugned Act. The only questions that arise are whether Parliament and the State Legislature sought to exercise their powers over the same subject matter or whether the laws enacted by Parliament were intended to be a complete exhaustive code or, in other words, expressly or impliedly evinced an intention to cover the whole field.” “…..Act X of 1955 included within the definition of essential commodity food stuffs which we have seen above would include sugar as well as sugarcane. This Act was enacted by Parliament in exercise of the concurrent legislative power under Entry 33 of List III as amended by
were there defined as including crops of sugarcane and section 3(1) gave the Central Government powers to control the production, supply and distribution of essential commodities and trade and commerce therein for maintaining or increasing the supplies thereof or for securing their equitable distribution and availability at fair prices. Section 3(2)(b) empowered the Central Government to provide inter alia for bringing under cultivation any waste or arable land whether appurtenant to a building or not for growing thereon of foodcrops generally or specified foodcrops and section 3(2)(c) gave the Central Government power for controlling the price at which any essential commodity may be bought or sold. These provisions would certainly bring within the scope of Central legislation the regulation of the production of sugarcane as also the controlling of the price at which sugarcane may be bought or sold, and in addition to the Sugar Control Order, 1955 which was issued by the Central Government on 27th August, 1955, it also issued the Sugarcane Control Order, 1955, on the same date investing it with the power to fix the price of sugarcane and direct payment thereof as also the power to regulate the movement of sugarcane.” “…..Parliament was well within its powers in legislating in regard to sugarcane and the Central Government was also well within its powers in issuing the Sugarcane Control Order, 1955 in the manner it did because all this was in exercise of the concurrent power of legislation under Entry 33 of List III. That, however, did not affect the legislative competence of the U. P. State Legislature to enact the law in regard to sugarcane and the only question which remained to be considered was whether there was any repugnancy between the provisions of the Central legislation and the U. P. State legislation in this behalf. As we have noted above, the U. P. State Government. did not at all provide for the fixation of minimum prices for sugarcane nor did it provide for the regulation of movement of sugarcane as was done by the Central Government in clauses (3) and (4) of the Sugarcane Control Order, 1955. The impugned Act did not make
any provision for the same and the only provision in regard to the price of sugarcane which was to be found in the U. P. Sugarcane Rules, 1954, was contained in Rule 94 which provided that a notice of suitable size in clear bold lines showing the minimum price of cane fixed by the Government and the rates at which the cane is being purchased by the centre was to be put up by an occupier of a factory or the purchasing agent as the case may be at each purchasing centre. The price of cane fixed by Government here only meant the price fixed by the appropriate Government which would be the Central Government, under clause 3 of the Sugarcane Control Order, 1955, because in fact the U. P. State Government never fixed the price of sugarcane to be purchased by the factories. Even the provisions in behalf of the agreements contained in clauses 3 and 4 of the U. P. Sugarcane Regulation of Supply and Purchase Order, 1954, provided that the price was to be the minimum price to be notified by the Government subject to such deductions, if any, as may be notified by the Government from time to time meaning thereby the Central Government, the State Government not having made any provision in that behalf at any time whatever. The provisions thus made by the Sugarcane Control Order, 1955, did not find their place either in the impugned Act or the Rules made thereunder or the U.P. Sugarcane Regulation of Supply and Purchase Order, 1954, and the provision contained in section 17 of the impugned Act in regard to the payment of sugarcane price and recovery thereof as if it was an arrear of land revenue did not find its place in the Sugarcane Control Order, 1955. These provisions, therefore, were mutually exclusive and did not impinge upon each other there being thus no trenching upon the field of one Legislature by the other. Our attention was drawn to the several provisions contained in the Sugarcane Control Order, 1955 and the U.P. Sugarcane Regulation of Supply and Purchase Order, 1954 and the agreements annexed thereto and it was pointed out that they differed in material particulars, the provisions of the latter being
more stringent than those of the former. It is not necessary to refer to these provisions in any detail. Suffice it to say that none of these provisions do overlap, the Centre being silent with regard to some of the provisions which have been enacted by the State and the State being silent with regard to some of the Provisions which have been enacted by the Centre. There is no repugnancy whatever between these provisions and the impugned Act and the Rules framed thereunder as also the U.P. Sugarcane Regulation of Supply and Purchase Order, 1954 do not trench upon the field covered by Act X of 1955. There being no repugnancy at all, therefore, no question arises of the operation of article 254(2) of the Constitution and no provision of the impugned Act and the Rules made thereunder is invalidated by any provision contained in Act LXV of 1951 as amended by Act XXVI of 1953 or Act X of 1955 and the Sugarcane Control Order, 1955 issued thereunder.” “27. It has been urged by learned counsel for the respondents that the expression “at the minimum price notified by Government” used in the proforma of the agreement which is to be executed between a canegrower and the occupier of the factory as given in Form B and that which is to be executed between a canegrowers' cooperative society and the occupier of the factory as given in Form C in the appendix to the 1954 Order indicates that it is only the minimum price fixed by the Central Government which can be the consideration or price for the sale of sugarcane to the sugar factory. Strong reliance in support of this submission has been placed upon certain observations made by this Court in Tika Ramji v. State of U.P. The proforma of agreement viz. Forms B and C are contained in the appendix to U.P. Sugarcane Supply and Purchase Order, 1954. This Order has been made by U.P. Government in exercise of the power conferred by Section 16 of the 1953 Act, which provides that the State Government may for maintaining supplies by Order
regulate the distribution, sale or purchase of cane in any reserved or assigned area, etc. The Order having been made by the State Government in exercise of a power conferred by an Act made by U.P. legislature, the only logical inference which can be drawn is that the word “Government” refers to State Government. There is no indication in the proforma of the agreement or in the 1954 Order that the word “Government” would refer to Central Government. If the State Government is prescribing a proforma of an agreement which is to be executed by a canegrower or a canegrowers' cooperative society and the occupier of the factory regarding sale and purchase of sugarcane wherein the word “Government” is used, it can only mean the State Government and not the Central Government unless there is clear indication to the 28. The observations made in Tika Ramji, strong reliance on which is placed by learned counsel for the respondents, have to be understood in the context in which they were made. It may be noted that the writ petitions in the said case were filed in this Court in the year 1954 and the judgment was delivered on 2441956. At the relevant time, it was the Sugarcane (Control) Order, 1955 which was in operation. Clause 3 of this Order empowered the Central Government to fix the price or the minimum price to be paid by a producer of sugar for sugarcane purchased by him. The 1955 Order has been repealed by Sugarcane (Control) Order, 1966 and Clause 3 of this Order provides that the Central Government may fix the minimum price of sugarcane to be paid by producers of sugar. There is a difference between “the price” which is a fixed amount and “the minimum price” which only indicates the lowest permissible rate. The 1966 Order which itself was made by the Central Government more than a decade after the judgment was rendered in Tika Ramji was amended in 1978 and Clauses 3(3) and 3A thereof contemplate an “agreed price” which in view of the mandate of Clause 3(2) is bound to be higher than the “minimum price” fixed
under Clause 3(1). Naturally it is this “agreed price” which is to be mentioned in the agreements for sale and purchase of sugarcane in Forms B and C otherwise the very purpose of entering into agreements would be defeated. The State Government had not fixed any price for the sugarcane under its regulatory power by the time Tika Ramji was decided by this Court in April, 1956 and only the Central Government had taken a step for fixing the price. It was in these circumstances that it was observed that the “price fixed by the Government” would mean “the Central Government”. The observations relied upon by the learned counsel for the respondents were made while considering the question whether there was any repugnancy between the provisions of the Sugarcane Control Order 1955 and the 1953 Act, the Rules and 1954 Order and they should be understood in that context. The relevant portion of the judgment on SCR p.434 is being reproduced below: “The price of cane fixed by Government here only meant the price fixed by the appropriate Government which would be the Central Government, under clause 3 of the Sugarcane Control Order, 1955, because in fact the U.P. State Government never fixed the price of sugarcane to be purchased by the factories. Even the provisions in behalf of the agreements contained in clauses 3 and 4 of the U.P. Sugarcane Regulation of Supply and Purchase Order, 1954, provided that the price was to be the minimum price to be notified by the Government subject to such deductions, if any, as may be notified by the Government from time to time meaning thereby the Central Government, the State Government not having made any provision in that behalf at any time whatever. The provisions thus made by the Sugarcane Control Order, 1955, did not find their place either thereunder or the U.P. Sugarcane Regulation of Supply and Purchase Order, 1954; and the provision contained in Section 17 of the impugned Act in regard to the payment of sugarcane price and recovery thereof as if it was an arrear of land revenue did not find its place in the Sugarcane “28.1 Having regard to the factual situation then
existing that U.P. Government had not fixed the price of the sugarcane, it was held that the price of the cane fixed by the Government could only mean “Central Government”. It has not been laid down as a principle of law that the words “minimum price notified by Government” must necessarily mean the minimum price fixed by the Central Government or that under no circumstances it can mean the price fixed by the State “34. Learned Senior Counsel for the respondents has strenuously urged that the Central Government having made the 1966 Order which contains a specific provision for fixation of price of sugarcane, under Clause 3(1) thereof, the regulatory power under the 1953 Act cannot embrace within its fold the same power of fixation of price as this will be clearly repugnant to a law made by the Parliament and would be void in view of Article 254(1) of the Constitution. In Tika Ramji it has been held that the EC Act under which the Central Government made the 1966 Order and the 1953 Act made by U.P. Legislature have been enacted with reference to Entry 33 of List III of the Seventh Schedule. The constitutional validity of the 1953 Act was upheld by the Constitution Bench in the said decision. On p. 437 of the Reports (SCR) the Court quoted with approval the following passage from the judgment of Sulaiman J. in Shyamakant Lal v. Rambhajan Singh (FCR at p. 212 : AIR at p. 83) for the principle of construction in regard to repugnancy : (AIR p. 700, para “When the question is whether a Provincial legislation is repugnant to an existing Indian law, the onus of showing its repugnancy and the extent to which it is repugnant should be on the party attacking its validity. There ought to be a presumption in favour of its validity, and every effort should be made to reconcile them and construe both so as to avoid their being repugnant to each other; and care should be taken to see whether the two do not really operate in different
fields without encroachment. Further, repugnancy must exist in fact, and not depend merely on a possibility:” And then went to hold : (AIR p. 700, para 33) “33. In the instant case, there is no question of any inconsistency in the actual terms of the Acts enacted by Parliament and the impugned Act. The only questions that arise are whether Parliament and the State Legislature sought to exercise their powers over the same subjectmatter or whether the laws enacted by Parliament were intended to be a complete exhaustive code or, in other words, expressly or impliedly evinced an intention to cover the whole field.” 35. In M. Karunanidhi v. Union of India, the principles to be applied for determining repugnancy between a law made by Parliament and law made by State legislature were considered by a Constitution Bench. In pursuance of an FIR lodged against Shri M. Karunanidhi the CBI after investigation had submitted chargesheet against him under Section 161, 468 and 471 IPC and Section 5(2) read with Section 5(1)(d) of the Prevention of Corruption Act. The Madras Legislature had passed an Act known as Tamil Nadu Public Men (Criminal Misconduct) Act, 1973 which had received the assent of the President. It was contended that by virtue of Article 254(2) of the Constitution, the provisions of Indian Penal Code, Prevention of Corruption Act and Criminal Law Amendment Act stood repealed. After review of all the earlier authorities Court laid down the following tests : “35. 1. That in order to decide the question of repugnancy it must be shown that the two enactments contain inconsistent and irreconcilable provisions, so that they cannot stand together or operate in the same field. 2. That there can be no repeal by implication unless the inconsistency appears on the face of the two statutes. 3. That where the two statutes occupy a particular field, but there is room or possibility of both the statutes operating in the same field without
coming into collision with each other, no repugnancy results. 4. That where there is no inconsistency but a statute occupying the same field seeks to create distinct and separate offences, no question of repugnancy arises and both the statutes continue “37. Under Subsection (1) of Clause 3 of the 1966 Order, the Central Government can only fix a minimum price of sugarcane. This clause should be read along with Subclause (2) which creates an embargo or prohibition that no person shall sell or agree to sell sugarcane to a producer of sugar and no such producer shall purchase or agree to purchase sugarcane at a price lower than that fixed under Subclause (1). The inconsistency or repugnancy will arise if the State Government fixed a price which is lower than that fixed by the Central Government. But, if the price fixed by the State Government is higher than that fixed by the Central Government, there will be no occasion for any inconsistency or repugnancy as it is possible for both the orders to operate simultaneously and to comply with both of them. A higher price fixed by the State Government would automatically comply with the provisions of Subclause (2) of Clause 3 of 1966 Order. Therefore, any price fixed by the State Government which is higher than that fixed by the Central Government cannot lead to any kind of repugnancy.” “39. …..that under the 1966 Order the Central Government only fixes the minimum price and it is always open to the State Government to fix a higher price. Under the enactments made by the State Legislatures areas are reserved for the sugar factories and the canegrowers therein are compelled to supply sugarcane to them and therefore the State Government has incidental power to fix the price of sugarcane which will also be statutory price. They further lay down that the Cane Commissioner can direct the canegrowers and the sugar factories to enter into agreements for purchase of sugarcane at a price fixed by the State Government and such agreements cannot be branded as having been obtained by force or compulsion.”
“43. One of the main reasons given by the High Court for allowing the writ petition and quashing the order of fixation of State Advised Price is that power to fix sugarcane price had been given to the State Government under the Sugarcane Act, 1934 and hence it would be redundancy to say that the same power to fix cane price also flows from Section 16 of the 1953 Act. The High Court has also held that when the 1953 Act was enacted there was already a law, viz., the Sugarcane Act, 1934, which enabled the State Government to fix the minimum cane price and hence, it could not have been the intention of the U.P. Legislature while enacting 1953 Act that Section 16 thereof would include the power to fix the minimum cane price as such a power was already there with the State Government under Section 3(2) of the Sugarcane Act, 1934. The High Court, therefore, concluded that Section 16 of the 1953 Act only gave power to the State Government to regulate the supply and purchase of sugarcane in the narrower sense and not in the wider sense so as to include the power to fix the minimum price. This reasoning of the High Court proceeds on the footing that the Sugarcane Act, 1934 was in existence and was in operation when the 1953 Act was enacted by U.P. Legislature. It appears that the correct legal position was not brought to the notice of the learned judges. The Sugarcane Act, 1934 was repealed by U.P. Sugar Factories Control Act, 1938 (UP Act 1 of 1938). Section 26 of U.P. Sugarcane (Regulation of Supply & Purchase) Act, 1953 repealed the U.P. Sugar Factories Control Act, 1938. With the enforcement of the Government of India Act, 1935, there was distribution of legislative powers between the Dominion Legislature and the Provincial Legislature and the entire subject matter of Sugarcane Act, 1934 fell within the Provincial Legislative list. It was in these circumstances that the U.P. Legislature enacted the U.P. Sugar Factories Control Act, 1938 which repealed the Sugarcane Act, 1934 in its application in the State of U.P.
This position has been noticed in Tika Ramji v. State of U.P., SCR at pp. 400, 401 and 417. Therefore, the aforesaid reasoning given by the High Court has no legal “44. The second reasoning given by the High Court is that even if the State Government had the power to fix the minimum cane price under Section 16 of the 1953 Act, this power came to an end in view of Article 254(1) of the Constitution on the enactment of the EC Act and the promulgation of the Sugarcane Control Order, 1955 (later replaced by the 1966 Order), which now gives exclusive power to the Central Government to fix the minimum price. As discussed earlier we are not in agreement with the aforesaid reasoning as the question of repugnancy does not arise. The High Court has also held that the Central Government, while fixing the price of the sugar under Section 3(3C) of the EC Act, takes into consideration the minimum price of sugarcane fixed under 1966 Order and if the sugar mills are compelled to pay a higher price than that fixed by the Central Government, it will disturb the price of the levy sugar and such an eventuality could not have been contemplated by the legislature. Over a period of time, the quota of levy sugar has gone down from 40 per cent to 10 per cent of the total production of sugar and the sugar mills are now free to sell 90 per cent of their production in open market. Under Section 3(3C) of the EC Act, the Central Government has to determine the price of the levy sugar having regard to several factors enumerated in the subsection and the minimum price fixed under 1966 Order is only one of the factors. The manufacturing cost of sugar and securing of reasonable return on the capital employed in the business of manufacturing sugar are also relevant factors under Clauses (b) and (d) of Section 3(3) EC Act and, therefore, the fixation of higher price for sugarcane by the State Government by itself cannot have any major or substantial impact on the fixation of the price of the levy sugar by the
12. The question involved in Ch. Tika Ramji & Ors., etc. v. The State of Uttar Pradesh & Ors. AIR 1956 SC 676 was concerning the validity of the Uttar Pradesh Sugarcane (Regulation of Supply and Purchase) Act, 1953 (for short, “Act of 1953”) and notifications dated 27.9.1954 and 9.11.1955 issued by the Government of Uttar Pradesh thereunder. The notification dated 27.9.1954 was issued in exercise of the powers/ conferred under subsection 1(a) read with subsection 2(b) of Section 16 of the Act of 1953 which provided that not less than 3/4 of the cane growers of the area of operation of a Cane Growers Cooperative Society to be members of the society. The occupier of the factory for which the area is assigned shall not purchase or enter into an agreement to purchase cane grown by a cane grower except through such Cane Growers Cooperative Society. 13. The notification dated 9.11.1955 which was issued in exercise of the powers conferred by section 15 of the Act of 1953, reserved or assigned to the sugar factories mentioned in column 2 of the Schedule annexed to it, the cane purchasing centers, with the authorities attached to them, specified against them in column 3 for the supply of sugarcane during the crushing season 195556. Thus, it is apparent that the notification dated 27.9.1954 related to the agency of supply of sugar cane to the factories and the notification dated 9.11.1955 related to the creation of the zones for particular factories were questioned. Various submissions were raised to assail the validity of the Act and the notification. 14. Firstly, it was urged that the State of Uttar Pradesh had no power to enact the Act of 1953 as it relates to the subject of industries, the control of which by the Union is declared by Parliament by law to be expedient in the public interest within the meaning of Entry 52 of List I. The Act of 1953 was repugnant to Essential Commodities Act, 1955 and the Industries Development Regulation Act, 1951. The Act of 1953 infringes the
fundamental right carved out under Article 14 as vast powers were given to the Cane Commissioner, which could be used in a discriminatory manner. The notification dated 27.9.1954 violated the fundamental right guaranteed under Article 19(1)(c). The cane growers were compelled to become a member of the society before they could sell sugarcane to a factory. The Act of 1953 and the notifications infringe the fundamental right guaranteed by Article 19(1)(f) and (g) and Article 31 of the Constitution. 15. This Court held that the State of Uttar Pradesh had the legislative competence to enact the Act, and there was no repugnancy of the Act of 1953 with the Act of 1951 or the Essential Commodities Act, 1955. This Court upheld the validity of the Act and notifications and also held that there was no unreasonable restriction imposed. There was no violation of fundamental right under Article 19(1)(f) and (g) and Article 31 of 16. The question of fixation of price by the State Government under the Act of 1953 did not fall for consideration in Ch. Tika Ram (supra). This Court noted that the Uttar Pradesh Government had never fixed the price of sugarcane to be purchased by the factories by the time the decision was rendered. While examining the repugnancy, passing reference has been made to the provisions contained in the Act of 1954. 17. During the pendency of petitions, the Sugar Control Order, 1955, was issued on 27.8.1955, which was referred to in the judgment. It was not even submission raised or considered that the power of regulation under Section 16 of the Act would include the power to fix the advised price of sugarcane. The concept of fixation of minimum price by Central Government vis a vis to State Advised Price to be fixed by State Government, never fell for consideration of this Court in the said decision. The ratio of decision has to be considered in the light of questions considered and answered. In Tika Ramji (supra), it was held that there was no repugnancy in the Act of 1953 with Act of 1955 or
with the Act of 1951, and notifications which were impugned did not infringe the fundamental rights. 18. Thus, from the above, it is clear that the factual matrix and the relevant provisions which fell for consideration before this Court in the case of Tika Ramji (supra) and which fell for consideration by this Court in the case of U.P. Coop. Cane Unions Federations(supra) were altogether different. As observed hereinabove, Clause 3 of 1955 Order empowered the Central Government to fix “the price or the minimum price”. The aforesaid Clause 3 of 1955 Order was under consideration by this Court in the case of Tika Ramji(supra). However, subsequently, 1955 Order has been repealed by 1966 Order and Clause 3 of 1966 Order provides that the Central Government may fix “the minimum price” of the sugarcane. Therefore, when the legislature consciously deleted the word “the price” and retained the power with the Central Government to fix “the minimum price”, some meaning has to be given to such a deletion. The intention of the legislature is also required to be considered when certain words in the provisions of a statute are deleted or added and/or substituted. In the case of Tika Ramji(supra), this Court though specifically observed and held that in the field of sugar and sugarcane, both, the Parliament and the State legislature would have the concurrent Jurisdiction as the same will fall under Entry 33 in the Concurrent List of seventh Schedule. Considering the fact that the State Government did not exercise the power of fixing the price, though the powers were available and the Central Government fixed the price/minimum price which came to be adopted by the State Government, this Court in Tika Ramji’s case(supra) held that in such a situation there is no conflict and the question of repugnancy does not arise. Therefore, we are of the opinion that as such there is no apparent conflict between the decisions in Tika Ramji’s case and U.P. Coop. Cane Unions Federations, which require to be referred to a larger Bench of seven Judges.
19. Under clause 3 of the 1966 order, the minimum price can be fixed. Under clause 3A of the said order, as amended in 1978, the agreed price is to be mentioned in the agreement, which can be higher than the minimum price and not less than that. Under clause 3(2), no person shall sell or agree to sell sugarcane to a producer of sugar or his agent, and no such producer or agent shall purchase or agree to purchase sugarcane at a price lower than that fixed under subclause (1). Thus, the price fixed under clause 3(1) has to be treated as a minimum price. Under clause 3(A), as inserted on 2.2.1978, agreement in writing is required, and the price has to be paid as agreed to within 14 days. 20. Even otherwise and on merits and for the reasons stated hereinbelow, we are in complete agreement with the view taken by this Court in the case of U.P. Coop. Cane Unions Federations, which lays down that the inconsistency or repugnancy will arise if the State Government fixed a price which is lower than that fixed by the Central Government. But, if the price fixed by the State Government is higher than that fixed by the Central Government, there will be no occasion for any inconsistency or repugnancy as it is possible for both the orders to operate simultaneously and to comply with both of them. A higher price fixed by the State Government would automatically comply with the provisions of Subclause (2) of Clause 3 of 1966 Order. Therefore, any price fixed by the State Government which is higher than that fixed by the Central Government cannot lead to any kind of repugnancy. 20.1 Question of repugnancy under Article 254 of the Concerning laws in List III of the Seventh Schedule of the Constitution of India, where both the Union and the States have the power to enact a law, the question of repugnancy arises only in a case where there is an actual irreconcilable conflict between the two laws. Inconsistency between the two laws is
irreconcilable, then the question of repugnancy arises. It is necessary to find the dominant intention of both the legislatures, partial or incidental coverage of the same area in a different context, and to achieve a different purpose, does not attract the doctrine of repugnancy. In Rajiv Sarin v. State of Uttarakhand, “33. It is trite law that the plea of repugnancy would be attracted only if both the legislations fall under the Concurrent List of the Seventh Schedule to the Constitution. Under Article 254 of the Constitution, a State law passed in respect of a subject-matter comprised in List III i.e., the Concurrent List of the Seventh Schedule to the Constitution would be invalid if its provisions are repugnant to a law passed on the same subject by Parliament and that too only in a situation if both the laws i.e., one made by the State Legislature and another made by Parliament cannot exist together. In other words, the question of repugnancy under Article 254 of the Constitution arises when the provisions of both laws are completely inconsistent with each other or when the provisions of both laws are absolutely irreconcilable with each other, and it is impossible without disturbing the other provision, or conflicting interpretations resulted into when both the statutes covering the same field are applied to a given set of facts. That is to say, in simple words, repugnancy between the two statutes would arise if there is a direct conflict between the two provisions and the law made by Parliament and the law made by the State Legislature occupies the same field. Hence, whenever the issue of repugnancy between the law passed by Parliament and of State Legislature are raised, it becomes quite necessary to examine as to whether the two legislations cover or relate to the same subject-matter or different. 45. For repugnancy under Article 254 of the Constitution, there is a twin requirement, which is to be fulfilled: firstly, there has to be a “repugnancy” between a Central and State Act; and secondly, the Presidential
assent has to be held as being non-existent. The test for determining such repugnancy is indeed to find out the dominant intention of both the legislations and whether such dominant intentions of both the legislations are alike or different. To put it simply, a provision in one legislation in order to give effect to its dominant purpose may incidentally be on the same subject as covered by the provision of the other legislation, but such partial or incidental coverage of the same area in a different context and to achieve a different purpose does not attract the doctrine of repugnancy. In a nutshell, in order to attract the doctrine of repugnancy, both the legislations must be substantially on the same subject.” 20.2 In M. Karunanidhi v. Union of India & Anr., (1979) 3 SCC 431, the Court opined that where there is a direct collision between the law made by the State and the law made by the Parliament, State law would be void to the extent of repugnancy. It is only when the provisions are irreconcilable. The Court held: “8. It would be seen that so far as clause (1) of Article 254 is concerned it clearly lays down that where there is a direct collision between a provision of a law made by the State and that made by Parliament with respect to one of the matters enumerated in the Concurrent List, then, subject to the provisions of clause (2), the State law would be void to the extent of the repugnancy. This naturally means that where both the State and Parliament occupy the field contemplated by the Concurrent List then the Act passed by Parliament being prior in point of time will prevail, and consequently, the State Act will have to yield to the Central Act. In fact, the scheme of the Constitution is a scientific and equitable distribution of legislative powers between Parliament and the State Legislatures. First, regarding the matters contained in List I, i.e., the Union List to the Seventh Schedule, Parliament alone is empowered to legislate, and the State Legislatures have no authority to
make any law in respect of the Entries contained in List I. Secondly, so far as the Concurrent List is concerned, both Parliament and the State Legislatures are entitled to legislate in regard to any of the Entries appearing therein, but that is subject to the condition laid down by Article 254(1) discussed above. Thirdly, so far as the matters in List II, i.e., the State List are concerned, the State Legislatures alone are competent to legislate on them, and only under certain conditions, Parliament can do so. It is, therefore, obvious that in such matters, repugnancy may result from the following circumstances: 1. Where the provisions of a Central Act and a State Act in the Concurrent List are fully inconsistent and are absolutely irreconcilable, the Central Act will prevail, and the State Act will become void in view of the repugnancy. 2. Where however a law passed by the State comes into collision with a law passed by Parliament on an Entry in the Concurrent List, the State Act shall prevail to the extent of the repugnancy and the provisions of the Central Act would become void provided the State Act has been passed in accordance with clause (2) of Article 254. 3. Where a law passed by the State Legislature while being substantially within the scope of the entries in the State List entrenches upon any of the Entries in the Central List the constitutionality of the law may be upheld by invoking the doctrine of pith and substance if on an analysis of the provisions of the Act it appears that by and large the law falls within the four corners of the State List and entrenchment, if any, is purely incidental or 4. Where, however, a law made by the State Legislature on a subject covered by the Concurrent List is inconsistent with and repugnant to a previous law made by Parliament, then such a law can be protected by obtaining the assent of the President under Article 254(2) of the Constitution. The result of obtaining the assent of the President would be
that so far as the State Act is concerned, it will prevail in the State and overrule the provisions of the Central Act in their applicability to the State only. Such a state of affairs will exist only until Parliament may at any time make a law adding to, or amending, varying or repealing the law made by the State Legislature under the proviso to Article 254. So far as the present State Act is concerned, we are called upon to consider the various shades of the constitutional validity of the same under Article 254(2) of the 24. It is well settled that the presumption is always in favour of the constitutionality of a statute and the onus lies on the person assailing the Act to prove that it is unconstitutional. Prima facie, there does not appear to us to be any inconsistency between the State Act and the Central Acts. Before any repugnancy can arise, the following conditions must be satisfied: 1. That there is a clear and direct inconsistency between the Central Act and the State Act. 2. That such an inconsistency is absolutely irreconcilable. 3. That the inconsistency between the provisions of the two Acts is of such nature as to bring the two Acts into direct collision with each other and a situation is reached where it is impossible to obey the one without disobeying the other.” 20.3 Clause (1) of Article 254 of the Constitution gives primacy to central legislations in case of conflict with State laws whether enacted before or after. The central law operates only in case of repugnancy and not in a case of mere possibility when such an order might be issued under state law, as opined in Belsund Sugar Co. Ltd. v. State of Bihar & Ors., (1999) 9 SCC 620; Punjab Dairy Development Board & Anr. v. Cepham Milk Petrochemicals Industries Ltd. v. Electricity Inspector and ETIO & Ors., (2007) 5 SCC 447 and Bharat Hydro Power Corporation
Ltd. & Ors. v. State of Assam & Anr. (2004) 2 SCC 553. 20.4 It is apparent that in U.P. Cooperative Cane Unions Federations (supra), a Constitution Bench has rightly opined that under section 16 of the Act of 1953, there is the power to fix a price with State, which is State advised price. It cannot be said that the Central legislation occupies the field, the Essential Commodities Act, 1955, and the Order of 1966 issued thereunder deals with minimum price. The Central Government has the power to fix the minimum price in clause 3. The State Government is not denuded of the power under the Act of 1953 to fix the “State Advised Price” under section 16 as held in U.P. Cooperative Cane Unions Federations (supra). The power to regulate includes the power to fix the price. But State advised price has to be higher than the minimum price fixed by Central Government. But the exercise of the power under section 16 of the Act of 1953 to fix State Advised Price, cannot be said to be irreconcilable with the minimum price fixation under section 3(2) (c) of the Essential Commodities Act, 1955 and clause 3 of the Sugarcane (Control) Order, 1966. The power of fixation of State advised price under section 16 of the Act of 1953 cannot be said to be arbitrary or illegal in any manner. 20.4.1 In the case of U.P. Cooperative Cane Unions Federations (supra), this Court had an occasion to consider the ambit, scope and import of Section 16 of the Act. The question involved was as to whether the State Government had the power to fix SAP for sugarcane or it was only the Central Government, which could fix the minimum price or so to say, whether the fixation of SAP was covered by the Central Legislation or was it open to the State to fix the price different than the price fixed by the Central Government and whether there was repugnancy in view of Article 254 of the Constitution. 20.4.2 From the close scrutiny of the judgment passed by
this Court in the case of U.P. Cooperative Cane Unions Federations (supra), it did appear that this Court took into consideration the effect, scope and impact of Section 16 under the Act. This Court considered in detail Section 16 of the Act – the provision to regulate purchase and supply of sugarcane in the reserved and assigned area, under which the State Government is vested with the power to regulate the distribution, sale or purchase of sugarcane in any reserved or assigned area and purchase of cane in any area other than a reserved or assigned area by issuing an order to that effect. Thereafter, this Court has held that the power to regulate includes the power to fix the SAP. This Court has also specifically observed and held that there was no repugnancy. 20.4.3 From the judgment of the Constitution Bench in the case of U.P. Cooperative Cane Unions Federations (supra), it further appears that this Court took into account the relevance, importance, purpose and object, its impact, implication and reasons for enacting Section 16 of the Act and after taking into account all the relevant considerations this Court has specifically held that the SAP is a price higher than that determined by the Central Government which is known as Statutory Minimum Price (SMP). Thus, in the case of U.P. Cooperative Cane Unions Federations (supra), this Court has specifically upheld the power of the State Government to fix the SAP under Section 16 of the Act. 20.5 Now, so far as the fixation of the SAP by the State Government is concerned, from the counter affidavit before the High Court filed in Writ Petition No. 8548 (MB) of 2007 it appears that as per the State Government, the following factors are the relevant facts for determination of SAP. (i) The cost of cultivation of sugarcane. (ii) The cost of transport of sugarcane by cane growers from the field to purchase center or to mill gate as the case may be. (iii) A reasonable return on the aforesaid amount of his produce to cane growers.
(iv) Availability of the cane area, demand of sugarcane by industries, profitability of the industries by selling sugar, and other bye products etc. (v) The price of sugarcane paid by sugar factories in the proceeding year. (vi) The factors necessary to avoid diversion of sugarcane from sugar industries to other consumers like Kolhu and Khandsari Units. It also appears that determination and fixation of the SAP is a Cabinet decision which has been fixed after considering several factors, including the cost of cultivation/production of the sugarcane etc. and after taking into consideration the relevant factors as above and including increasing of national economic growth, cost of production of sugarcane, increase in the cost of seeds, fertilizers, labour charges, irrigation etc., including the profit earned by sugar factories from the produces from bye products, power projects etc. Thus it appears that that authority is guided by all relevant factors while determining such price – 20.5.1 In the case of U.P. Cooperative Cane Unions Federations (supra), the Constitution Bench has upheld the power and authority of the State Government to fix the SAP after precisely observing that the Act of 1953 has been enacted to regulate the SAP and purchase of sugarcane required by the sugar factories and that the word ‘regulate’ would also include the right to fix the price. It has also declared that the SAP fixed by the State Government has to be higher than the minimum price fixed by the Central Government. In a given case, the SAP price may be an agreed price. 20.6 At this stage, is required to be noted that in the case of U.P. Cooperative Cane Unions Federations (supra), this Court specifically negatived the submission on behalf of the sugar factories that they cannot be compelled to enter into agreements with the cane growers and canegrowers’ cooperative society in forms B and C, wherein the Stateadvised price is mentioned. This Court also negatived the submission on behalf of the sugar factories that as the consent cannot be said to be a voluntary consent and as the consent was obtained under compulsion or
duress and, therefore, the sugar factories cannot be compelled to pay such Stateadvised price even though it may have been mentioned in the forms or in the purchase and therefore it cannot be said to be a sale. Negativating the aforesaid submission and after considering the entire scheme, this Court in paragraph 33 observed and held as under: “33. As discussed earlier, the reservation or assignment of area is made for the benefit of a sugar factory. The agreements executed by the cane growers or canegrowers' cooperative society in favour of occupier of a factory are also for the benefit of the sugar factory as by such agreements it gets an assurance of a continuous supply of freshly harvested sugarcane on the days indicated in the requisition slips issued by it so that there may not be any problem in getting optimum quantity of raw material throughout the crushing season. In absence of the agreements the sugar factory will also be a loser as it may face great problem in getting the supply of sugarcane according to its requirement. The occupiers of the factory are themselves keen for execution of the agreements but their only objection is to the mention of State Advised Price. The agreement is one composite transaction and it is not open to them to contend that the terms thereof which are to their advantage should be enforced but the term relating to price notified by the State Government should not be enforced as their consent in that regard was not a voluntary act. In our opinion, having regard to the advantages derived by the sugar factories, they are fully bound by the agreement wherein the State Advised Price may be mentioned and it is not open to them to assail the clause relating to price of the sugarcane on the ground that their consent was not voluntary or was obtained under some kind of duress. It further lays down the proposition that having regard to the advantages derived from the sugar factories, they are fully bound by the agreement, wherein the Stateadvised price may be mentioned and it is not open to them to assail the clause relating to price of the sugar cane on the ground that their consent was
not voluntary or was obtained under some kind of duress. 20.7 As observed herein above, in the 1966 Order the word “the price” has been deleted and Clause 3 of 1966 Order provides that the Central Government may fix “the minimum price” of the sugarcane to be paid by the producer of sugar. As rightly submitted by the learned Counsel on behalf of the State, there is a difference between “the price” and “the minimum price”. The aforesaid shall be apparent from the relevant Clauses of the 20.7.1 The provision of State advised price has been made to protect the interests of the sugarcane growers who are not in a position to negotiate. In Sukhnandan Saran Dinesh Kumar & Ors. v. Union of India & Ors., (1982) 2 SCC 150, this Court “22. The statutory prescription of quantum of rebate for binding material has been prescribed for the benefit of sugarcane growers. Producers of sugar and khandsari sugar constitute a powerful trade lobby, the fact of which one can take judicial notice. Sugar being an essential commodity occasionally kept in short supply and being a commodity needed for consumption by almost the entire population, the powerful industry magnates in this field are in a position to dominate both the growers of sugarcane as also the consumers of the essential commodity. Number of regulations have been enacted almost since the dawn of independence to regulate this powerful combination of manufacturers of sugar and khandsari sugar all over the country for the ultimate benefit of consumers on the one hand and on the other hand the farmers and the growers of sugarcane with their small holdings and raising a perishable food crop. The marginal farmers are unable to stand up against the organised industry. It does not require long argument in this predominantly agricultural society that the farmers having small holdings need protection for selling at fair price their meagre agricultural produce. As far back as 1953, the U.P. Legislature enacted U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953, for rational distribution of sugarcane to factories, for its development on the organised scientific line, to protect the
interest of cane growers and of the industry, etc. Constitutionality of this Act was challenged on various grounds including one under Article 19(1)(g). In Ch. Tika Ramji v. State of U.P. this Court repelled the challenge under Article 19(1)(g) holding that the restriction which is imposed upon the cane growers in regard to sale of their sugarcane to the occupiers of factories in areas where the membership of the cane growers’ cooperative society is not less than 75 per cent of the total cane growers within the area, is a reasonable restriction in the public interest designed for safeguarding the interest of the large majority of growers of sugarcane in the area and works for the greatest good of the greatest number. The proposition is now beyond the pale of controversy that the State can impose a restriction in the interest of general public on the right of a party to contract where in the opinion of the Government the contracting parties are unable to negotiate on the footing of equality. Constitutional validity of statutes prescribing minimum wages has been founded on this proposition. The principle can be effectively extended to the powerful sugar industry and the cane growers because the cane growers admittedly are at a comparative disadvantage to the producers of sugar and khandsari sugar who were described in the course of arguments as sugar barons. It does not require an elaborate discussion to reach an affirmative conclusion that sugarcane growers who are farmers cannot negotiate on the footing of the equality with the producers of sugar and khandsari sugar. The State action for the protection of the weaker sections is not only justified but absolutely necessary unless the restriction imposed is excessive.” 20.7.2 Clause 3(1) empowers the Central Government to fix the minimum price of sugarcane to be paid by the producers of sugar or their agents for the sugarcane purchased by them. Clause 3(2) provides that no person shall sell or agree to sell sugarcane to a producer of sugar or his agent, and no such producer or agent shall purchase or agree to purchase sugarcane, at a price lower than that fixed under subclause (1).
As per Clause 3(3), where a producer of sugar purchases any sugarcane from a grower of sugarcane or from a Sugarcane grower's Cooperative Society, the producer shall, unless there is an agreement in writing to the contrary between the parties, pay within fourteen days from the date of delivery of the sugarcane to the seller or tender to him the price of the cane sold at the rate agreed to between the producer and the sugarcane grower or Sugarcane growers' Cooperative Society or that fixed under subclause (1), as the case may be. Clause (3A) provides that a producer of sugar or his agent shall pay, for the sugarcane purchased by him, to the sugarcane grower or the sugarcane growers’ coopearative society, either the minimum price of sugarcane fixed under Clause 3, or the price agreed to between the producer or his agent and the sugarcane grower or the sugarcane growers’ cooperative society, as the case may be (agreed price). Agreed Price to be paid under the Agreement may be even SAP fixed and/or determined by the State Government. Clause (5A) provides that where a producer of sugar purchases sugarcane, from a sugarcanegrower during each sugar year, he shall be liable to pay, in addition to the minimum sugarcane price fixed under Clause 3, an additional price. Subclause (2) of Clause 5A authorizes the appropriate authority to determine the additional price. Subclause (5) further provides that no additional price determined under subclause (2) or subclause (3) is required to be paid by a producer of sugar who pays a price higher than the minimum price fixed under Clause 3 to the sugarcanegrower, provided that, “the price so paid is not less than the total price comprising the minimum sugarcane price fixed under Clause 3 and the additional price determined under sub clause (2) or subclause (3).” 21. As held by this Court in the case of U.P. Cooperative Cane Unions Federations (supra), the State has the competence to determine and fix the State Advised Price fixed under section 16
and therefore fixation of SAP by the State Government cannot be said to be beyond the purview of legislative competence. Once the fixation of State Advised Price has been done, the Cane Commissioner can direct the parties to follow the same as held in U.P. Cooperative Cane Growers Federation (supra). It cannot be said that fixation of price under the regulatory measure provided in section 16 suffers from arbitrariness, nor can it be termed to be uncanalised power. Thus, we are of the considered opinion that the decision in Tika Ramji (supra) is not in conflict with the decision in U.P. Cooperative Cane Unions Federations (supra) and the decision in the latter case is not required to be revisited by a larger Bench of seven Judges. 22. Thus, considering the entire scheme of 1966 Order, it provides for “the minimum price” and “the additional price” or “the advised price”. Considering the aforesaid provisions under 1966 Order, there cannot be any sugarcane price (advised price) below “the minimum price”. As per the agreement entered into the “advised price” necessarily had to be higher than the “minimum price”. Thus, there is a difference between “the price” and the “the minimum price”. As per Clause 3 of 1966 Order, it empowers the Central Government to fix the “minimum price” and the State Government is authorized to fix the Advised Price which as observed hereinabove is always higher than the “minimum price” fixed by the Central Government. Therefore, as rightly observed by this Court in the case of U.P. Coop. Cane Unions Federations, there is no conflict in exercise of powers by the Central Government in fixing the “minimum price” and in fixing the “advised price” by the State Government which is higher than the “minimum price” fixed by the Central Government. Therefore, as rightly observed by this Court in the case of U.P. Coop. Cane Unions Federations, there is no inconsistency or repugnancy in fixing the “advised price” or
“remunerative price” by the State Government and the “minimum price” fixed by the Central Government. As rightly held, if the price fixed by the State Government is higher than that fixed by the Central Government, there will be no occasion for any inconsistency or repugnancy as it is possible for both the orders to operate simultaneously and to comply with both of 23. Thus, it is held that the view taken by the Constitution Bench of this Court in the subsequent decision in the case of U.P. Coop. Cane Unions Federations (supra) is the correct law. There is no conflict between the two decisions of this Court in the case of Tika Ramji and in the case of U.P. Coop. Cane Unions Federations and therefore, there is no necessity to refer the matter to the larger Bench consisting of seven Judges. Therefore, our final conclusions are as under: a. By virtue of Entries 33 and 34 List III of seventh Schedule, both the Central Government as well as the State Government have the power to fix the price of sugarcane. The Central Government having exercised the power and fixed the “minimum price”, the State Government cannot fix the “minimum price” of sugarcane. However, at the same time, it is always open for the State Government to fix the “advised price” which is always higher than the “minimum price”, in view of the relevant provisions of the Sugarcane (Control) Order, 1966, which has been issued in exercise of powers under Section 16 of the U.P. Sugarcane (Regulation of Supply and Purchase) b. The Sugarcane (Control) Order, 1966 which has been issued under Section 16 of the U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953 confers power upon the State Government to fix the remunerative/advised price at which sugarcane can be bought or sold which shall always be higher than the minimum price fixed by the Central Government; c. Section 16 of the U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953 is not repugnant to Section 3(2)(c) of the Essential Commodities Act,
1955 and Clause 3 of the Sugarcane (Control) Order, 1966 as, as observed hereinabove, the price which is fixed by the Central Government is the “minimum price” and the price which is fixed by the State Government is the “advised price” which is always higher than the “minimum price” fixed by the Central Government and therefore, there is no conflict. It is only in a case where the “advised price” fixed by the State Government is lower than the “minimum price” fixed by the Central Government, the provisions of the Central enactments will prevail and the “minimum price” fixed by the Central Government would prevail. So long as the “advised price” fixed by the State Government is higher than the “minimum price” fixed by the Central Government, the same cannot be said to be void under Article 254 of the Constitution of India. d. The view taken by the Constitution Bench of this Court in the case of U.P. Cooperative Cane Unions Federations vs. West U.P. Sugar Mills Association and Others is the correct law. 24. The Reference is answered accordingly. Now the Registry to notify all these matters before the Court taking up such matters forthwith, for disposal.
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A special group of Supreme Court judges decided recently that both the national government and state governments have the power to set sugarcane prices. However, the price a state government sets for sugarcane cannot be lower than the lowest price set by the national government, the Court added. Also, states are allowed to set a price higher than the price fixed by the... A special group of Supreme Court judges also said that both the national government and state governments can set sugarcane prices. But the price fixed by the state government for sugarcane cannot be lower than the 'minimum price' set by the national government. Additionally, states are free to set prices higher than the price set by the national government. A group of five judges, including Justices Arun Mishra, Indira Banerjee, Vineet Saran, M R Shah, and S Ravindra Bhat, was trying to decide if two past court cases disagreed. These cases were Tika Ramji (from 1956) and U.P. Cooperative Cane Unions Federations (from 2004). The judges decided that these two earlier cases did not conflict. So, they ruled there was no need to send the issue to a larger group of seven judges. The court had previously delayed its decision on this specific question of sending the case to more judges on February 27. The main question in the case was whether the Uttar Pradesh state government could set its "State Advised Price" (SAP) for sugarcane. This SAP would be higher than the lowest price set by the national government. When a group of three judges looked at this issue in 2012, they thought the Tika Ramji and UP Cooperative Cane Unions Federations cases conflicted. They then sent the matter to a group of five judges. In response to the issue, the five judges pointed out that the specific facts in both older decisions were different. In the Tika Ramji case, the court had decided that the national government was the correct authority to set sugarcane prices. This was based on rule 3 of the Sugarcane (Control) Order of 1955, which came from the Essential Commodities Act. Later, the national government replaced the 1955 order with a new one in 1966. In the 1966 Order, the power to set the general "price" was removed. Only the power to set the "minimum price" (the lowest price) was kept.
This 1966 Order was then reviewed in the later UP Cooperative Cane Unions Federations case. Noting the changes, the Court in that case decided that the national government's power was only to set the 'minimum price.' It also found that the state government could set a price higher than this national 'minimum price.' With this background, the current five-judge group decided that these earlier decisions did not conflict: The judges stated that, as previously decided in the U.P. Cooperative Cane Unions Federations case, the state has the legal right to set the State Advised Price (SAP). This price is set under Section 16 of the U.P. Sugarcane (Regulation of Supply and Purchase) Act of 1953. So, the state government setting the SAP is within its legal power. Once the State Advised Price is set, an official called the Cane Commissioner can direct people to follow it. The judges added that setting prices under Section 16 is not unfair or without limits. Therefore, they firmly believe that the Tika Ramji decision does not conflict with the U.P. Cooperative Cane Unions Federations decision. Also, the latter case does not need to be re-examined by a larger group of seven judges. The five-judge group then summarized its conclusions as follows: Based on specific parts of the Constitution, both the national government and the state government can set the price of sugarcane. Since the national government has already used its power to set the "minimum price," the state government cannot also set a "minimum price" for sugarcane. However, states can always set an "advised price" which is always higher than the "minimum price." This is allowed by the Sugarcane (Control) Order of 1966, issued under Section 16 of the U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953. The Sugarcane (Control) Order of 1966, which comes from Section 16 of the U.P. Sugarcane (Regulation of Supply and Purchase) Act of 1953, gives state governments the power to set a profitable or "advised price" for sugarcane. This price must always be higher than the minimum price set by the national government.
Section 16 of the U.P. Sugarcane (Regulation of Supply and Purchase) Act of 1953 does not clash with Section 3(2)(c) of the Essential Commodities Act of 1955 or Rule 3 of the Sugarcane (Control) Order of 1966. This is because, as explained earlier, the price set by the national government is the "minimum price." The price set by the state government is the "advised price," which is always higher than the national "minimum price." Therefore, there is no conflict. A conflict would only happen if the "advised price" set by the state government was lower than the "minimum price" set by the national government. In that case, the national laws would take priority, and the national "minimum price" would be used. As long as the "advised price" set by the state government is higher than the national "minimum price," it is valid under Article 254 of the Constitution of India. The special group of judges confirmed that the decision made by this Court in the case of U.P. Cooperative Cane Unions Federations vs. West U.P. Sugar Mills Association and Others is the correct legal position. Case Information Case Name: West UP Sugar Mills Association and others vs State of Uttar Pradesh and others Case Number: Civil Appeal No. 7508 of 2005 Judges: Justices Arun Mishra, Indira Banerjee, M R Shah, Vineet Saran, and Ravindra Bhat. Lawyers Present: Senior Advocate Jayanth Bhushan (representing those who brought the appeal), Senior Advocate Krishnan Venugopal (representing the State of Uttar Pradesh).
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ivil Appeal No. 269 of 1962. Appeal by special leave from the judgment and decree dated October 5, 1959 of the Bombay High Court in First Appeal No. 712 of 1955. 212 section G. Patwardhan and B.R.G.K. Achar, for the appellant. G. section Pathak and Naunit Lal, for the respondents. The Judgment of the Court was delivered by Gajendragadkar C. J. What is the scope and effect of the provisions contained in section 65 read with section 83 of the Bombay Tenancy and Agricultural Lands Act, 1948 (No. 67 of 1948) (hereinafter called the Act), that is the short question which arises for our decision in this appeal. The four respondents are the owner of certain agricultural lands in Deokhope in Taluka Palghar in Maharashtra. On the 23rd June, 1951, a notice was served by the appellant, State of Bombay (now Maharashtra), inviting the attention of the respondents to the fact that the agricultural lands of which they were the owners had remained fallow since 1948 49, and intimating to them that the appellant State would resume management of the said lands under section 65 of the Act unless the respondents took steps to bring them under cultivation in the following agricultural season. The respondents were told that in case they wanted to bring the said lands into cultivation, they should send intimation of their intention to do so within 15 days from the date of the receipt of the notice. It appears that later, an enquiry was made under the orders of the Dy. Collector as a result of which on the 30th December, 1951, he passed an order under section 65 directing that the lands should be resumed by the Government for cultivation. Thereafter, representations were made by the respondents to the Dy. Collector as a result of which about 8 acres and 30 ghunthas of land were released on the ground that the owners had taken steps to cultivate that portion of the lands in pursuance of the direction given to them by the earlier notice. The order passed 'by the Dy. Collector in respect of other lands remained unaffected. Thereafter, respondent No. 1 approached the Collector by his application dated 24th March, 1952. This application was, however, rejected. That is why the present suit was filed by them on the 23rd December, 1953 for a declaration that the order passed by the Dy. Collector on the 30th December, 1951 was illegal and void, and that it could not dispossess them of the lands which belonged to them. As a consequence of the declaration thus claimed by them, the respondents, asked for a decree for possession and mesne profits against the appellant. The appellant disputed the respondents ' claim. It urged that the suit as framed was barred under section 63 (I ) and section 85 of 213 the Act. On the merits, the appellant challenged the correctness of the allegations made by the respondents. It was averred by the appellant that the requisite enquiry had been duly and properly made and the impunged order was passed in accordance with the relevant provisions of the Act. Collector before he passed the impunged order. The learned trial Judge who framed appropriate issues on these pleadings, in the main upheld the contentions raised by the appellant. In his opinion, the present suit was barred by sections 65 (1) and 85 of the Act. He also held that the declaration made by the Dy. Collector was not null and void. The plea raised by the respondents against the validity of the statutory provisions contained in sections 65 & 66 of the Act was rejected by him, because he thought that the said sections did not contravene the provisions of Articles 19 and 31 of the Constitution. The learned Judge also found that the grievance made by the respondents against the propriety or reasonableness of the enquiry made prior to the passing of the impunged order was not justified. In the result, the respondent 's suit was dismissed. The respondents then carried the matter before the High Court by an appeal, and on their behalf three contentions were raised before the High Court. It was first argued that the lands in respect of which the impunged declaration was made were not lands as defined by the Act, and so, the relevant provisions of the Act were inapplicable. It was then urged that before the Government could exercise its powers under section 65 of the Act, a duty was cast on it to be satisfied that the lands had remained uncultivated for a period of two years before their management was assumed; and this condition had not been satisfied, because delegation by the State Government to subordinate officers of its duty to satisfy itself, or its power to make the declaration, was not justified in law. It was also contended that since the satisfaction had to be by the authority who was competent to make the declaration, he could not delegate any part of his function and duty in that behalf and the said authority had to hold the enquiry himself. The High Court has upheld the second of these contentions. It has found that on a fair and reasonable construction of section 65(1) read with section 83, the appellant could delegate its powers prescribed by section 65(1), but could not delegate its duty incidental to the exercise of the said power. That is why the decree passed 214 by the trial Court has been reversed on this ground and the respondents ' suit 'has been decreed. Consistently with this decision, an appropriate order has been passed in regard to the delivery of possession and the payment of mesne profits as claimed by the respondents. It is against this decree that the appellant has come to this Court by special leave; and the only point which is raised on its behalf by Mr. Patwardhan is that the view taken by the High Court in regard to the scope and effect of the provisions contained in section 65(1) read with section 83 is not well founded. Section 65(l) reads thus "If it appears to the State Government that for any two consecutive years, any land has remained uncultivated or the full and efficient use of the land has not been made for the purpose of agriculture, through the default of the holder or any other cause whatsoever not beyond his control the State Government may, after making such enquiry as it thinks fit, declare that the management of such land shall be assumed. The declaration so made shall be conclusive. " Along with this section, it is necessary to refer to section 83 which reads thus: "The State subject to such restrictions and conditions as it may impose, by notification in the Official Gazette, delegate to any of its officers not below the rank of an Assistant or Deputy Collector, all or any of the powers conferred on it by this Act." The High Court appears to have taken the view that though it was competent to the State Government to delegate its powers under section 65(l), it could not delegate its duty or obligation to make an enquiry as a result of which the declaration in question can be made. The State Government, says the High Court, can exercise its authority to make a declaration and this authority or power can be delegated under 9. 83; but before such authority or power can be exercised, there is an obligation imposed on the State Government to make an enquiry as to whether the agricultural land in question has remained uncultivated or fallow for the period prescribed by the statute, and the obligation or duty to hold such an enquiry which is distinct and separate from the power or authority to make a declaration consequent upon the enquiry, cannot be 215 delegated under section 83. It is common ground that the enquiry was not made by the State Government and if the view taken by the High Court is right that the obligation or duty to hold the enquiry cannot be delegated, then the impugned declaration would be open to attack because it had not been preceded by a proper enquiry. Mr. Patwardhan contends that the view taken by the High Court is plainly erroneous and we are satisfied that this contention is well founded. Section 83 in terms authorises delegation by the State Government to any of its officers of the specified status and the delegation can be in respect of all or any of the powers conferred on the State Government by the provisions of the Act. Now, it seems to us that the authority to delegate all or any of the powers which is expressly conferred on the State Government by section 83 would be rendered almost meaningless if the duty to hold an enquiry as a condition precedent for the exercise of the said authority cannot be delegated. In the context, the power which can be delegated is inseparable from the enquiry which must precede the exercise of the power, and so, in order to make section 83 effective it is necessary to hold that the delegation of the power authorised by the said section must necessarily involve the delegation of the discharge of obligations or functions which are necessary for the exercise of the said power. If the view taken by the High Court is right it would mean that whereas the State Government can authorise any of the officers belonging to the specified class to exercise its powers under section 65(l), it must hold the preliminary enquiry itself without delegating the authority to ' hold such an enquiry to any officer. It is hardly necessary to emphasise that this position is so plainly illogical that it would be unreasonable to recognise the validity of the authority to confer powers while insisting that the conditions precedent for the exercise of the powers are of such a separate and distinct character that in order to satisfy the said conditions, the required enquiry must be held not by any delegate of the State Government but by the State Government itself. In coming to the conclusion that the duty, as distinct from the power, cannot be delegated, the High Court was apparently influenced by the fact that there would be no appeal against the enquiry and the conclusion reached at such an enquiry. We do not propose to express any opinion on this part of the reasoning adopted by the High Court; that will depend upon the construction of section 86 of the Act. But whatever may be the position in respect of the competence of an appeal, we are satisfied that on 216 a fair and reasonable construction of section 83 it must be held to authorise the delegation not only of the powers mentioned by it, but also of duties or functions which are incidental to the ,exercise of the powers and are integrally connected with them. In this connection, we may usefully refer to the decision of the Privy Council in Edward Liso Mungoni vs Attorney General of Northern Rhodesia(1). In that case, in dealing with a similar question under regulation 16(1) of the Emergency Powers Regulations, 1956 of Northern Rhodesia, made by the Acting Governor of Northern Rhodesia under his statutory powers, the Privy Council has held that the power and the duty under reg. 16(1) were so interwoven that it was not possible to split the one from the other so as to put the duty on one person and the power in another; the regulation contained not so much a duty, but rather a power coupled with a duty, and he who exercised the power bad to carry out the duty. In the result, the Privy Council took the view that in delegating his functions under reg. 16(41) the Governor could delegate both the power and duty together to ,one and the same person he could not delegate the power to another and keep the duty to himself. It is not difficult to realise what anomalous consequences would follow if it is held that the power can be delegated, but not the duty to hold the incidental enquiry which alone can lead to the exercise of the power. In substance, the view taken by the High Court would make the authority to delegate the power wholly meaningless. In fairness, we ought to add that Mr. Pathak who appeared for the respondents did not seek to support this part of the High Court 's decision. It appears that a result of the decision of the High Court in the present case, the Maharashtra Legislature thought it prudent to make the necessary amendment in section 83 of the Act. Section 29(a) of the Amending Act provides that for the words "powers conferred the words "Powers conferred or duties impose& ' shall be and shall be deemed to have been substituted ,on the 31st day of October, 1949; and accordingly, the delegation or the purported delegation by the State Government under section 83 of any duty imposed shall (notwithstanding the judgment, decree or order of any Court) be deemed always to have been valid, and the discharge of any such duty by any officer shall for all purposes be valid and effective and shall not be called in question in any Court on the ground only that the State Government had no power to delegate the duty; and clause (b) provide that (1) 217 to the marginal note the words "and duties" shall be added. It is not surprising that in view of the serious consequences which would have inevitably followed if the judgment under appeal had remained unchanged, the legislature thought it necessary to make a suitable amendment in order to avoid any interruption in the peaceful and smooth working of the,, relevant provisions of the Act. Realising the infirmity in the view taken by the High Court, Mr. Pathak attempted to support the decision of the High Court on another ground. He argued that since the enquiry was made by the Talathi and the Mamlatdar under section 65 and not by the Dy. Collector, the declaration made by the Dy. Collector was invalid. In other words, the argument is that the State Government may have validly delegated its powers under section 65(l) to the Dy. Collector, but the Dy. Collector who is a delegate of the State Government cannot, in turn, delegate a part of his power or authority to a subordinate of his own, and that is what he has done in the present case. This argument proceeds on the basis that in exercising his powers under section 65 ( 1 ), the Dy. Collector must himself hold the enquiry and cannot delegate the function of holding such an enquiry to any other subordinate revenue officer. There is no doubt that a delegate who has received the authority from the principal cannot, in turn, delegate his own authority to a delegate of his own, but there is hardly any question of delegation by a delegate in the present case. All that section 65(l) requires is that the State Government and therefore its delegate may after making such enquiry as it think,; fit, declare that the management of the land shall be resumed. In other words, in what form the enquiry should be held is a matter left entirely in the discretion of the State Government or its delegate. All that the Dy. Collector has done in the present case is to direct his subordinate officers to collect material relevant to the purpose of the enquiry. The Talathi went on the spot and ascertained as to whether the respondents ' lands were lying fallow for the requisite period. He submitted his report to the Mamlatdar. The Mamlatdar in turn made his report to the Dy. Collector. In other words, all that the Dy. Collector has done is to collect the relevant material, so that he can enquire into the question as to whether the lands are lying fallow or not. This procedure does not, in our opinion, involve the question of any delegation at all. The form of the enquiry and its mode are entirely in the discretion of the Dy. Collector. Section 65(l) does not require that the Dy. Collector must himself go to the agricultural fields and enquire on the spot whether they are lying fallow. He may, if 218 he so desires, record evidence himself, or the recording of the evidence and the actual inspection on the spot can be left to some subordinate officer. The report of such local inspection and the record of the evidence collected in that behalf would be forwarded to the Dy. Collector, and that would be the material on which he would hold the enquiry himself. The enquiry is thus hold by the Dy. Collector, though the mechanical work of collecting material has been entrusted to a subordinate revenue officer. In such a case, we do not see how the principle that a delegate cannot delegate comes into operation. In support of his argument, Mr. Pathak has relied on a decision of the Kings Bench Division in Allingham and anr. vs Minister of Agriculture and Fisheries(1). In that case, the Court held that on the principle of delegatus non potest delegare, the Committee exercising its powers under reg. 62(1) could not delegate its powers to determine the land to be cultivated to its officers and, therefore, the notice issued in that behalf was ineffective and noncompliance with it was not an offence. It, however, appears that the War Agricultural Committee for the County did appoint the Biggleswade district Committee as a sub committee to Act under the instructions of the executive committee and to make recommendations to the executive committee. Apparently, they made some recommendations to the executive officer and the executive officer accordingly made the order. On these facts, Lord Goddard, C.J., observed that he could find nothing in the regulations or the statute which enabled the executive officer to make the order. The appellants had contended before the Court that they were entitled to have the decision of the executive committee and no one else on the matter, and this contention was upheld on the facts of that case. We do not see how this case can assist Mr. Pathak 's argument in the appeal before us, because there has been no delegation to hold an enquiry as such. What the Dy. Collector has done in the present proceedings is not to delegate his authority to hold an enquiry, but to get the material necessary for the enquiry collected by his subordinate officers. After the material was thus collected, he examined the material himself, held the enquiry and came to conclusion that the lands had remained fallow and uncultivated for the requisite period. We are, therefore, satisfied that the English decision on which Mr. Pathak relies does not assist him in the present case. This contention appears to have been raised before the High (1) 219 Court and has been rejected by it and, we think, rightly. In fact, in Nathubhai Gandabhai Desai vs The State of Bombay and Ors. (1), a similar contention was raised before the High Court and had been rejected by it. In that case, the High Court has field that inasmuch as the Legislature has left it entirely to the discretion of the State Government or the delegated authority to hold such enquiry as it thinks proper, if an enquiry Is held the Court cannot consider as to whether the enquiry was a proper one or whether a better enquiry would not have yielded better results. This view has been consistently followed in the Bombay High Court and we see no reason to doubt its correctness. In the result, the appeal succeeds, the decree passed by the High Court is set aside and that of the trial Court restored. There would be no order as to costs throughout. Appeal allowed.
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The state sent a notice to the landowners saying their farmland was not being used. The state said it would take over managing the land, as allowed by the Bombay Tenancy and Agricultural Lands Act, unless the owners started farming it again. Later, someone looked into the matter because the Deputy Collector ordered it. The Deputy Collector then ordered that the state should take back the land for farming. The landowners tried to change the Deputy Collector's order, but they couldn't. So, they sued, saying the order was illegal and shouldn't take away their land. The court disagreed and dismissed their case. The landowners then appealed to the High Court. The High Court said that while the state could assign its powers under the law, it couldn't assign the responsibilities that went along with those powers. So, the High Court overturned the trial court's decision. The state appealed to a higher court. The higher court HELD: (i) The law allows the state to assign not only the powers mentioned in the law, but also the duties or functions that are related to those powers. (ii) The law doesn't say the Deputy Collector has to personally visit the farms to see if they are unused. The Deputy Collector can record evidence himself, or he can have a lower-ranking officer do it. The officer's report and evidence would be sent to the Deputy Collector, who would then use that information to make a decision. This process is not considered assigning power to someone else.
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Civil Appeal No. 3121 of 1981. From the Judgment and Order dated 28 9 1979 of the Madhya Pradesh High Court in Misc. Petition No. 408 of 1978. M.K. Ramamurthi and H.S. Parihar for the Appellants. Maheshwari T. V.S.N. Chari and R.N. Poddar for the Respondents. The Judgment of the Court was delivered by KHALID, J. The question involved in this appeal brings to fore how the equality doctrine embodied in the Constitution of India is attempted to be flouted by some authorities under cover of artificial divisions, dividing persons doing the same work into two 103 groups without any justification and denying to one group by way of pay and emoluments what the other group gets. We do not propose to examine the width of the quality provisions contained in article 39(d) in all its manifold aspects but would like to restrict it in its application to the facts of this case, in our attempt to see whether the High Court was justified or not, in declining relief to the petitioners. Now the facts: This appeal by special leave is directed against the Judgment of a Division Bench of the High Court of Madhya Pradesh at Jabalpur in Miscellaneous Petition No. 408 of 1978, dismissing the petition challenging the Order of the Government of India accepting the recommendations of the Third Pay Commission dividing Senior Draughtsmen into two groups with different pay scales, which according to the appellants violated Articles 14 and 16 of the Constitution. The Appellants Nos. 1 to 8 are Senior Draughtsmen in the Ordnance Factories under the Ministry of Defence, Department of Defence Production and the Director General of Ordnance Factories. Appellants Nos. 1 to 5 were promoted on different dates to the post of senior Draughtsman when they were working as Draughtsmen. Appellants Nos. 6, 7 & 8 were directly recruited as Senior Draughtsmen in the Vehicle Factory, Jabalpur on different dates. Appellant No. 9 is a registered Association of the Employees working in the Design/Drawing Office of the Defence Establishments under the Ministry of Defence, etc. There are 33 establishments under the Ministry of Defence Production and Director General of ordnance Factories, Calcutta. In these establishments, there are two categories of Drawing Office Staff; (1) Senior Draughtsman and (2) Draughtsman. Senior Draughtsmen are either directly recruited or promoted from the post of Draughtsmen. At all relevant times, all the Senior Draughtsmen throughout the above establishments, were drawing the same pay scale. The first and the second Pay Commission set up by the Government of India, recommended same scales of pay for all the Senior Draughtsmen. A Third Pay Commission was set up by the Government of India under the Chairmanship of Shri Raghubar Dayal, a retired Judge of the Supreme Court of India and consisting of three other members. One of the recommendations of this Pay Commission, related to the scales of pay of Draughtsmen and Senior Draughtsmen, 104 Draughtsmen were to be in the scale of Rs. 330 560 while the Senior Draughtsmen were divided into two groups with two scales of pay, Rs. 330 560 and Rs. 425 700. It is this division of Senior Draughtsmen that was under challenge before the High Court. Representations were made by the Petitioner against this grouping by the Third Pay Commission, and they pleaded that there should not be any discrimination in the pay scales of Senior Draughtsmen as was recommended by the Third Pay Commission. Similar representations were made by others also like Senior Rate Estimator, Senior Rate Fixer, Senior Planner and Supervisor etc. Some representations were accepted by the Government but not the representations made by the appellants ' Association. Aggrieved by this unhelpful attitude of the Government in not accepting their representation, the appellants moved the High Court under Article 226 of the Constitution, Their case before the High Court was that Senior Draughtsmen discharged identical duties and performed similar work. That being so there was little or no justification in putting 50% of them in a higher scale of pay and 50% others in a lower scale of pay. This grouping was without any intelligible differentia. The High Court referred to a decision of this Court in Kishori Mohanlal Bakshi vs Union of India(1) and sought support from it to deny relief to the petitioners. That was a case where the grouping of Income tax Officers as Class I and class II with different scales of pay and different channel of Promotion was questioned. This Court observed in that Judgment as follows: "It might very well be that "matters relating to employment or appointment to any office" in article 16(1) are wide enough to include the matter of promotion. Inequality of opportunity for promotion as between citizens holding different posts in the same grade may, therefore, be an infringement of article 16. Thus, if of the Income tax Officers of the same grade, some are eligible for promotion to a superior grade, and others are not, the question of contravention of article 16(1) may well arise. But no such question can arise at all when the rules make Income tax Officers of Class I, eligible for appointment as Assistant Commissioner, but make 105 Income tax Officers of Class II eligible for promotion as Income tax Officers of Class I but not for promotion to the post of Assistant Commissioners. There is no denial in such a case of equality of opportunity as among citizens holding posts of the same grade. As between citizens holding posts in different grades in Government service there can be no question of equality of opportunity. article 16 does not forbid the creation of different grades in the Government service. The abstract doctrine of equal pay for equal work has nothing to do with article 14. article 14, therefore, cannot be said to be violated whose the pay scales of Class I and Class II Income tax Officers are different though they do the same kind of work. Incremental scales of pay can be validly fixed dependent on the duration of an officers service. " The High Court also referred to the decisions of this Court in State of Punjab vs Joginder Singh(1), Unikat Saakunni Menon vs State of Rajasthan(2) and State of Mysore & Anr. vs P. Narsingh Rao(3) in which cases also certain grouping of employees were challenged as violative of article 14 & 16, which challenge was repelled by the Supreme Court. The High Court relied upon these decisions and held that "It is therefore evident that it was open to the Government to fix two different pay scales for Senior Draughtsmen," and that "It was for the Government to decide what pay scale should be provided to the different. classes of employees and simply because they have been provided different pay scales that would not amount to discriminations. " The High Court was told that all the Senior Draughtsmen did the same kind of work and discharged same or similar duties and that therefore there was no justification for a distinction being made between the two classes of Senior Draughtsmen, providing two different pay scales on the basis of seniority, Denial of the higher scale of pay to one class of Senior Draughtsmen, only on the ground of length of service was, according to the appellants, wrong. The Government brought in this classification, by its Order dated 1 7 1978, directing that only Senior Draughtsmen, holding that post on 31 12 1972, would be given the Senior scale and not 106 those who did not hold that post on 31 12 1972. This basis, the appellants, contended was unsupportable. These contentions did not appeal to the High Court. While repelling the arguments of the Petitioners, the High Court observed that "The petitioners are unable to show a single authority in support of their contention that all the persons doing the same work are entitled to same scale of pay. " It is the correctness of this decision that falls to be decided in this appeal. Before discussing the factual matrix of the case, we will refer to the Order passed by the Government of India on 27th January, 1978, which brought into effect this difference in the pay scale. The said Order reads as follows: "The undersigned is directed to refer to Sl. No. 32 of Part D, Section I, in the First Schedule to the Civilians in Defence Services (Revised Pay) Rules, 1973 and to say that the President is pleased to decide that, as recommended by the Third Pay Commission in para 81, Chapter 14, of their report, half the number of posts of Draughtsman in the DGOF Organisation on the present pay scale of Rs. 205 7 240 8 280 will be placed in the revised scale of Rs. 425 15 500 EB 15 560 20 700 and the remaining half in the revised scale of Rs. 330 10 380 EB 12 500 EB 15 560. . . . . On their allocation to the revised scale of Rs. 425 700 and Rs. 350 560, the existing Draughtsman in the present pay scale of Rs. 205 280 who are brought on to the revised scale of Rs 330 560 would continue to retain their present designation as a personal to them. The placement of the existing Draughtsman in the higher revised pay scale of Rs. 425 700 will be on the basis of seniority, subject to the rejection of the unfit. Any administrative instruction that may be considered necessary may be issued by you. These orders will take effect from 1 1 73. " It is pursuant to this Order that the change in the emoluments of the petitioners ' group of Draughtsmen was effected. 107 It has to be borne in mind that this differentiation is not based on any intelligible ground. The group of Draughtsmen entitled to the higher scale of pay, is not selected by any process nor is it based on any merit cum seniority basis, but is based only on seniority cum fitness. There is no denial anywhere that both these types of Draughtsmen do the same work and discharge the same functions and duties. According to the recommendations of the Third Pay Commission, a Draughtsman has to get Rs. 330 10 380 EB 12 500 EB 15 560, while Senior Draughtsman, like the appellants, who have become so on promotion, will continue to get the same scale of pay and not the higher scale of pay. In other words, the promoted persons like the appellants, are without any monetary benefit to them. The pay that they would get as Senior Draughtsman, would be the same as a Draughtsman would get under the Third Pay Commission. That is, for the same work and same functions, the appellants would get less pay than the other group of Senior Draughtsmen. The explanation is that this division is based on seniority. This cannot be accepted as sufficient to meet the requirements of law. By seniority, a Senior Draughtsman will get higher pay with the increments that he earns proportionate to the number of years he is in service. Here that is not the case. It is the classification of the Senior Draughtsmen into two groups, that is responsible for the higher pay. For this classification, the Government must be able to satisfy the Court of certain other tests which are non existent, in this case, since it is not in dispute that Senior Draughtsmen, belonging to the two Divisions, do equal and same work. In view of the total absence of any plea on the side of the respondents, that the Senior Draughtsmen who are placed in the advantageous group, do not perform work and duties more onerous or different from the work performed by the appellants group, it will have to be held that this grouping violates Article 14 of the Constitution. The High Court did not have the advantage of a decision of this Court in Randhir Singh vs Union of India & Ors.(1), to which one of us was a party, which evolved the equality doctrine embodied in Article 39(d) and read Article 14 into it; while considering the complaint of a driver who was originally in the Army but later employed as a driver constable in Delhi Police Force under the Delhi Administration and who was denied the same pay as was available to the other drivers in the service of the Delhi Administration. This Court 108 allowed the Writ Petition and directed the concerned authorities to pay the petitioners in that case, salary at least equal to the Drivers of the Railway Protection Force. Disagreeing with the plea, put forward by the Union of India this Court observed as follows: "The Counter Affidavit does not explain how the case of the drivers in the police force is different from that of the drivers in other departments and what special factors weighed in fixing a lower scale of pay for them. Apparently in the view of the respondents, the circumstance that persons belong to different departments of the Government is itself a sufficient circumstance to justify different scales of pay irrespective of their identity of their powers, duties and responsibilities. We cannot accept this view. If this view is to be stretched to its logical conclusion, the scales of pay of officers of the same rank in the Government of India may vary from department to department notwithstanding that their powers duties and responsibilities are identical. We concede that equation of posts and equation of pay are matters, primarily for the Executive Government and expert bodies like the Pay Commission and not for Courts but we must hasten to say that where all things are equal, that is where all relevant considerations are the same, persons holding identical posts may not be treated differentially in the matter of their pay merely because they belong to different departments. Of course, if officers of the same rank perform dissimilar functions and the powers, duties and responsibilities of the posts held by them vary, such officers may not be heard to complain of dissimilar pay merely because the posts are of the same rank and the nomenclature is the same. " This Court however observed that a differential treatment in appropriate cases can be justified, when there are two grades based on reasonable grounds, and stated as follows: "It is well known that there can be and there are different grades in a service, with varying qualification for entry into a particular grade, the higher grade often being a promotional avenue for officers of the lower grade. The higher qualifications for the higher grade, which may be 109 either academic qualifications or experience based on length of service reasonably sustain the classification of the officers into two grades with different scales of pay. The principle of equal pay for equal work would be an abstract doctrine not attracting article 14 if sought to be applied to them." With respect we agree with the conclusion arrived at in the above Judgment, that where all relevant considerations are the same, persons holding identical posts and discharging similar duties should not be treated differently. The case on hand is much stronger than the facts of the Randhir Singh 's case. In that case, the drivers belonged to two different departments. In this case, the Senior Draughtsmen, divided into two groups are in the same department doing identical and same work. It is not a case of different grades created on the ground of higher qualification either academic or otherwise or an entitlement by any other criteria laid down. The justification for this classification is by the mere accident of an earlier entry into service. This cannot be justified. The above decision of this Court has enlarged the doctrine of equal pay for equal work, envisaged in Article 39(d) of the Constitution of India and has exalted it to the position of a fundamental right by reading it alongwith Article 14. This exposition of law had given rise to some whispering dissent in that the doctrine had been extended beyond permissible limits. The observations that the abstract doctrine of equal pay for equal work has nothing to do with article 14, in the Judgment in Kishori Mohanlal Bakshi vs Union of India (supra), rendered by a Constitution Bench of this Court it is contended, may perhaps run counter to the observations in the decision referred above. We do not think it necessary on the facts of this case to dwelve at length upon the effect of this observation on a wider campus of service jurisprudence in the context of equal pay for equal work which will have to be attempted in an appropriate case. For the purposes of the case on hand, it is sufficient to note that the classification between two groups of Senior Draughtsmen is 110 without any basis. They do the same work, they perform the same duties, and as such the ratio of the decision in Randhir Singh 's case applies to this case with greater force. The Order passed by the Government of India on 27th January, 1978, implementing this classification violates article 14 of the Constitution and has to be struck down and we do so. In our opinion, it would be a great injustice to continue the appellants on the scales of pay of Draughtsmen even after promotion as Senior Draughtsmen, which is destructive of all incentive and initiative in the service. In our Judgment, the High Court was in error in declining relief to the appellants. We accordingly, set aside the Judgment of the High Court and allow this appeal and direct the Union of India to fix the scale of pay of appellants at Rs. 425 15 50 EB 15 560 20 640 EB 20 700. The appellants will be entitled to costs from the respondent No. 1. M.L.A. Appeal allowed.
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Senior Draughtsmen worked in government-owned factories that made weapons and equipment. They were either hired directly or promoted from lower-level Draughtsmen positions. All Senior Draughtsmen in these factories were paid the same amount: Rs. 205-280. When the government was deciding how much to pay different workers, a group called the Third Pay Commission said Draughtsmen should be paid Rs. 330-560. The Pay Commission also said Senior Draughtsmen should be split into two groups. Half would be paid Rs. 425-700, and the other half would be paid Rs. 330-560. This would be based on how long they had worked there (seniority). Following this idea, the government said in an order on July 1, 1978, that only Senior Draughtsmen who had the job before December 31, 1972, would get the higher pay of Rs. 425-700. The Senior Draughtsmen who are appealing this decision (the appellants) complained to the government about being split into two groups by the Third Pay Commission. Because their complaints were ignored, they took the government to court, arguing that all Senior Draughtsmen did the same work. They said there was no good reason to pay them differently based only on seniority. The High Court (lower court) disagreed and said the government could set different pay scales for Senior Draughtsmen and decide how much different types of employees should be paid. The appeal was allowed, and the court *HELD*: People with the same jobs and responsibilities should be treated the same if everything else is equal. Therefore, the government's order that split Senior Draughtsmen into two groups with different pay scales based on seniority breaks Article 14 of the Constitution (which guarantees equal treatment) and is canceled. The case *Randhir Singh vs Union of India and Ors.* was followed as a precedent. In this situation, the Senior Draughtsmen who get the higher pay were not chosen through any special process or based on merit. It was only based on how long they had worked there and if they were considered suitable. Also, both groups of Senior Draughtsmen work in the same department and do the same jobs. This is not a case where different grades were created because of higher education or other qualifications. So, the division between the two groups of Senior Draughtsmen has no valid reason. Because the government did not argue that the higher-paid Senior Draughtsmen do more difficult or different work than the others, the court decided that this grouping violates Article 14 of the Constitution. The cases *Kishori Mohanlal Bakshi vs Union of India*, *State of Punjab vs Joginder Singh*, *Unikat Sankunni Menon vs State of Rajasthan*, and *State of Mysore and Anr. vs P. Narsingh Rao* were distinguished from this case.
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HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
S.B. Criminal Misc(Pet.) No. 2516/2022
Aman Chopra S/o Shri Virendra Chopra, Aged About 36 Years, R/
o I-1901, Arihant Arden, Sector - 1, Greater Noida West,
Gautam Buddh Nagar, Uttar Pradesh.
----Petitioner
1. State Of Rajasthan, Through Pp
2. Krishnaraj Singh S/o Shri Indrajeet Singh Chouhan, R/o
Bichiwada, Police Station Bichiwada, Dungarpur,
Rajasthan.
For Petitioner(s) : Mr. Sidharth Luthra, Sr. Advocate
assisted by Mr. Mrinal Bharti and
Mr. Achintya Kaushik
Mr. Manoj Bhandari, Sr. Advocate
assisted by Mr. Nishank Madhan and
Mr. Aniket Tater
For Respondent(s) : Mr. Vinit Jain, Special P. P. assisted by
Mr. Pravin Vyas
1. Learned Senior Counsel Mr. Luthra and Mr. Bhandari, inform
the Court that Hon’ble the Supreme Court, while hearing the
matters relating to ‘sedition’ in S. G. Vombatkere Vs. Union of
Indian (WPC No.682/2021) along with Editors Guild of India
& Anr. Vs. Union of India & Ors. (WPC No.552/2021) has
passed an interim order directing the Centre/State Government to
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(2 of 2) [CRLMP-2516/2022]
refrain from registering any FIRs under Section 124-A of Indian
Penal Code and keep all pending matters in abeyance during the
period that Section 124-A of IPC is being reconsidered.
2. This Court has viewed the contentious debate recorded on a
C.D. provided by the petitioner.
3. Having heard learned counsel for the parties at some length
and considering the submissions made on facts so also on law,
this Court is of the view that the investigation, including
petitioner’s interrogation, is necessary before reaching any
concrete conclusion regarding commission of offences alleged
against the petitioner.
4. The petitioner is, therefore, directed to appear before the
on 16.05.2022 at 11.00 a.m.
5. The Investigating Officer shall carry out the
investigation/interrogation by 5.00 p.m., whereafter the State
would be free to pray for further opportunity for investigation (if
required) on the next date of hearing, which is being fixed as
20.05.2022. He shall, however, not investigate the matter for
allegations covered by Section 124-A of the Indian Penal Code.
6. Till then, the petitioner shall not be arrested in relation to
present FIR No.0147/2022 registered at Police Station Bichhiwada,
District Dungarpur or in relation to any other FIR filed or likely to
be filed concerning the programme ‘Desh Nahi Jhukne Denge’
aired at 8.00 p.m. on 22.04.2022.
7. List the matter on 20.05.2022.
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The Rajasthan High Court, from its Jodhpur branch, has told the state police not to look into the accusations against News 18 journalist Aman Chopra. These accusations claim he committed a crime called sedition, which is covered by Section 124-A of India's main criminal law. Sedition means stirring up people against the government.
Chopra received this help because a police report (FIR) was filed against him. This report was for broadcasting a talk show called "Desh Jhukne Nahi Denge" and then putting it on his Twitter page. It was claimed that this show led to conflict and riots between different communities in Alwar on April 22, 2022. Judge Dinesh Mehta gave this order because the Supreme Court had just decided to put the 152-year-old sedition law (Section 124A) on hold. This law will stay on hold until the central government rethinks it. Chopra's lawyers had told the High Court about the Supreme Court's decision.
Because he aired and posted his show on Twitter, three separate police reports (FIRs) were filed against him. The first report was filed at Bichwada Dungarpur Police Station on April 23, 2022. The second was filed on the same day at Sadar, Bundi Police Station. The third was filed on April 24, 2022, at Kotwali, Alwar Police Station. He was charged under several parts of India's criminal law: Section 124-A (sedition, meaning encouraging rebellion against the government), Section 295-A (doing things to offend people's religious beliefs), and Section 153-A (encouraging hatred between different groups).
For the second and third police reports, Chopra was given a break on May 7. The Court gave him temporary protection, meaning he could not be arrested for those cases. Now, regarding the very first police report, which this current court case is about, the Court said that a full investigation and questioning of Chopra are needed before a clear decision can be made about the crimes he's accused of. So, Chopra was told to appear before the police investigator. This was at Bichhiwada Police Station in Dungarpur on May 16, 2022, at 11:00 AM. The investigator was ordered to finish the investigation and questioning by 5:00 PM that day. After that, the Court said the government could ask for more time to investigate. This would be if needed, at the next court hearing on May 20, 2022. Until then, the Court has ordered that Chopra must not be arrested for this first police report. He also cannot be arrested for any other police reports already filed or possibly filed later. These reports would all be about his show "Desh Nahi Jhukne Denge," which aired on April 22, 2022.
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1. By reference to FIR no. 02/2022 of the Police Station, Anti-Corruption
Bureau, Rajouri (camp Jammu), the petitioner has come to be arrested on
14.11.2022 after being allegedly caught red handed in the course of an alleged
trap laid by the trap team of the Anti Corruption Bureau, while accepting bribe
amounting to Rs. 50,000/- from one Sominder Singh @ Sourav S/o Late. Sh.
2. The petitioner was posted as Tehsildar Bahu, Jammu at the time of the
alleged trap. The alleged background for the alleged transaction of bribe demand
and giving is related to issuance of fard from the petitioner sought by the
complainant, namely, Sominder Singh @ Sourav. The petitioner has come to be
arrested for the alleged commission of offence under section 7 of the Prevention
3. The trap laying team was headed by Dy. SP-Sunny Gupta of Police
Station, ACB Rajouri (camp Jammu) and it is the same very Officer who has
came to be entrusted with and seized of the investigation of the FIR in question
which in itself is a contradiction of some nature.
4. Be that as it may be, the petitioner has suffered police custody tenure
and is now in judicial custody. The investigation with respect to the trap led
incident is very specific to the occasion in which the petitioner came to be
allegedly found demanding and accepting the alleged bribe amount. The custody
of an accused before the trial of the case is not meant to be of and for punitive
purpose but only for the purpose of serving the investigation of the case, which
in the present case as per the fresh objections filed on behalf of the respondent
by the recall of the objections first filed in the case, is over. This Court sees no
justification for further custody of the petitioner which is not going to serve in
any manner whatsoever the investigation official of the case by the Investigating
Authority of the Police Station, Anti-Corruption Bureau, Rajouri (Camp
Jammu). The petitioner is a public servant and, as such, there is no question of
his escaping from the reach of law or tempering with the evidence in the case.
5. It seems that even the Anti-Corruption Bureau, Rajouri (Camp Jammu)
is conscious of the fact that the custody of the petitioner in reference to FIR
under investigation might not enjoy any further extension from the court of law
and, as such in order to lend a more serious note to the case, the respondent in its
fresh objections have come forward with the plea that the petitioner is also under
enquiry for disproportionate assets. It is not understandable as to how in the FIR
relating to trap case the fact of enquiry against the petitioner for alleged
disproportionate assets has any bearing except as an attempt to put off the
indulgence of the Court in considering the grant of bail in favour of the
6. The petitioner has come to seek the bail after his bail application filed
before the Court of Special Judge, Anti Corruption, Jammu came to be rejected
vide an order dated 21.11.2022 passed on file no. 1611/2022. From reading of
the said order, the Special Judge, Anti Corruption, Jammu seems to have been
weighed down by the fact that by reference to FIR no. 02/2022 which has been
registered only for the incident of demand of bribe from the complainant by the
petitioner, the Investigation Officer is stretching the investigation to case of
alleged disproportionate assets against the petitioner. The Special Judge, Anti
Corruption, Jammu deemed the stage of the investigation warranting no bail to
the petitioner without attending the case from the perspective as to whether with
respect to the commission of offence alleged in the FIR no. 02/2022, there was
any purpose for the continuing custody of the petitioner by the arresting
7. Be that as it may be, a successful prosecution of a criminal case in a
court of law is based upon quality of police investigation with respect to the facts
and circumstances of the case attending the commission of offences and not by
length of continuing custody of a suspect or an accused during the course of
investigation. An investigation authority is bound to show and demonstrate on
factual basis as to how if an accused is admitted to bail in a case before
finalization of police investigation and consequent presentation of police report
under section 173 Cr. P.C, 1973, the investigation work is likely to suffer
hurdles/obstacles to the prejudice of taking the investigation to the truth of the
matter. Just by sound effects of expressions that the bail granted will
jeopardize/undermine investigation may not suffice to deny bail to an accused
under custody at the hands of the Police.
8. In the background of the aforesaid case is made for admission of the
petitioner to bail and as such, the petitioner is admitted to bail subject to the
following terms and conditions:
a) That the petitioner shall make himself available for the
investigation purpose as and when required, by the
b) That the petitioner shall furnish personal bond to the
amount of Rs. 1,00,000/- with one surety of the like amount
before the Investigating Officer.
c) That the petitioner shall not directly or indirectly make any
attempt to interfere and intermeddle in many manner
whatsoever in the cause of investigation in the case and
shall not attempt to temper with witnesses in the case.
d) That the petitioners shall not leave the UT of J&K without
the prior written permission of the Investigating Officer.
9. Bail application stands disposed of, accordingly.
I attest to the accuracy and
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The High Court in Jammu and Kashmir and Ladakh recently reminded everyone. Winning a criminal case in court does not depend on how long police hold a suspect. This is true during the investigation.
Justice Rahul Bharti and other judges explained this point. They said that winning a criminal case relies on a good police investigation. It depends on the facts and details of the crime. It does not depend on how long police hold a suspect during the investigation. The police must use facts to clearly show why letting a suspect out on bail would cause problems. They need to prove it would make their investigation harder. This applies before they finish their investigation and give their report to the court.
The court made these statements during a bail request hearing. This request came from a case filed by the Anti-Corruption Bureau. The person asking for bail was a government official in Jammu. He was supposedly caught last month taking a bribe of Rs. 50,000. The case was filed under a law that prevents corruption.
The lawyer for the Anti-Corruption Bureau argued against the bail request. They said that besides the current accusations, the person was also being investigated for having more wealth than his known income. Because of this, the lawyer felt the bail request should be turned down.
When deciding the matter, Justice Bharti said it was unclear how the investigation into the person's wealth was relevant. This applied to the current bribery case. He suggested that bringing it up was just a way to make the court less likely to grant bail.
Thinking more about the case, the judges noted that the person had already been held by the police. He was now in jail under court order. The investigation for the bribery incident was very specific to that moment. This was when the person was supposedly caught asking for and taking the bribe. The judges stressed that holding a person before their trial is not meant as a punishment. It is only to help with the investigation. In this case, the police later confirmed that the investigation was now finished.
The court stated there was no reason to keep holding the person. It would not help the police investigation in any way. They also noted that since the person was a government employee, it was unlikely he would try to escape the law. It was also unlikely he would try to mess with the evidence in the case.
Based on all these points, the judges allowed the person to be released on bail. However, he had to follow certain rules.
Case Title: Rohit Sharma Vs State of J&K
Coram: Justice Rahul Bharti
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ivil Appeal No. 3951 of 1990. From the Judgment and Order dated 10.4.1990 of the Himachal Pradesh High Court in C.W.P. No. 12 of 1990. V.A. Bobde, A.K.Sanghi and section Mudaliar for the Appellants. Dr. Y.S. Chitale, Mrs. Sadhna Ramachandran and Jagan Mohan Rao for the Respondent. Respondent, Raj Kumar Thakur, was a student in the Postgraduate Doctoral Programme as a Ph.D. scholar with his subject for doctoral study "Breeding of Honey Bees A Mellif era for Honey production through Artificial Insemination" which is a subject under the Department of Agriculture of Dr. Y.S. Parmar University of Horticulture & Forestry and is a course of study available in several other institutions in the country. The respondent was registered for this course in 1985 and was required to complete the same in six semes ters with entitlement for extension by two more semesters by the Dean on the recommendation of the Adviser and for a further extension of two more semesters by the Vice Chancel lor of the Dr. Y.S. Parmar University of Horticulture and Forestry on the recommendation of the Dean. The respondent completed seven semesters as a student and registered for the eighth semester on 24.7.1989 as a student of the Univer sity. However, during this period respondent was appointed as Assistant Scientist in the pay scale of Rs.2200 4000 vide letter of appointment dated 26.7.1989. The Dean by order dated 774 27.7.1989 permitted the respondent to register for the eighth semester. This permission of the Dean was granted without the knowledge of the respondent having become an employee of the University as a result of the appointment letter dated 26.7.1989. The respondent joined the post of Assistant Scientist pursuant to this appointment on 29.7.1989. The respondent thereafter applied for a further extension of his registration for the course for the ninth semester. The Vice Chancellor vide his order dated 22.11.1989 refused the permission on the ground that the respondent having become an employee of the University, was not entitled to that benefit in accordance with the provi sions applicable. The restrictions in regard to an employee/teacher of the University for the purpose are as under: "(a) An employee/teacher of the University is permitted to undertake doctoral programme only in subjects for which facilities in other Universities in the country are not available. Forestry being one such subject in the petitioner University. The course of study of the respondent viz. Agriculture, is however, available in numerous other insti tutions and Universities in the country. (b) An employee/teacher is required to take study leave and the same is admissible for pursuing approved courses outside the University only. It is only in cases where facilities for the course of study which is not available elsewhere in the country, an in service teacher is permitted to undertake the same in the petitioner University. (c) Study leave is not granted as a matter of fight and can be granted only after the employee/teacher has completed five years of continuous service in the University. (d) Considering the number of employees aspiring to do doctoral programme the permission to do the same is given according to seniority. " An employee of the University would be required to complete the Ph.D. within eight years of recruitment failing which increments are not admissible till completion of the course. An employee who is Assistant Professor or holds an equivalent post, the respondent being in that category, normally becomes entitled to the senior scale of Rs.3000 5000 after completion of eight years of service. However, in case of an employee obtaining the Ph.D. degree the senior scale be 775 comes applicable after five years instead of eight years. On completion of eight years in the senior scale an employee/teacher is promoted to the next higher rank of reader. Thus, a person getting a Ph.D. degree gets the senior scale ,earlier and consequently he is also promoted earlier to the post of reader. There are 24 other employees who are senior to the respondent and are awaiting completion of their five years service for doing the doctoral programme and there are eight other employees who joined initially with the Ph.D. degree and are awaiting completion of five years for getting the senior scale. The consequence of granting permission to the respondent for registration to the ninth semester would be to confer on the respondent the benefit which is not available to an employee of the Univer sity because of the aforesaid restrictions and this would result in giving a benefit to the respondent contrary to the provisions applicable while denying the same to others who are senior to the respondent in employment. According to the appellants this was the reason for refusal by the Vice Chancellor of the permission sought by the respondent. The respondent challenged this refusal of the permission to him by the Vice Chancellor by order dated 22.11.89 in the High Court of Himachal Pradesh in C.W.P. No. 12 of 1990. By the impugned judgment dated 10.4.1990, the Full Bench of the High Court by majority allowed the writ petition and direct ed the Vice Chancellor to register the respondent for the remaining two semesters, namely, the ninth and the tenth semesters. Hence, this appeal by special leave. The grievance of the appellants is that the result of the impugned majority judgment of the High Court Would be that though the respondent is an employee/teacher of the University he would be doing research in a subject in which otherwise employees of the University are not permitted; the respondent would get the senior scale earlier and also be promoted to the post of Reader much before 24 persons senior to him who are awaiting their turn in the order of seniority to undertake the doctoral programme after completion of the requisite five years service which is contrary to the statu tory provisions; and the 24 other employees senior to the respondent would be adversely affected even without being parties in the writ petition. The statutory provisions applicable to the case and their meaning is not in controversy. The only controversy is whether the respondent can be treated as an employee or in service candidate for the Ph.D. course on these facts so as to attract the restrictions which are relied on by the University for refusing the permission for registration to the 776 ninth and tenth semesters sought by the respondent. The majority opinion in the impugned judgment takes the view that the respondent is not an in service candidate for this purpose as he has already completed eight semesters and requires only two or three months to complete the Ph.D. course. The majority has also been influenced by the fact that refusal of permission for completing the course at this stage would be hard on the respondent. The minority view of Bhawani Singh, J., is that on appointment to a teaching post in the University, the respondent incurred the disability and attracted the restrictions which are applicable to all employees of the University irrespective of the consequence flowing from it. In our opinion, the minority judgment of Bhawani Singh, J., on this point and the conclusion reached by him that the respondent attracted the restrictions at taching to all employees of the University on his appoint ment as a teacher of the University is the correct view and the respondent cannot escape from the statutory restrictions which became applicable to him as soon as he became an in service candidate for the remaining part of the Ph.D. course on his taking up of the appointment in the University. The further fact that the benefit claimed by the respondent, if granted, would result in the respondent getting consequen tial benefits much before his several seniors as a result of this permission alone cannot also be overlooked. It is not a case of merely giving some benefit to the respondent even by relaxation of some statutory provisions without causing any prejudice to anyone else but a case where such a benefit granted to the respondent alone from amongst a large number of employees of the University would also seriously preju dice their claim and amount to an act of discrimination. Obviously, such a course is impermissible. This is the consequence of the High Court judgment and, therefore, it must be set aside. Consequently, the appeal is allowed and the impugned judgment dated 10.4.1990 of the High Court of Himachal Pradesh in C.W.P. No. 12 of 1990 is set aside. No costs. R.S.S. Appeal allowed.
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A teacher at the University who wants to get a doctorate degree has to follow certain rules. These rules say: (a) the course they want to take must not be offered at other schools, (b) they can only get time off to study outside the University for approved courses, (c) they must have worked at the University for at least five years straight, and (d) permission to take the course will be given based on how long they have worked there (seniority). An Assistant Professor usually gets a pay raise (called a senior scale) after working for eight years. But, if someone gets a Ph.D., they can get the senior scale after only five years instead of eight. The person in this case was working on his Ph.D. in Agriculture at the University. This course was available at other schools. He was supposed to finish in six semesters (school terms), but could get two extra semesters if his advisor and the Dean agreed. Later, he became an Assistant Professor at the same University. He had already finished seven semesters of his Ph.D. The Dean let him sign up for the eighth semester, not knowing he was now a University employee. But, the Vice Chancellor (the head of the University) then refused to let him sign up for the ninth semester. The Vice Chancellor said that because he was now an employee, he couldn't get that benefit anymore. The person filed a legal challenge. The High Court said that he wasn't a current employee since he had already finished eight semesters. They ordered the Vice Chancellor to let him sign up for the ninth and tenth semesters. The Court disagreed with the High Court's decision. They said that the person now had to follow the rules for employees since he became one before finishing his Ph.D. If he was allowed to get the benefit, he would get promotions and other advantages before teachers who had worked there longer. This would be unfair and discriminate against the other teachers. That is not allowed.
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Case :- CRIMINAL MISC. BAIL APPLICATION No. - 59616 of 2022
Opposite Party :- State of U.P.
Counsel for Applicant :- Saksham Srivastava,Veerendra Singh
Counsel for Opposite Party :- G.A.
By means of the the bail application the applicant has
prayed to be enlarged on bail in Case Crime No.144 of
2018 at Police Station-Asmoli, District-Sambhal, under
Sections 363 and 366 IPC. The applicant is in jail since
The bail application of the applicant was rejected by the
learned District & Sessions Judge, Sambhal on
The following arguments made by Shri Veerendra
Singh, learned counsel on behalf of the applicant, which
could not be satisfactorily refuted by Shri Sunil Kumar
Srivastava learned AGA from the record, entitle the
applicant for grant of bail:
(1). The applicant and the victim were intimate.
(2). The FIR is a result of opposition of the victim's
family members to the said relationship.
(3). The victim in her statement under Section 164
Cr.P.C. has asserted that she had left the house because
of domestic discord.
(4). No allegation of abduction or inappropriate
behaviour by the victim in her statement under Section
(5). Explaining the criminal history of the applicant it is
contended that the applicant belongs to poor economic
strata of the society and is a convenient scapegoat for
the police authorities. The applicant has been falsely
nominated in the said cases only to burnish the
credentials of the police authorities. The said cases do
not depict commission of any heinous offence and have
no bearing on the instant bail application.
(6). The applicant is not a flight risk. The applicant
being a law abiding citizen has always cooperated with
the investigation and undertakes to cooperate with the
court proceedings. There is no possibility of his
influencing witnesses, tampering with the evidence or
In the light of the preceding discussion and without
making any observations on the merits of the case, the
bail application is allowed.
Let the applicant- Manjeet Alias Pintoo be released on
bail in the aforesaid case crime number, on furnishing a
personal bond and two sureties each in the like amount
to the satisfaction of the court below. The following
conditions be imposed in the interest of justice:-
(i) The applicant will not tamper with the evidence or
influence any witness during the trial.
(ii) The applicant will appear before the trial court on
the date fixed, unless personal presence is exempted.
Before parting it will be appropriate to notice the
submission of Shri Veerendra Singh, learned counsel
for the applicant which was made at the start of the
Shri Veerendra Singh, learned counsel for the applicant
contends that the applicant belongs to the economically
poor strata of the society. It is submitted that the
applicant is in jail for more than three years as he did
not have access to legal aid & he is financially destitute.
This Court noticed that a large number of under trial
prisoners are not able to file timely bail applications as
they are poor or abandoned by their family members.
Directions have already been issued in this regard by
this Court in Criminal Misc. Bail Application No.
16961 of 2022 (Anil Gaur @ Sonu @ Sonu Tomar Vs.
State of U.P).
In this case it is evident from the case of the prosecution
that there was no incriminating evidence against the
applicant since the victim had not made any allegation
of abduction or inappropriate behaviour against the
applicant. However the applicant was confined in jail
for more than three years due to his destitute
circumstances and lack of access to legal aid.
shall enquire into the matter and see if there was any
non compliance of orders passed by this Court in Anil
Gaur (supra) in the failure to provide legal aid. The
shall also take appropriate measures to ensure
compliance of the order of this Court in Anil Gaur
A copy of this order shall be communicated to
by the learned Government Advocate.
High Court of Judicature at Allahabad
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Last week, the Allahabad High Court told the head of Uttar Pradesh's Legal Services Authority to make sure a 2022 court order was being followed. This 2022 order, from a case called 'Anil Gaur v. State of U.P.', gave specific instructions to the state. These instructions were about how to make sure people in jail waiting for their trial get legal help.
Judge Ajay Bhanot issued this order while reviewing a request for bail. This request came from someone accused of kidnapping. The accused person had stayed in jail because he was poor and could not get legal help.
The Court also considered what the accused person's lawyer argued. The lawyer said that the accused and the person who was supposedly kidnapped had a close relationship. The lawyer claimed that the initial police report, called an FIR, was filed only because the victim's family did not approve of this relationship.
The lawyer also said that the victim herself did not accuse the man of kidnapping or bad behavior in her official statement given to a judge. Finally, the lawyer argued that because the accused was poor, the police found him to be an easy person to blame. The lawyer claimed the police wrongly named him in the case just to make themselves look good.
Even after looking at the government's side of the case, the Court noticed something important. There was no strong evidence showing the accused was guilty, and the victim had not accused him of kidnapping or bad behavior. However, because he was very poor and could not get legal help, he had stayed in jail for more than three years.
Because of this situation, the Court also told the head of the Uttar Pradesh Legal Services Authority to investigate. They needed to find out if the rules from the earlier Anil Gaur case were not followed when it came to giving legal help to the accused.
In the Anil Gaur case, the Allahabad High Court had stressed that two rights are connected: the right to ask for bail quickly and the right for a deserving prisoner to get legal help. To fix delays in prisoners asking for bail, especially when they don't have proper legal help, the Court had suggested some important steps.
Justice Ajay Bhanot noted that the right to ask for bail becomes meaningless, and personal freedom seems impossible, if a prisoner who deserves legal help doesn't get it. So, he instructed the State Legal Services Authority to create a plan. This plan would help prisoners waiting for trial who cannot ask for bail because they don't have proper legal support.
The Court suggested these steps because it noticed the problems faced by prisoners waiting for trial. Their inability to get legal help brought up serious legal and constitutional concerns. These concerns directly impact a person's right to ask for bail and their personal freedom.
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Criminal Appeal No. 189 of 1966. Appeal by special leave from the judgment and order dated July 4, 1966 of the Patna High Court in Criminal W.J.C. No. 11 of 1966. B.R.L. lyengar and U.P. Singh, for the appellants. V. A. Seyid Muhammad and S.P. Nayar, for respondent No. 1. The Judgment of the Court was delivered by Hegde J. This appeal against the decision of the High Court of Patna in Criminal W.J.C. No. 11 of 1966 was brought after obtaining special leave from this Court. The principal question raised herein is whether the investigation which is being carried on against the 'appellants under sub rule (3 ) of rule 3 of Sugarcane (Control) Order, 1955 (to be hereinafter referred to as the Order) read with section 7 of the (to be hereinafter referred to as the Act) is in accordance with law. The appellants are office bearers of M/s. S.K.G. Sugar, Ltd.(Lauriya). A complaint has been registered against them under sub rule (3) of rule 3 of the Order read with section 7 of the Act on the ground that they have failed to pay to the sellers the price of the sugarcane purchased by them, within the time prescribed. The said complaint is being investigated. The appellants are objecting to that investigation on various grounds. They unsuccessfully sought 'the intervention of the High Court of Patna under article 226 of the Constitution in Cr. W.I.C. No. 11 of 1966. Hence this appeal. 675 Mr. B.R.L. Iyengar appearing for the appellants challenged the validity of the investigation in question on various grounds. We shall now proceed to deal with each one of those grounds. The 1st contention of Mr. Iyengar was that sub rule (3) of rule 3 could not have been validly issued under section 3 of the Act. According to him the said section 3 cannot be used for controlling the payment of the price of food crops; it can only deal with foodstuffs; food crops are outside its scope. This contention has been negatived by the High Court. We agree with the High Court that there is no merit in this contention. Section 2(a) of the Act defines "essential commodity". Sub cl. (v) of that clause brings. foodstuffs within the definition of essential commodity. Clause (b) of section 2 provides that food crops include sugarcane. The next important provisions in the Act are cls. (b) and (c) of section 3(1). Section 3 (1 ) provides that if the Central Government is of opinion, that it is necessary or expedient so to do for maintaining or increasing supplies of any essential commodity or for securing their equitable distribution and availability at fair prices, it may, by order, provide for regulating or prohibiting the production,. supply and distribution thereof and trade and commerce therein. Sub section (2)of that section says that without prejudice to the. generality of the _powers conferred by sub section (I ) an order made. thereunder may provide . . "(b) for bringing under cultivation any waste or arable land, whether appurtenant to a building or not, for the growing thereon of food crops generally or of specified food crops, and for otherwise maintaining or increasing ' the cultivation of food crops generally, or of specified food crops;" Clause (c) provides for controlling the price at which any essential commodity may be bought or sold. From the scheme of cls. (b) and (c) of section 2 and section 3 of the Act, it is clear that the Parliament intended to bring under control the cultivation and ' sale of food crops. In view of these provisions it is idle to contend that sugarcane does not come within the ambit of the Act. The question whether the cultivation and sale of sugarcane can be regulated under section 3 of the Act came up for the consideration of this Court in Ch. Tika Ramji and Ors. vs The State of U.P. and Ors.(1) At pages 432 and 433 of the report it is observed : "Act X of 1955 included within the definition of essential commodity foodstuffs which we have seen above would include sugar as well as sugarcane. This Act was enacted by Parliament in exercise. of ' the con (1) 676 current legislative power under ' Entry 33 of List III as amended by the. Constitution Third Amendment Act, 1954. Foodcrops were there defined as including crops of sugarcane and section 3 (1 ) gave the Central Government powers to control the production, supply and distribution of essential commodities and trade and commerce therein for maintaining or increasing the supplies thereof or for securing their equitable distribution and availability at fair prices. Section 3(2)(b) empowered the Central Government to provide inter alia for bringing under cultivation any waste or arable land whether appurtenant to a building or not for growing thereon of foodcrops generally or specified foodcrops and section 3(2)(c) gave the Central Government power for controlling the price at which any essential commodity may be bought or sold. These provisions would certainly bring within the scope of Central legislation the regulation of the production of sugarcane as also the controlling of the price at which sugarcane may be bought or sold, and in addition to the Sugar Control Order, 1955 which was issued by the Central Government on 27th August, 1955, it also issued the Sugarcane Control Order, 1955, on the same date investing it with the power to fix the price of sugarcane and direct payment thereof as also the power to regulate the movement of sugarcane. Parliament was well within its powers in legislating in regard to sugarcane and the Central Government was also well within its powers in issuing the Sugarcane Control Order, 1955 in the manner it did because all this was in exercise of the concurrent power of legislation under Entry 33 of List III. " It is needless to say anything more on this question. It was next contended by Mr. Iyengar that the regulation of the price of sugarcane is expressly dealt with by the Bihar Sugar Factories Control Act, 1937 and therefore we should not impliedly spell out the same power from the provisions of the Order and the Act. Mr. Iyengar is not right in contending that the power that is sought to be exercised in the instant case is an implied one. Sub rule (3) of rule 3 specifically provides that unless there is an agreement in writing to the contrary between the parties the purchaser shall pay to the seller the price of the sugarcane purchased within 14 days from the date of the delivery of the sugarcane. This is a .specific mandate. If the Bihar Act provides anything to the contrary the same must be held to have been 677 altered in view of article 372 of the Constitution which provides that all laws in force in the territory of India immediately before the commencement of this Constitution shall continue in force therein until altered or repealed or amended by a competent legislature or other competent authority. Quite clearly the Bihar Act is a pre Constitution Act and it could have continued to be in force only till it was altered, repealed o.r amended by a competent legislature or other competent authority. We shall presently see that the authority that altered or amended that law is a competent one. The next contention of the learned Counsel for the appellants was that the Parliament had no competence to enact any law relating to the control of sugarcane as that subject is within the exclusive legislative jurisdiction of the State, the same being a part of agriculture. This contention is again unsustainable in view of Entry 33 of List III of the Constitution which empowers the Parliament to legislate in respect of production, supply and distribution of foodstuffs. It is not disputed that the Parliament had declared by law that it is expedient in public interest that it should exercise control over foodstuffs. That being so it was well within the competence of Parliament to enact the Act and hence the power conferred on the Government ,under section 3 of the Act cannot be challenged as invalid. There is no substance in the contention that the impugned order contravenes the fundamental right guaranteed to the citizens under article 19 (1 ). No fundamental fight is conferred on a buyer not to pay the price of the goods purchased by him or to pay the same whenever he pleases. The contention that in view of section 11 of the Act, no cognizance could have been taken of the offence alleged is premature. This question does not arise in this ease. No court has yet taken cognizance of the case. That stage has Still to come. There is no substance in the contention that the complaint made before the police does not disclose a Cognizable offence and as such the police could not have taken up the investigation of that complaint. The offence complained of is punishable with three years ' imprisonment and as such it falls within the 2nd Sch. of the Cr. P.C. and consequently the same is a cognizable offence as defined in section 4(1)(f) of the Cr. Hence it was open to the police to investigate the same. For the reasons mentioned above we are unable to accept any of the contention advanced on behalf of the appellants. In the result this appeal fails and the same is dismissed. G.C. Appeal dismissed.
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The people in charge of a sugar company were the appellants (those appealing a decision). Someone filed a police complaint against them. The complaint said they broke a rule about sugarcane prices. Specifically, they didn't pay sugarcane sellers on time. This violated the Sugarcane (Control) Order from 1955 and Section 7 of the Essential Commodities Act, 1955. The appellants disagreed with the police investigation. They asked the High Court to stop it, using Article 226 of the Constitution. But the High Court refused to get involved. So, the appellants asked the Supreme Court to hear their case. The appellants argued: (i) The sugarcane rule couldn't be made under Section 3 of the Essential Commodities Act, 1955. They said Section 3 only applied to food items, not crops used to make food. (ii) The Bihar Sugar Factories Control Act, 1937 already controlled sugarcane prices. So, the national government couldn't also control prices using the Sugarcane Order. (iii) Only the state government, not the national government, could make laws about sugarcane. They said sugarcane was part of agriculture, which states control. (iv) The sugarcane order violated their basic rights under Article 19(1) of the Constitution. (v) Because of Section 11 of the Essential Commodities Act, 1955, the court couldn't even hear the case. (vi) The police complaint didn't describe a real crime. So, the police couldn't investigate it. HELD (the court's decision): (i) Based on Sections 2 and 3 of the Essential Commodities Act, 1955, and a previous Supreme Court case (Ch. Tika Ramji 's case), the argument that food crops aren't covered by Section 3 is wrong. (ii) The sugarcane rule specifically says buyers must pay sellers within 14 days, unless there's a written agreement saying otherwise. So, this isn't an implied power. Even if the Bihar Sugar Factories Control Act, 1937 says something different, Parliament (the national government) changed it. They had the power to do this under Article 372 of the Constitution, which deals with existing laws. (iii) Parliament had the power to pass the Essential Commodities Act, 1955 and give the government power under Section 3. Entry 33 of List III of the Constitution lets Parliament make laws about producing, supplying, and distributing food. (iv) There was no violation of Article 19(1). Buyers don't have a basic right to not pay for goods or to pay whenever they want. (v) The argument about Section 11 of the Essential Commodities Act, 1955 was too early. No court had officially started the case yet. (vi) The crime complained about could be punished with three years in jail. This means it's a "cognizable offence" under the Code of Criminal Procedure (meaning the police can investigate it), as defined in Section 4(1)(f) of that Code.
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Appeal No. 47 of 1965. Appeal from the judgment and decree dated December 12, 1962 of the Patna High Court in Appeal from Original Decree No. 433 of 1959. H. R. Gokhale, section N. Prasad and B. P. Singh, for the appellant. 883 emption and not of renewal was granted to the appellant Com pany. The High Court of Patna confirmed the decree passed by the Trial Court but on different grounds. The High Court held that the right granted by cl. 29 gave rise to an "encumbrance" which was extinguished when the interest of the owners in the land vested in the State. With certificate granted by the High Court, this appeal has been preferred by the Company. A notification under section 3(1) of the Bihar Land Reforms Act, 1950, on June 27, 1953 was issued in respect of the land of the owners. Section 4 of the Act prescribes the consequences of the publication of the notification under section 3(1) : it provides, insofar as it is relevant : "Notwithstanding anything contained in any other law for the time being in force or in any contract, on the publication of the notification under sub section (1) of section 3, or sub section (1) or (2) of section 3A the following consequences shall ensue, namely : (a) Such estate or tenure including the interests of the proprietor or tenure holder in any building or part of a building comprised in such estate or tenure and used primarily as office or cutchery for the collection of rent of such estate or tenure, and his interests in trees, forests, fish eries, jalkars, hats, bazar, mela and ferries and all other sairati interests as also his interest in all sub soil including any rights in mines and minerals, whether discovered or undiscovered, or whether being worked or not, inclusive of such rights of a lessee of mines and minerals comprised in such estate or tenure (other than the interests of raiyats and under raiyats) shall, with effect from the date of vesting, vest absolutely in the State free from all encumbrances and such proprietor or tenure holder shall cease to have any interests in such estate or tenure, other than the interests expressly saved by or under the provisions of this Act. " The opening words of this clause "Subject to the subsequent provisions of this Chapter" were omitted by Bihar Act 16 of I 959, but that omission has no practical significance in this case. Section 10 of the Act provides : "(1) Notwithstanding anything contained in this ,Act, where immediately before the date of vesting of the estate or tenure there is a subsisting lease of mines or minerals comprised in the estate or tenure or any part thereof, the whole or that part of the estate or tenure 884 comprised in such lease shall, with effect from the date of vesting, be deemed to have been leased by the State Government to the holder of the said subsisting lease for the remainder of the term of that lease, and such holder shall be entitled to retain possession of the leasehold property. (2) The terms and conditions of the said lease by, the State Government shall mutatis mutandis be the same as the terms and conditions of the subsisting lease referred to in sub section (1), but with the additional condition that, if in the opinion of the State Government the holder of the lease had not, before the date of the commencement of this Act, done any prospecting or developing work, the State Government shall be entitled at any time before the expiry of one year from the said date to determine the lease by giving three month 's notice in writing Provided (3) Counsel for the appellant Company contended that cl. 29 created an interest in the demised land in favour of the Company and the State of Bihar as successor in title of the original owners took the land subject to that interest. In the alternative, counsel contended, the Company acquired immediately on execution of the indentures of lease an indefeasible right to obtain renewal and that right was enforceable against the owners and their successors in interest alike. We are unable to agree with those contentions. The covenant granting an option of renewal of the lease on the expiry of the period of the lease outstanding is a covenant running with the land : it creates no interest in land. In The, State of Bihar vs Indian Copper Corporation Ltd.(1) the High Court of Patna held that a clause for renewal of a lease on the expiry of it% period has not the effect of a present demise nor does it operate to create an interest in land on the date on which the original lease was executed : a covenant for renewal is not tantamount to an actual demise and therefore "no leasehold interest is created for the renewed term when the original lease is granted. " Under the terms of the lease dated September 30, 1940, the appellant Company became entitled to a lease for a period of fifteen years. On the expiry of that period the Company could have entorced their right to get a renewal of the lease for a period of fifteen years against the owners if their interest had not been extinguished. If the owners declined to carry out their obligation, the Company could sue for specific performance and claim a right to remain I ) I.L.R. 38 Pat. 1160, 885 in possession for a period of fifteen years stipulated in cl. 29. But the provisions of the Bihar Land Reforms Act intervened. By the express terms of section 4 (a) of the Act all the interests of the owners in all sub soil including any rights in mines and minerals, whether discovered or undiscovered or whether being worked or not, inclusive of such rights of the lessee of mines and minerals comprised in such estate or tenure became vested in the State with effect from the date of vesting absolutely and free from all encum branches. Even the interest of the lessees of the mines and minerals comprised in the estate therefore ceased, and all encumbrances on the interest of the owners ' estate were extinguished and the State took the estate free from all the rights of the lessees. The original contractual lease came to an end by the operation of section 4 (1 )(a,) of the Act, and a fresh statutory lease for the remainder of the term of that lease in favour of the lessee came into being under s.1 0 ( 1 ) of the Act. The appellant Company therefore acquired the rights of a statutory lessee for the period between June 27, 1953 and September 30, 1955, with terms and conditions mutatis mutandis the same as the conditions of the original lease granted by the owners on September 30, 1940. But by virtue of section 4 that covenant by which ,he owners had agreed to renew the lease at the option of the lessee being merely of the nature of an encumbrance and not an interest in the land was extinguished, the land vested in the State free from the obligation created by the renewal clause. We agree with the High Court that "a clause for renewal of the lease at a future date was a limitation imposed upon the lessor. His freedom as an absolute owner was sought to be curtailed by such agreement. It was thus an encumbrance and all encumbrances were wiped out by section 4. . . . Taking all these provisions into consideration, an agreement for renewal of a lease in future cannot be binding upon the State Government after the vesting of the estate". Counsel for the appellant relied upon r. 40 of the Mineral Concession Rules, 1949, and contended that under the scheme of the Rules a lessee of a mining lease is entitled to at least one renewal. Rule 40, insofar as it is material, provides : "(1) The period for which a mining lease may be granted shall be 30 years in the case of coal, iron ore and bauxite for manufacture of aluminium, and 20 years in the case of any other minerals, unless the applicant himself asks for a shorter period. The lease shall be renewable at the option of the lessee, for one or two periods, each not exceeding the duration of the original lease, in the case of iron ore and bauxite for manufacture of aluminium, and one period not exceeding the 8 8 6 duration of the original lease in the case of other minerals. " But r. 40 has no application. Manifestly, the rule applies to grants made by the Government : it has no application to statutory leases arising by virtue of section 10 of the Bihar Land Reforms Act. Even assuming that r. 40 applies to such a statutory lease, the duration of the "original lease" may be deemed to be no longer than the period between the date of vesting and September 30, 1955. That period for which renewal may have been claimed has expired many years ago, and recognition of the rights of the appellant Company will be of no practical significance in this appeal. The appeal fails and is dismissed with costs. Appeal dismissed.
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A company rented land containing mica from the owners for fifteen years. The rental agreement said the company could renew the lease when it ended, if they wanted to. The land was part of a larger property. A law in Bihar (the Bihar Land Reforms Act of 1950) said that the government now owned the property, taking it over completely. This meant the government owned it free of any debts or other claims, including the rights of renters. However, the company stayed on the land for the rest of their original rental period. They did this under a new rental agreement that the law said the government had given them. The question was: could the company force the government to renew their lease, as the original agreement allowed? The court decided: The government did not have to honor the original renewal agreement after taking over the property. (1) The original rental agreement ended when the government took over the property. The law created a new rental agreement for the rest of the original term, with the same rules as before. But the option to renew the lease was just a part of the overall agreement about the land. It didn't give the company any actual ownership of the land. Because it was like a debt or claim on the land, it was canceled when the government took over. The government now owned the land without having to honor the renewal clause. The court agreed with a previous case, *The State of Bihar vs Indian Copper Corporation Ltd.* (2) There were also mining rules (Mineral Concession Rules of 1949) that said someone renting land for mining could renew their lease at least once, for a period no longer than the original lease. But these rules only apply to agreements made directly by the government, not to the new agreements created by the law. So, the rule doesn't apply here. Even if it did, the length of the "original lease" in this case would only be from when the government took over to when the original lease was supposed to end. That period, for which the company could have asked for a renewal, ended many years ago.
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Case :- CRIMINAL MISC. BAIL APPLICATION No. - 27194 of 2021
Opposite Party :- State of U.P.
1-Today, when the case is taken up, Mr. Ram Ker Singh, learned
counsel, (Enrollment No. UP 4309 of 1980, Advocate Roll No.
Court Allahabad, Mobile Nos. 9451302056 and 9807344717), has appeared
in this case on behalf of the applicant, whereas Mr. Hausila Prasad, learned
Hall IInd Floor, High Court, Allahabad, resident of 475 Rajapur, near police
booth, Prayagraj, 211001) has appeared on behalf of opposite party No.
2/informant, Gurdeep Verma, who is father of the victim/prosecutrix aged
about 15 years.
2-Learned counsel for the applicant after advancing his argument at
some length, stated that Mr. Hausila Prasad, learned counsel for the
informant/complainant also has no objection in granting bail to the
applicant. On being enquired by this Court, Mr. Hausila Prasad, learned
Advocate did not oppose the submissions of learned Counsel for the
applicant. In the meantime, Mr. Vivek Kumar Singh, learned Advocate
(Enrollment No. A/V-0571/2012, U.P.B.C. No. 2590 of 1998, Mobile No.
9412207892) appeared in this case and by raising a preliminary objection,
apprised the Court that in fact only he has the instructions on behalf of
informant, Gurdeep Verma S/o Heman Verma, resident of Mohalla Sarai
Gosain, police station Kotwali City, district Bulandshahr and not Mr.
Hausala Prasad, Acvocate, who has filed forged Vakalatnama on behalf of
the informant. He also pointed out that Mr. Hausila Prasad, Advocate has
filed his Vakalatnama on 26th of July, 2021 through E-mode in collusion
with Mr. Ram Ker Singh, learned counsel for the applicant only to obtain
bail by hook or crook and in fact the said Vakalatnama is a forged document,
whereas the fact is that the informant/complainant, Gurdeep Verma has not
engaged him.
3-When Mr. Hausila Prasad was confronted with the submissions of
Mr. Vivek Kumar Singh, Advocate that he has instructions on behalf of the
informant/complainant, Mr. Hausila Prasad, learned Advocate stated at the
bar that the said Vakalatnama has been provided to him by Mr. Ram Ker
Singh, learned counsel for the applicant. It is also submitted by Mr. Hausila
Prasad that he is associated with Mr. Ram Ker Singh, learned counsel
appearing for the applicant. It is further submitted that his fee to appear in
this case on behalf of the informant has also been given by Mr. Ram Ker
Singh, learned counsel for the applicant. He was engaged by Mr. Ram Ker
Singh, for the reason that the Hon'ble Court may not issue the notices to the
informant/complainant, Gurdeep Verma and victim of this case, because the
present matter pertains to offence under Section 376(2)(i), 506 IPC and 3/4
Protection of Children from Sexual Offences Act, registered as Case Crime
No. 434 of 2021 at police station Kotwali Nagar, district Bulandshahr and
grant bail to the applicant.
4-From the aforesaid statements made by Mr. Hausila Prasad, learned
Advocate at the bar, who has appeared in this case on behalf of
informant/complainant, it is ostensibly clear that forged Vakalatnama has
been filed on behalf of informant/complainant to surreptitiously obtain bail.
Hard copy of the aforesaid "Vakalatnama" in question is made part of the
5-At this stage, Mr. Hausila Prasad learned counsel has tendered his
unconditional apology by stating that in future he will take care of such
things and will not repeat such mistake in future and also stated that he
wants to withdraw his aforesaid Vakalatnama, whereas Mr. Ram Ker Singh,
learned counsel did not tender his apology and stated at the bar that it is not
a new thing but it is a common practice in the High Court. This statement of
Mr.Ram Ker Singh advocate is very shocking and painful to the conscious
which creates a stir compelling one to ponder over the matter. The conduct
of Mr. Ram Ker Singh and Mr. Hausila Prasad, Advocates who are having a
long standing experience of more than 40 years and 26 years of the practice
respectively, is highly deplorable. This Court denounces/condemns the
conduct of both the Advocates as they made effort to tarnish the image of
noble profession of advocacy.
6-It is very painful to see the downfall in moral values of noble legal
profession. In the legal field, professional ethics are a fundamental
requirement, because it is an important tool that establishes rule of law and
keeps the legal profession and the legal institutions on a high pedestal. In the
legal profession, in order to maintain the sanctity of faith between the Bar
and the Bench, ethics are important factor, which contains the elements of
discipline, fairness, trust, moral values, help to colleagues, respect and
responsibilities, etc. It creates confidence between the Bar and the Bench.
Lawyers play a crucial role in justice delivery system and in my view,
professional ethics are the back bone of legal profession, which is self
regulating profession and it is moral duty of the Bar and the Bench both to
maintain the sanctity of legal profession and the institution.
7-Vakalatnama is a valuable document in legal profession, which
empowers a lawyer to act for or on behalf of his client. Sometimes it confers
wide authority/power upon a lawyer, therefore in the opinion of this Court,
"Vakalatnama" must be beyond the shadow of any doubt.
8-Since, Mr. Hausila Prasad learned advocate realizing his mistake has
accepted his guilt before the Court, therefore, this Court is not taking any
action against him and on his request, he is permitted to move an appropriate
application to withdraw his Vakalatnama from this case, whereas Mr. Ram
Ker Singh, learned counsel for the applicant, who had provided forged
Vakalatnama of the informant and had also given fee to Mr. Hausila Prasad,
as per disclosure made by him, neither tendered an oral apology nor did he
feel regret on his conduct. Under the facts and circumstances of the case, this
Court can not act as a silent spectator and has no option left, except to refer
the issue of filing the forged Vakalatnama of the informant as mentioned
above to the Bar Council of Uttar Pradesh for taking appropriate
action/decision in the matter.
9-The issue of filing a forged Vakalatnama of any person in a Court
proceeding is not a small one but it is serious issue, because it may adversely
affect the valuable legal right and interest of the persons/litigants concerned,
ergo keeping in view, the larger interest of the litigants/victims,complainants
or aggrieved persons specially in criminal matters and members of the bar,
who believe in professional ethics, this Court feels that now it is high time to
adopt some remedial measures, so the litigants or aggrieved persons are not
deprived of their legal rights. This Court proposes that along with
Vakalatnama, self attested copy of any identity proof (preferably Aadhar
Card) mentioning mobile number of the person concerned should also be
filed or any other method may be adopted in the interest of litigants and the
10-In view of above, the following directions are issued:-
(i)-Let a copy of this order be placed before the Registrar General of
this Court within a week, who shall forward the certified copy of this
order to the Chairman, Bar Council of Uttar Pradesh within two weeks
thereafter for taking appropriate action/decision in the matter in accordance
with law.
(ii)-The copy of this order be circulated to all the Hon'ble sitting
judges of this Court as well to the president, Allahabad High Court Bar
Association and Advocates' association.
(iii)-The aforesaid proposal as mentioned in paragraph no. 9 of this
order, be placed by the Registrar General before Hon'ble the Acting Chief
Justice for necessary directions in the matter.
(iv)-A notice be issued to the informant/opposite party No. 2, Gurdeep
Verma through Chief Judicial Magistrate concerned, who will ensure service
of notice upon the informant/opposite party No. 2 and submit report by the
next date fixed in the matter.
11-Let this case be listed on 7th of September, 2021 before the
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In a bail hearing at the Allahabad High Court, it came out that the lawyers for the person accused of a crime and the person making the complaint (the complainant) were secretly working together. The lawyer for the accused had created a fake document called a 'vakalatnama' for the complainant's lawyer. A vakalatnama is a legal paper that allows a lawyer to officially represent someone in court. This fake document was used so the complainant's lawyer would say they had no problem with the accused getting bail, which means being temporarily released from jail. Justice Sanjay Kumar Singh said that this action by experienced lawyers was very shameful and hurt the honesty of the legal job and the court system. As a way to fix this, the Court suggested that people should also file a copy of an ID, like an Aadhar Card, that they have signed themselves, along with their mobile number, when they file a vakalatnama. After arguing for the accused person, Advocate Ram Ker Singh told the Court that the complainant agreed to the bail. Mr. Hausila Prasad, who claimed to represent the complainant, also said there was no objection to giving bail. However, Advocate Vivek Kumar Singh, who was actually hired by the complainant, then stepped in. He told the Court that Advocate Hausala Prasad had filed a fake vakalatnama and that the real complainant had not hired him. He explained that this fake document was filed online on July 26, 2021. He argued that Advocate Prasad and Mr. Ram Ker Singh, the lawyer for the accused, worked together to get bail by any means possible. When the Court questioned Advocate Prasad, he admitted that Mr. Ram Ker Singh, the accused's lawyer, had given him the fake vakalatnama. He also said he worked with Mr. Singh and that Mr. Singh paid his fees to appear in court. He admitted they did this so the Court would not have to officially notify the real complainant. This was important because the case involved very serious charges, including sexual offenses against children. The Court clearly saw that a fake vakalatnama had been filed on behalf of the complainant to get bail secretly and dishonestly.
Mr. Prasad completely apologized. He promised to be more careful and not make such mistakes again. He also said he wanted to take back his vakalatnama from the case. But Mr. Ram Ker Singh, the lawyer for the accused, did not apologize. He simply said that this kind of thing was a common practice at the High Court. The Court was shocked by Mr. Singh's statement. It found his comment deeply troubling and something that made one think seriously about the issue. The Court strongly criticized this action. It said that such behavior by experienced lawyers was completely wrong and an attempt to ruin the good name of the law profession. The Court also felt it was very sad to see a decline in the moral values of the noble law profession. It stated that good professional behavior, or ethics, is a basic need in the legal field. Ethics help establish the rule of law and keep the legal profession and the courts highly respected. The Court stressed the importance of trust between lawyers and judges. It noted that ethics are key and include things like discipline, fairness, trust, moral values, helping colleagues, respect, and responsibilities. The Court said: "Ethics build trust between lawyers and judges. Lawyers are vital to how justice is delivered. In my view, professional ethics are the core of the legal profession, which governs itself. It is the moral duty of both lawyers and judges to maintain the honesty of the legal profession and the court system." The Court explained that a vakalatnama must be completely trustworthy. It is a very important document that gives a lawyer the power to act for their client, sometimes giving them wide authority. Because Advocate Prasad realized his mistake and admitted his guilt, the Court did not punish him. He was allowed to file a request to withdraw his vakalatnama from the case. However, Advocate Singh, who provided the fake vakalatnama for the complainant and paid Advocate Prasad, did not apologize or show any regret for his actions. The Court said it could not just stand by and do nothing. So, it sent the matter to the Bar Council of Uttar Pradesh, which is the body that oversees lawyers, to decide what action to take.
The Court also noted that filing a fake vakalatnama in court is a serious problem. It can affect the important legal rights and interests of the people involved in a case, like victims or complainants. So, considering the greater good of these people, especially in criminal cases, and lawyers who believe in good ethics, the Court said it was "high time" to make changes. This would ensure that people do not lose their legal rights. Following this, the Court suggested that along with a vakalatnama, a self-signed copy of any ID (preferably an Aadhar Card) that includes the person's mobile number should also be filed. The Court also said other methods could be used to help protect the people involved in cases and the court system. Javed Ansari v. State of Uttar Pradesh
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224 and 225 of 1954. Both these appeals are directed against the judgment of the High Court of Nagpur passed in an appeal under section 19(1) (f) of the Defence of India Act, 1939, hereinafter referred to as the Act. 224 of 1954. As there was no agreement on the amount of compensation payable to him, the Central Government referred the determination thereof to Mr. Jafry, Additional District Judge, Khandwa, under section 19(1) (b) of the Act. Against this award, there was an appeal to the High Court of Nagpur under section 19(1) (f) of the Act, and that was heard by a Bench consisting of Grille C. J. and Padhve J. By their judgment dated December 31, 1947, they enhanced the annual rent payable to the appellant by a sum of Its. The appellant applied for leave to appeal against this judgment to the Federal Court under sections 109 and I 10 of the Code of Civil Procedure in respect of the amounts disallowed. On August 25, 1949, both these applications were granted, and a certificate was issued that the appeals fulfilled the requirements of sections 109 and 110 of the Code of Civil Procedure. Hanskumar Kishanchand is the appellant in Civil Appeal No. 224 of 1954 and the Union of India, in Civil Appeal No. 225 of 1954. At the opening of the hearing, a preliminary objection was taken by the learned Solicitor General to the maintainability of Civil Appeal No. 224 of 1954 on the ground that the judgment of the High Court passed in appeal under section 19(1) (f) was an award and not a judgment, decree or order within the meaning of sections 109 and 110 of the Code of Civil Procedure, and that accordingly the appeal was incompetent. any action is taken of the nature decribed in sub section (2) of section 299 of the Government of India Act, 1935, there shall be paid compensation, the amount of which shall be determined in the manner, and in accordance with the principles, hereinafter set out. Section 19(1) (a) provides for the amount of compensation being fixed by agreement, and section 19(1) (b) enacts that : " Where no such agreement can be reached, the Central Government shall appoint as arbitrator a 1181 person qualified under sub section (3) of section 220 of the above mentioned Act for appointment as a Judge of a High Court. " Then comes sub section (f), which is important for the present purpose, and it is as follows: "An appeal shall lie to the High Court against an award of an arbitrator except in cases where the amount thereof does not exceed an amount prescribed in this behalf by rule made by the Central Government. " On these provisions, the contention on behalf of the Government is that the reference under section 19(1),(b) and the appeal under section 19(1) (f) are all arbitration proceedings, that the decision of the High Court in the appeal is really an award, and that it is, in consequence, not appealable under sections 109 and 110 of the Code of Civil Procedure, as they apply only to judgments, decrees or orders of Courts and not to awards. Mr. Achbru Ram, learned counsel for the appellant does not dispute that the proceedings under section 19(1) (b) are by way of arbitration, but he contends that when once the matter comes before the High Court by way of appeal under section 19(1)(f), it becomes a civil proceeding under the ordinary jurisdiction of the Court, and that any decision therein is open to appeal under sections 109 and I 10 of the Code of Civil Procedure. 29 of the Letters Patent, and that, 1182 the certificate granted by the High Court is under that provision as well. When parties enter into an agreement to have their dispute settled by arbitration, its effect is to take the lis out of the hands of the ordinary Courts of the land and to entrust it to the decision of what has been termed a private tribunal. Such an agreement is not hit by section 28 of the Contract Act as being in restraint of legal proceedings, because section 21 of the Specific Relief Act expressly provides that " save as provided by the , no contract to refer present or future differences to arbitration shall be specifically enforced ; but if any person who has made such a contract . There is a similar provision in section 28 of the Contract Act which is applicable, where the is not in force. Where an arbitration is held in pursuance of such an agreement and that results in a decision, that decision takes the place of an adjudication by the ordinary Courts, and the rights of the parties are thereafter regulated by it. It is true that under the law the Courts have the authority to set aside the award, , made by arbitrators on certain grounds such as that they are on matters not referred to arbitration, or that the arbitrators had misconducted themselves, or that there are errors apparently the face of the award. But where the award is not open to any such objection, the Court has to pass a decree in terms of the award, and under section 17 of the , an appeal lies against such a decree only on the ground that it is in excess of, or not otherwise in accordance with the award. In other words, it is the decision of the arbitrator where it is not set aside that operates as the real adjudication binding on the parties, and it is with a view to its enforcement that the, Court 'is authorised to pass a decree in terms thereof. There is thus a sharp distinction between a 1183 decision which is pronounced by a Court in a cause which it hears on the merits, and one which is given by it in a proceeding for the filing of an award. The former is a judgment, decree or order rendered in the exercise of its normal jurisdiction as a Civil Court, and that is appealable under the general law as for example, under sections 96, 100, 104, 109 and 110 of the Code of Civil Procedure. The latter is an adjudication of a private tribunal with the imprimatur of the Court stamped on it, and to the extent that the award is within the terms of the reference, it is final and not appealable. The position in law is the same when the reference to arbitration is made not under agreement of parties but under provisions of a statute. That decision is an award, and stands on the same footing as an award made on reference, under agreement of parties. It is for this reason that section 46 of the X of 1940 enacts that: " The provisions of this Act, except subsection (1) of section 6 and sections 7, 12, 36 and 37 shall apply to every arbitration under any other enactment for the time being in force, as if the arbitration were pursuant to an arbitration agreement and as if that, other enactment were an arbitration agreement; except in so far as this Act is inconsistent with that, other enactment or with any rules made thereunder. " In that case, the Court hears the matter not as a Civil Court but as persona designata, and its decision will be an award not open to appeal under the ordinary law applicable to decisions of Courts. A statute, however, might provide for the decision of a dispute by a Court as Court and not as arbitrator, in which ease, its decision will be a decree or order of Court in its ordinary civil jurisdiction, and that will attract the normal procedure governing the decision of that Court, and a right of appeal will be comprehended therein. The position therefore is that if the 1184 reference is to a Court as persona designata, its decision will not be open to appeal except to the extent that the statute so provides; but that if, on the other hand, it is to a Court as Court, its decision will be appealable under the general law, unless there is something in the statute, which abridges or takes away that incident. It may be a question whether the reference to a Court under a particular statute is to it as a Court or as persona designata ; but when once it is determined that it is to it as persona designata, there call be no question that its decision is not open to appeal under the ordinary law. We shall now consider the authorities hearing on the question. wala (3), Manavikraman Tirumalpad vs The Collector of the Nilgris (4) and Secretary of State for India in Council vs Hindusthan Co operative Insurance Society Limited (5) were relied on as supporting the contention that the present appeals are incompetent. In Rangoon Botatoung Company vs The Collector, Rangoon (1), the facts were that certain properties had been acquired tinder the Land Aequistion Act of 1894, and the Collector had determined the amount of compensation payable to the quondam owners. On their objection as to the quantum of compensation, the matter was referred to the decision of the Chief Court of Burina. A pre limilary objection was taken to the maintainability of the appeal on the ground that the decision sought to be appealed against was not a judgment of Court but an award and was therefore not appealable. 1185 suggestion that when once the claimant is admitted to the High Court he has all the rights of an ordinary suitor, including the right to carry an award made in an arbitration as to the value of land taken for public purposes up to this Board as if it were a decree of the High Court made in the course of its ordinary jurisdiction. " Shortly after this judgment was pronounced, the question arose for determination in The special officer, Salsette Building Sites vs Dossabhai Bezonji (1), whether a decision given by the High Court in appeal under section 54 of the Land Acquisition Act was a judgment within Cl. The applicant sought to distinguish the decision in Rangoon Botatoung Company vs The Collector, Rangoon (2) on the ground that there, the decision sought to be appealed against was that of the Chief Court of Burma, and the question of maintainability fell to be decided on the terms of the, Code of Civil Procedure, whereas in the instant case, the party had a right to appeal to the Privy Council under Cl. In rejecting this contention, the High Court referred to the observations in Rangoon Botatoung Company 's Case (2) already quoted, and observed " This passage shows that it is a mistake to suppose that the award made in such a case by the High Court is a decree within the ordinary jurisdiction to which the Civil Procedure (" 'ode refers; and it seems to me it would be equally erroneous to regard such an award as a final judgment or order within the meaning of clause 39 of the Letters Patent. " 1186 Niligris(1) the question was whether a judgment of the High Court passed in an appeal under the Land Acquisition Act was a judgment within the meaning of Cl. 15 of the Letters Patent so as to entitle a party to file a further appeal to the High Court under that provision, and it was held, on a consideration of the authorities above referred to, that it was not. Under that Act, there is a tribunal constituted for determining the amount of compensation payable on acquisition of land, and under the Calcutta Improvement (Appeals) Act, 1911, an appeal is provided in certain cases from the decision of the tribunal to the Calcutta High Court. The point that arose for determination was whether the decision given by the High Court in appeal under this provision was open to further appeal to the Privy Council. In answering it ill the negative, the Privy Council observed that in view of the decision in Rangoon Botatoung Company vs The Collector, Rangoon (3), there could be no right of appeal against the decision of the High Court. It further held that this conclusion was not affected by the amendment of the Land Acquisition Act, 1921, providing for an appeal to the Privy Council against the decision of the High Court under section 54 of that Act, as that amendment could not be held to have been incorporated by reference in the Calcutta Improve ment Act, 1911. The law as laid down in the above authorities may thus be summed up: It is not every decision given by a Court that could be said to be a judgment, decree or order within the provisions of the Code of Civil Procedure or the Letters Patent. Where the dispute is referred to the Court for determination by way of arbitration as in Rangoon Botatoung Company vs The Collector, Rangoon (3), or where it comes (1) Mad. 1187 by way of appeal against what is statedly an award as in ' The Special Officer, Salsette Building Sites vs Dossabhai Bezonji (1), Manavikraman Tirumalpad vs The Collector of the Nilgris (2) and Secretary of State for India in Council vs Hindusthan Co operative Insurance Society Limited (3) then the decision is not a judgment, decree or order under either the Code of Civil Procedure or the Letters Patent. Section I thereof enacted that certain differences between the Postmaster General and any other person should, if the parties agreed, be referred for decision to the Railway and Canal Commission constituted under an Act of 1888 ; and section 2 provided that all enquiries under the reference should be conducted by the Commission in accordance with the Act of 1888. Under the Act of 1888, the Commission was constituted a Court of record and an appeal lay against its decision to the Court of Appeal except on questions of fact and locus standi. It was held by the House of Lords that as under the Act of 1888 the reference to the Commission was to it as a Court, the reference under the Telegraph (Arbitration) Act, 1909, to that tribunal must also be held to be to it as a Court and not as a body of arbitrators, and an appeal against its decision was therefore competent. (4) 151 1188 It may be noted that it was the use of the word " arbitration " in the title to the Act that furnished the ground for the contention that the proceedings before the Commission were of the nature of arbitration. In fact, there was no element of arbitration in the proceedings. It is true that under that Act there could be a reference only by agreement of parties. That, however, could not make any difference in the character of the proceedings before the Commission, as a statute can provide for the jurisdiction of the Court being invoked as a Court on the agreement of parties, as for example, on a case stated under Order 36 of the Code of Civil Procedure. There is thus nothing in National Telephone Company Limited vs Postmaster General (1), which can be said to conflict with the law as laid down in Rangoon Botatoung Company vs The Collector, Rangoon. (2) that when the reference is to a Court as arbitrator, its decision is not open to appeal. The distinction between the two classes of cases, where the reference is to court as court and where the reference is to it as arbitrator, was again pointed out by the Privy Council in Secretary of State for India vs Chelikani Rama Rao (3). The point for decision was whether the decision of the District Court was open to further appeal under the provisions of the Code of Civil Procedure. The contention was that the reference to the District Court under the Act was to it not as a Court but as arbitrator, and that therefore its decision was not open to appeal on the principle laid down in Rangoon Botatoung Company 's Case In repelling this contention, (1) (2) (1912) L.R. The claim was " he said, " the assertion of a legal right to possession of and property in land; and if the ordinary Courts of the country are seized of a dispute of that character, it would require, in the opinion of the Board, a specific limitation to exclude the ordinary incidents of litigation" The principles being thus well settled, we have to see in the present case whether an appeal to the High Court under section 19(1)(f) of the Act comes before it as a Court or as arbitrator. And under the law, no appeal would have lain to the High Court against the decision of such an arbitrator. Thus, the provision for appeal to the High Court under section 19(1)(f) can only be construed as a reference to it as an authority designated and not as a Court. Then again, the decision of the arbitrator appointed under section 19(1)(b) is expressly referred to in section 19(1)(f) as an award. Now, an appeal is essentially a continuation of the original proceedings, and if the proceedings under section 19(1)(b) are arbitration proceedings, it is difficult to see how their character can suffer a change, when they are brought up before an appellate tribunal. The decisions in The Special Officer, Salsette Building Sites vs Dossabhai Bezonji (1), The Special Officer, Salsette Building Sites vs Dassabhai Basanji Motiwala (2), Manavikraman Tirumalpad vs The Collector of the Nilgris (3) and Secretary of State for India in Council vs Hindusthan Co operative Insurance Society Limited (4) proceed all on the view that an appeal against an award continues to be part of, and a (1) Bom. and it was held by them that the word "arbitration" in section 19(1)(g) of the Act covered the entire proceedings from their com mencement before the arbitrator to their termination in the High Court on appeal where an appeal had been preferred, and the High Court in hearing and deciding the appeal acted essentially as an arbitration tribunal. We agree with this decision that the appeal under section 19(1) (f) is an arbitration proceeding. We must therefore hold that the decision of the High Court in the appeal under that provision is not a judgment, decree or order either within sections 109 and I 10 of the Code of Civil Procedure or cl. 39 of the Letters Patent of the Calcutta, Madras and Bombay High Courts, and that, therefore, the present appeals are incompetent. Mr. Achbru Ram finally contended that even if no appeal lay under sections 109 and 110 of the Code of Civil Procedure or cl. He argued that the Privy Council had the power to grant leave to appeal against the decision of the Nagpur High Court in the appeal under section 19(1) (f), that under section 3(a)(ii) of the Federal Court (En. it is sufficient answer to this contention that the Federal Court had power under section 3(a) (ii) to grant leave only when the proposed appeal was against a judgment, and that, under the definition in section 2(b), meant a judgment, decree or order of a High Court in a civil case; and that on our conclusion that the decision in the appeal under section 19(1) (f) is not a judgment, decree or order but an award, no order could have been passed granting special leave under section 3(a) (ii).
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These two appeals were made against the Nagpur High Court's decision. That court was hearing an appeal related to the Defence of India Act of 1939, specifically section 19(1)(f). This section deals with changes to compensation awards made under section 19(i)(b) of that same Act. The compensation was for property the government took over under Rule 75(A) of the rules created under the Act. Both sides asked for and received permission to appeal to the Federal Court. They used sections 109 and 110 of the Code of Civil Procedure to do this. The government argued that the High Court's decision wasn't a judgment or order, but an award. According to the government, this meant sections 109 and 110 of the Code didn't allow for an appeal. The court agreed with the government, so both appeals were dismissed. The court said that an appeal to the High Court under section 19(1)(f) of the Defence of India Act is like an arbitration. Arbitration is when a neutral third party helps resolve a dispute. Therefore, the decision in such an appeal couldn't be a judgment or order under the Code of Civil Procedure or the Nagpur High Court's rules. The court agreed with the decision in *Kollegal Silk Filatures Ltd. vs province, of Madyas*. There's a clear difference between a court's decision in a regular case and its decision when it's just filing an award. The first type of decision is a judgment or order that can be appealed under normal laws. The second type is like a private person's decision that the court approves. If it follows the original agreement, it's final and can't be appealed. There's no legal difference between arbitration agreed to by the parties and arbitration required by a law. When a law sends a case to a court for arbitration, it can do so in two ways. It can send it to the court as a regular court, or as an arbitrator. If it's sent to the court as a regular court, the decision is a judgment or order that can be appealed, unless the law says otherwise. But if the court acts as an arbitrator, its decision is an award. Awards can't be appealed under normal laws, only under the specific law and to the extent it allows. An appeal is a continuation of the original case. If the case started as an arbitration, it stays that way even if the law allows an appeal. The court cited several cases to support this: *Rangoon Botatung Company vs The Collecter*, *The special officer sales the building sites Dassabhai Beznoji*, *the special officer sales the Building sites vs Dassabhai Bozanji Motiwala Manavikram Tirumalpad vs the Collector of the Nilagrie*, and *secretary of state for India in council vs Hindustan Co operative Insurance society Limited*. The court also discussed the case of *National Telephone Company Limited vs Postmaster General*.
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The present appeal is directed against an order
passed by the National Consumer Disputes Redressal
Commission [in short, “NCDRC”] in R.P. No. 170 of
2006 on 21.10.2009, whereby the revision against an
order of the State Dispute Redressal Commission
dismissing the complaint was upheld.
The appellant is the brother-in-law of one Kiran
Srivastava, who was four months’ pregnant when she
was taken for treatment to the clinic of the
respondent on 22.12.2001. It is not necessary to
examine the allegations on merits, however, the
question required to be examined is as to whether the
appellant could file a complaint in respect of
deficiency in service on part of the respondent
regarding the treatment given to his sister-in-law
The argument of the appellant is that his brother
is a Constable and, therefore, the appellant had
availed the services for consideration on behalf of
his sister-in-law, being the Karta of Joint Hindu
Family. Therefore, the complaint on his behalf would
be maintainable.
A ‘complainant’ is defined under Section 2(1)(b)
of the Consumer Protection Act, 1986, whereas a
‘consumer’ is defined under Section 2(1)(d) of the
“(b) "complainant" means -
(ii) any voluntary consumer association
registered under the Companies Act, 1956 (1 of
1956) or under any other law for the time
(iii) the Central Government or any State
(iv) one or more consumers, where there are
numerous consumers having the same interest;
(v) in case of death of a consumer, his legal
heir or representative; who or which makes a
(d) "consumer" means any person who—
(ii) hires or avails of any services for a
consideration which has been paid or promised
or partly paid and partly promised, or under
any system of deferred payment and includes any
beneficiary of such services other than the
person who [hires or avails of] the services
for consideration paid or promised, or partly
paid and partly promised, or under any system
of deferred payment, when such services are
availed of with the approval of the first
mentioned person [but does not include a person
who avails of such services for any commercial
purpose]”
Learned counsel for the appellant relied upon two
judgments of this Court reported as (1998) 4 SCC 39 -
Anr., and (2020) 3 SCC 455 - Canara Bank Vs. United
India Insurance Company Ltd. and Ors. We have heard
the learned counsel for the parties and find no merit
in the present appeal.
A consumer as mentioned above, means any person
who hires or avails of any services for a
consideration which has been paid or promised or
partly paid and partly promised and includes a
beneficiary of services. The brother-in-law of a
pregnant woman would not be a beneficiary of any
services rendered by the respondent. There is no
allegation that he has paid or promised any
consideration for engaging the services of the
respondent. The only assertion in the complaint is
that he is the ‘Karta’ of a Joint Hindu Family,
therefore, he is entitled to file a complaint on
account of the alleged deficiency of service by the
respondent. Spring Meadows (supra) was a case of
medical negligence in respect of a child. It was the
parents of the child, who had filed a consumer
complaint, which was found to be maintainable in terms
of Section 2(1)(d)(ii). This Court held as under :-
“12. In the present case, we are concerned
with clause (ii) of Section 2(1)(d). In the
said clause a consumer would mean a person
who hires or avails of the services and
includes any beneficiary of such services
other than the person who hires or avails of
the services. When a young child is taken to
a hospital by his parents and the child is
treated by the doctor, the parents would come
within the definition of consumer having
hired the services and the young child would
also become a consumer under the inclusive
definition being a beneficiary of such
services. The definition clause being wide
enough to include not only the person who
hires the services but also the beneficiary
of such services which beneficiary is other
than the person who hires the services, the
conclusion is irresistible that both the
parents of the child as well as the child
would be consumer within the meaning of
Section 2(1)(d)(ii) of the Act and as such
can claim compensation under the Act.”
Further, Canara Bank (Supra) was a case arising
out of a claim on account of fire in the cold
storage, which was used to store the crop of the
farmers. It was, in these circumstances, it was
held that the complaint on behalf of the farmers,
who were the beneficiaries, was maintainable. This
“29. The definition of ‘consumer’ under
the Act is very wide and it includes
beneficiaries who can take benefit of the
insurance availed by the insured. As far as
the present case is concerned, under the
tripartite agreement entered between the
Bank, the cold store and the farmers, the
stock of the farmers was hypothecated as
security with the Bank and the Bank had
insisted that the said stock should be
insured with a view to safeguard its
interest. We may refer to the penultimate
clause of the tripartite agreement which
“WHEREAS the Third Party has agreed
to insure the produce/goods stored in
the cold storage to indemnify the
produce in case of any casualty or
accident by any means to cover the
risk and also to cover the loan
amount to avoid loss at the cost of
the Second Party till the release
order or repayment of the loan
amount.”
30. The aforesaid clause in
unambiguous terms binds the cold store
to insure the goods, to indemnify the
produce, to cover the risk and cover the
loan amount. This insurance policy has
to be taken at the cost of the second
party which is the farmer. Therefore,
there can be no manner of doubt that the
farmer is a beneficiary under the
policy. The farmer is, therefore,
definitely a consumer and we uphold the
orders of both the Commissions that the
complaint under the Act is
maintainable.”
The appellant herein is the ‘Karta’ of a Joint
Hindu Family. He cannot be said to be availing the
services of a medical practitioner in respect of the
pregnancy of his sister-in-law. The concept of
Joint Hindu Family does not extend to the treatment
of a pregnant sister-in-law. It is needless to
mention that no objection regarding maintainability
of complaint was raised either before the State
Commission or the National Commission, but such
issue of maintainability of the complaint goes to
the root of the case and we have found it to be non-
maintainable on the bare assertions of the complaint
alone. We find that the complaint itself was not
maintainable and, therefore, the present appeal is
dismissed.
There shall be no order as to costs.
Pending interlocutory application(s), if any,
is/are disposed of.
Date : 15-09-2021 This appeal was called on for hearing today.
UPON hearing the counsel the Court made the following
The appeal is dismissed in terms of the signed order.
Pending interlocutory application(s), if any, is/are disposed
(Signed order is placed on the file)
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The Supreme Court ruled that a Karta cannot file a consumer complaint about poor service from a hospital or doctor. This was regarding the medical treatment given to his pregnant sister-in-law. A Karta is the head of a traditional Indian family, known as a Joint Hindu Family.
The judges who heard the case, Justices Hemant Gupta and V. Ramasubramanian, made a clear point. They said the idea of a Joint Hindu Family does not include medical care for a pregnant sister-in-law.
In this specific case, the Karta filed a consumer complaint against a medical clinic. He claimed the clinic provided poor service for his pregnant sister-in-law, Kiran Srivastava. In his complaint, he stated he paid for these services for her because he was the Karta of their Joint Hindu Family. A lower consumer court, the National Consumer Disputes Redressal Commission, had already dismissed his complaint. That decision was then supported.
The judges looked at the rules in the Consumer Protection Act of 1986. They explained that a "complainant" is any person who hires or uses services and pays for them, or promises to pay, whether fully, partly, or in a combination. This also includes anyone who benefits from those services.
The court decided that a pregnant woman's brother-in-law does not directly benefit from her medical services. Also, there was no claim that he paid for or promised to pay for the clinic's services. His only argument in the complaint was that as the Karta, he had the right to complain about the clinic's claimed poor service.
The court further emphasized that the concept of a Joint Hindu Family does not include medical care for a pregnant sister-in-law.
The person who brought the appeal (the Karta) is the head of a Joint Hindu Family. However, he could not be considered someone directly using a doctor's services for his sister-in-law's pregnancy. The judges again noted that the idea of a Joint Hindu Family does not cover medical treatment for a pregnant sister-in-law.
The court decided that the question of whether the complaint was legally valid was a fundamental problem for the entire case. Because of this, the appeal was dismissed.
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N THE HIGH COURT OF DELHI AT NEW DELHI Date of Decision: 23rd January, 2025 + CONT.CAS. (CRL) 13/2024 COURT ON ITS OWN MOTION .....Petitioner Through: Mr. Rajiv Nayar, Sr. Adv, Mr. Dayan versus ROOP DARSHAN PANDEY AND ORS. .....Respondents JUSTICE PRATHIBA M. SINGH JUSTICE AMIT SHARMA Prathiba M. Singh, J. (Oral) 1. This hearing has been done through hybrid mode. Background 2. The present contempt reference arises out of the order dated 28th October, 2024 passed by a ld. Single Judge of this Court in CRL.M.C. 5587/2024 titled as Vijay Srivastava & Anr. v. State NCT of Delhi & Anr. The said CRL.M.C. was filed by Shri Vijay Srivastava and Hero Moto Corp. Ltd. challenging the order dated 19th July, 2023 passed in Complaint Case No.187/2024 wherein the ld. Judicial Magistrate directed registration of FIR against the Petitioner. The said complaint was filed on 21st July, 2024, by the contemnor Shri Roop Darshan Pandey, who was a director of Brain Logistics Pvt. Ltd. (hereinafter referred as 'BLPL'). Dispute between BLPL/Roop Darshan Pandey with Hero Moto Corp. Ltd. 3. The dispute between the contesting parties emanated out of a jobs contract dated 1st October, 2001 signed with BLPL, for providing manpower services at the spare parts division of the Petitioner company, which at the relevant point of time was referred as Hero Honda Motors Ltd. ('HHML') and now known as Hero MotoCorp Ltd. (hereinafter referred as 'HML'). The said contract was terminated on 30th March, 2010, on account of relations turning sore between the parties. The said agreement dated 1st December, 2005 contained an arbitration clause 24. The same was invoked by BLPL, by issuing notice dated 27th April, 2010. The Petitioner also changed their name from Hero Honda Motors Ltd. to Hero MotoCorp Ltd sometime in the year 2011.
4. Late Hon'ble Justice H.S. Bedi (Retd.) of the Supreme Court was appointed as the Sole Arbitrator for adjudication of the disputes between the parties on 27th April, 2012. The ld. Sole Arbitrator had rendered the award dated 20th May, 2018, which has been challenged before the Punjab & Haryana High Court. Vide the said arbitral award ld. Arbitrator awarded to BLPL, a sum of Rs.70,00,000/- towards short payments and interest @6% p.a. from April, 2010+Rs.1,25,000/- service charge along with interest @6% p.a. from March, 2010. 5. This contractual dispute, however, has unfolded into a plethora of criminal cases between the parties. Various allegations were raised by BLPL against HML and its officials. Various FIRs were sought to be registered raising allegations related to certain documents and certain PF issues. One such criminal complaint filed by BLPL against the company is Complaint Case No.187/2024. In the said case, vide order dated 19th July, 2024, the ld. Magistrate, Karkardooma Court directed registration of FIR within three days. The said order was passed on Friday and the FIR was to be registered on Monday i.e., on 22nd July, 2024. 6. The company HML and one of its officials filed a petition for quashing being CRL.M.C.5587/2024 before this Court. In view of the urgency that an FIR would be registered in three days, the petition was sought to be mentioned for urgent listing by counsel for the Petitioners. Advance intimation of the same was given by an email on 22nd July, 2024 itself in the morning that the matter would be mentioned. Considering the advocate on record in the matter, the matter could not have been mentioned before the extant DB-I and the mentioning is stated to have been done before DB-II. Once mentioning was done, the Court (DB-II) had allowed the listing of the matter on the same day subject to office objections.
7. On 22nd July, 2024, notice was issued in CRL.M.C.5587/2024 and an interim order was also passed by which the order of the ld. Magistrate dated 19th July, 2023 was stayed. The relevant portion of the order has been extracted below: "1. Matter has been listed by way of the 'Supplementary List' and has been taken up in the post lunch session. 2. By way of present petition, the petitioners seek quashing and setting aside of the order dated 19.07.2024 passed by the learned Judicial Magistrate, Karkardooma Courts, Delhi in Complaint Case 187/2024 titled as 'Brains Logistics Pvt. Ltd. v. Vijay Srivastav and Ors.' whereby a direction has been given to register an FIR in pursuance of an application filed under Section 156(3) Cr.P.C. by the complainant/respondent No.2. 3. Learned Senior Counsels for the petitioners contend that the dispute pertains to an underlying Job Contract Agreement and a Supplementary Job Agreement both dated 01.10.2001 executed between the parties initially for a period of two years. Subsequently, in the year 2010, on account of relations turning sore between the parties, the Agreements were terminated, resulting in arbitration proceedings and passing of the arbitral award. It is next contended that the application filed by the complainant under Section 156(3) Cr.P.C. pertains to fabrication, and forgery of the PF challans concerning which, the present petitioners had already lodged an FIR No.842/2013 under Sections 120- B/418/420/467/468/471 IPC at P.S. Gurugram against the respondent/complainant in which the charges were framed against the complainant and its Director on 27.03.2018. Further, a challenge to the FIR by the complainant vide CRM-M No.25759 of 2021 was dismissed by the Punjab & Haryana High Court at Chandigarh vide order dated 03.12.2021. A challenge to the same, vide SLP (Crl) No. 808 of 2022 also came to be dismissed by the Supreme Court on 07.02.2022. 4
19. The Court has perused the record. It is seen that Mr. Pandey and his company - BLPL have filed multifarious cases in various forums including criminal complaints against HML, its directors and its promoters. The details of the said cases are as under: 20. Coming to the present contempt, even after the contempt reference was made, Mr. Pandey continued to insist on the allegations that the matter was wrongly entertained for mentioning in DB-II and has placed on record the Rosters of the Delhi High Court for the relevant period with an intention to completely scandalize the Court further. There are primarily three allegations made by BLPL and Mr. Pandey in the legal notice against the Court: i) That the mentioning could not have been done in DB-II; ii) That the mentioning was allowed "subject to office objections" and therefore the Registry ought to have ensured that all objections are cleared and could not have listed the matter without the clearance of all objections; iii) That the Registry could not have listed the matter in Court No.30 by presuming that the matter was connected to CRL.M.C. 5587/2024. 21. In the opinion of this Court, all the three allegations made by Mr. Pandey and BLPL as also his Counsels, are completely incorrect. Firstly, as per the usual practice in the Delhi High Court mentioning of all urgent matters is before DB-I. However, owing to the Counsel on record in this case who has been appearing, and who could not have appeared before DB-I, the matter had to be mentioned before DB-II. There was nothing wrong in this procedure.
22. Insofar as the expression 'subject to office objections' is concerned, the clear understanding and practice of the Court is that due to urgency, if there are any objections raised in the scrutiny of the papers by the Registry, the matter would be listed before the Court "subject to office objections" and the Court would then pass directions regarding the objections or clearing of the objections in its order. In effect, therefore, the matter would be listed despite the objections raised by the Registry. This understanding of "subject to office objections" is known generally to all Counsels and the Registry of this Court. The Court had directed both the lawyers to file an affidavit explaining this expression and in response thereto in the affidavit of Mr. Dahiya, it is stated as under: "2. That vide order dated 07.11.2024, this Hon'ble court was pleased to direct the deponent to explain the meaning of "subject to office objections", qua which in the legal notice allegations have been made against the Registry of this Court as well. In this regard, it is humbly submitted that the meaning of "subject to office objections" is that any matter filed, can be placed before the Hon'ble court with a condition that the 'office objections', if any, shall be cleared in the due course as per applicable rules, or as directed by the Hon'ble court before which the matter is listed." 23. Even in the affidavit of Mr. Yadav, it is stated as under: "2. That vide order dated 07.11.2024, this Hon'ble court was pleased to direct the deponent to explain the meaning of "subject to office objections", qua which in the legal notice allegations have been made against the Registry of this Court as well. In this regard, it is humbly submitted that the meaning of "subject to office objections" is that any matter filed, can be placed before the Hon'ble court with a condition that the 'office objections', if any, shall be cleared in the due course as per applicable rules, or as directed by the Hon'ble court before which the matter is listed." 24. Mr. Pandey has also filed an affidavit as under:
"6. That with great humility and unconditional apology, the deponent submits that at the time of issuing of subject matter legal notice, it was understood that fresh matter approved for listing "subject to office objections" and the Ld. Registry has raised 'office objections' then the same are to be cleared in due course of time as per applicable rules. The Deponent, humbly submits that the 'office objections' to be that "any fresh matter filed by the litigants / Ld. Counsels on which the Ld. Registry has raised 'office objections' then the said fresh case can be listed with 'subject to office objections' mentioned in the cause list for further directions by the Hon'ble Court before which the matter is listed and the 'office objections' are to be cleared by the by the litigants / Ld. Counsels in the due course as per applicable rules". It is humbly submitted that the deponent has / had no intent to make any allegations against the Ld. Registry of this Hon'ble Court or this Hon'ble Court. However, the Deponent sincerely tenders bona fide, unconditional apology before this Hon'ble Court." 25. In the above affidavits it is clearly admitted by Mr. Pandey as also his counsels that the term "subject to office objections" means that the matter can be listed before the Court despite the objections. It is thus clear that the allegation made in the legal notice to the contrary, that all objections had to be removed prior to listing, was completely false to the knowledge of both the lawyers and the client. The allegation in the legal notice was clearly to scandalize the Court and the Registry as also to raise unnecessary doubts as to the functioning of the Court. Moreover, even if the allegations are not direct, allusions to wrong doing by the Court or the Registry, which is clear from the legal notice, would also not be permissible.
26. Insofar as the third allegation is concerned i.e., that the two matters were not connected and the Registry could not have listed the matter before the same Bench which was hearing CRL.M.C. 5587/2024 is concerned, even the said allegation is completely bereft of any merit. On behalf of the Petitioners, a note has also been filed along with the comparative chart giving the similarities between the two cases, i.e., CRL.M.Cs. 7840/2023 and 5587/2024. The Court has also perused the two petitions. A perusal of the same would show: i) That they arise out of the same contractual dispute between the parties i.e., HML and BLPL; ii) That the allegation is in respect of certain documents produced by HML; iii) That the allegation is about putting of a stamp of Hero Moto Corp instead of Hero Honda Motors Ltd. which is alleged to be a forgery; iv) In CRL.M.C. 7480/2023, the allegations is in respect of summary sheets for the year 2009-10 and in CC 187/2024 which is the subject matter of CRL.M.C. 5587/2024. The allegations are in respect of PF Challans for the year 2009-10. v) The contesting parties in both the matters are the same. 27. The endorsement made by HML that CRL.M.C. 5587/2024 is connected to the pending petition CRL.M.C. 7480/2023 which is pending before a particular Court, is thus not a wrong statement. It does not amount to forum shopping. In fact there is a duty cast upon any litigant to inform the Registry of any dispute between the same parties arising out of the same contract which may be pending. This is in order to ensure that contradictory orders or multiple litigations are not heard on similar subject matter by different Courts. This is also expedient in the interest of conservation of judicial time. The allegations that there was wrong-doing by the Registry is also thus baseless.
28. In Krishna Lal Chawla and Ors. v. State of Uttar Pradesh & Anr., (2021) 5 SCC 435 the Court emphasised on the importance of judicial time and the responsibility of clients and counsels. The Court also frowned upon filing of multiple cases relating to the same issue which leads to resource crunch of the opposing party. The relevant portion of the judgment has been extracted below: "10. Article 21 of the Constitution guarantees that the right to life and liberty shall not be taken away except by due process of law. Permitting multiple complaints by the same party in respect of the same incident, whether it involves a cognizable or private complaint offence, will lead to the accused being entangled in numerous criminal proceedings. As such, he would be forced to keep surrendering his liberty and precious time before the police and the courts, as and when required in each case. As this Court has held in Amitbhai Anilchandra Shah [Amitbhai Anilchandra Shah v. CBI, (2013) 6 SCC 348 : (2014) 1 SCC (Cri) 309] , such an absurd and mischievous interpretation of the provisions of the CrPC will not stand the test of constitutional scrutiny, and therefore cannot be adopted by us. xxx 22. Frivolous litigation should not become the order of the day in India. From misusing the public interest litigation jurisdiction of the Indian courts to abusing the criminal procedure for harassing their adversaries, the justice delivery system should not be used as a tool to fulfil personal vendetta. The Indian judiciary has taken cognizance of this issue. In 2014, this Court elucidated as follows, the plight of a litigant caught in the cobweb of frivolous proceedings in Subrata Roy Sahara v. Union of India [Subrata Roy Sahara v. Union of India, (2014) 8 SCC 470 : (2014) 4 SCC (Civ) 424 :
(2014) 3 SCC (Cri) 712] : (SCC p. 642, para 191) "191. ... One needs to keep in mind, that in the process of litigation, there is an innocent sufferer on the other side, of every irresponsible and senseless claim. He suffers long drawn anxious periods of nervousness and restlessness, whilst the litigation is pending, without any fault on his part. He pays for the litigation, from out of his savings (or out of his borrowings), worrying that the other side may trick him into defeat, for no fault of his. He spends invaluable time briefing counsel and preparing them for his claim. Time which he should have spent at work, or with his family, is lost, for no fault of his." While the Court's ruling pertained to civil proceedings, these observations ring true for the criminal justice machinery as well. We note, with regret, that 7 years hence, and there has still been no reduction in such plight. A falsely accused person not only suffers monetary damages but is exposed to disrepute and stigma from society. While running from pillar to post to find a lawyer to represent his case and arranging finances to defend himself before the court of law, he loses a part of himself." 29. The Court in Buddhi Kota Subbarao v. K. Parasaran, (1996) 5 SCC 530 also observed that litigants cannot file frivolous petitions to satisfy their whims. The relevant portion of the judgment reads as under: "11. The applicant, it appears to us is labouring under grave misconception both of law and facts and has filed this petition unmindful of the scope of the provisions of Section 340 CrPC as well as of Sections 191, 192 and 193 IPC. ................
...............The course adopted by the applicant is impermissible and his application is based on misconception of law and facts. No litigant has a right to unlimited drought on the court time and public money in order to get his affairs settled in the manner as he wishes. Easy access to justice should not be misused as a licence to file misconceived or frivolous petitions. After giving our careful consideration to the submissions made at the Bar as well as those contained in the memorandum of the application, we are of the opinion that this application is misconceived, untenable and has no merits whatsoever. It is accordingly dismissed." 30. Therefore the said endorsement by HML can hardly be termed as forum shopping and the Registry cannot be blamed in any manner for having listed the matter before the same Bench where CRL.M.C. 7480/2023 was pending. The allegations against HML and its counsels as also the Registry was therefore completely baseless. In fact, in the affidavit of Mr. Pandey, he continues to insist that the two matters are not connected. The relevant paragraph of the affidavit is set out below: 4. That I hold this Hon'ble Court in the highest esteem and regard the institution of the judiciary as the cornerstone of justice, fairness, and democracy. 5. That I submit my unconditional apology for publication or action on my part or on behalf of "New Indian" that may have been construed as contemptuous or disrespectful to this Hon'ble Court. It is submitted that in great regard to this Hon'ble Court, the Published contemptuous material has been immediately taken down from the Platform. 6. That it was never my intention to undermine the authority, dignity, or majesty of this Hon'ble Court, and I deeply regret any inconvenience or harm caused due to my actions. 7. That I assure this Hon'ble Court that I have taken all necessary steps to rectify the error and ensure that no such incident occurs in the future. Further, I shall remain vigilant and cautious in the discharge of my professional duties as a publisher.
8. That I solemnly undertake to exercise the utmost caution and due diligence in the future to ensure that no such act or omission occurs and that the integrity and dignity of this Hon'ble Court remain intact at all times. 9. That this unconditional apology is tendered with utmost sincerity, bona fide intention, and without any reservation whatsoever. I humbly pray for the forgiveness and indulgence of this Hon'ble Court." 34. Even the counsel - Mr. Dahiya has stated in his affidavit as under: "3. ..... Therefore, it is the humble understanding of the Deponent that in view of the roster, all urgent matters will be mentioned only before the DB-1. That once again, it is humbly submitted that the deponent has / had no intent to make any allegations against the Registry of this Hon'ble court or this Hon'ble court. 4. That it is submitted that the Deponent has been informed by Mr. Yadav that all future notices will be issued by his firm, with website details of firm, full name of advocate and the Bar Council registration number, etc. and as per applicable law." 35. Mr. Yadav, ld. Counsel in his affidavit dated 12th November, 2024 has also stated as under: "3. ..... Therefore, it is the humble understanding of the Deponent that in view of the roster, all urgent matters will be mentioned only before the DB-1. That once again, it is humbly submitted that the deponent has / had no intent to make any allegations against the Registry of this Hon'ble court or this Hon'ble court. 4. That it is submitted that the Deponent shall ensure that all future notices shall be issued with website detail of firm, full name of advocate and the Bar Council registration number and as per applicable law."
36. Having heard the parties and having seen the record and also having perused the affidavits filed on behalf of the Respondents and lawyers and the Journalist, this Court is at pains to observe that every lawyer and litigant who is before the Court has a responsibility to ensure that any conduct which lowers the faith in the judicial system ought not to be resorted to. Over the course of various hearings, it has become clear to the Court that while Mr. Pandey himself has become a habitual litigant indulging in various practices which would constitute abuse of process, the advice being given to him by his lawyers is also clearly far from bona fide. Mr. Pandey has categorically made a statement before the Court that the content of the legal notice were based on the advice given to him by his lawyers. 37. All three i.e., Mr. Dahiya, Mr. Yadav and Mr. Pandey have admitted that insofar as the term 'subject to office objection' is concerned, they had clearly made a wrong allegation in the notice. This Court is also clear that insofar as the mentioning before the DB-II and the listing of the matter before the Bench where CRL.M.Cs. 7840/2023 was pending, there is no irregularity whatsoever. Even Mr. Atul Krishan had a duty to verify the allegations before bringing the notice in public domain. 38. Responsible journalism has been emphasised by the Court in In Re: H""It has come to notice that Bar Council of India, in the year 2006, had issued a Circular No.STBC/Cir/No.18/2006 dated 5.7.2006 to all the State Bar Councils, communicating its approval to the new Rule 105A, framed by the Bar Council of Delhi, whereby it was made compulsory for the Advocates to mention enrolment number on their letter heads and vakalatnamas. All the Officers and Dealing Assistants of the Filing Counter are requested to ensure that the Vakalatnamas, filed by the Advocates, must contain their enrolment numbers as well, in addition to other requirements of the Vakalatnama." 45. The above stated Rule 105 A has been extracted below:
Rule 105A: Every advocate shall mention his/her enrollment number on every visible representation (wherever the letter "Advocate"/"Attorney"/ "Counsel" is mentioned after or before the same) including visiting card, letter head, vakalatnama etc. 46. A perusal of the above stated rule shows that the enrolment number needs to be mandatorily added at all places in the letter where "Advocate"/"Attorney"/ "Counsel" is mentioned. It can be seen that in the present case neither the letterhead mentions the details of the Advocate and the enrolment number. The same is also not mentioned in the end salutation. It's a prescribed practice to write the name and enrolment number of the Advocate sending the legal notice to verify the authenticity of said notice. Moreover, legal notices are made on the letterhead of the concerned advocate/firm/chamber who is sending the notice and absence of such details questions the validity of the said notices. 47. The Bombay High Court in Criminal Appeal No. 172/2014 titled Shaikh Farooq v. Shaikh Rafiq and Ors. also observed that without any signature a typed document in the form of a notice cannot be considered as a legal notice as nobody would own up to the correctness of its contents. 48. Under these circumstances, both the lawyers have violated the Bar Council Rules and the practice directions of this Court. This Court is of the opinion that the Counsels have indulged in unprofessional conduct. The matter is accordingly referred to Bar Council of Delhi for initiating disciplinary proceedings which shall be decided in accordance with law. In addition, they shall henceforth comply with the said Rules and modify their letterheads and all other communications in accordance with the said Rules.
49. Insofar as Mr. Roop Darshan Pandey is concerned, his conduct has been totally defiant even during Court proceedings. The apology is completely conditional and the intent has been to justify all the allegations which have been made. The allegations are clearly false to the knowledge of Mr. Pandey who is a habitual litigant in the Court. The attempt of Mr. Pandey appears to be somehow continue to harass the company HML, its officials and its Counsels while making wild allegations against them. Mr. Pandey has also not spared the Court or the Registry of this Court when clearly there was no fault of the Registry of the Delhi High Court in the clearing of the matter for listing and also listing of the matter on an urgent basis. 50. The Hon'ble Supreme Court in Haridas Das v. Usha Rani Banik (Smt.) and Ors., (2007)14 SCC 1 observed that anyone who tends to tarnish the image of the judiciary should not be allowed to go unpunished. In such cases the ultimate victim is the institution. The Court in the said case also observed that the apology of the Contemnor was not genuine and instead he tried justifying the malicious statement given by them, therefore the Court sentenced the Contemnor to two months of imprisonment. The relevant portion of the judgment reads as under: "1. "Judge bashing" and using derogatory and contemptuous language against Judges has become a favourite pastime of some people. These statements tend to scandalise and lower the authority of the courts and cannot be permitted because, for functioning of democracy, an independent judiciary to dispense justice without fear and favour is paramount. Its strength is the faith and confidence of the people in that institution. That cannot be permitted to be undermined because that will be against the public interest. 2. Judiciary should not be reduced to the position of flies in the hands of wanton boys. Judge bashing is not and cannot be a substitute for constructive criticism. xxxx
12. There is guarantee of the Constitution of India that there will be freedom of speech and writing, but reasonable restrictions can be imposed. It will be of relevance to compare the various suggestions as prevalent in America and India. It is worthwhile to note that all utterances against a Judge or concerning a pending case do not in America amount to contempt of Court. In Article 19 the expression "reasonable restrictions" is used which is almost on a par with the American phraseology "inherent tendency" or "reasonable tendency". The Supreme Court of America in Bridges v. California [314 US 252 : 86 L Ed 192 (1941)] said : (L Ed p. 203) "What finally emerges from the 'clear and present danger' cases is a working principle that the substantive evil must be extremely serious and the degree of imminence extremely high before utterances can be punished." 13. The vehemence of the language used is not alone the measure of the power to punish for contempt of court. The fires which it kindles must constitute an imminent, not merely a likely, threat to the administration of justice. The stream of administration of justice has to remain unpolluted so that purity of court's atmosphere may give vitality to all the organs of the State. Polluters of judicial firmament are, therefore required to be well taken care of to maintain the sublimity of court's environment; so also to enable it to administer justice fairly and to the satisfaction of all concerned. To similar effect were the observations of Lord Morris in Attorney General v. Times Newspapers [1974 AC 273 : (1973) 3 WLR 298 : (1973) 3 All ER 54 (HL)] , AC at p. 302. It was observed that when "unjustifiable interference is suppressed it is not because those charged with the responsibilities of administering justice are concerned for their own dignity : it is because the very structure of ordered life is at risk if the recognised courts of the land are so flouted that their authority wanes and is supplanted." (All ER p. 66f) xxxx
29. Considered in the light of the aforesaid position in law, a bare reading of the statements makes it clear that those amount to a scurrilous attack on the integrity, honesty and judicial competence and impartiality of Judges. It is offensive and intimidating. The contemnor by making such scandalising statements and invective remarks has interfered and seriously shaken the system of administration of justice by bringing it down to disrespect and disrepute. It impairs confidence of the people in the court. Once door is opened to this kind of allegations, aspersions and imputations, it may provide a handle to the disgruntled litigants to malign the Judges, leading to character assassination. A good name is better than good riches. Immediately comes to one's mind Shakespeare's Othello, Act II, Scene iii, 167: "Good name in man and woman, dear my Lord is the immediate jewel of their souls; who steals my purse, steals trash; its something, nothing; 'T was mine, its his, and has been slate to thousands; But he that filches from me my good name, Robs me of that which not enriches him And makes me poor indeed." 30. Majesty of law continues to hold its head high notwithstanding such scurrilous attacks made by persons who feel that the law courts will absorb anything and everything, including attacks on their honesty, integrity and impartiality. But it has to be borne in mind that such divinity and magnanimity is not its weakness but its strength. It generally ignores irresponsible statements which are anything but legitimate criticism. It is to be noted that what is permissible is legitimate criticism and not illegitimate insinuation. No court can brook with equanimity something which may have tendency to interfere with the administration of justice. Some people find judiciary a soft target because it has neither the power of the purse nor the sword, which other wings of democracy possess. It needs no reiteration that on judiciary millions pin their hopes, for protecting their life, liberty, property and the like. Judges do not have an easy job. They repeatedly do what rest of us (the people) seek to avoid, make decisions, said David Pannick in his book Judges. Judges are mere mortals, but they are asked to perform a function which is truly divine. xxxx
34. There can be no quarrel with the proposition that anyone who intends to tarnish the image of judiciary should not be allowed to go unpunished. By attacking the reputation of Judges, the ultimate victim is the institution. The day the consumers of justice lose faith in the institution that would be the darkest day for mankind. The importance of judiciary needs no reiteration. 35. When the background facts highlighted above are considered in the background of the principles set out above, the inevitable conclusion is that the contemnor deserves no sympathy. In fact, the lenient approach of the Gauhati High Court seems to have encouraged him to make statements on oath tarnishing the image of the Judges of the highest judiciary. His apology seems to be not genuine. This is more so because he wanted to justify the statements made in Para 4. 36. Therefore, we find the contemnor guilty of contempt. He is sentenced to undergo imprisonment for a period of two months. He shall be taken into custody and sent to Tihar Jail, New Delhi, forthwith to serve the sentence awarded." 51. The Court in Ram Niranjan Roy v. State of Bihar and Ors., (2014) 12 SCC 11, observed that contempt matters are committed in the face of the High Court and these matters not only humiliate Judges but scandalise the institution by lowering its dignity in the eyes of the public. The relevant portion of the said judgment has been extracted below:
16. Thus, when contempt is committed in the face of the High Court or the Supreme Court to scandalise or humiliate the Judge, instant action may be necessary. If the courts do not deal with such contempt with strong hand, that may result in scandalising the institution thereby lowering its dignity in the eyes of the public. The courts exist for the people. The courts cherish the faith reposed in them by people. To prevent erosion of that faith, contempt committed in the face of the court need a strict treatment. The appellant, as observed by the High Court was not remorseful. He did not file any affidavit tendering apology nor did he orally tell the High Court that he was remorseful and he wanted to tender apology. Even in this Court he has not tendered apology. Therefore, since the contempt was gross and it was committed in the face of the High Court, the learned Judges had to take immediate action to maintain honour and dignity of the High Court. There was no question of giving the appellant any opportunity to make his defence. This submission of the appellant must, therefore, be rejected. xxxxx 19. In Bi
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Delhi High Court: A case was filed claiming someone disrespected a court order. This order, from October 28, 2024, was made by a single judge in a criminal case brought by Hero MotoCorp. Hero MotoCorp had challenged an earlier order from July 19, 2023. In that earlier order, a judge had told the police to start an investigation (called an FIR) against Hero MotoCorp. The person accused of disrespecting the court (the respondent) was a director of Brain Logistics Pvt. Ltd. (BLPL) and had filed the original complaint on July 21, 2024. A panel of two judges, Prathiba M Singh and Amit Sharma, sentenced the respondent to two weeks in jail and a fine of Rs. 2,000. If he doesn't pay the fine, he will spend an additional 7 days in jail. The judges made this decision because his untrue claims against the court and its office (the Registry) about scheduling cases were completely baseless. The judges felt that ignoring such claims would, over time, cause people to lose trust in the court's fair system. The disagreement between Hero MotoCorp Ltd. and Brains Logistics Pvt. Ltd. (BLPL) began with a work contract from October 1, 2001. This contract ended in March 2010 because their relationship worsened. BLPL then used a part of their contract that called for arbitration, a way to settle disputes outside of court. As a result, Justice H.S. Bedi (retired) was appointed as the sole arbitrator in 2012. In 2018, the arbitrator decided that BLPL should receive ₹70,00,000 plus interest. Hero MotoCorp disagreed with this decision and took the matter to the Punjab & Haryana High Court. This contract dispute led BLPL to make many criminal claims and ask for police investigations (FIRs) against Hero MotoCorp. BLPL accused them of faking documents and misusing employee savings funds. BLPL’s complaint caused a Karkardooma judge to order the police to register an FIR. Hero MotoCorp then challenged this order in the Delhi High Court. The Court temporarily stopped the police from starting the FIR, which then caused more claims and arguments about how the legal process was handled.
After the court stopped the FIR, BLPL claimed that Hero MotoCorp was trying to find a court that would favor them. They also accused Hero MotoCorp of improper procedures and wrongly influencing the court's office. BLPL’s lawyers put these claims into a formal legal letter that was not dated. This letter criticized how cases were scheduled, the court's office, and even made claims against judges. It questioned how the case was being handled and was also published online. Hero MotoCorp showed this letter and related emails to the Court, which led to a closer look at the legal procedures. Because of these events and claims, the Court decided to start its own contempt case. Due to the repeated claims, worries about how legal steps were followed, and arguments about the case, the Court felt it had to file this case to deal with all the problems thoroughly. The Court noted that BLPL, the respondent's company, had filed many different cases in various courts, including criminal complaints against Hero MotoCorp, its directors, and its founders. The legal letter from BLPL and the respondent made three main claims against the Court. First, they claimed the case should not have been brought up for quick discussion in a specific court section. Second, they claimed that even though the case was brought up with some issues (called "office objections"), the court office should have fixed all these issues before scheduling the case. Third, they claimed the court office should not have scheduled the case in Court 30 by assuming it was connected to another specific case. The Court stated that all these claims made by the respondent, BLPL, and their lawyers were completely wrong.
The Court also observed that the claim in the legal letter, which said all issues had to be fixed before a case could be scheduled, was false. Both the lawyers and their client knew it was untrue. The Court said the claim in the legal letter was clearly meant to discredit the Court and its office and to make people doubt how the Court works. Furthermore, even indirect hints of wrong actions by the Court or its office, which were clear in the legal letter, are not allowed. The Court stated that "The language in the legal notice completely discredits the Court and makes baseless claims and negative statements against the court's administration of justice by raising doubts about how this Court’s office works. After the legal letter was sent, there were clear and intentional efforts by the lawyers or the person involved to get it published online. The journalist involved later gave a full apology. However, the fact remains that the letter was published on the 'X' (formerly Twitter) platform of a media account. Without checking the facts, the letter was clearly leaked by the respondent and BLPL. This was done not only to harm Hero MotoCorp's reputation but also to make the public respect the Court less." The Court concluded that the respondent's lawyers had not only given their client bad advice but also showed no regret during the hearings. Their legal letter did not follow the necessary rules for such documents; it did not include the lawyer's name, bar council registration number, the date, website, or names of other lawyers in the firm. The Court noted that lawyers often use such strategies to protect themselves from any action while making broad, unsupported claims. Because of this, the Court sent the matter to the Bar Council of Delhi to start an official investigation into the lawyers' conduct, which will be decided according to law. Therefore, the Court decided that the respondent regularly makes claims against Courts, judges, and lawyers. His harmful behavior was not a mistake or bad advice but was done on purpose with hidden, bad reasons. The apology he offered was not genuine.
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742 of 1979. 656 of 1976. A.S. Sohal and P.N. Kiran Choudhri and T. Sridharan for the Respondent. S of 1976 convicting appellant for offences under Sections 302 and 120 B of the Indian Penal Code and sentencing her to imprisonment for life, raises certain questions as to the nature and extent of corroboration of an accomplice 's evidence; and as to the procedure for the trial of offences by a "child" under the East Punjab Children 's Act 1949. Appellant Balwant Kaur was said to be 15 1/2 years of age at the time of the commission of the offence alleged against her. Appellant was arrested on 8.5.1975. Nand Singh and Ram Sarup were also arrested on 8.5. Ram Sarup became an approver. The judgment of the High Court under appeal is common to Criminal Appeal No. 676 of 1976 preferred by Nand Singh who was convicted under Sections 302, 364, 201 and 120 B of I.P.C. Appellant 's husband, Pritam Singh for whose murder appellant and the said Nand Singh had been arraigned, was, at the relevant time, a police constable at the Police Station West, Sector 11 Chandigarh. The married life of Appellant and Pritam Singh, according to the prosecution, lacked connubial felicity and was marked by constant bickerings and quarrels, the cause for this discord being the addiction of Pritam Singh to liquor. It was further alleged that appellant had developed illicit intimacy with Nand Singh. Ram Sarup, in the course of his visits 750 to Bhag Singh 's house met, and became friendly with Nand Singh and the two become accustomed to take liquor together. Ram Sarup also knew deceased Pritam Singh. This appears to have tempted Ram Sarup to ask Nand Singh to introduce Ram Sarup also to appellant for a similar intrigue. On November 13, 1973, in the afternoon when Ram Sarup was off duty, Nand Singh took Ram Sarup to his own quarters in Sector 20 A said to be at a short distance from the appellant 's residence and the two had liquor together. Thereafter, Nand Singh is stated to have taken Ram Sarup to the residence of, and introduced him to the appellant and persuaded her to gratify the desire of Ram Sarup also. Later, the same afternoon, the three met again at appellant 's home when, it would appear, appellant while narrating the privations and hardships endured by her at the hands of her husband broke down and implored Nand Singh and Ram Sarup to do away with Pritam Singh. She appears to have also offered that after Pritam singh 's death she would marry and live with Nand Singh, who was then unmarried. According to the prosecution, it was agreed amongst the three that the appellant should persuade her husband to reach Chandigarh bus stand the following day i.e. November 14, 1973 and that Nand Singh and Ram Sarup, who would be present three, would entice him away to Pinjore with the inducement of liquor and, do away with him there. Pursuant to this design and conspiracy, appellant is stated to have persuaded her husband to go to the bus stand at Chandigarh at 9.30 a.m. On 14.11.1973 where Nand Singh and Ram Sarup who were waiting for him as pre arranged took him to Pinjore by bus. Thereafter, all the three agreed to go back Chandigarh on foot which took them along a 'dandi ' passing by the side of the Pinjore gardens. Ram Sarup (P.W. 2) was ahead; Pritam Singh was in 751 the middle with Nand Singh following behind him. Nand Singh is stated to have suddenly administered 2 3 Ghotna blows on the head of the unsuspecting Pritam Singh and told Ram Sarup (P.W. Ram Sarup pulled Pritam Singh down whereupon Nand Singh gave 8 to 10 more blows with the Ghotna on the person of Pritam Singh. Then Nand Singh threw away the Ghotna and the two, namely, i.e. Nand Singh and Ram Sarup, hastened towards Chandigarh. However, after the two had gone 2 furlongs or so, Nand Singh urged Ram Sarup (P.W. They, accordingly, returned and ensured that Pritam Singh had died. Next day, i.e. On 15.11.1973, Nand Singh came to Raj Bhavan where Ram Sarup was on duty and told the latter that he had, in turn, informed Balwant Kaur of the death of Pritam Singh. This, in substance is the prosecution case as unfolded in the evidence of the Ram Sarup (P.W. On 13. In that, it was stated that she had learnt from Pandit Sita Ram that a certain Naik Singh and his two sons of the village Lahor Khuda and Dev Singh, the Sarpanch of that village along with two other relatives of the Sarpanch had killed Pritam Singh, the alleged motive was that deceased Pritam Singh, when he was earlier serving in Lahorkhuda had developed illicit relations with Naik Singh 's daughter, Prito. At the trial Mukhtiar Kaur was examined to establish that this complaint was engineered by the appellant and Nand Singh to put the investigation on a wrong scent. Dr. Inderjit Dewan (P.W. 1 could 752 not, however confirm whether the injuries were ante mortem or not. 23) on 8.5.1975 and Ram Sarup was also arrested the same day. The trial court on the basis of the approver 's testimony as corroborated by other evidence, held both Nand Singh , and the appellant guilty of the offences they were charged with and sentenced them to imprisonment for life. Shri A.S. Sohai, Learned counsel appearing in support of the appeal urged that the evidence of the Approver in so far as the complicity of appellant is concerned, lacked corroboration on materials particulars and that no conviction could be sustained on such uncorroborated accomplice 's testimony. His 'credit ' or the sufficiency of his evidence as a quantitative conception, however, remained in the background. On the further development in the law which slowly began to recognise the distinction between 'competency ' and 'credit ', Wigmore says: Wigmore on Evidence: 3rd Edition Vol. About that time there comes into acceptance a general practice to discourage a conviction founded solely upon the testimony of an accomplice uncorroborated. But was this practice founded on a rule of law? It was recognised constantly that the judge 's instruction upon this point was a mere exercise of his common law function of advising the jury upon the weight of the evidence, and was not a statement of a rule of law binding upon the jury". But then, Section 133 provides that a conviction is not illegal merely because it rests upon an accomplice 's uncorroborated testimony. "It is a practice" it is said "which deserves all the reverence of law. " The aspect as to the extent and content of independent corroboration is, again, an interesting area of study. One view was that independent evidence tending to verify any part of the testimony of the accomplice should suffice. The other view required that the corroborative evidence should not only show that part of the accomplice testimony is true; but should go further and also implicate the other accused. In R. vs Bhaskerville, the Court of Criminal appeal in England favoured and adopted the second view. Thirtyfive years ago, Bose J referring with approval to the principles in Bhaskerville said that this branch of the law in India is the same as in England and that the lucid exposition of it given by Lord Reading, cannot be bettered. But to this extent the rules are clear: (21) First, it is not necessary that there should be independent confirmation of every material circumstance in the sense that the independent evidence in the case, apart from the testimony of the complainant of the accomplice, should in itself be sufficient to sustain conviction. (22) Secondly, the independent evidence must not only make it safe to believe that the crime was committed but must in some way reasonably connect or tend to connect the accused with it by confirming in some material particular the testimony of the accomplice or complainant that the accused committed the crime. This does not mean that the corroboration as to identity must extend to all the circumstances necessary to identify the accused with the offence. (23) Thirdly, the corroboration must come from independent source and thus ordinarily the testimony of one accomplice would not be sufficient to corroborate that of another (24) Fourthly, the corroboration need not be direct evidence that the accused committed the crime. It is sufficient if it is merely circumstantial evidence of his connection with the crime . " The difference of opinion has arisen in the main in reference to the question whether the corroborative evidence must connect the accused with the crime. The rule of practice as to corroborative evidence has arisen in consequence of the danger of convicting a person upon the unconfirmed testimony of one who is admittedly a criminal . " 755 Resolving the difference of opinion it was held: "We hold that evidence in corroboration must be independent testimony which affects the accused by connecting or tending to connect him with the crime. In other words, it must be evidence which implicates him, that is, which confirms is some material particular not only the evidence that the crime has been committed, but also that the prisoner committed it. The test applicable to determine the nature and extent of the corroboration is thus the same whether the case falls within the rule of practice at common law or within that class of offences for which corroboration is required by statute". II para 454) the following passage obtains: "Corroboration of a witness 's testimony must be afforded by independent evidence which affects the defendant by connecting or tending to connect him with the offence charged. It must be evidence which implicates him, that is which tends to confirm in some material particular not only that the offence was committed, but also that the defendant committed it". As to independent nature of the corroboration learned Chief Justice observed in Bhaskerville case: " . Again, the corroboration must be by some evidence other than that of an accomplice, and therefore one accomplice 's evidence is not corroboration of the testimony of another accomplice: Rex vs Noakes . " It is sufficient if there is confirmation as to a material circumstance of the crime and of the identity of the accused in relation to the crime. Indeed, if it were required that the accomplice A should be confirmed in every detail of the crime, his evidence would not be essential to the case it would be merely confirmatory of other and independent testimony . " (page 664 in Rex vs Bhaskerville) In Halsbury 's Laws of England IV Edn. II page 268 this proposition is stated thus: "The word 'corroboration ' is not a technical term of art; it means by itself no more than evidence tending to confirm, support or strengthen, other evidence . " It is sufficient if it is circumstantial evidence of the defendant 's connection with the offence, but it must be independent evidence, and must not be vague However there were some observations in Director of Public Prosecutions vs Killbourne (1973) Appeal A.C. 729 which tended towards a departure from the rule in Rex vs Bhaskerville. In Killbourne case Lord Hailsham said and this is also the statement of the law in Halsbury IV Edition "Evidence which is admissible, relevant to the evidence requiring corroboration and (if believed) conformatory of that evidence in a material particular, is capable of being corroborative and, when believed, is corroboration". For example confirmation does not mean that there should be independent evidence of that which the accomplice relates, or his testimony would be unnecessary Reg vs Mullins ( 1) per Maule J . " But, in R. vs Beck., [ , it was reiterated by way of clarification that corroborating evidence need not relate to 757 the particular evidence spoken to by a suspect witness, and that it was merely independent testimony which confirmed in some material particular not only the evidence that a crime had been committed but also that the accused person had committed it. Referring to the statement of Lord Hailsham in Killbourne case, All England law reports 1982(1) page 815(g) it was observed: "The learned editors of Archbold para 1416, after, in our judgment correctly, stating that the corroborative evidence need not relate to the particular incident or incidents spoken to by the "suspect witness", express the view that 'Lord Hailsham 's dictum that the corroborative evidence must be "relevant to the evidence requiring corroboration" may be misleading '. We do not think that Lord Hailsham LC was expressing any support for the proposition of counsel for the appellant. " The position of law in Rex vs Bhaskerville was, thus restored. However, in regard to the quality and extent of corroboration, in R. vs Donat, [19861 , it was reiterated that to count as corroboration, it is not enough that a piece of evidence merely supports the accomplice 's credibility, however, convincingly and independently; but it must go a little further and implicate the accused. In Sharvana Bhavan vs State of Madras, (AIR the corroboration was held to be of two kinds: the first belonging to the area of reassurance of the credit of the approver himself as a trustworthy witness; and the second which arises for conclusion after the court is satisfied about the credibility of the approver as to the corroboration in material particulars not only of the commission of the 758 crime but also of the complicity of other accused persons in the crime. If on the first area the court is not satisfied the second stage does not Arise. The position is attractively presented in Halsbury: (IV Edition Vol. In Attorney General of Hongkong vs Wong Muko Ping, [ Lord Bridge of Harwich speaking for the Judicial Committee of the Privy council said: ". It is said that this two stage approach is implicitly indicated by passages from speeches in the House of Lords in two of the leading authorities". " The presence or absence of corroborated evidence may assist a jury to resolve, one way or the other, their doubts as to whether or not to believe the evidence of a suspect witness, it must, in their Lordship 's Judgment, be wrong to direct them to approach the question of credibility in two stages as suggested in the submission made on behalf of the defendant. The controversy in the present case in the ultimate analysis, belongs to the second area, whether the approver 's testimony as to appellant 's complicity in the conspiracy could safely be held to have been corroborated by independent evidence on the material particulars The facts that require sequentially to be established are that appellant 's married life was in a serious disarray: that she and Nand Singh were on terms of illicit intimacy; that she also submitted herself to Ram Sarup (P.W. 2) in an ex marital relation; that on 13.11.1973 she implored Nand Singh and Ram Sarup to free her from a cruel husband by doing away with him; that she agreed that she would, 759 thereafter, live with Nand Singh as his wife and that after coming to know of Pritam Singh 's death she deliberately missed her mother in law, Mukhtiar Kaur (P.W. The evidence of P.Ws. 17 & 18 on the first two points has been discarded by the sessions court. It is not also suggested that after the murder of Pritam Singh, appellant began to live with Nand Singh. There is no evidence to show that, in the interregnum, there was any liasion between the two. The incriminating circumstances in the evidence of the approver appearing against the appellant had had to be put to the appellant in her examination under Section 313 Cr. The incriminating testimony of the approver pertaining to the case that on 13.11.1973 appellant wept and implored Nand Singh and Ram Sarup to do away with Pritam Singh and that appellant also agreed that she would, thereafter, live with Nand Singh has not been put to the appellant in the course of her examination under Section 313 Cr. On a consideration of the entire matter, it appears to us that the approver 's evidence in regard to the complicity of the appellant in the conspiracy lacks corroboration on certain material particulars necessary to connect the appellant. A little more reassurance than is afforded by the State of evidence in the case is perhaps, necessary to convict appellant. At the time of the commission of the offence, the appellant, even on the basis of the observations, made by the session court, was about 15 xab years of age and was a "child" within the meaning of East Punjab Children 's Act 1949. Sentences that may not be passed on child Notwithstanding anything to the contrary contained in any law, 760 no person who as a child at the date of the commission of the offence shall be sentenced to death or transported or committed to prison for any offence or in default of payment of fine, damages or costs: Provided that a child who is fourteen years of age or upwards may be committed to prison where the court certifies that he is of so unruly or of so depraved a character that he is not fit person to be sent to a certified school and that none of the other methods in which the case may legally be dealt with is suitable". The sessions court has invoked the proviso and has held that appellant was so depraved a character that none of the other methods in which the case could legally be dealt with is suitable in her case. An examination of the legality or propriety of the procedure adopted in the case in the matter of the trial of a 'child ' under the East Punjab Children 's Act 1949 and as to the correctness of the view of the sessions court in appealing to the proviso to Section 27 and in sentencing appellant to imprisonment for life may not be necessary in this case, in view of our finding that appellant is entitled to the benefit of doubt.
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The prosecution said that the appellant, who was about 15 and a half years old, had a troubled marriage. They claimed she was having an affair with the other accused person (who didn't appeal), and also had an affair with PW 2 (a witness) outside of her marriage. They said that on November 13, 1973, she asked the other accused and PW 2 to kill her husband to free her from him. The prosecution claimed the three planned and agreed to kill the husband. As part of the plan, the appellant convinced her husband to go to the bus stand in Chandigarh at 9:30 a.m. On November 14, 1973, the other accused and PW 2 were waiting for him at the bus stand, as planned. They took him to Pinjore by bus, where they drank alcohol together. While the three were walking back to Chandigarh and climbing a hill, the other accused hit the husband on the head with the Ghotna while PW 2 held him down. The two men returned to Chandigarh that night, and the other accused told PW 2 that he had informed the appellant about her husband's death. He gave information that led to the discovery of a pair of shoes, a purse, and 25 bone pieces, including a partial human skull (exhibit P8). The appellant and PW 2 were arrested on May 8, 1975. PW 2, who was one of the accused, became an approver (a witness for the prosecution in exchange for immunity). The trial court, based on the approver's testimony and other evidence, found the other accused and the appellant guilty of offenses under sections 302 (murder) and 120 B (criminal conspiracy) of the I.P.C. The High Court dismissed their appeals and upheld the convictions and sentences. In the appeal to the Supreme Court, it was argued that the approver's evidence against the appellant was not properly supported by other evidence and that a conviction should not be based only on an approver's unsupported testimony. The court considered: (1) how much evidence is needed to support an approver's testimony; and (2) the rules for trials of children under the East Punjab Children's Act, 1949. Section 114 of the Evidence Act suggests that an approver's testimony is not credible. However, section 133 says that a conviction is not illegal just because it is based on an approver's unsupported testimony. 1.2 In serious crime cases, it is generally considered unsafe to convict someone based only on the testimony of a person involved in the crime without independent evidence to back it up. 1.4 There are two types of supporting evidence. The second type is needed after the court believes the approver. This evidence must support the key details of the crime and prove that the other accused person was involved. If the court doesn't find the approver trustworthy in the first place, the second type of evidence is not considered. The court must look at all the evidence to make its decision. 1.5 The main question in this case is whether the approver's testimony about the appellant's involvement in the conspiracy is supported by independent evidence. There was a long time between the husband's death and the arrest of the appellant and the other accused. The approver's testimony that the appellant cried and asked the other accused and PW 2 to kill her husband, and that she agreed to live with the other accused afterward, was not presented to the appellant during her questioning under section 313 of the Criminal Procedure Code. This means the appellant was not given a chance to explain or deny this evidence. Therefore, that part of the evidence must be excluded. After considering everything, the court found that the approver's evidence about the appellant's involvement in the conspiracy was not supported by enough independent evidence. More supporting evidence is needed to convict the appellant. At the time of the crime, the appellant was about 15 years old, making her a "child" under the East Punjab Children's Act, 1949. Because the court found that the appellant should get the benefit of the doubt, it's not necessary to decide whether the trial court followed the correct procedure for trying a child under the East Punjab Children's Act, 1949, or whether the trial court was right to use the special exception in section 27 and sentence the appellant to life in prison. However, the conviction and sentence of the other accused person (who did not appeal) were not changed.
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% 30.01.2025 CRL.M.A. 2893/2025-EX.
1. Allowed subject to all just exceptions.
2. The application stands disposed of.
3. This is a petition filed under section 483 of BNSS seeking grant of regular bail to the petitioner in FIR No. 383/2016, dated 18.08.2016 registered at PS Jyoti Nagar under sections 302/120-B of IPC, 1860 and sections 25/27/54/59 of Arms Act, 1959. The chargesheet has been filed under sections 302/120-B/34 of IPC, 1860 and sections 25/27/54/59 of Arms Act, 1959.
4. In the present case, the petitioner has been in custody since 23.09.2016.
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5. Ms. Dixit, learned counsel for the petitioner submits that the petitioner has been falsely implicated. Further, no finger prints have been found on the knife which was used to kill the deceased.
6. She further states that the co-accused has already been granted bail and the petitioner is also entitled to bail on the ground of parity. In addition, the petitioner is the sole bread earner of his family. She states that the mother of the petitioner is suffering from a heart disease and the petitioner is responsible to take care of her mother and sister.
7. List on 10.03.2025.
CRL.M.A. 2894/2025-INTERIM BAIL
8. This is an application filed under section 483 of BNSS seeking interim bail to the petitioner for a period of 30 days on the ground that the sister of the petitioner is getting married on 02.02.2025.
9. For the said reasons, issue notice.
10. Mr. Gahalot, learned APP accepts notice on behalf of the respondent.
11. On instructions, learned APP states that the petitioner has 3 other brothers, out of which, one brother, namely Gufran has already been granted custody parole and 2 other brothers are also available for performing all the rights at the marriage.
12. Since the allegations against the petitioner are serious and grave in nature, I am not inclined to grant interim bail to the petitioner for a period of 30 days, however since the petitioner has been in custody from 23.09.2016, the petitioner is granted custody parole from 1 p.m. to 8 p.m. on 02.02.2025 for attending the wedding of her sister at H.No. 383, Gali No.1, Kardampuri, Shani Bazar, Delhi-10094.
13. The expenses of the police personnel accompanying the petitioner This is a digitally signed order.
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14. The application stands disposed of.
15. Dasti under the signature of the Court Master.
JASMEET SINGH, J JANUARY 30, 2025 / (MS) Click here to check corrigendum, if any This is a digitally signed order.
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Delhi High Court: The court looked at a request to appeal a decision made on February 10, 2020. In that earlier decision, the person accused was found not guilty under Section 4 of the Protection of Children from Sexual Offences Act, 2012 (called the POCSO Act). Justice Jasmeet Singh said that society and the law should recognize the right of young people to have romantic relationships that are free from harm or abuse. Love is a basic human feeling, and teenagers have the right to form emotional connections. The law should change to accept and respect these relationships, as long as both people agree and no one is forced. Considering all the facts, the Court decided that the challenged decision from February 10, 2020, was well-reasoned and did not need to be changed. So, the Court rejected this appeal. On December 10, 2014, around 12:25 AM, the father of the girl involved (the "prosecutrix") reported his daughter missing. She was about 17 years old and in Class 12. The girl had gone for tuition but did not come home. Her father suspected the accused, who was also missing from his house. During the investigation, the girl and the accused were found in Dharuhera and brought to Delhi. The girl had a medical check-up, and she gave a statement to a judge under Section 164 of the Criminal Procedure Code, 1973. The accused was also arrested. On August 6, 2015, the accused was formally charged under Section 4 of the POCSO Act. He said he was innocent and asked for a trial. After reviewing all the evidence, the first court (Trial Court) found the accused not guilty under Section 4 of the POCSO Act. Feeling that this decision was wrong, the current appeal was filed. The Court said that a key part of the crime under the POCSO Act is proving that the girl was under 18 years old when the event happened. The responsibility to prove this was on the prosecution (the lawyers trying to prove guilt). In this case, there were differences in the girl's date of birth. Her school records were not supported by other evidence, as required by Section 94 of the Juvenile Justice (Care and Protection of Children) Act, 2015. Because of this, the prosecution could not prove without a doubt that the girl was under 18 on the day the incident supposedly took place.
The Court stated that in situations like this one, where the girl was almost 17 years old, and there was no clear proof of her exact age, it was risky to use the POCSO Act against the accused. The Court felt that finding someone guilty under the POCSO Act without definite proof of the girl's age, especially when she was only one or two years younger than the legal adult age (18), would be unfair and harsh. In addition, the Court noted that the girl had clearly stated that her relationship with the accused was with her agreement when she gave her statement to the judge. When she spoke in court, she also said that any physical contact between them was with her consent. The Court said that all the facts shown in this case clearly proved that the girl willingly went with the accused and that any physical relationship between them happened because both agreed. The Court stated that how society and the law view love among teenagers should highlight the rights of young people to be in romantic relationships that are free from harm and abuse. Love is a basic human experience, and teenagers have the right to form emotional connections. The law should change to accept and respect these relationships, as long as both people agree and no one is forced. The Court mentioned that while the legal age of consent (the age at which someone can legally agree to sexual activity) is important for protecting those under 18, teenagers should be allowed to show their feelings and have relationships without being treated like criminals. The law should focus on stopping harm and abuse, rather than punishing love. The Court confirmed that consensual and respectful love between teenagers is a natural part of growing up. The legal system must protect the rights of young people to love, while also making sure they are safe and well. The Court stated that the POCSO Act was created to protect children. However, it does not make a difference for a girl under 18 who chooses a partner by her own free will. Therefore, any sexual act or intercourse by a man with such a girl would still be considered a crime under different parts of the POCSO Act.
The Court stated that the legal adult age (18), as set by law, must be understood and applied based on the specific law and situation. In a case like this, where the girl (who was under 18) was certain and firm in her feelings and wishes, it would not be right for this Court to ignore her views just because she was not yet 18 (she was 16 years, 10 months, and 21 days old). Considering all the factors, the Court stated that the prosecution had not proven without a doubt that the girl was under 18. Also, the girl herself was sure that the relationship was with her consent. Therefore, the Court stated that the challenged decision from February 10, 2020, was well-reasoned and did not need to be changed. As a result, the Court rejected this appeal.
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: Criminal Appeal No, 385 of 1976. (From the Judgment and Order dated 22 12 1975 of the Gujarat High Court in Crl. Appeal No. 180/74) N.N. Keswani & Ramesh N. Keswani for the appellant. K.H. Kazi & M.N. Shroff for the Respondent. The Judgment of the Court was delivered by BHAGWATI, J. This appeal, by special leave, is directed against an order passed by the High Court of Gujarat setting aside the acquittal of the appellant and directing that he, along with other accused, be retried not only for the of fence of consumption of liquor of which he was acquitted but also for the offence of possession of liquor punishable under section 66(1)(b) of the Bombay Prohibition Act, 1949. The question arising for determination is a short one, but in order to appreciate it, it is necessary to state the. facts giving rise to the appeal. The appellant, original accused No. 2, was at all mate rial times working as District Health Officer in District Amreli in the State of Gujarat. He was, according to the prosecution, found of liquor and whenever he used to go out of Amreli in connection with his duties, he used to partici pate in drinking parties. On 3rd August, 1972, he visited Kodinar, a town situate in the District of Amreli and late in the evening of that day, he attended a drinking party which was arranged by accused No. 1 in his agricultural farm situate at a place called Ghantwad about 50 Kms. away from Kodinar. Besides accused Nos. 1 and 2, six other persons who were arraigned as accused Nos. 3 to 8 were also present at the drinking party. On receiving information about the drinking party, the District Magistrate and the District Superintendent of Police along with other police officers and panch witnesses raided the agricultural farm where the drinking party was in progress. The raid was carried out at about 00.30 hrs. after midnight and on seeing the police, the appellant and the other accused tried to run away but they were apprehended. The raiding party, also found five glasses and two empty bottles, all smelling of liquor, twelve empty soda water bottles and one full ' bottle con taining liquor and these articles were seized by the raiding party in the presence of the panch witnesses and the panch nama was prepared. The appellant and the other accused were thereafter taken to the Amreli hospital where their blood was taken by the Civil Surgeon for the purpose of carrying out 874 the necessary test for determining the presence of alcohol. The analysis of the blood revealed that, in the case of the appellant, the concentration of alcohol in the blood was more than 0.05 per cent weight in volume while in the case of the other accused, it was less than 0.05 per cent. On these facts, the appellant and the other accused were charge sheeted before the Judicial Magistrate, Kodinar. The charge against accused No. 1 was that he possessed as well as consumed liquor in contravention of the provisions of the Act and was, therefore, guilty of offences punishable under section 66(1)(b), while the charge against the other ac cused, including the appellant, was that they were guilty of consuming liquor in contravention of the provisions of the Act and were hence liable to be punished for the offence under section 66(1) (b) of the Act. The learned Judicial Magistrate accepted the evidence in regard to the concentra tion of alcohol in the blood of the accused, but taking the view that breaches of certain rules in the Bombay Prohibi tion (Medical Examination and Blood Test) Rules, 1959 were committed in taking the blood of the accused, the learned Judicial Magistrate acquitted the accused including the appellant of the offence of consuming liquor under section 66 (1 ) (b). The learned Judicial Magistrate also acquitted accused No. 1 of the offence of possessing liquor under section 66(1)(b) on the ground that it was not proved by the prosecution beyond reasonable doubt that he was in posses sion of liquor. The State preferred two appeals against the order of acquittal passed by the learned Judicial Magistrate. Both the appeals were heard by a Single Judge of the High Court any they were disposed of by a common judgment. The High Court did not examine whether the order passed by the learned Judicial Magistrate acquitting the appellant and the other accused of the offence of consuming liquor was right or wrong nor did it consider whether the acquittal of ac cused No. 1 for the offence of possessing liquor was correct or incorrect. But, taking the view that there was no dis tinction between the case of accused No. 1 on the one hand and that of the appellant and accused Nos. 3 to 8 on the other so far as the charge of possession of liquor is con cerned, the High Court held that, on the material on record, the learned Judicial Magistrate should have flamed a charge against the appellant and accused Nos. 3 to 8 not only for the offence of consuming liquor but also for the offence of possession of liquor as in the case of accused No. 1. The High Court observed: "Whenever "Drinking Parties" are detect ed by the police, it is the imperative duty of the prosecution to allege that all the partic ipants of the same are charged with the "possession" of liquor in contravention of the provisions of law contained in Sec. 66(1 )(b) of the B 'bay Prohibition Act, 1949. It may be emphasised that in such cases, "possession" of liquor does not only necessarily mean actual, physical or conscious possession of the owner or the occupant of the premises". In such cases of "Drinking Parties", it is always open to a participant to stretch his hand and to take the liquor in question for his own use and consumption. But, in all such cases of 875 "Drinking Parties", the Court must be satis fied that the attendant circumstances should clearly indicate that the accused persons are the participants in a "Drinking Party". In the case before me, why should the accused persons, during the night hours, having gath ered together go to a distant farm house ? Why should they be found with the aforesaid articles ? Why should they create a situa tion as a result of which a constable had to jump over a wall ? Why should they try to run away when they Were apprehended by the respon sible officers for Amreli ? In such circumstances, it is the duty of the prosecution to see that all the partic ipants are charged with the commission of the offence viz. of possessing liquor in contra vention of the provisions contained in Sec. 66(1)(b) of the B 'bay Prohibition Act, 1949. " The High Court, on this view, set aside the order of acquittal in 'its entirety without examining its correctness and remanded the case to the learned Judicial Magistrate with a direction to try the appellant and the other accused not only on the charge of consuming liquor but also on the further charge of possession of liquor. Accused Nos. 1 and 3 to 8 did not challenge the correctness of this order made by the High Court, but the appellant impugned it by prefer ring the present appeal with special leave obtained from this Court. The impugned Order made by the High Court consists of two parts. One part set aside the order of acquittal and directed retrial of the appellant on the charge of consuming liquor while the other directed that the appellant and accused Nos. 3 to 8 'should also be tried on the further charge of possession of liquor. The appellant attacked both parts of the Order and the contention urged by him in sup port of the appeal was a two fold one. The first limb of the contention was that the order setting aside the acquit tal of the appellant for the offence of consuming liquor and directing retrial of the appellant for that offence was improper, since it was not competent to the High Court in appeal to set aside the order of acquittal and direct retri al, unless it_found that the acquittal was wrong. Here in the present case, the High Court did not even consider whether the acquittal of the appellant was correct or not and without finding that the acquittal was erroneous, pro ceeded to set aside the acquittal and direct retrial. This, according to the appellant, was impermissible for the High Court to 'do and it was said that the order setting aside the acquittal must, therefore, be reversed and the acquittal restored. The second limb of the contention related to that part of the impugned order which directed that the appellant and accused Nos. 3 to 8 should be retried not only on the charge of consuming liquor but also on the further charge of possession of liquor. The argument of the appellant under this head of contention was that in the appeal, the High Court was confined merely to a consideration of the question whether the acquittal of the appellant for the offence of consuming liquor was right or wrong and it was, not compe tent to the High Court 6 1338SCI/76 876 to frame a new charge for possession of liquor and direct trial of the appellant and the other accused on such now charge. These were the twin grounds on which the order made by the High Court was challenged on behalf of the appellant. Now, there can be no doubt that there is great force. in the first part of ' the contention of the appellant. The learned Judicial Magistrate acquitted the appellant of the offence of consuming liquor. The State preferred an appeal against the acquittal and manifestly, in this appeal, the acquittal could not be set aside unless the High Court, on a consider ation of the evidence, came to the conclusion that the acquittal was wrong. It was not competent to the High Court to set aside the acquittal without finding that it was erroneous. The High Court, however, did not even care to examine whether the acquittal was right or wrong, but merely because it took the view that a further charge should have been framed against the appellant and accused Nos. 3 to 8, it set aside the acquittal and directed retrial of the appellant and the other accused. This was plainly and indubitably wrong and the: order setting aside the acquittal must, therefore, be quashed. But from that it does not necessarily follow that the acquittal must be restored. The High Court having failed to consider the merits of the acquittal,. the matter would have to go back to the High Court for the purpose of deciding whether on the evidence on record, the acquittal was justified or not. The appeal being directed against the correctness of the acquittal, the High Court would have to determine whether on merits, the acquittal should be maintained or reversed. We must, there fore, quash that part of the order of the High Court which set aside the acquittal of the appellant for the offence of consuming liquor and remand ' the case to the High Court for disposing of the appeal against the acquittal of the appel lant on merits. That takes us to the second limb of the contention directed against the order of retrial on the further charge of possession of liquor. It is true that originally when the case was tried before the learned Judicial Magistrate, there was no charge against the appellant and accused Nos. 3 to 8 for the offence of consuming liquor and the appeal of the State was also directed 'only against their acquittal for ,the offence of consuming liquor. But there can be no doubt that if, while hearing the appeal, the High Court found that, on the material before .him, the learned Judicial Magistrate should have framed a further charge against the appellant and accused Nos. 3 to 8 but he failed to do so, the High Court could certainly direct the learned Judicial Magistrate to frame such further charge and try the appel lant and accused Nos. 3 to 8 on such further charge. The High Court could legitimately in the exercise of its juris diction, set right the error committed by the learned Judi cial Magistrate in not flaming a proper charge. Here, the High Court, on a consideration of the material which was before the learned Judicial Magistrate, came to the conclu sion that this material warranted the framing of a further charge against the appellant and accused Nos. 3 to 8 for possession of liquor and it, therefore, directed that the case should go back to the learned judicial Magistrate and he should try the appellant and accused Nos. 3 to 8 on 877 such further charge. The High Court clearly had jurisdic tion to make such an order. But then, the complaint made on behalf of the appellant was that the material before the learned Judicial Magistrate did not justify the framing of a charge against the appellant and accused Nos. 3 to 8 for possession of liquor and hence the order directing their trial on such further charge was not justified. This is, however, a complaint on facts and we do not see any reason why we should, in the exercise of our extra ordinary juris diction under Article 136 of the Constitution, entertain such a complaint. It is true that there are certain obser vations made by the High Court which are a little too wide but it cannot be gained that even a person who participates in a drinking party can in conceivable cases be guilty of the offence of possession of liquor. Suppose a person is found at a drinking party and he has a glass with him with liquor in it at the time when the raid is carried out, would it not be correct to say that he was at the relevant time in possession of liquor ? The liquor in his glass would be liquor in his possession. But at the same time it would not be correct to say that merely because a participant in a drinking party can stretch his hand and take liquor for his use and consumption, he can be held to be in possession of liquor. The question is not whether a participant in a drinking party can place himself in possession of liquor by stretching his hand and taking it but whether he is actu ally in possession of it. Possession again must be distin guished from custody and it must be conscious possession. If, for example, a bottle liquor is kept by. some one in the car or house of a person without his knowledge, he cannot be said to be in possession of the bottle of liquor. It can not, therefore, be laid down as an absolute proposition that whoever is present at a drinking party must necessarily be guilty of the offence of possession of liquor and must be charged for such offence. Whether an accused is in posses sion of liquor or not must depend on the facts and circum stances of each case. Here in the present case, the prose cution will have to establish at the trial by leading satis factory evidence that the appellant and the other accused were in possession of liquor as else the prosecution on the charge of possession of liquor will fail. The order direct ing trial of the appellant and the other accused for the offence of possession of liquor must, therefore, be main tained, but we think it would be desirable if this trial is taken up after the disposal of appeal by the High Court in regard to the acquittal of the appellant for the offence of consuming liquor. We accordingly allow the appeal in part and reverse that part of the 'order of the High Court which set aside the acquittal of the appellant for the offence of consuming liquor and remand the case to the High Court for disposing of the appeal against the acquittal of the appellant on merits, but so far as the other part of the order directing trial of the appellant and the other accused on the charge of possession of liquor is concerned, we do not see any reason to interfere with the same and we accordingly reject the appeal in so far as it is directed against that part of the order. S.R. Appeal partly allowed.
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Section 66(1)(b) of the Bombay Prohibition Act of 1949 says that anyone can be punished if they are found guilty of "drinking, using, having, or moving any alcohol or drugs." Section 66(2)(b) says there's a limit of 0.05 percent of alcohol allowed in a person's blood. In cases 798 and 799 from 1972, a court in Gujarat charged the person appealing this case (accused No. 2) and six others with drinking alcohol. Accused No. 1, who owned the farm where the drinking happened, was charged with having alcohol. Even though accused No. 2 had more alcohol in their blood than the legal limit, they were found not guilty. This was because the police didn't follow certain rules for medical exams and blood tests, as stated in the Bombay Prohibition (Medical Examination and Blood Test) Rules of 1959. Accused 3 to 8 were also found not guilty because their alcohol levels were below the limit. Accused No. 1 was also found not guilty because there wasn't enough proof that they had alcohol. The state appealed, saying that anyone at a drinking party should also be charged with having alcohol. The High Court agreed and ordered a new trial for everyone, without checking if the original court's decisions were correct. The case went to a higher court, which HELD: (i) When the state appeals a "not guilty" verdict, the higher court should only overturn it if they find that the original decision was wrong after looking at the evidence. In this case, the High Court didn't even check if the first court was right to find the person appealing this case not guilty. They just overturned the decision and ordered a new trial without saying the original decision was wrong. The High Court couldn't overturn the "not guilty" verdict without first finding that it was wrong. Ordering a new trial just because they thought the person should have been charged with having alcohol was clearly a mistake. (ii) If a High Court thinks a person should have been charged with something else based on the evidence, they can fix the mistake the first court made by adding the correct charge. (iii) The Supreme Court won't usually look at complaints about the facts of a case when using its special power under Article 136 of the Constitution. (iv) Having something is different from just holding it. It means you know you have it. Whether someone has alcohol depends on the specific facts of each case.
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(Crl.) No. 15 of 1989. Shah, M.N. Shroff and K.M.M. RAY, J. This writ petition is directed against the order of detention made under section 3(1) of Gujarat Prevention of Anti Social Activities Act, 1985, mainly on the grounds that the grounds are not germane and relevant and there has been non application of mind by the detaining authority in making the said order. 1, Shri S.N. The detenu thereafter challenged the impugned order of detention before this Court by the instant Writ Petition No. You are known as dangerous and terrible person in the said area. Therefore you are a 'dangerous person ' as defined under section 2(c) of the said Act and you are, by creating atmosphere of danger and terror, becoming hurdle in the way of maintenance of law and order in the said area. The details thereof are as under: section No. Crime R. No. Kagdapith 96/85 324,504, 114 Compounded IPC, 135(1) B.P. 135(1) B .P. Conviction 4. 324, 504, Under in 114 IPC, 135(1) vestigation. Act. Kagdapith 51/88 307,232, 114 IPC Under in 135(1) B.P. Act. Kagadapith 81/88 326, 114 IPC, Under in 135(1) B.P Act vestigation. Therefore, you are a dangerous person as defined in section 2(c) of the said Act. In the said area in drunken condition you are demanding money from those passing from there. You are beating peace loving citizens in the said area in public believing that they are giving information of your activities to the police. By this you are coming in the way of maintenance of public order. Particulars in support of your aforesaid anti social activities have been given by four persons residing in the said area or doing trade or business in the said area in their statements. Therefore, you are not given names and addresses of those witnesses as provided in section 9(2) of PASA ACT, 1985 however contents of the facts states by them are given to you." By such activities you have 574 become hurdle in maintenance of public order. " 1 has thus referred to seven criminal cases filed against the petitioner and also the statements of four persons residing in the area recorded by the police. 1 has also made averments in the grounds alleging various anti social activities of the petitioner and after considering the same made the impugned order of detenu on forming an opinion that the petitioner is a dan gerous person within the meaning of section 2(c) of the said Act. The names and addresses of the four witnesses have not been disclosed claiming privilege under section 9(2) of 'PASA ' Act. As regards the seven criminal cases, the detenu has been acquitted of the charges ,in the first two cases that is, Kagdapith case No. 120/86 which have been compounded, In the third case under section 135 of the Bombay Police Act, that is, Kagdapith case No. But it has no relevance for the purpose of forming an opinion that the petitioner is a dangerous person .under section 2(c) of PASA Act. As regards the case No. 4, that is criminal case No. 122/86, the petitioner has been acquitted. The other three criminal cases that is Maninagar case No. 33/88, Kagdapith case No. It has also been stated that the grounds of detention supplied to the petitioner are vague and indefinite and as such the detenu could not make an effective and proper representation under article 22(5) of the Constitution. It has further been stated that out of the aforesaid seven criminal cases, the first two criminal cases are not proximate to the date of making the impugned order of detention. There is absolute non application of mind by the detaining authority in coming to his subjective satisfaction that the impugned order was necessary to be made to prevent the detenu from acting in any manner prejudicial to the maintenance of public order. 1, filed an affidavit in reply stat ing inter alia that the petitioner detenu is indulging in criminal activities prejudicial to the maintenance of the public order and as such the order of detention was made against the detenu after considering that recourse to ac tions under the provisions of ordinary law will not be adequate. It has also been stated that on the basis of the apprehension expressed by those four witnesses 575 whose statements have been recorded by the Police Inspector and verified by the Superintendent of Police that their names and addresses have not been disclosed by the detaining authority claiming the privilege available under section 9(2) of the Gujarat Prevention of AntiSocial Activities Act, 1985. It has also been stated that the detaining authority has been subjectively satisfied that the petitioner is indulging in nefarious activities prejudicial to the maintenance of public order and as such the impugned order of detention was made by him against the detenu It has also been stated that in Criminal Case No. 225/87, the detenu was found with razor and he was convicted in that particular case. It has also been. stated that from the cases registered against the detenu from 1985 to 1988 that the detenu is involved in prejudicial activities from 1985 to 1988 and as such it was inferred that the passing of detention order was the only remedy to restrain the petitioner from indulging in similar prejudicial activities. It is evident from the grounds of detention that the impugned order of detention was made on the ground that the petitioner is a dangerous and terrible person in the area as defined in section 2(c) of the PASA Act. The said section states: "dangerous person" means a person, who either by himself or as a member or leader of a gang, during a period of three successive years habitually commit, or attempts to commit or abets the commission of any of the offences punishable under Chapter XVI or Chapter XVII of the Indian Penal Code (XLV of 1860) or any of the offences punishable under Chapter V of the (54 of 1959). " In the grounds, it has been stated that the detenu by creat ing atmosphere of danger and terror has become hurdle in the way of maintenance of law and order in the said area. It has also been stated that for such acts as well as due to the following criminal offences under the Indian Penal Code registered against him, the detenu has become a dangerous person of the area. It has also been stated that the detenu has been robbing persons who pass from there for business or service by showing deadly weapons. It has also been stated, "In the said area in drunken condition you are demanding money from those passing from there. You are beating peace loving citizens in the said area in public believing that they are giving informa tion of your criminal activities to the police. By this you are coming in the way of maintenance of public order. " 576 It has already been stated hereinbefore that offences under Chapter XVI of Indian Penal Code have been compounded. As regards the third case that is, Kagdapith case No. 225/87 under section 135 of Bombay Police Act, the petitioner was convicted. This offence is not one of the offences falling within the offences men tioned in section 2(c) of the PASA Act and as such this case cannot be taken into consideration to hold the detenu a dangerous person. As regards the fourth case Maninagar case No. 122/86, being not proved against the petitioner he has been acquitted of the offences charged in the said case. The other three remaining cases that is, Maninagar case No. 33/88, Kagdapith case No. For the purpose of determining the petitioner as a dangerous person, it is also very relevant to notice that section 2(c) defines dangerous person as a person who habitually commits or attempts to commit offences pun ishable under Chapter XVI or Chapter XVII of Indian Penal Code or any of the offences under Chapter V of the . From the aforesaid seven criminal cases, two cases are of 1985 and 1986 which are not proximate to the date of the order of detention and so stale. Similarly case No. Fourth case No. Merely on consideration of the other three crimi nal cases which are under investigation and are yet to be decided the detaining authority cannot come to his subjec tive satisfaction that the detenu was a dangerous person who habitually indulges in committing offences referred in section 2(c) of the PASA Act. The other averments made in the said grounds and referred to hereinbefore are absolutely vague in as much as no particulars as to which persons have been robbed or what offences have been committed by showing deadly weapons at what place have not been mentioned. There is no particular instance also as to which peace loving citizens and in which area the petitioner has beaten in public believing, that they are giving infor mation of his criminal activities to the police. It is also a vague statement that the detenu is coming in the way of maintenance of public order. Similarly the statement of the said four witnesses mentioned in the grounds of detention are also very vague and without any particulars of the names of the four witnesses and their addresses were not dis closed. This ArtiCle confers on a detenu two fundamental rights namely, (1) that the detaining authority has to communicate to the detenu the grounds as early as possible on which the order of detention has been made and secondly the right to make an effective representation against the said order. This obviously requires that the grounds must not be vague but must be specific, relevant in order to enable the detenu to make an appropriate and effecting representation against the same before the Advisory Board as well as before other authorities including detaining author ity. The grounds and the averments made in the grounds which were served on the detenu are Vague and as such they are violative of the article 22(5) of the Constitution of India. "Similarly, if some of the grounds supplied to the detenu are so vague that they would virtually deprive the detenu of the statutory right of making a representation, that again may make the order of detention invalid. " "It was held by this Court that the ground was extremely vague and gave no particulars to enable the petitioners to make an adequate representation against the order of deten tion and it infringed the constitutional safeguard provided under article 22(5) of the Constitution of India. " In the case of Pushkar Mukharjee, the ground No. It was held in this case that, "It is manifest that this ground is extremely vague and gives no particulars to enable the petitioner to make an adequate representation against the order of detention and thus infringes the constitutional safeguard provided under article 22(5). " 578 The second crucial question that fails for consideration in this case is whether the grounds of detention particular ly referring to the seven criminal cases are relevant and germane grounds for passing of an order of detention under section 3(1) of the PASA Act. All the seven criminal cases men tioned relate to problem of law and order and not public order in as much as they disclose cases relating to particu lar persons which has nothing to do with the maintenance of public order. As has already been said hereinbefore that out of the seven criminal cases, two have been compounded and in the fourth case the criminal charges have not been proved against the petitioner as such he was acquitted. The third case being under section 135 of the Bombay Police Act does not fall within the purview of the section 2(c) of the Act and it is ' confined to a private individual. The other three cases which are under investigation also relate to assault to private individuals and they have nothing to do with the disturbance of even tempo of the life of the community or of men of a particular locality nor does it affect the even flow of life of the public as a whole. Section 3(1) clearly mandates that the order of detention can be made only when the State Government or its authorised officer has come to a subjective satisfaction that a person is required to be detained in order to prevent him from acting in any manner prejudicial to the maintenance of the public order. Sub section 4 embodies a deeming clause to the effect that a person should be deemed to act in any manner prejudicial to the maintenance of public order when such person is engaged in any activities as a dangerous person which affect ad versely or are likely to affect adversely the maintenance of public order. Explanation 2 clause 4 further provides that for the purpose of this sub section public order shall be deemed likely to be affected adversely or shall be deemed likely to be affected adversely inter alia if any of the activities of any person referred to in this sub section directly or indirectly, is causing or is likely to cause any harm, danger or alarm or feeling of insecurity among the general public or any section thereof or a grave or wide spread danger of life, property or public health. Coming to this particular case, the criminal cases mentioned in the grounds do not refer to any dangerous, harmful or adverse act or alarm which gives rise to a feeling of insecurity for the general public amongst the persons of a locality. The criminal cases are confined to certain private individuals and it is merely a law and order problem and it has nothing to do with maintenance of public order. An act may create a law and order problem but such an act does not necessarily cause an obstruction to the maintenance of public order. The difference between 'the law and order and public order has been very succinctly stated by this Court in Dr. Ram Manohar Lohia vs State of Bihar & Ors., [966] 1 SCR 709 at page 746 wherein it has been stated that: "It will thus appear that just as "public order" in the rulings of this Court (earlier cited) was said to comprehend disorders of less gravity than those affecting "security of State" "law and order" also comprehends disor ders of less gravity than those affecting "public order". It is then easy to see that an act may affect law and order but not public order just as an act may affect public order but not security of the State. In Pushkar Mukharjee vs State of West Bengal, (supra), it has been stated that: "It is manifest that every act of assault or injury to specific persons does not lead to public disorder. The contravention of any law always affects order but before it can be said to affect public order, it must affect the community or the public at large. A District Magistrate is therefore entitled to take action under section 3(1) of the Act to pre vent subversion of public order but not in aid of maintenance of law and order under ordinary circumstances. " It has also been observed in a recent decision of the Supreme Court in Piyush Kantilal Mehta vs The Commissioner of Police, Ahmedabad City, (supra) that: "The allegations made against the petitioner may give rise to a question of law and order but, surely, they have nothing to do with the question of public order. A person may be very fierce by nature, but so long as the public generally are not affected by his activities or conduct, the question of maintenance of public order will not arise. In order that an activity may be said to affect adversely the maintenance of public order, there must be materials to show that there has been a feel ing of insecurity among the general public. If any act of a person creates panic or fear in the minds of the members of the public upset ting the even tempo of life of the community, such act must be said to have a direct bearing on the question of maintenance of public order. Our attention has been drawn to the decision in the case of Ashok Kumar vs Delhi Administration, In that case in the grounds of detention thirty six criminal cases have been referred to showing the prejudicial activi ties of the detenu leading to public disorder. This Court in considering these series of criminal cases committed by the detenu held that the detenu appears to have taken a life of crime and become a notorious character. Considering these, this Court held in the particu lar facts and circumstances of that case that the order of detention made by the detaining authority after being sub jectively satisfied that the acts of the detenu hinder the maintenance of public order. The facts and circumstances of that case are distin guishable from the facts of the present case and as such it has got no application. There is nothing in this case to show that the petitioner was a member of a gang which are engaged in criminal activities systematically in a particu lar locality and those create a panic and a sense of insecu rity amongst the residents of that particular area in con sideration of which the impugned order was made. Considering the above decisions, we are unable to hold that the criminal cases mentioned in the grounds and the statements of the witnesses referred to in the vague and irrelevant grounds of detention do not in any way pose a threat to the maintenance of public order nor it disturbs the even tempo of public life as envisaged in section 3(1) of PASA Act. It has been urged on behalf of the detenu that there has been no consideration by the detaining authority of the relevant facts and circumstances before making an order under section 9(2) of the PASA Act in not disclosing the names and addresses of the witnesses on whose statements the subjective satisfaction has been arrived at. It has also been stated in this connection that in the grounds of deten tion it has merely been stated, "Being afraid of you the aforesaid witnesses have asked not to disclose their names and addresses because they are afraid of persons. It has been urged with force that this ground does not refer that the detaining authority has himself considered and satisfied that the disclosure of their names and addresses are likely to cause damages to their person and properly. It has been stated by the detaining authority that on relevant enquiry, it found those statements to be true and as such the names and addresses of those witnesses have not been given to the detenu is provided in section 9(2) of the PASA Act, 1985. It has been contended on behalf of the petitioner that there is nothing to show that the detaining authority has himself considered that in public interest the names and addresses of these persons should not be disclosed and so such non disclosure is vague. We do not want to enter into this controversy and decide the same as in our opinion the 582 detaining authority has been satisfied not to disclose the names of those witnesses under section 9(2) of the said Act.
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In this case, the person filing the petition ("Petitioner") argued that their detention order was illegal. This order was issued by the other party ("Respondent") under a law called the Gujarat Prevention of Anti Social Activities Act, 1985. The person detained ("detenu") was arrested and put in jail on October 5, 1988. Soon after, the detenu sent a request to the person who ordered the detention, the state government, and an advisory board, all protesting the detention order. Because they didn't get a reply, they filed this legal challenge (Writ Petition). The reasons given for the detention included claims that the detenu and their friends had committed crimes like robbery and assault with dangerous weapons. Because of these actions, they were considered a threat in the area, or a "dangerous person," according to the law. The reasons also listed seven criminal cases that had been filed against the detenu. The detenu was accused of using weapons like razors, knives, and hockey sticks to commit crimes that hurt people. It was also stated that if people refused to give the detenu money when asked, the detenu would threaten to kill them with weapons. The reasons also mentioned that four people from the area gave information about the detenu's illegal activities. These people didn't want their names revealed, so they weren't, based on legal privilege. Considering these facts, the person who ordered the detention believed that the detenu had committed crimes punishable under the Indian Penal Code (I.P.C.). They felt that these actions disturbed public order and interfered with keeping the peace. That's why the detention order was issued. The Petitioner challenged the detention order mainly for two reasons: (i) The reasons for detention were not clear or relevant because they were too vague and lacked specific details. (ii) The person who ordered the detention didn't properly consider the situation before making the order. The Court, after hearing the arguments, made an order on May 5, 1988, allowing the Writ Petition. They stated that a written explanation would follow later. Here are the reasons the Court gave for its decision: The claims made in the reasons for detention were too vague. They didn't specify who had been robbed, what crimes had been committed with weapons, or where these events took place. The reasons also didn't say when or where the detenu, while drunk, demanded money from someone, or when the detenu threatened someone with a razor or knife. There were no specific examples of the Petitioner beating peaceful citizens in public because they thought those citizens were giving information about their criminal activities to the police. The statement that the detenu was interfering with public order was also too vague. The reasons and claims given to the detenu were unclear and violated Article 22(5) of the Constitution of India (which protects people from being detained without proper cause). (Citations to other cases removed to simplify the text.) An action might cause a "law and order" problem, but that doesn't always mean it disrupts public order. A "law and order" problem usually affects specific people, while disturbing "public order" affects the community at large. The criminal cases in this situation only involved certain individuals. This is a "law and order" problem, not a matter of "public order." The impact wasn't significant enough to create panic or disrupt the community's peace. There was no evidence that the Petitioner's actions had disrupted the normal life of the community. The person who ordered the detention stated that they investigated and believed the statements were true. They didn't give the detenu the names and addresses of the witnesses, as allowed under Section 9(2) of the PASA Act, 1985. The Court didn't argue about this, because it believed the person ordering the detention was justified in not revealing the names of the witnesses.
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[304D] & CIVIL ORIGINAL JURISDICTION: Writ Petitions Nos. 2687, 5822 of 1983 etc. (Under Article 32 of the Constitution of India). Dr. Shankar Ghosh, T.S.K. Iyer, M.L. Lahoty, P.S. Jha, D.D. Gupta, S.K. Jain, D.P. Mukherjee, S.R. Srivastava, P.N. Tewari and Parijat Sinha for the petitioners. Tapas Ray, Anil B. Dewan, T.C. Roy, G.S. Chatterjee, Dalip Sinha and H.K. Puri for the respondents. The judgment of the Court was delivered by PATHAK, CJ. By these writ petitions and transferred cases the petitioners challenge the validity of the levy of cess in respect of tea estates under the West Bengal Rural Employment and Production Act, 1976. The West Bengal Rural Employment and Production Act, 1976, (shortly referred to as the "West Bengal Act") is intended to provide the additional resources for the promo tion of employment in rural areas and for implementing rural production programmes. The additional resources are sought to be raised from two sources, a surcharge on land revenue under section 3 of the Act and a rural employment cess under section 4 of the Act. We are concerned here with the levy of the rural employment cess. 297 Originally section 4 of the West Bengal Act provided as follows: "4. (1) On and from the commencement of this Act, all immovable properties on which road and public work cesses are assessed according to the provisions of the Cess Act, 1880, shall be liable to the payment of rural employment cess: Provided that no raiyat who is exempted from paying revenue in respect of his holding under clause (a) of subsection (1) of section 23B of the West Bengal Land Reforms Act, 1955, shall be liable to pay rural em ployment cess. (2) The rural employment cess shall be levied annually (a) in respect of lands, at the rate of six paise on each rupee of development value thereof; (b) in respect of coal mines, at the rate of fifty paise on each tonne of coal on the annual dispatches therefrom; (c) in respect of mines other than coal mines and quarries, at the rate of six paise on each rupee of annual net profits thereof. " The West Bengal Taxation Laws (Amendment) Act, 1982 amended the West Bengal Act and by section 7(b) thereof amend ments were made in section 4(2) of the West Bengal Act with effect from 1 April, 1981. As a result, as from that date, section 4(2) in so far as it is material read as follows: 4(2). The rural employment cess shall be levied annually (a) in respect of lands, other than a tea estate, at the rate of six paise on each rupee of development value thereof; (aa) in respect of a tea estate at such rate, not exceeding rupees six on each kilogram of tea on the dispatches from such tea estate of tea grown therein, as the State Government may, by notification in the Offi cial Gazette, fix in this behalf: 298 Provided that in calculating the dispatches of tea for the purpose of levy of rural employment cess, such dispatches for sale made at such tea auction centres as may be recognised by the State Government by notification in the Official Gazette shall be excluded. Provided further that the State Government may fix different rates on des patches of different classes of tea. Explanation For the purpose of this section, "tea" means the plant Camellia Sinen sis (L) O. Kuntze as well as all varieties of the product known commercially as tea made from the leaves of the plant Camellia Sinensis (L) O. Kuntze, including green tea and green tea leaves, processed or unprocessed;" Section 4 was also amended further by the insertion of sub section (4) which provided: "(4) The State Government may, if it considers necessary so to do, by notification in the Official Gazette, exempt such categories of despatches or such percentage of despatches from the liability to pay the whole or any part of the rural employment cess, or reduce the rate of the rural employment cess payable thereon, under clause (aa) of sub section (2), on such terms and conditions as may be speci fied in the notification. Thereafter the West Bengal Taxation Laws (Amendment) Act, 1982 was enacted with effect from 1 October, 1982. section 4(2) of the West Bengal Act was amended and under clause (aa) thereof the first proviso was omitted. Pursuant to the amendments in the West Bengal Act in 1981 and 1982, various notifications were issued by the State Government, which for our purpose broadly cover these different periods: (a) First Period: 1 April, 1981 to 30 Septem ber, 1982 299 Rural employment cess was levied at the rate of Rs.5 per Kg. on all despatches of tea, but in respect of despatches to two tea auction centres within West Bengal the rate of duty was nil, and in respect of tea sold in West Bengal through registered dealers otherwise than through the two tea auction centres the rate of tax was Rs.2.50 per Kg. (b) Second Period: 1 October, 1982 to 28 March, 1984 Rural employment cess was levied at the rate of Rs. on all despatches of tea except that for despatches to the said two tea auction centres the rate of levy was 30 paise per Kg. (c) Third Period: 29 March, 1984 onwards Rural employment cess was levied at the rate of Rs.3 per Kg. on all despatches of tea except that for despatches to the said two tea auction centres in West Bengal the rate of tax was only 30 paise per Kg. Learned counsel for the petitioners contend that the levy of the cess under section 4(1) read with section 4(2)(aa) of the West Bengal Act as amended in 1981 and 1982 is ultra vires inasmuch as the statutory provisions violate Article 14 and Article 301 of the Constitution and also lie outside the legislative competence of the State Government. It seems to us that these cases can be disposed of on the short ground based on Article 301 of the Constitution and want of legis lative competence. There can be no dispute that the rural employment cess is a tax. cannot also be disputed that if the levy of a tax on goods has the direct and immediate effect of impeding the movement of goods throughout the territory of India, there is a violation of Article 301 of the Constitution. If, however, the impact of the levy is indirect or remote, no valid complaint can be made in relation to Article 301. In Atiabari Tea Co., Ltd. vs The State of Assam and Others, ; , Gajendragadkar, J (as he then was) speaking for the majority in that case held that tax laws would effect trade and commerce and could be violative of the freedom guaranteed by Article 30 1, provided they di rectly or immediately affect the freedom of trade and com merce and not indirectly or in a remote manner. This princi ple was affirmed by this Court in The Automobile Transport (Rajasthan) 300 Ltd. vs The State of Rajasthan and Others, [1963] 1 S.C.R. 491 and again in Firm A.T.B. Mehtab Majid and Company vs State of Madras and Another, [1963] Suppl. But the declaration in Article 301 that trade, commerce and intercourse throughout the territory of India shall be free is subject to Article 304(b) which provides: "304. Notwithstanding anything in Article 301 or Article 303, the Legislature of a State may by law ( a ) . (b) impose such reasonable restrictions on the freedom of trade, commerce or inter course with or within that State as may be required in the public interest. Therefore, there is no violation of Article 30 1 if the case falls under Article 304(b) and its proviso. In Kalyani Stores vs The State of Orissa and Others, [1966] 1 S.C.R. 865 this Court held that a restriction on the freedom of trade and commerce which is guaranteed by Article 301 cannot be justified unless the procedure provided in Article 304 is followed. That was also the view taken in State of Mysore vs H. Sanjeeviah; , and Andhra Sugars Ltd. & Anr. vs State of Andhra Pradesh & Ors. In other words, if the Legislature of a State enacts a law which imposes such reasonable restrictions on the free dom of trade, commerce or intercourse with or within that State as may be required in the public interest and further that the Bill or amendment for the purposes of clause (b) has been introduced or moved in the Legislature of a State with the previous sanction of the President, such enactment will not offend the Article 301. The question then is whether the impugned levy impedes the free flow of trade and commerce throughout the territory of India, and if it does, whether it fails within the excep tion carved out in Article 304(b). If the levy imposes a cess in respect of tea estates, it may well De said that even though the free flow of tea is impeded in its movement throughout the territory of India it is in consequence of an indirect or 301 remote effect of the levy and that it cannot be said that Article 301 is contravened. The contention of the petition ers is, however, that it is ostensibly only in respect of tea estates but in fact it is a levy on despatches of tea. If that contention is sound, there can be no doubt that it constitutes a violation of Article 301 unless the legisla tion is brought within the scope of Article 304(b). To determine whether the levy is in respect of tea estates or is a levy on despatches of tea, the substance of the legis lation must be ascertained from the relevant provisions of the statute. It cannot be disputed that the subject of the levy, the nature of which defines the quality of the levy, must not be confused with the measure of liability, that is to say, the quantum of the tax. There is a plenitude of case law supporting that principle, among the cases being Union of India and Others vs Bombay Tyre International Ltd. and Others, ; But what is the position here? The statute speaks of a levy "in respect of a tea estate", and it says that the levy will not exceed Rs.6 on each Kilogram of tea on the des patches from such tea estate of tea grown therein. The statute also provides that in calculating the despatches of tea for the purpose of levy of rural employment cess, the despatches for sale made at such tea auction centres as may be recognised by the State Government shall be excluded. And there is a proviso which empowers the State Government to fix different rates on despatches of different classes of tea. There is also section 4(4) which empowers the State Govern ment to exempt such categories of despatches or such per centage of despatches from the liability to pay the whole or any part of the rural employment cess, or to reduce the rate of the rural employment cess payable thereon under clause (aa) of sub section (2) on such terms and conditions as it may specify by notification. As from 1 October, 1982 the posi tion remained the same except that the first proviso to section 4(2)(aa) excluding the despatches for sale made at recog nised tea auction centres was deleted. The remaining provi sions continued as before. Now, for determining the true nature of the legislation, whether it is a legislation in respect of tea estates. and therefore of land, or in respect of despatches of tea, we must, as we have said, take all the relevant provisions of the legislation into account and ascertain the essential substance of it. It seems to us that although the impugned provisions speak of a levy of cess in respect of tea estates, what is really contemplated is a levy on despatches of tea instead. The entire structure of the levy points to that conclusion. If the levy is regarded as one in respect of tea estates and the measure of the liability is defined in terms of the weight of tea des patched from the tea estate there must be a nexus between the two indicating a 302 relationship between the levy on the tea estate and the criteria for determining the measure of liability. If there is no nexus at all it can conceivably be inferred that the levy iS not what it purports to be. The statutory provisions for measuring the liability on account of the levy throws light on the general character of the tax as observed by the Privy Council in Re: A Reference under the Government of Ireland Act, 1920 and Section 3 of the Finance Act (Northern Ireland), 1934, In R.R. Engineering Co. vs Zila Parishad, Bareilly & Anr., ; , this Court observed that the standard on which the tax is levied was a relevant consideration for determining the nature of the tax, although it could not be regarded as conclusive in the matter. Again in The Hingir Rampur Coal Co. Ltd. and Others. vs The State of Orissa and Others, ; , this Court observed that the method of determining the rate of levy would be relevant in consider ing the character of the levy. All these cases were referred to in Bombay Tyre International Ltd. (supra) where in the discussion on the point at page 367 this Court said: "Any standard which maintains a nexus with the essential character of the levy can be regard ed as a valid basis for assessing the measure of the levy. " In the case before us, however, we find that the nexus with the tea estate is lost altogether in the provisions for exemption or reduction of the levy and that throughout the nexus is confined to despatches of tea rather than related to the tea estate. There is nothing to suggest that a particular tea estate produces only one class of tea, and when reference is made to a certain class of tea the reference identifies a certain class of tea estates. We may presume that a tea estate produces different classes of tea and not one class of tea only. While there must always be a nexus between the subject of the levy and the measure of the levy that nexus extends into different dimensions. If the measure of levy is to vary with the despatches of different classes of tea there must be something in the class of tea concerned which points to a reason located in the particular tea estate or classes of tea estates which are made the subject of the levy. So also if the measure varies with the centre of sale of tea, the variation must relate to a reason to be found in the nature of the tea estate or classes of tea estates. In other words, there must be a reason why one class of tea is treated 303 differently from another class of tea when deciding upon the rate to be applied to different classes of tea and that reason must be found in the nature of the tea estate con cerned. Ultimately the benefit of exemption or reduced levy must be related to the need for exempting the tea estate from that levy or relieving it from part of the normal levy. When the provisions before us are examined in their totali ty, we find no such relationship or nexus between the tea estate and the varied treatment accorded in respect of despatches of different kinds of tea. It seems to us that having regard to all the relevant provisions of the statute, including section 4(2)(aa) and section 4(4), in substance the impugned levy is a levy in respect of despatches of tea and not in respect of tea estates. Treating it as a levy on despatches of tea it is evident that the levy must be regarded as constituting a direct and immediate restriction on the flow of trade and commerce in tea throughout the territory of India, and the levy can avoid the injunction declared in Article 301 only if it satisfies the provisions of Article 304(b) and the proviso thereto. For bringing the legislation within the saving provisions of Article 304(b) it is necessary that the Bill or amendment should have been introduced or moved in the Legislature of the State with the previous sanction of the President. It is not disputed that the amendments to the West Bengal Act made in 198 1 and 1982 did not satisfy that requirement. Indeed, it appears that the West Bengal Govern ment had sent an earlier Bill to the President with the object of levying a tax on the income from tea but the Presidential assent was not granted. It appears further that the Finance Minister of WeSt Bengal made a statement in the West Bengal Legislature on 27 February, 1981 stating that he would introduce the rural employment cess on despatches of tea. He referred to a Bill for amending the West Bengal Marketing (Regulation) Act, 1972 having been sent to the President and the President not having signified his consent to the amendment. In our opinion, the impugned provisions brought into the West Bengal Act by the amendments in 1981 and 1982 so far as they purport to relate to tea estates are unconstitutional and void and cannot be given effect to. Another aspect of the matter may be considered, and that relates to legislative competence. If the impugned legisla tion were to be regarded as a levy in respect of tea es tates, it would be referable to Entry 49 in List II of the Seventh Schedule of the Constitution which speaks of "taxes on lands and buildings". But if the legislation is in sub stance legislation in respect of despatches of tea, legisla tive authority must be 304 found for it with reference to some other Entry. It may be noted that Parliament had made a declaration in section 2 of the that it was expedient in the public interest that the Union should take under its control the tea industry. Under section 25 of the Act a cess on tea produced in India has also been imposed. It appears to us that the impugned legis lation is also void for want of legislative competence as it pertains to a covered field. We do not consider it necessary to express our opinion on the other points raised between the parties in this case. In the result, the writ petitions filed in this Court and the petitions in the Transferred Cases are allowed, the impugned amendments effected in the West Bengal Rural Em ployment and Production Act, 1976 by the amending Acts of 1981 and 1982 so far as they purport to relate to tea es tates are declared void and the petitioners are held enti tled to the refund of cess paid by them under the impugned statutory provisions. The petitioners are entitled to their costs. Petitions allowed.
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Section 4(1) of the West Bengal Rural Employment and Production Act, 1976 said that a tax called a rural employment cess could be put on properties that can't be moved, like land. Clause (aa) of section 4(2), which was changed by section 7(b) of the West Bengal Taxation Laws (Amendment) Act, 1981, said that a rural employment tax could be put on tea estates based on how much tea they shipped out that was grown there. The first rule added to that clause said that tea sent to be sold at approved places was not included. The first added rule to section 4(2)(aa) was, however, taken out by the West Bengal Taxation Laws (Amendment) Act, 1982. The people filing the case argued that the tax under section 4(1), along with section 4(2)(aa) of the Act, as changed in 1981 and 1982, broke the freedom promised by Article 301 of the Constitution and was beyond the state government's power to make laws about it. But if the tax only has a small or indirect effect, then there's no good reason to complain about Article 301. Also, Article 301 isn't broken if the case is allowed under Article 304(b) and its rule. The rural employment tax in this case was a tax. Ariabari Tea Co., Ltd. vs The State of Assam & Ors. ; ; The Automobile Transport (Rajasthan) Ltd. vs The State of Rajasthan & Ors., [1963] 1 S.C.R. 491; Firm A.T.B. Mehtab Majid and Company vs State of Madras & Anr., [1963] Suppl. 435; Kalyani Stores vs TIre State of Orissa & Ors., ; ; State of Mysore vs Ii. vs State of Andhra Pradesh & Ors. 2.1 To figure out if the tax was on tea estates (meaning it was about land and had a small effect) or if it was on tea shipments (meaning it directly stopped goods from moving), we need to look at the main points of the law using the law's relevant parts. Also, the rules for measuring how much tax is owed should relate to the kind of tax it is. 2.3 If the tax is on tea estates, and how much you owe is based on how much tea is shipped from the estate, then there needs to be a connection between the two. This shows a relationship between the tax on the tea estate and how the amount of tax is decided. If there's no connection at all, it could mean that the tax isn't really what it seems to be. 2.4 In this case, the connection to the tea estate is completely lost when we look at the rules for getting a break on the tax or lowering it. When a certain type of tea is mentioned, it doesn't mean we're talking about a certain type of tea estate. 2.5 There must always be a connection between what the tax is on and how the tax amount is decided. If the amount changes based on different types of tea being shipped, there has to be something about that type of tea that points back to a reason connected to the tea estate or types of tea estates being taxed. Also, if the amount changes based on where the tea is sold, the change has to connect to something about the tea estate. In the end, any break on the tax or lower tax amount should be tied to why the tea estate needs to be excused from the tax or get a break from the normal tax. 2.6 In this case, the relevant laws, including section 4(2)(aa) and section 4(4), don't show any connection between the tea estate and the different ways tea shipments are treated. So, the rural employment tax was on tea shipments, not on tea estates. 2.7 Such a tax could only be allowed under Article 301 if it followed the rules of Article 304(b) and its added rule. The changes made to the West Bengal Act in 1981 and 1982 weren't brought before the state's lawmakers with the President's approval beforehand. So, the parts added to the Act by those changes were against the Constitution and invalid, and couldn't be put into action. Under section 25 of that Act, a tax on tea made in India had also been put in place. The state law that taxed tea shipments was also invalid because the state didn't have the power to make laws about something that was already covered by federal law.
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1. In the facts and circumstances of the case and having heard the
learned counsel for the respective parties, the delay caused in filing the
special leave petition is hereby condoned.
1A. Leave granted.
2. Feeling aggrieved and dissatisfied with the impugned judgment
and order dated 12.09.2018 passed by the High Court of Rajasthan,
Bench at Jaipur in S.B. Criminal Revision No. 1270 of 2018, by which
the High Court, in exercise of its revisional jurisdiction, has quashed the
Act, Bharatpur dated 22.06.2018 framing the charge against the
respondent-accused for the offence under Section 7 of the Prevention of
Corruption Act (for short, ‘PC Act’) and consequently has discharged the
accused of the alleged offence under Section 7 of the PC Act, the State
has preferred the present appeal.
3. That the respondent herein – original accused was serving as a
Patwari. That the original complainant Jai Kishore and one another on
31.08.2010 submitted a written report before the Additional
Superintendent of Police, Anti-Corruption Bureau, Bharatpur stating that
for the purpose of issuing Domicile Certificate and OBC Certificate of his
son, he has submitted an application enclosed with complete certificates
before the accused – Patwari Ashok Kumar Kashyap for endorsing his
report. However, the Patwari in lieu of endorsing his report over the said
application demanded a bribe of Rs.2,800/-. Thereafter after conducting
the investigation a chargesheet came to be filed by the investigating
agency against the accused for the offence under Section 7 of the PC
Act. That the learned Special Judge heard the prosecution as well as
the defence at the time of framing of the charge. After hearing the
prosecution as well as the counsel for the defence and considering the
material on record which included the transcript of conversation recorded
between the complainant and the accused and considering the other
material on record and having found that there is a prima facie case
made out and the defence of the accused is not to be considered at this
stage, by order dated 22.06.2018 framed the charge against the
accused for the offence under Section 7 of the PC Act.
4. Feeling aggrieved and dissatisfied with the order passed by the
learned Special Judge framing the charge against the accused under
Section 7 of the PC Act, the accused preferred revision application
before the High Court by filing Criminal Revision No. 1270 of 2018.
4.1 Before the High Court, it was contended on behalf of the accused
that no case is made out under Section 7 of the PC Act, even on the
basis of the transcript recording the conversation between the
complainant and the accused. It was submitted that it is borne out from
the transcript that the accused in fact refused to give bonafide residence
certificate and returned the form on 29.08.2010 and that no work was
pending before him. It was also contended that on reading the entire
transcript the factum of demand of Rs.2,800/- is not revealed.
4.2 The revision application was opposed by the learned Public
Prosecutor. Heavy reliance was placed on the decision of this Court in
the case of Chitresh Kumar Chopra v. State (Govt, of NCT of Delhi), AIR
2010 SC 1446 and it was submitted that as held by this Court that at the
stage of framing of charge, the Court is required to evaluate the material
and documents on record with a view to finding out if the facts emerging
therefrom, taken at their face value, disclose the existence of all the
ingredients constituting the alleged offence. It was submitted that from
the transcript it is evident that bribe was demanded from the
complainant.
4.3 That by the impugned judgment and order, the High Court has
allowed the said revision application and has quashed and set aside the
order passed by the learned Special Judge framing the charge against
the accused for the offence under Section 7 of the PC Act and
consequently discharged the accused from the alleged offence by
“10. In the present case in hand, complainant himself when he
moved to the Anti Corruption Department mentioned that petitioner had
returned the form without making report. From the transcript which is
available on record, it is evident that some prior transactions pertaining
to bank file was pending between the parties and matter pertained to
Rs. 4,850/- out of which as per the petitioner, Rs. 4,000/- was to be
paid to the bank and in the transcript he has explained the total amount
which was payable by the complainant. There is no specific demand for
making a bonafide residence certificate, rather, petitioner had
mentioned in the transcript that as the complainant and his son are
residing in Agra (U.P.), a bonafide residence certificate cannot be
issued. No trap proceedings were conducted in the case and the
matter has remained pending with the Anti Corruption for a period of
more than five years. There is no specific demand of money by
petitioner and on the date of transcript no matter was pending before
11. In view of the same, it is evident from bare reading of the
transcript that offence under Section 7 of the Prevention of Corruption
Act would not be made out against the petitioner.”
5. Feeling aggrieved and dissatisfied with the impugned judgment
and order passed by the High Court, discharging the accused and
quashing and setting aside the order of framing charge by the learned
Special Judge, in exercise of its revisional jurisdiction, the State has
preferred the present appeal.
6. Mr. Vishal Meghwal, learned Advocate appearing on behalf of the
State has vehemently submitted that in the facts and circumstances of
the case, the High Court has erred in discharging the accused of the
charged offence when there is ample material and evidence on record
against the accused and sufficient grounds are available for proceeding
against the accused.
6.1 It is submitted that the High Court has failed to appreciate that at
the stage of framing of charge and/or consideration of an application for
discharge, the Court is to consider whether there is any prima facie case
made out against the accused or not and at that stage the Court is
required to evaluate the material and documents relied on by the
prosecution only with a view to find out whether the facts emerging
therefrom, if taken at their face value, disclose the existence of all the
ingredients constituting the alleged offence or not.
6.2 It is submitted that in the present case the High Court has
committed a grave error in evaluating the transcript/evidence on merits
which at the stage of considering the application for discharge is not
permissible.
6.3 It is further submitted by the learned Advocate appearing on behalf
of the State that in the present case even otherwise from the transcript
recording the conversation between the complainant and the accused a
case of demand of illegal gratification has been made out. It is
submitted that the accused has been charged for the offence under
Section 7 of the PC Act and therefore even an attempt is sufficient to
attract the offence under Section 7 of the PC Act. It is submitted that
therefore the High Court has erred in evaluating the evidence on record
on merits at the stage of considering the discharge application which, as
such, is impermissible and beyond the scope of the exercise of the
revisional jurisdiction.
6.4 Learned Advocate appearing on behalf of the State has heavily
relied upon the decisions of this Court in the cases of P. Vijayan v. State
of Kerana, (2010) 2 SCC 398; Srilekha Sentil Kumar v. Deputy
Superintendent of Police, CBI, ACB, Chennai, (2019) 7 SCC 82; Asim
Shariff v. National Investigation Agency (2019) 7 SCC 148; and State of
Karnataka Lokayukta, Police Station, Bengaluru v. M.R. Hiremath,
7. Learned Advocate appearing on behalf of the respondent-accused
has vehemently submitted that in the facts and circumstances of the
case and as it was found from the transcript recording the conversation
between the complainant and the accused that no case, at all, has been
made out against the accused for the offence under Section 7 of the PC
Act, the High Court has rightly discharged the accused by quashing and
setting aside the order passed by the learned Special Judge framing
charge against the accused. It is vehemently submitted by the learned
Advocate for the respondent-accused that, as such, the accused refused
to issue residence certificate and caste certificate having come to know
about the complaint being the permanent resident of Agra. It is submitted
that in fact the complainant wanted a false residence certificate and
caste certificate illegally to be made in the State of Rajasthan, though he
was the permanent resident of Agra. It is submitted that in fact the
respondent-accused gave a report rejecting the request of the
complainant on 29.08.2010 and therefore, as such, there was nothing
pending before the accused and the decision regarding his application
was already taken.
7.1 It is submitted that in fact even as per the case of the prosecution
and even the complainant the trap failed and the accused refused to
accept the bribe in the trap proceedings.
7.2 It is submitted that at the time of conversation two persons were
present, (1) the complainant – Jai Kishore; and (2) Devi Singh. It is
submitted that there was a mixing of the conversation with the
complainant as well as Devi Singh. It is submitted that so far as the
complainant is concerned, the accused categorically refused to accept
any bribe. However, it is submitted that the appellant has tried to
confuse and mislead the Court by mixing the conversation of Devi Singh
regarding his dues of Rs.4,850-/ to the bank against which he has paid
Rs.2,000/- and the remaining amount of Rs.2,850/- was due to the bank.
It is submitted that therefore so far as the complainant is concerned,
neither there was any acceptance nor there was any demand of bribe
and therefore having found on the basis of the material/evidence on
record that no case is made out against the accused for the offence
under Section 7 of the PC Act, the High Court has rightly discharged the
accused.
7.3 Learned counsel appearing on behalf of the accused has heavily
relied upon the decision of this Court in the case of Dilawar Balu Kurane
v. State of Maharashtra, (2002) 2 SCC 135 and has submitted that as
held by this Court the Court while exercising powers under Section 227
Cr.P.C. and while considering the question of framing of the charge has
the undoubted power to sift and weigh the evidence for the limited
purpose of finding out whether or not a prima facie case against accused
is made out and where the material placed before the Court discloses
grave suspicion against the accused which has not been properly
explained, the court will be fully justified in framing of the charge and
proceeding with the trial, however, by and large if two views are equally
possible and the Judge is satisfied that the evidence produced before
him will give rise to some suspicion but not grave suspicion against the
accused, he will be fully justified to discharge the accused. It is
submitted that therefore in the present case the High Court was justified
in evaluating the evidence on record to come to a conclusion whether
there is any sufficient material/evidence making out a case for the
offence under Section 7 of the PC Act or not.
7.4 Number of other submissions have been made by the learned
counsel for the respective parties on merits after taking us in detail to the
transcript recording the conversation between the complainant and the
accused. However, at the stage of framing of the charge and/or while
considering the discharge application, we do not propose to go into in
detail on merits of the allegations and the evidence on record as for the
reasons stated hereinbelow the same is not permissible at this stage.
8. We have heard the learned counsel for the respective parties.
By the impugned judgment and order, the High Court in exercise of
its revisional jurisdiction has set aside the order passed by the learned
Special Judge framing the charge against the accused under Section 7
of the PC Act and consequently has discharged the accused for the said
offence. What has been weighed with the High Court while discharging
the accused is stated in paragraphs 10 & 11 of the impugned judgment
and order, which are reproduced hereinabove.
9. While considering the legality of the impugned judgment and order
passed by the High Court, the law on the subject and few decisions of
this Court are required to be referred to.
9.1 In the case of P.Vijayan (supra), this Court had an occasion to
consider Section 227 of the Cr.P.C. What is required to be considered at
the time of framing of the charge and/or considering the discharge
application has been considered elaborately in the said decision. It is
observed and held that at the stage of Section 227, the Judge has
merely to sift the evidence in order to find out whether or not there is
sufficient ground for proceeding against the accused. It is observed that
in other words, the sufficiency of grounds would take within its fold the
nature of the evidence recorded by the police or the documents
produced before the Court which ex facie disclose that there are
suspicious circumstances against the accused so as to frame a charge
against him. It is further observed that if the Judge comes to a
conclusion that there is sufficient ground to proceed, he will frame a
charge under Section 228 Cr.P.C., if not, he will discharge the accused.
It is further observed that while exercising its judicial mind to the facts of
the case in order to determine whether a case for trial has been made
out by the prosecution, it is not necessary for the court to enter into the
pros and cons of the matter or into a weighing and balancing of evidence
and probabilities which is really the function of the court, after the trial
starts.
9.2 In the recent decision of this Court in the case of M.R. Hiremath
(supra), one of us (Justice D.Y. Chandrachud) speaking for the Bench
has observed and held in paragraph 25 as under:
25. The High Court ought to have been cognizant of the fact
that the trial court was dealing with an application for
discharge under the provisions of Section 239 CrPC. The
parameters which govern the exercise of this jurisdiction have
found expression in several decisions of this Court. It is a
settled principle of law that at the stage of considering an
application for discharge the court must proceed on the
assumption that the material which has been brought on the
record by the prosecution is true and evaluate the material in
order to determine whether the facts emerging from the
material, taken on its face value, disclose the existence of the
ingredients necessary to constitute the offence. In State of
T.N. v. N. Suresh Rajan [State of T.N. v. N. Suresh Rajan, (2014)
11 SCC 709, adverting to the earlier decisions on the subject,
“29. … At this stage, probative value of the materials has to
be gone into and the court is not expected to go deep into
the matter and hold that the materials would not warrant a
conviction. In our opinion, what needs to be considered is
whether there is a ground for presuming that the offence
has been committed and not whether a ground for
convicting the accused has been made out. To put it
differently, if the court thinks that the accused might have
committed the offence on the basis of the materials on
record on its probative value, it can frame the charge;
though for conviction, the court has to come to the
conclusion that the accused has committed the offence. The
law does not permit a mini trial at this stage.”
10. We shall now apply the principles enunciated above to the present
case in order to find out whether in the facts and circumstances of the
case, the High Court was justified in discharging the accused for the
offence under Section 7 of the PC Act.
11. Having considered the reasoning given by the High Court and the
grounds which are weighed with the High Court while discharging the
accused, we are of the opinion that the High Court has exceeded in its
jurisdiction in exercise of the revisional jurisdiction and has acted beyond
the scope of Section 227/239 Cr.P.C. While discharging the accused,
the High Court has gone into the merits of the case and has considered
whether on the basis of the material on record, the accused is likely to
be convicted or not. For the aforesaid, the High Court has considered in
detail the transcript of the conversation between the complainant and the
accused which exercise at this stage to consider the discharge
application and/or framing of the charge is not permissible at all. As
rightly observed and held by the learned Special Judge at the stage of
framing of the charge, it has to be seen whether or not a prima facie
case is made out and the defence of the accused is not to be
considered. After considering the material on record including the
transcript of the conversation between the complainant and the accused,
the learned Special Judge having found that there is a prima facie case
of the alleged offence under Section 7 of the PC Act, framed the charge
against the accused for the said offence. The High Court materially
erred in negating the exercise of considering the transcript in detail and
in considering whether on the basis of the material on record the
accused is likely to be convicted for the offence under Section 7 of the
PC Act or not. As observed hereinabove, the High Court was required to
consider whether a prima facie case has been made out or not and
whether the accused is required to be further tried or not. At the stage of
framing of the charge and/or considering the discharge application, the
mini trial is not permissible. At this stage, it is to be noted that even as
per Section 7 of the PC Act, even an attempt constitutes an offence.
Therefore, the High Court has erred and/or exceeded in virtually holding
a mini trial at the stage of discharge application.
12. We are not further entering into the merits of the case and/or
merits of the transcript as the same is required to be considered at the
time of trial. Defence on merits is not to be considered at the stage of
framing of the charge and/or at the stage of discharge application.
13. In view of the above and for the reasons stated above, the
impugned judgment and order passed by the High Court discharging the
accused under Section 7 of the PC Act is unsustainable in law and the
same deserves to be quashed and set aside and is accordingly hereby
quashed and set aside and the order passed by the learned Special
Judge framing charge against the accused under Section 7 of the PC
Act is hereby restored. Now the case is to be tried against the accused
by the competent court for the offence under Section 7 of the PC Act, in
accordance with law and its own merits.
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The Supreme Court stated that a person's full defence, where they argue their innocence, should not be reviewed at an early stage. This includes when the court decides if there's enough evidence to formally accuse someone or when it's asked to drop the charges.
Justices DY Chandrachud and MR Shah added that at this early point, a "mini trial" is not allowed. A "mini trial" would involve fully debating all the evidence.
In this specific case, a Special Court reviewed all the evidence. This included a written record of conversations between the person complaining and the accused person. The court found enough initial evidence to suggest a crime occurred. It decided there was a "prima facie case" – meaning enough facts to go forward. The court also said the accused person's full defence should not be weighed yet. So, it formally charged the person under Section 7 of the Prevention of Corruption Act.
Later, the Rajasthan High Court accepted a request to review the case. It then dropped the charges against the accused for the supposed crime under Section 7. The government (the state) appealed this decision to the Supreme Court. The state argued the High Court made a serious mistake. It claimed the High Court looked too deeply at the evidence and conversation records. This detailed review, the state said, is not allowed when deciding whether to drop charges.
The Supreme Court judges observed that the High Court had looked too much into the details of the case when it dropped the charges. It had even thought about whether the accused person would likely be found guilty based on the evidence. The judges added that the High Court went into too much detail about the conversation record. This kind of detailed review is strictly not allowed when deciding to drop charges or formally accuse someone.
The Supreme Court said the High Court should only have checked if there was enough initial evidence (a "prima facie case") and if the accused needed a full trial. It repeated that a "mini trial" is not allowed when formally accusing someone or deciding to drop charges. The Court also noted that under Section 7 of the Anti-Corruption Act, even trying to commit the crime is an offense. Therefore, the Supreme Court concluded that the High Court made a mistake and went too far. It had, in fact, held a "mini trial" when it was only supposed to consider dropping the charges. The Supreme Court added that it would not look into the full details of the case or the conversation record itself. These details, it said, must be looked at during the actual trial. It repeated that a person's full defence should not be considered when deciding to accuse them or drop the charges. With this, the Supreme Court confirmed the Special Court's original decision to formally accuse the person.
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Appeals Nos. 1153 to 1160 and 1161 to 1168 of 1968. Appeals by special leave from the judgment and order, dated November 16, 1967 of the Madhya Pradesh High Court in Misc. Civil Cases Nos. 96 to 103 of 1967. I. N. Shroff, for the appellant (in C.As. Nos. 1161 to 1168 of 1968). Desai, B.L. Neema and Anjali Varma, for the appellant (in C.As. 1153 to 1160 of 1958). N.D. Karkhanis and 11. G. Ratnaparkhi, for the intervener (in C. Pa, Nos. 1153 to 1160 of 1968). The judgment of the Court was delivered by Grover, J. This judgment will dispose of two 'sets of cross appeals Nos. 1153 1160 & 1161 1168/68 which are from a common judgment of the Madhya Pradesh High Court and have been entertained by special leave. The relevant assessment years for the purpose of levy of sales tax are from April 1, 1957 to March 31, 1958. and April 1, 1964 to March 31, 1965. For the assessment years prior to April 1, 1959 the enactment in force was the C.P. and Berar Sales Tax Act, 1947 (No; XXI of 1947) and for the subsequent two years it is the Madhya Pradesh General Sales Tax Act (Act No. 2 of 1959), which would be applicable. material facts may be shortly stated, The assessee Madhya Pradesh Electricity Board hereinafter called the "Electricity Board? ' is a body constituted under section 5 of the Electricity Supply Act, 1948. Under section 944 18 of that Act it was the general duty of the Electricity Board to promote coordinated development of the generation, supply and distribution of electric energy within the State of Madhya Pradesh in the most efficient and economical manner. In the assessment years in question the Electricity Board sold, supplied and distributed electric energy to various consumers. It also sold coal ash a waste product and Supplied steam to Nepa Mills of Burhanpur. It further supplied specification and tender forms on payment to persons desirous of submitting tenders for the works undertaken by the Electricity Board. It purchased articles like Gitti, Murram, sand etc. from unregistered dealers. It is common ground that under the provisions of Act XXI of 1947 and H of 1959 read with the ' Schedule contained therein sale of electricity is exempt from sales tax. For the purpose of determining the gross turnover, however, the sale of electric energy is to be taken into account. The Assistant Commissioner of Sales tax assessed the Electricity Board to tax on its turnover of sale of coal ash and specification and tender forms and the supply of steam to Nepa Mills. The Board was further assessed to purchase tax on Gitti, Murram etc. purchased from unregistered dealers. In appeal the Deputy Commissioner, Sales Tax, upheld the assessment orders. On second appeal the Sales Tax Tribunal which was the Board of Revenue, Madhya Pradesh, held that the Electricity Board was not a "dealer" within the meaning of that term as defined in the two Acts and that the coal ash was not produced for the purpose of sale with the result that sales of coal ash could not be subjected to tax. As regards the supply of steam to Nepa Mills the tribunal, on examining the terms of the agreement under which the Electricity Board supplied the steam, came to the conclusion that such supply was an isolated transaction and that such activity which had been undertaken on no profit no loss basis could not be assessed to sales tax. The specification and tender forms were held not to be marketable goods involving any profit element and for that reason could not be taxed. As regards the purchase tax the tribunal held that as the Electricity Board was not a dealer in respect of the sale and supply of electric energy no purchase tax could be imposed on goods purchased by it and consumed "in furtherance of and in aid of the business activity of generating, supplying and distributing electricity. " Both the Electricity Board and the Commissioner of Sales Tax. Madhya Pradesh, filed applications requiring the Tribunal to refer to the High. Court certain questions of law arising out of its common order. The tribunal drew up a common statement of case and referred five questions of law. On the first question the High Court 'held that the Electricity Board could not be held to be "dealer" as defined in section 2(c) of Act XXI of 19.47 or section 2(d) 942 of Act H of 1959 in respect of its activity of generation, distribution, sale and supply of electric energy. On the second question it was held that as the Electricity Board regularly and continuously produced coal ash as a subsidiary product and sold it regularly it was a "dealer" in regard to the sale of coal ash and the sale, transactions relating to this product were liable to be assessed to sales tax. The third question was answered in favour of the Electricity Board. It was found that stem was not being supplied to the Nepa mills with profit motive although it fell within the definition of "goods" given in the two Acts. As regards the specification and tender forms the High Court was of the view that the Electricity Board was not carrying on any business of selling such forms and therefore no sales tax could be levied in respect of them. The fifth question was answered by holding that as the Electricity Board was not a "dealer" in respect of sale and supply of electric energy it was not entitled to purchase any taxable goods for consumption or use for producing such energy without paying sales tax to the selling dealer under section 4(6) of Act XXI of 1947 and section 7 of Act II of 1959 and therefore there. Mr. Shroff, who has argued the appeals of the Commissioner of Sales Tax, has not quite properly and rightly pressed the matter relating to imposition of sales tax on supply of specification and tender forms. Desai, who has. appeared for the Electricity Board, after a certain amount of argument, has submitted that he had nothing much to say on the question relating to coalash except that it should be held to be exempt from payment of sales tax because electric energy is exempt from such tax as stated before. As regards the fifth question relating to the imposition of purchase tax Mr. Desai has not pressed for any decision being given by us. Arguments which have been addressed by both sides have therefore centered on question nos. 1 and 3 which are as follows : "(1) On the facts and circumstances of the case whether or not the Madhya Pradesh Electricity Board is a dealer within the meaning of section 2(c) of the C.P. & Berar Sales Tax Act, and section 2(d) of the Madhya Pradesh General Sales Tax Act, 1958, in respect of its activity of generation, distribution, sale and supply of electrical energy ? (2) (3) On the facts and circumstances of the case, whether or not steam is saleable goods and if they are saleable goods is the turnover representing the supply thereof liable to be assessed to sales tax m the hands of the assessee ?" The definition of a "dealer" as given in the two Acts substantially is that any person who carries on the business of buying, selling, supplying or distributing the goods as a "dealer" and "goods" are defined by s.2(d) of Act of 1947 as meaning all kinds ' of movable property other than actionable claims . and include all materials articles and commodities whether or not to be used in the construction, fitting out, improvement or repair of immovable property. The definition contained in section ~2(g) of Act II of 1959 is almost in similar terms except that there are certain additions with which we are not concerned. Reference may be made, at this stage, to the definition of "movable property" which has not been defined in the two Acts given in section 2(24) of the Madhya Pradesh General Clauses Act. It has been defined to mean "property of every description, except immovable property". Section 2(18) of that Act says that "immovable property" includes land,. The High Court went into a discussion from the point of view of mechanics relating to transmission of electric energy. It was of the view that electricity could not be regarded as an article or matter which could be possessed or moved or delivered. It relied on certain decisions and referred to Entries Nos. 53 and 54 in List II of Seventh Schedule to the Constitution and held that electricity did not fall within the meaning of "goods" in the two Acts and therefore the Electricity Board could not be held to be a "dealer" in respect of its activity of generation, distribution, sale and supply of electric energy. Shroff has relied on certain decisions in which the same point was involved as in the present case. namely, whether electricity is "goods" for the purpose of imposition of sales tax. ' In Kumbakonam Electric Supply Corporation Ltd. vs Joint Commercial Tax Officer, Esplanade Division, Madras(1), the Madras High Court was called upon to decide whether electricity is "goods" for the purposes of the Madras General Sales Tax Act, 1959 and the . After referring to the definition of "goods" as given in the , it was observed that under that definition goods must be property and it must be movable. According to the learned Madras Judge any kind of property which is movable would fall within the definition of "goods" provided it was transmissible or transferable from hand to hand or capable of delivery which need not necessarily be in a tangible or a physical sense. Reference was also (1) 14 S.T.C. L6 Sup. C I.169 9 944 made to the definition given in the General Clauses Act which was quite wide and it was held that if electricity was property and it was movable it would be "goods". The learned Judge found little difference between electricity and gas or water which would be property and could be subjected to a particular process, bottled up and sold for consumption. It was observed that electricity was capable of sale as property as it was sold, purchased and consumed everywhere. A "dealer" was defined by the practically in the same way as in the Madras General Sales Tax Act and it meant a person who carried on business of buying and selling goods. In the opinion of the learned Judge the concept of dealer, goods and sale comprehended all kinds of movable property. He further relied on certain decisions which have been cited before and which will be presently noticed. (1) It was held that electric energy fell within the definition of "goods" in both the Punjab Sales Tax Act, 1948 and the . According to the learned Judge electric energy has the commonly accepted attributes of movable property. It can be stored and transmitted. It is also capable of theft. It may not be tangible in the sense that it cannot be touched without considerable danger of destruction or injury but it was perceptible both as an illuminant and a fuel and also in other energy giving forms. Electric energy may not be property in the sense of the term "movable property" as used in the Punjab & Central General Clauses Acts in contra distinction to "immovable property" but it must fall within the ambit of "goods" "even if in a sense it was intangible or invisible". As pointed out in the Madras case the statement contained in American Jurisprudence(2) recognises that electricity is property capable of sale and it may be the subject of larceny. In Naini Tal Hotel vs Municipal Board(a) it was held that for the purpose of article 52 of the Indian Limitation Act electricity was property and goods. In Erie County Natural Gas & Fuel Co. Ltd. vs Carroll(4), a question arose as to the measure of damages for a breach of contract to supply gas. Lord Atkinson delivering the judgment of the Privy Council applied the same rule which is applicable where the contract is one for sale of goods. In other words gas Was treated to be "goods". The High Court, in the present case, appears to have relied on Rash Behari vs Emperor(5) in which approval was accorded to the statement in Pollock & Mulla 's Commentary on Sale Goods Act, 1913 that it was doubtful whether that Act was applicable to such "goods" as gas, water 'and electricity. The context (1) 22 S.T.C. (1946) All. (4) (5) A.I,R. 945 which this matter is discussed in the Calcutta case is altogether different and distinguishable and what was being decided there was the scope and ambit of section 39 of the Electricity Act, 1910, As regards the Entries in List 11 of the Seventh Schedule to the Constitution, the relevant ones may be produced: "53. Taxes on the consumption or sale of electricity. Taxes on the sale or purchase of goods other than newspapers, subject to the provisions of entry 92A of List I". The reasoning which prevailed with the High Court was that a well defined distinction existed between the sale or purchase of "goods" and consumption or sale of electricity; otherwise there was no necessity of having Entry No. But under Entry 53 taxes can be levied not only on sale of electricity but also on its consumption which could not probably have been done under Entry 54. What has essentially to be seen is whether electric energy is "goods" within the meaning of the relevant provisions of the two Acts. The definition in terms is very wide according to which "goods" means all kinds of movable property. Then certain items are specifically excluded or included and electric energy or electricity is. not one of them. The term "movable property" when considered with reference to "goods" as defined for the purposes of sales tax cannot be taken in a narrow sense and merely because electric energy is not tangible or cannot be moved or touched like, for instance, a piece. of wood or a book it cannot cease to be movable property when it has all the attributes of such property. It is needless to repeat that it is capable of abstraction, consumption and use which, if done dishonestly, would attract punishment under section 39 of the . It can be transmitted, transferred, delivered, stored, possessed etc. in the same way as any other movable property. Even in Banjamin on Sale, 8th Edn., reference has been made at page 171 to County of Durham Electrical, etc., Co. vs Inland Revenue(1) in which electric energy was assumed to be "goods". If there can be sale and purchase of electric energy like any other movable object we see no difficulty in holding that electric energy was intended to be covered by the definition of "goods" in the two Acts. If that had not been the case there was no necessity of specifically exempting sale of electric energy from the payment of sales tax by making a provision for it in the Schedules to the two Acts. It cannot be denied that the Electricity Board carried on principally the business of selling, supplying or distributing electric energy. It would therefore clearly fall within the meaning of the expression "dealer ' ' in the two Acts. (1) 946 As regards steam there has been a good deal of argument on the question whether it is liable to be assessed to sales tax in the hands of the Electricity Board. According to Mr. Shroff the Electricity Board carried on the business of selling steam to the Nepa Mills and that this has lasted for a number of years. It has been submitted that simply because the Electricity Board does not have any profit motive in supplying steam it cannot escape. payment of sales tax because the steam is nevertheless being sold as "goods". The High Court was of the view that the water which the Nepa Mills supplied free to the Electricity Board became the property of the Board and in return for this free supply the Board agreed to give steam to Nepa Mills at a rate based solely on the coal consumed in producing steam. The mills had also agreed to reimburse the Electricity Board for the loss sustained on account of the mills not taking the "full demand of steam". to the High Court there was no contract for the sale of steam as such and it was only for the labour and cost involved in its supply to the mills. The High Court relied on the findings of the Tribunal on this point and held that the turnover in respect of steam was not taxable. The tribunal in its order dated June 16, 1966 referred to certain conditions of working arrangement which was reduced to writing but which had not been properly executed as a contract which showed that the mills was supplying water free and the Electricity Board was making a pro rata charge of conversion of water into steam. It seems to us that the High Court was right in coming to the conclusion, on the finding of the tribunal, that the real arrangement was for supplying steam on actual cost basis and in that sense it was more akin to a labour contract than to sale. Mr. Shroff has argued that the document which was relied upon by the tribunal could not be looked at as it was neither admissible in evidence nor had it been properly executed as a contract between the Electricity Board and the mills and it happened to be a mere draft of an agreement which was proposed to be entered into. It is too late for Mr. Shroff to take these objections because these should have been raised before the Tribunal and the High Court. It is stated in Halsbury 's Laws of England, III Edn. 34, page 6 that "a contract of sale of goods" must be distinguished from a contract for work and labour. The distinction is often a fine one. A contract of sale is a contract whose main object is the transfer of the property in, and the delivery of possession of, a chattel as a chattel to the buyer. Where the main object of work undertaken by the payee. of the price is not the transfer of a chattel qua chattel, the contract is one for work and labour. 947 the works contracts are frequently not recorded in writing setting out all the covenants and conditions thereof, and the terms and incidents of the contracts have to be gathered from the evidence and attendant circumstances. The question in each case is one about the true agreement between the parties and the terms of the agreement must be deduced from a review of all the attendant circumstances. On the findings of the tribunal and the High Court we are of the opinion that the arrangement relating to supply of steam in return for the water supplied by the mills on payment of actual cost was not one of sale but was more in the nature of a works contract. In the result the answer of the High Court to the first question is discharged and it is held that the Electricity Board is a "dealer" within the meaning of the relevant provisions of the two Acts in respect of its activities of generation, distribution, sale and supply of electric energy. The answers to the second, third and fourth questions are affirmed. The answer given by the High Court to the fifth question is discharged. It is unnecessary to express any opinion on that question because Mr. Desai has not pressed for any decision being given by us and has accepted the liability in respect of the purchase tax as determined by the assessing authorities for the assessment orders in question. The appeals are allowed to the extent indicated above. In view of all the circumstances the parties are left to bear their own costs. Appeals allowed in pan.
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The Electricity Board, created under the Electricity Supply Act of 1948, provided electricity in Madhya Pradesh. During the years in question, the Board sold and distributed electricity to different customers. It also provided steam to a company called Nepa Mills. Nepa Mills provided water for free. The Board charged them for turning the water into steam. The mill also agreed to pay the Board for any money the Board lost if the mill didn't use all the steam it had asked for. In legal cases about sales tax from 1947 and 1959, the main questions were: (1) Was electricity "goods" according to the laws? Was the Board a "dealer" according to the laws? (2) Was providing steam a "sale," and therefore subject to sales tax? The High Court decided that electricity wasn't "goods," the Board wasn't a "dealer" in electricity, and providing steam wasn't taxable because the Board wasn't trying to make a profit. The Commissioner of Sales Tax appealed to a higher court. The higher court HELD: (i) The Electricity Board was in the business of selling and providing electricity. This means electricity falls under the definition of "goods" in the two laws, and the Board was a "dealer." The definition of "goods" is very broad and includes all kinds of movable property. When we talk about "movable property" in relation to sales tax, we can't think of it in a limited way. Just because electricity isn't something you can touch or move like a piece of wood or a book, doesn't mean it can't be movable property. It has all the characteristics of movable property. Electricity can be taken, used, and consumed. If someone does this dishonestly, they can be punished. It can be sent, moved, delivered, stored, and owned, just like other movable property. If electricity can be bought and sold like any other movable object, then it should be considered "goods" under the two laws. If that wasn't the case, there wouldn't have been a need to specifically say that electricity sales were exempt from sales tax in the schedules (lists) of the two laws. (ii) In this case, the agreement to provide steam in exchange for water and payment of costs wasn't a sale. It was more like a contract for work. When the main goal of the work isn't to transfer ownership of an item, the contract is for work and labor.
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Appeal by special leave from the judgment and order dated the 9th April 1975 of the Allahabad High Court in Application No. A. We have already announced our order in this appeal on the 2nd May 1975. Respondent No. 1 Chaudhari Ram Gopal Singh and Respondents 2 to 11 contested election, as rival candidates from U. P. Legislative Assembly Constituency (No. 293), Sarsaul. Respondent 1 filed an election petition challenging the election of the appellant inter alia on the ground (vide para 9(1) of the petition) that the result of the election so far as the returned candidate was concerned materially affected by improper reception and rejection of votes and mistakes in counting. That in a number of polling stations, the instruments supplied to the electors for the purposes of stamping on or near the symbol of the candidate to whom he intends to vote, was seal of Presiding officer which was meant to be put on the reverse of the ballot papers. Since the electors were supplied these instruments by the Presiding officer for marking the ballot papers the electors indicated their choice by marking in the column of the petitioner with that instrument. There were 41 such ballot papers which were clear votes for the petitioner that were illegally rejected by the Presiding officer on the ground that the electors ' choice was expressed through the instrument meant for the Presiding officer for stamping on the reverse side of the ballot papers. Particulars of such ballot papers are given in Schedule I attached to the Election Petition. The number of some of such ballot papers are 100976, 100977, 100978, 100979, 100980, 100982, 100983 and 100984. The reason on which it was rejected was wholly illegal. 9(1) of the Election Petition are not admitted. The result of the election in so far as the answering respondent is concerned has not been materially affected by any improper reception or 194 rejection, or by wrong arithmetical and clerical mistake in counting of votes and/or counting and acceptance of void votes in favour of the answering respondent. It is wrong to say that 41 ii ballot papers mentioned in Schedule I or any ballot paper counted in favour of the respondent No. It is admitted that the ballot papers on which unauthorised seal was found were rejected. Some of these rejected ballot papers may be of the petitioner but most of them were of respondent No. That the contents of para 11 (b) of the petition and Schedule II are not admitted as stated. In these circumstances such ballot papers were rejected by the Returning officer. It is submitted that such ballot paper were in respect of all the candidates including the respondent No. That no different criteria was adopted by the Returning officer in the matter of acceptance or rejection of ballot papers and the respondent No. 1 maintains that many ballot papers in which the Electors expressed their choice in favour of the respondent No. 1 by putting the seal of the Presiding officer as supplied by the Presiding officer, were wrongly rejected during the counting by the Returning officer. " But on 24 2 1975, he made an application before the High Court, praying for scrutiny and recount of the ballot papers. The allegations in para 11(a) and (b) of the election petition were reiterated in the application. The learned Judge of the High Court by his order, dated 9 4 1975, allowed that application and directed scrutiny and recount of ballot papers on the view that: (a) The appellant "was declared to have won by a very small margin of only 22 votes". 195 (b) "lt is not in dispute that a number of ballot papers were rejected by the Returning officer as invalid be cause the polling staff of a particular polling station forgot to detach the counter foils of a number of ballot papers. As the counter foils contained the identity of the voters, the ballot papers were rejected for no fault of the voters, but because of negligence or incompetence on the part of the polling staff". (c) "It is also the admitted case of the parties that a number of ballot papers were rejected because the voters cast their votes by putting their mark not with the marking instrument issued by the Election Com mission but with the marking or stamping instrument issued by the Election Commission for the use of the Presiding officers. (d) lt "The petition, the written statement, the recriminatory petition filed by the respondent (now appellant) and the reply thereto filed by the petitioner would show that this is a case in which both parties have pleaded that there was wrong reception, rejection and u counting of votes. " It is against this order, dated 9 4 75 of the High Court that this appeal has been filed by the returned candidate after obtaining special leave. Having heard learned Counsel on both sides, we are or opinion that the order made by the High Court for a general scrutiny and re count of all the ballot papers cast at the election, was not justified. The returned candidate had not categorically and specifically admitted the allegations made in the election petition with regard to the improper rejection of the ballot papers. This will be clear from a comparative reading of Paragraph 11 (a) and (b) of the petition and the answers thereto given in the written statement, which have been reproduced above verbatim. Such a traverse is then followed by qualified and vague admissions that some ballot papers were rejected because they were not marked with the instrument meant for this purpose, or bore the names or signatures of the voters on the counter foils that remained attached to them, owing to the mistake of the Presiding Officer. After having thus replied to the petitioner 's allegations, the returned candidate said that most of these rejected 196 ballots had been cast for him and not for the petitioner. Mr. Mukherjee, learned Counsel for Respondent 1 (election petitioner) has drawn our attention to the "Additional Pleas" in the written statement of the appellant. According to Counsel it were these pleas, more than anything else, that led to the finding "that this is a case in which both parties have pleaded that there was wrong reception, rejection and counting of votes. " At this place it will be sufficient to say that since the returned candidate in his written statement did not specifically and fully admit all the facts alleged in Paragraph 11 (a) and (b) of the petition, the Court could not dispense with proof of those facts altogether. For instance, in reply to the facts alleged in Para 11 (a) of the petition, the returned candidate did not admit that the instrument with which such rejected ballot papers were found stamped, was supplied by the Presiding officer. The parties being at variance on this material point, this issue of fact was required to be proved by the party alleging lt. Now, we come to the finding of the learned Judge as to the wrong reception and rejection of votes being a common ground between the parties. We do not propose to over burden this judgment by reproducing all that has been stated in Paragraph 47 to 56 of the written statement under the caption "Additional Pleas". 1 were wrongly rejected by the Returning officer at the time of counting. That as in the case of the Election Petitioner the Ballot Papers in favour of the Respondent No. 1 with which counterfoils were attached were rejected. In case the Hon 'ble Court finds that similar ballot papers in favour of 197 the election petitioner are to be accepted, the ballot papers in favour of the Respondent No. That the bundles of ballot papers in favour of the Respondent No. I say that the Respondent No. As clarified by this Court in Jabar Singh vs Genda Lal(1), the scope of the inquiry in a case under section 100(1) (d) (iii) is to determine whether any votes had been improperly cast in favour of the returned candidate or any votes had been improperly refused or rejected in regard to any other candidate. In fact section 97(1) of the Act has no application to a case falling under section 100(1) (d) (iii). The scope of the enquiry is limited for the simple reason that what the clause requires to be considered, is, whether the election of the returned candidate has been materially affected and nothing else. It is true that in a composite election petition wherein the petitioner claims not only that the election of the returned candidate is void but also that the petitioner or some other person be declared to have been duly elected, section 97 would also come into play and allow the returned candidate to recriminate and raise counter pleas in support of his case, "but the pleas of the returned candidate under section 97 have to be tried after a declaration has been made under section 100 of the Act. The first part of the enquiry in regard to the validity of the election of the returned candidate has therefore to be tried within the narrow limits prescribed by section 100(1) (d) (iii) and the latter part of the enquiry governed by section 101 (a) will have to be tried on a broader basis permitting the returned candidate to lead evidence in support of the please taken by him in his recriminatory petition; but even in such a case the 198 enquiry. necessary while dealing with the dispute under section 101 (a) will not be wider if the returned candidate has failed to recriminate and in a case of this type, the duty of the Election Tribunal will not be to count and scrutinise all the votes cast at the election. Moreover, in the instant case, it is a matter of controversy to be decided as to whether the recriminatory petition filed by the appellant is within time or not. The above being the law on the point, it is clear that the learned Judge was in error in ordering general inspection and recount of the total votes polled at the election, merely because in these Additional Pleas the returned candidate also had by way of recrimination, complained of wrong reception and rejection of votes and wrong counting of votes. They were beyond the scope of the enquiry into the petitioner 's case which (as set up in Para 11 of the petition) fall under section 100(1)(d)(iii) of the Act Further, the High Court did not properly apply its mind to the question, whether on the facts alleged in Para 11 (a) and (b) of the petition assuming the same to be correct a prima facie case for improper rejection of The 50 ballot papers referred to therein, had been made out. In other words, if the defects in these SO ballot papers were attributable to the mistakes or negligence of the Presiding officer or his staff, would it take those ballot papers out of the mischief of clauses (a) and (b) of Rule 56(2) of the Conduct of Election Rules, 1961 Rule 56 runs thus: "(1) Subject to such general or special directions, if any, as may be given by Election Commission in this behalf, the ballot papers taken out of all boxes used in a constituency shall be mixed together and then arranged in convenient bundles and scrutinised. (2) The returning officer shall reject a ballot paper (a) if it bears any mark or writing by which the elector can be identified, or (b) if, to indicate the vote, it bears no mark at all or bears a mark made otherwise than with the instrument supplied for the purpose, or (c) if votes are given on it in favour of more than one candidate, or (d) if the mark indicating the vote thereon is placed in such manner as to make it doubtful to which candidate the vote has been given, or 199 (e) if it is a spurious ballot paper, or (f) if it is so damaged or mutilated that its identity as a genuine ballot paper cannot be established, or (g) if it bears a serial number, or is of a design different from the serial numbers, or, as the case may be, design, or the ballot papers authorised for use at the particular polling station, or (h) if it does not bear (both, the mark and the signature) which it should have borne under the provisions of sub rule (1) of rule 38; Provided that where the returning officer is satisfied that any such defect as is mentioned in clause (g) or clause (h) has been caused by any mistake or failure on the part of a Presiding officer or polling officer, the ballot paper shall not be rejected merely on the ground of such defect; Provided further that a ballot paper shall not be rejected merely on the ground that the mark indicating the vote is indistinct or made more than once, if the intention that the vote shall be for a particular candidate clearly appears from the way the paper is marked. (3) to (5): . (6) Every ballot paper which is not rejected under this rule shall be counted as one valid vote: Clauses (a) and (b) of Rule 56(2) are referable to Rule 38 which requires every elector to whom ballot paper has been issued under Rule 38 to maintain secrecy of voting and "to make a mark on the ballot paper with the instrument supplied for the purpose on or near the symbol of the candidate for whom he intends to vote. " This Rule requires every ballot paper and the counterfoil attached thereto to be stamped on the back by the Presiding officer with such distinguishing mark as the Election Commission may direct. Every such ballot paper before it is issued is required to be signed in full on its back by the Presiding officer. 200 In the case of 41 ballot papers mentioned in para 11(a), what happened was that instead of marking those ballot papers with the instrument supplied for this purpose by the Election Commission the electors concerned stamped it with the instrument meant to be used exclusively by the Presiding officer for stamping the counterfoils and lacks of the ballot papers. This question would further resolve itself into two issues: (i) Was the stamping instrument with which these electors "marked" the ballot papers, given to them by the Presiding officer cr any member of his staff ? It will be sufficient to reiterate that the provisions of Rules 38 and 56(2) (a) and (b) with which we are concerned in this case are mandatory and strict compliance therewith is essential. We would further make it clear that even if any such defect as is mentioned in clauses (a) or (b) of Rule 56 is caused by any mistake or failure on the part of the Returning officer or Polling Officer, the Returning officer would be bound to reject the ballot paper on the ground of such defect. That such is the imperative of Rule 56(2) is clear from the fact that the said clauses (a) and (b) have advisedly been excluded from the first Proviso to Rule 56(2) which gives a limited discretion in the matter of rejection to the Returning officer only where the defect is of a kind mentioned in clauses (g) and (h) of this sub rule. The total number of votes so polled was 443, out of which, 62 were in favour of the then appellant, 301 in favour of the first respondent therein and the remaining in favour of the other candidates. Rule 47(1)(c) of the Conduct of the Election Rules, 1951 provided that "a ballot paper contained in a ballot box shall be rejected if it bears 201 any serial number or mark different from the serial number or marks of ballot papers authorised for use at the polling station or the polling booth at which the ballot box in which it was found, was used. " It was contended that the electors were not at fault and that the wrong ballot papers were issued due to the lapse on the part of the Returning officer and that to reject the votes of the electors for the failure of the Polling officer to deliver the correct ballot papers under Rule 23 would be to disfranchise them, and that a construction which involve such a consequence should not be adopted. This Court repelled the contention in these terms: "If the word 'shall is thus to be construed in a mandatory sense in Rule 47(1) (a), (b) and (d), it would be proper to construe it in the same sense in Rule 47(1) (c) also. The practical bearing of the distinction between a provision which is mandatory and one which is directory is that while the former must be strictly observed in the case of the latter it is sufficient that it is substantially complied with. How is this rule to be worked when the Rule provides that a ballot paper shall be rejected ? It was contended by the learned Counsel for the respondent before us, that the Provisos to sub rule (2) of Rule 56 are only illustrative and not exhaustive, and consequently, the principles underlying these Provisos would give a discretion to the Returning Officer not to reject a ballot paper on the ground of a defect caused by mistake or negligence of the Presiding officer/or Polling officer, notwithstanding that such defect is one mentioned in clauses (a), (b), (c), (d), (e) and (f) of Rule 56(2). It says that "every ballot paper which is not rejected under this sub rule shall be counted as one valid vote". The learned Judge of the High Court has not applied his mind as to whether the facts alleged in Paragraph 11(b) of the petition, if correct, would fall within the mischief of clause (d) of Rule 56(2). Another point in this context, for consideration will be whether the "counterfoil" can be said to be an integral part of the "ballot paper" so that any writing or marks of identification of the voter on a counterfoil issued to the voter by mistake, is to be deemed to be a defect of the nature mentioned in clause (a) of Rule 56(2). Nor could the Additional Pleas in the written statement of the returned candidate be taken into account for making an order for general inspection of the ballots, because investigation of those pleas was beyond the scope of the case alleged in Para 11 of the petition falling under section 100(1) (d) (iii) of the Act. We will close the discussion by repeating the note of caution that this Court speaking through V. Krishna Iyer J. recently sounded in Chanda Singh vs Ch. "A democracy runs smooth on the wheels of periodic and pure elections. The general reaction, if there is judicial relaxation on this issue, may well be a fresh pressure on luckless candidates, particularly when the winning margin is only of a few hundred votes as here, to ask for a recount Micawberishly looking for numerical good fortune or windfall of chance discovery of illegal rejection or reception of ballots. In the result we allow the appeal and set aside the order of the High Court for general scrutiny and recount of the ballot papers. the instrument which was used for marking the 41 votes (referred to in the election petition) was supplied to the voters by the Presiding officer or any other member of his Polling Staff. If both these issues (i) and (ii) are answered in the positive, then and then only he may proceed to inspection and recount of these votes mentioned in the petition. The learned Judge shall proceed with the trial of the election petition in the light of what has been said above.
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The person appealing this case (the appellant) and another candidate (respondent No. 1) ran in an election for the U.P. Legislative Assembly from Sarsaul. The appellant got 23,626 votes. Respondent No. 1 got 23,604 votes. The appellant won by only 22 votes. Respondent No. 1 filed a complaint about the election. They said the election result was unfairly affected because votes were wrongly accepted or rejected, and there were mistakes in counting. They said that 41 ballots were rejected because voters marked them with the wrong tool. Voters used the tool meant for the election official to stamp the back of the ballot. The details of these ballots were listed in a schedule attached to the complaint. They also said some ballots were rejected because they were given out with the part that should have been torn off still attached. The appellant argued that the allegations were false. They said the election result was not unfairly affected. Respondent No. 1 didn't give any proof for their claims. Instead, they asked the High Court to check and recount the ballots. The High Court agreed to the recount. They said: (a) The appellant won by a very small margin of 22 votes. (b) It was agreed that some ballots were rejected because the election workers forgot to remove the extra piece of paper (counterfoil). (c) It was also agreed that some ballots were rejected because voters used the wrong tool to mark their choice. They used the stamping tool for the election officials instead of the pen or marker provided. (d) Both sides claimed that votes were wrongly accepted, rejected, and counted. The appellant appealed this decision. The court allowed the appeal. It said: (1) The appellant did not clearly admit to wrongly rejecting ballots. (2) Because the appellant didn't admit to the claims, the court still needed proof. (3) The additional arguments in the appellant's written statements didn't matter to the main issue. The main issue was whether the election result was unfairly affected. These extra arguments were like counter-claims that couldn't be investigated in this case. The court only needed to decide if the election of the winner was unfairly affected. (4) Claims under section 97 (of the law) have to be tried after a decision has been made under section 100 (of the law). The judge was wrong to order a general check and recount of all votes just because the appellant also complained about wrong vote counting. The High Court didn't think about whether the claims, if true, showed a good reason to believe that 41 ballots were improperly rejected. Rule 38 of the Conduct of Election Rules says every ballot and its attached piece must be stamped on the back by the election official with a special mark. Rule 56 says every voter must keep their vote secret. They must mark the ballot with the tool given to them by the Election Commission. The point of these rules is to keep the vote secret and prevent cheating. These rules are important. Not following them means the ballots must be rejected. The High Court needed to think about whether these facts were enough to violate rule 56. The High Court also needed to think about whether the claims, if true, would break rule 56. Many times, this Court has said that a general check and recount of ballots should not be ordered lightly. Before ordering this, the Court must be sure that all important facts have been stated and proven. It must also be sure that it is absolutely necessary to do so to be fair. In this case, there was no good reason to order a general recount. The additional claims in the appellant's statement also couldn't be used to order a general check of the ballots. The order of the High Court was canceled. The High Court was told to decide the questions mentioned in this judgment. After that, they should decide whether to recount the specific ballots that respondent No. 1 complained about.
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