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ivil Appeal Nos.
204 226 of 1978.
Appeals by Special Leave from the order dated 29 11 1977 of the Commissioner, Pune Division, Pune in Passenger Tax Appeals Nos.
POI 1/56 AR 12, 24, 27, 32, 42, SO and 17 other appeals.
F. section Nariman Ravinder Narain and K. J. John for the Appellant.
V. section Desai M. C. Bhandare (In CA 209/78) and M. N. Shroff for the Respondents.
Ravinder Narain and K. J.
John for the Interveners Sandvik Asia Ltd. section K. F. Cooper Engineering Ltd. Bharat Forge Ltd. and Bajaj Auto Ltd. The Judgment of the Court was delivered by FAZAL ALI, J.
These appeals by special leave arc directed against an order of the Commissioner of Pune dated 29 11 1977 dismissing the appeals and holding that the challenge to the tax sought to be realised by the Revenue was not tenable and the appellants were liable to pay the tax as also the penalty.
The appellants are a company registered under the Companies Act, 1913 and have their factories at Pimpri and Chinchvad in the District of Pune (Maharashtra).
The appellants employ as many as 7.000 workmen in those factories.
In order to provide transport 359 facilities to their employees to come to the factories from their respective villages the appellants provided transport which would pick up passengers from Pune or Khed or Vadgaon or Alandi or places enroute to TELCO Factory at Pimpri or Chinchvad and back.
For this journey a nominal charge of Rs. 10 per month was realised by the appellants from the employees.
Similarly, for the transport facilities provided to the employees from Pimpri Railway Crossing and onwards to TELCO factory, they were charged at the rate of Rs. 5 per month.
A charge of Rs. 2 per month was levied for the transport of employees from Chinchvad Village to TELCo factory at Pimpri and back.
the appellants further averred that these amounts were realised by the appellants only from a particular category of employees and no charges were levied in respect of those employees who were in the supervisory grades.
In the course of the arguments, it was pointed out that when the company was prepared to grant free transport facilities to the supervisory staff there was no reason why the same amenities should not be extended to the other employees and Mr. Nariman, learned counsel for the appellants frankly conceded that in future no charges would be realised from the employees and they would he provided free transport as in the case of supervisory staff.
It is manifest that if the appellants had not levied any charge at all for the transport facilities granted to the employees they would not be exigible to passenger tax.
Mr. Nariman, however, argued that even if a nominal charge is realised from the employees that would not make the transport a public service vehicle carrying passenger;, so as to attract the provisions of section 3 which is the charging section of the Act.
In our opinion, the contention of the learned counsel is well founded and must prevail.
The Bombay Motor Vehicles (Taxation on Passengers) Act, 1958 hereinafter called the Act is a statute which authorises the levy of passenger tax.
This Act has been amended several times right from the year 1960 to 1975.
Before analysing the relevant provisions of the Act, it may be necessary to extract the Preamble to the Act which runs thus: .
Whereas it is expedient lo provide for the levy of a tax on passengers, carried in certain classes of public service.
vehicles in the State of Bombay.
It is hereby enacted in the Ninth Year of the Republic of India as follows.
" A perusal of the Preamble clearly reveals that the dominant object of the Act was to impose tax on certain classes of public service vehicles.
In other words, the Preamble indicates that vehicles which could not be termed as public service vehicles fell beyond the ambit of the taxing provisions of the Act.
360 Section 2(7) of the Act defines 'stage carriage ' thus: " 'stage carriage ' means a motor vehicle carrying or adapted to carry more than six persons excluding the driver, which carries passengers for hire or reward, at separate fares paid by or for individual passengers, either for the whole journey or for stages of the journey, and includes such a carriage or other omnibus when used as a contract carriage within the meaning of the ".
Section 3 which is the charging section runs thus: "3.
(1) There shall be levied and paid to the State Government a tax on all passengers carried by road in stage carriages at such rate to be filed by the State Government from time to time by order in the official Gazette as would yield an amount not exceeding twenty per cent of the inclusive amount of fares payable to the operator of a stage carriage.
(2) After calculating the total amount of tax payable under sub section (1) out of the total amount received by an operator during each month on account of inclusive fares in respect of the stage carriage or stage carriages held by him the total amount of the tax shall wherever necessary be rounded off to the nearest naya paisa, fractions of half a naya paisa and over being counted as one and less than half being disregarded".
Thus section 3 authorises the levy of tax on all passengers carriages by road in stage carriages.
This section contains two essential ingredients: (1) that the transport concerned must carry passengers by road, and (2) that such passengers must be carried in stage carriages.
that is to say, as defined in section 2(7) of the Act, passengers must be carried for hire or reward at separate fares paid by or for individual passengers, either for the whole journey or for stages of the journey.
Rule 2(i) of the Bombay Motor Vehicle Rules, 1940 framed under the Bombay defines 'passenger ' thus: " 'passenger ' for the purposes of the rules in Chapter IV means any person travelling in a public service vehicle other than the driver or the conductor or an employee of the permit holder while on duty".
361 A combined reading, therefore, of rule 2(i) and section 2(7) of the Act clearly indicates that the tax would be leviable only if the passengers are carried on a public service vehicle.
It is true that the term 'public service vehicle ' has not been defined either by the Act or by the Rules, but that however does not create any difficulty, because having regard to the Preamble of the Act we are of the opinion that the tax can be levied only on passengers who are carried by a stage carriage which is of the nature of a public service vehicle.
The word 'public ' has got a well known connotation and means a carriage to which any member of the public can have free access on payment of the usual charges.
It cannot by any process of reasoning or stretch of imagination be deemed to include employees of a private company who are given facilities not as members of the public but as holding a special status, namely, the employees of that company.
Thus, qua public the employees form a separate class and cannot be said to be public as contemplated by rule 2(i).
On the other hand, the Bombay Motor Vehicles Rules 1959 define 'private service vehicles ' as follows: "Private Service Vehicle ' means any omnibus constructed or adapted to carry more than nine persons excluding the driver and ordinarily used by or on behalf of the owner of such vehicle for the purpose of carrying persons for or in connection with his trade or business, or otherwise than for hire or reward; but does not include a motor vehicle used solely for Police purposes".
The transport service in the present case which was registered as private service vehicle falls squarely within the ambit of the aforesaid definition Moreover, in the instant case, it is not disputed that the transport provided to the employees of the company was reserved for them only and no other member of the public even if he wanted to pay full charges could be carried on the said vehicle.
In these circumstances, therefore, it cannot be said that the transport vehicle provided to the employees by the appellants could be a public service vehicle in any sense of the term.
Mr. Nariman drew our attention to a number of rules and forms in order to illustrate his point that private service vehicle was beyond the ambit of the charging section.
In view of what we have already said, it is not necessary for us to go into such meticulous details, because the legal position appears to be clear enough.
As counsel for the appellants has already undertaken not to charge any amount from the employees for providing transport facilities, the point has now become more or less academic.
The Commissioner appears to have dismissed the appeals of the appellants 5 978 SCI/78 362 as he felt bound by the judgment of the Bombay High Court which had held that the transport vehicle provided to the employees by the company would be a public service vehicle.
In view of our finding that such a transport vehicle is not a public service vehicle within the meaning of the provisions of the Bombay , the view taken by the Bombay High Court is clearly erroneous and must be overruled.
For these reasons, therefore, the appeals are allowed and the order of the Commissioner imposing the tax is set aside.
The appellants would he entitled to one set of costs.
S.R. Appeals allowed.
| IN-Abs | The appellants are a Company registered under the Companies Act, 1913 and provide transport facilities to their employees at a nominal rate from certain pick up places to their factories at Pimpri and Chinchvad in district Pune (Maharashtra) in their transport vehicle registered as "private service vehicle" within the meaning of the Bombay Motor Vehicles Rules 1959.
The Bombay High Court held that the transport vehicle provided to the employees by the company would be a public service vehicle and therefore, the respondents sought to levy a tax on passengers under the charging section 3 of the Bombay Motor Vehicles Taxation on Passengers) Act, 1958.
A challenge to the said levy having been rejected by the Commissioner of Pune the appellant obtained special leave of this Court.
Allowing the appeals, the Court ^ HELD: 1.
The preamble to the Bombay Motor Vehicles (Taxation on Passengers) Act, 1958 clearly reveals that the dominant object of the Act was to impose tax on certain classes of public service vehicles.
In other words, the Preamble indicates that vehicles which could not be termed as public service vehicles fell beyond the ambit of the taxing provisions of the Act.
[359 G H] 2.
Though the Act and Rules made thereunder do not define the term "public service vehicle", it is clear that, from the Preamble of the Act that the tax can be levied only on passengers who are carried by a stage carriage which is of` the nature of Public Service Vehicle.
[361A B] 3.
Section 3 of the Act which authorises the levy of tax on all passengers carried by road in state carriages contains two essential ingredients (1) that the transport concerned must carry passengers by road, and (2) that each passengers must be carried in stage carriages, that is to say, as defined in Section 2(7) of the Act, passengers must be carried for hire or reward at separate fares paid by or for individual passengers, either for the whole journey or for stages of the journey.
[360F G] 4.
A combined reading of section 7 (1) which defines 'passenger ' and section 2(7) which defines 'stage carriage.
Of the Act clearly indicates that the tax would be leviable only if the passengers are carried on a public service vehicle.
[361A] 358 5.
The word 'Public ' has got a well known connotation and means a carriage to which any member of the public can have free access of payment of the usual charges.
It cannot by any process of reasoning or stretch of imagination be deemed to include employees of a private company who are given facilities not as members of the public but as holding a status namely, the employees of that company.
Thus, qua public the employees from a separate class and cannot be said to be public as contemplated by rule 2(i).
[361 C] 6.
In the present case: (a) The transport service which was registered as a private service vehicle falls squarely within the ambit of the definition of 'private vehicle service in the Bombay Motor Vehicles Rules, 1959.
[361E] (b) The transport provided to the employees of the company was reserved for them only and no other member of the public even if he wanted to pay full charges could be carried on the said vehicle.
In these circumstances, therefore, it cannot be said that the transport vehicle provided to the employees by the appellants could be a public service vehicle in any sense of the term.
Such a transport vehicle, being not a public service vehicle within the meaning of the provisions of the Bombay Motor Vehicles Act, the view taken by the Bombay High Court is clearly erroneous.
[361F G, 362B]
|
Transfer Petition No. 96 of 1978.
Madan Bhatia and D. Gobardhan for the Petitioner.
V. M. Tarkunde and Mrs. K. Hingorani for the Respondent.
The Judgment of the Court was delivered by KRISHNA IYER, J.
Mrs. Maneka Gandhi figures as an accused a prosecution launched against her and others by Miss. Rani Jethmalani for an offence of defamation in the Court of the Metropolitan Magistrate, Bombay.
The former is the editor of a monthly called "Surya" and is the wife of Shri Sanjay Gandhi and daughter in law of Smt.
Indira Gandhi, former Prime Minister.
The latter is a young advocate and is the daughter of a leading advocate and currently an important Member of Parliament.
The present petition has been made for a transfer of the criminal case from Bombay to Delhi, and a string of grounds has been set out to validate the prayer.
We decline the transfer and proceed to give our reasons without making the least reflection on the merits of the case.
Assurance of a fair trial is the first imperative of the dispensation of justice and the central criterion for the court to consider when a motion for transfer is made is not the hypersensitivity or relative convenience of a party or easy availability of legal services or like minigrievances.
Something more substantial, more compelling, more imperilling, from the point of view of public justice and its attendant environment, is necessitous if the Court is to exercise its power of transfer.
This is the cardinal principle although the circumstances may.
be myriad and vary from case to case.
We have to test the petitioner 's grounds on this touch stone bearing in mind the rule that normally the complainant has the right to choose any court having jurisdiction and the accused cannot dictate where the case against him should be tried.
Even so, the process of justice should not harass the parties and from that angle the court may weigh the circumstances.
381 One of the common circumstances alleged in applications for transfer is the avoidance of substantial prejudice to a party or witnesses on account of logistics or like factors, especially when an alternative venue will not seriously handicap the complaint and will mitigate the serious difficulties of the accused.
In the present case the petitioner claims that both the parties reside in Delhi and some formal witnesses belong to Delhi; but the meat of the matter, in a case of defamation, is something different.
The main witnesses are those who speak to having read the offending matter and other relevant circumstances flowing therefrom.
They belong to Bombay in this case and the suggestion of the petitioner 's counsel that Delhi readers may be substitute witness and the complainant may content herself with examining such persons is too presumptuous for serious consideration.
Now to the next ground.
The sophisticated processes of a criminal trial certainly require competent legal service to present a party 's case.
If an accused person, for any particular reason, is virtually deprived of this facility, an essential aid to fair trial fails.
If in a certain court the whole Bar, for reasons of hostility or otherwise, refuses to defend an accused person an extra ordinary situation difficult to imagine, having regard to the ethics of the profession it may well be put forward as a ground which merits this Court 's attention.
Popular frenzy or official wrath shall not deter a member of the Bar from offering his services to those who wear unpopular names or unpalatable causes and the Indian advocate may not fail this standard.
Counsel has narrated some equivocal episodes which seem to suggest that the services of an efficient advocate may not be easy to procure to defend Mrs. Maneka Gandhi.
Such glib allegations which involve a reflection on the members of the Bar in Bombay may not be easily accepted without incontestible testimony in that behalf, apart from the ipse dixit of the party.
That is absent here.
It is difficult to believe that a person of` the position of the petitioner who is the daughter in law of the former Prime.
Minister, wife of a consequential person and, in her own right, an editor of a popular magazine, is unable to engage a lawyer to defend her, while, as a fact, she is apparently represented in many legal proceedings quite competently.
A more serious ground which disturbs us in more ways than one is the alleged absence of congenial atmosphere for a fair and impartial trial.
It is becoming a frequent phenomenon in our country that court proceedings are being disturbed by rude hoodlums and unruly crowds, jostling, jeering or cheering and disrupting the judicial hearing with menaces, noises and worse.
This tendency of toughs and street roughs to violate the serenity of court is obstructive of the course of justice 382 and must surely be stamped out.
Likewise, the safety of the person of an accused or complainant is an essential condition for participation in a trial and where that is put in peril by commotion, tumult or threat on account of pathological conditions prevalent in a particular venue, the request for a transfer may not be dismissed summarily.
It causes disquiet and concern to a court of justice if a person seeking justice is unable to appear, present one 's case, bring one 's witnesses or adduce evidence.
Indeed, it is the duty of the court to assure propitious conditions which conduce to comparative tranquillity at the trial. 'Turbulent conditions putting the accused 's life in danger or creating chaos inside the court hall may jettison public justice.
If this vice is peculiar to a particular place and is persistent the transfer of the case from that place may become necessary.
Likewise, if there is general consternation or atmosphere of tension or raging masses of people in the entire region taking sides and polluting the climate, vitiating the necessary neutrality to hold a detached judicial trial, the situation may be said to have deteriorated to such an extent as to warrant transfer.
In a decision cited by the counsel for the petitioner, Bose, J. Observed: ".
But we do feel that good grounds for transfer from Jashpurnagar are made out because of the bitterness of local communal feeling and the tenseness of the atmosphere there.
Public confidence in the fairness of a trial held in such an atmosphere would be seriously undermined, particularly among reasonable Christians all over India not because the Judge was unfair or biassed but because the machinery of justice is not geared to work in the midst of such conditions.
The calm detached atmosphere of a fair and impartial judicial trial would be wanting, and even if justice were done it would not be "seen to be done".(1) Accepting this perspective we must approach the facts of the pre sent case without excitement, exaggeration or eclipse of a sense of pro portion.
It may be true that the petitioner attracts a crowd in Bombay.
Indeed, it is true of many controversial figures in public life that their presence in a public place gathers partisans for and against, leading to cries and catcalls or 'Jais ' or 'zindabads '.
Nor is it unnatural that some persons may have acquired, for a time a certain quality of reputation, sometimes notoriety, sometimes glory, which may make them the cynosure of popular attention when they appear in cities even in a court.
And when unkempt crowds press into a court hall it is possible that some pushing, some nudging, some brash ogling or angry starting may occur in the rough and rumble resulting in ruffled feelings (1) G.X. Francis vs Banke Bihari Singh, A.I.R. 1958 S.C. 809 at 810.
383 for the victim.
This is a far cry from saying that the peace inside the court has broken down, that calm inside the court is beyond restoration, that a tranquil atmosphere for holding the trial is beyond accomplishment or that operational freedom for the Judge parties, advocates and witnesses has ceased to exist.
None of the allegations made by the petitioner, read in the pragmatic light of the counter averments of the respondent and understood realistically, makes the contention of the counsel credible that a fair trial is impossible.
Perhaps, there was some rough weather but it subsided, and it was a storm in the tea cup or transcient tension to exaggerate which is unwarranted.
The petitioner 's case of great insecurity or molestation to the point of threat to life is, so far as the record bears out, difficult to accept.
The mere word of an interested party is insufficient to convince us that she is in jeopardy or the court may not be able to conduct the case under conditions of detachment, neutrality or uninterrupted progress.
We are disinclined to stampede ourselves into conceding a transfer of the case on this score, as things stand now.
Nevertheless, we cannot view with unconcern the potentiality of a flare up and the challenge to a fair trial, in the sense of a satisfactory participation by the accused in the proceedings against her.
Mob action may throw out of gear the wheels of the judicial process.
Engineered fury may paralyse a party 's ability to present his case or participate in the trial.
If the justice system grinds to a halt through physical manoeuvres or sound and fury of the senseless populace the rule of E law runs aground.
Even the most hated human anathema has a right to be heard without the rage of ruffians or huff or toughs being turned against him to unnerve him as party or witness or advocate.
Physical violence to a party, actual or imminent, is reprehensible when he seeks justice before a tribual.
Manageable solutions must not sweep this Court off its feet into granting an easy transfer but uncontrollable or perilous deterioration will surely persuade us to shift the venue.
It depends.
The frequency of mobbing manouvres in court precincts is a bad omen for social justice in its wider connotation.
We, therefore, think it necessary to make a few cautionary observations which will be sufficient, as we see at present, to protect the petitioner and ensure for her a fair trial.
The trial court should readily consider the liberal exercise of its power to grant for the accused exemption from personal appearance save on crucial occasions.
Shri Tarkunde, for the respondent fairly agreed that it was the right thing to do and explained the special reason for its first rejection.
If the application is again made, the magistrate will deal with it as we have indicated.
This will remove much of the unsavoury sensationalism which the hearing may suffer from 384 The magistrate is the master of the orderly conduct of court proceedings and his authority shall not hang limp if his business is stalled by brow beating.
It is his duty to clear the court of confusion, yelling and nerve racking gestures which mar the serious tone of judicial hearing.
The officials whose duty is to keep the public peace shall, on requisition, be at the command of the court to help it run its process smoothly.
When the situation gets out of hand the remedy of transfer surgery may be prescribed.
Every fleeting rumpus should not lead.
to a removal of the case as it may prove to be a frequent surrender of justice to commotion.
The magistrate shall take measures to enforce conditions where the court function free and fair and agitational or muscle tactics yield no dividends.
If that fails, the parties have freedom to renew their motion under section 406 of the Criminal Procedure Code.
For, where tranquil court justice is a casualty the collapse of our constitutional order is an inevitability.
We dismiss, for the nonce, this transfer petition.
S.R. Petition dismissed.
| IN-Abs | ^ HELD: 1. Assurance of a fair trial is the first imperative of the dispensation of justice and the central criterion for the Court to consider when motion four transfer is made is not the hypersensitivity or relative convenience of a party or easy availability of legal services or the like mini grievances.
Something more substantial, more compelling, more imperilling, from the point of view of public justice and its attendant environment is necessitous, if the Court is to exercise its power of transfer.
This is the cardinal principle although the circumstances may be myriad and vary from case to case.
courts must test the petitioner 's grounds on this touch stone bearing in mind the rule that normally the complainant has the right to choose any Court having jurisdiction and the accused cannot dictate where the case against him should be tried.
Even so, the process of justice should not harass the parties and from that angle the Court may weigh the circumstances.
[380F H] 2.
The meat of the matter, in a case of defamation is something different than the common ground usually urged like the avoidance of substantial prejudice to a party or witnesses on account of logistics or like factors, especially when an alternative venue will not seriously handicap the complainant and will mitigate the serious difficulties of the accused.
The main witnesses are those who speak to having read the offending matter and other relevant circumstances flowing therefrom.
[381A B] In this case, the witnesses belong to Bombay and the suggestion that Delhi readers may be substitute witnesses and the complainant may consent herself with examining such persons is too presumptuous for serious consideration.
[381 C] 3.
The sophisticated processes of a criminal trial certainly require competent legal service to present a party 's case.
If an accused person, for any particular reason, is virtually deprived of this facility, an essential aid to fair trial fails.
If in a certain Court the whole Bar, for reasons of hostility or otherwise refuses to defend an accused person an extraordinary situation difficult to imagine, having regard to the ethics of the profession it may well be put forward as a ground which merits the attention of the Supreme Court.
Glib allegation like the services of an efficient advocate may not be easy to procure involves a reflection on the members of the Bar in Bombay and, therefore, is cannot be easily accepted without incontestible testimony in that behalf which is absent in this case.
apart from the ipse dixit of the party; Popular frenzy or official wrath shall not deter a member of the Bar from 379 offering his services to those who wear unpopular names or unpalatable causes and the Indian advocate may not fail this standard.
[381C E] 4.
It is true that a detached atmosphere of a fair and impartial judicial trial is a must.
The tendency of toughs and street roughs to violate the serenity of Court is obstructive of the course of justice and must surely be stamped out.
Likewise, the safety of the person of an accused or complainant is an essential condition for participation in a trial and where that is put in peril by commotion, tumult or threat on account of pathological conditions prevalent in a particular venue, the request for a transfer may not be dismissed summarily.
It causes disquiet and concern to a Court of justice if a person seeking justice is unable to appear present one 's case, bring one 's witnesses or adduce evidence.
Indeed, it is the duty of the Court to assure propitious conditions which conduce to comparative tranquility at the trial.
Turbulent conditions putting the accused 's life in danger or creating chaos inside the Court hall may jettison public justice.
If this vice is peculiar to a particular place and is persistent the transfer of the case from that place may become necessary.
Likewise, if there is general consternation or atmosphere of tension or raging masses of people in the entire region taking sides land polluting the climate, vitiating the necessary neutrality to hold a detached judicial trial, the situation may be said to have deteriorated to such an extent as to warrant transfer.
[381 H, 382A C] In the instant case, none of the allegations made by the Petitioner.
read in the pragmatic light of the counter averments of the respondent and understood realistically makes the contention credible that a fair trial is impossible.
[383A B] G. X. Francis vs Banke Bihari Singh, A.I.R. 1958 SC 809 and 810; referred to.
Observation : The frequency of mobbing manouvres in Court precincts is a bad omen for social justice in its wider connotation.
Mob action may throw out of the gear the wheels of the judicial process.
Engineered fury may paralyse a party 's ability to present his case or participate in the trial.
If the justice system grinds to a halt through physical manouvres or sound and fury of the senseless populace, the rule of law runs aground.
Even the most hated human anethema has a right to be heard without the rage of ruffians or huff of toughs being turned against him to unnerve him as party or witness or advocate.
Physical violence to a party, actual or imminent, is reprehensible when he seeks justice before a tribunal.
Manageable solutions must not sweep the Supreme Court off its feet into granting an easy transfer but uncontrollable or perilous deterioration will surely persuade this Court to shift the venue.
It depends.
[383D F] Therefore (a) the trial Court should readily consider the liberal exercise of its power to grant for the accused exemption from personal appearance save on crucial occasions.
[383G] (b) Where tranquil Court justice is a casualty, the collapse of an constitutional order is an inevitability.
The Magistrate is the master 380 of the orderly conduct of court proceedings and his authority shall not hang limp if his business is stalled by brow beating.
It is his duty to clear the Court of confusion, yelling and nerve racking gestures which mar the serious tone of judicial heaving.
The officials whose duty is to keep the public peace shall, on requisition, be at the command of the Court to help it run its process smoothly.
When the situation gets out of hand the remedy of transfer surgery may be prescribed Every fleeting rumpus should not lead to a removal of the ease as it may prove to be a frequent surrender of justice to commotion.
The Magistrate shall take measures to enforce conditions where the Court functions free and fair and agitational our muscle tactics yield no dividends.
[384A C]
|
Civil Appeal No. 484 of 1969.
From the Judgment and order dated 28 7 1967 of the Allahabad High Court in Special Appeal No. 352/67.
M. section Gupta for the Appellant.
G. N. Dikshit and O. P. Rana.
for the Respondents.
The Judgment of the Court was delivered by SARKARIA, J.
This is an appeal by certificate against a judgment, dated July 28, 1967, passed by the High Court of Allahabad in Special Appeal 352 of 1967.
It arises our of these fact.
Jai Dutt, appellant, was in possession of public land bearing Survey Nos 230, 131A and 131B, with an aggregate area of 80 Bighas and 19 Biswas in the area of village Guljarpur PurraamSingh, Tehsil Kala chungi, Distt.
Nainital.
The Public Authority, Nainital; served a show cause notice, dated August 26, 1963, under Section 3(1) of the U.P. Land (Eviction and Recovery of Rent and Damages) Act, 1959 (here inafter called the Eviction Act) on the appellant for his eviction from this land on the ground that he was in its unauthorised occupation.
The appellant contested the notice on the ground that he was in its possession for more than 12 years and had acquired the rights of a hereditary tenant in the land under Section 180(2) of the U.P. Tenancy Act, 1939 (for short, called the Tenancy Act).
On these premises, the appellant contended that the land was not 'public land ', and as such, the Eviction Act has no application and the notice was illegal.
By its order dated October 31, 1963, the Public Authority dismissed the objections, holding that the appellant "has not filed any documentary evidence to show that the land in dispute was allotted to him by a competent authority, while the documents filed on behalf of the State show that it is a public land and "the O.P. (appellant herein) is a trespasser thereon", and he is, therefore, liable to be evicted therefrom 177 under Section 4(1) of the Eviction Act.
The Public Authority further assessed Rs. 12/ as damages payable by the appellant.
Against this order of the Public Authority, Jai Dutt carried an appeal under Section S of the Eviction Act to the District Judge.
The appeal was heard by the Additional District Judge, Kummaon Nainital, before whom the appellant reiterated the contention that he had been in possession of the land in question for the preceding 12 years, and as such, had acquired the rights of a hereditary tenant thereon.
There, the appellant seems to have further contended that he had been paying "rent" for his occupation of the land He appears to have shown some receipts also to the Additional District Judge.
The Additional District Judge negatived all the contentions and dismissed the appeal.
The appellant then filed a writ petition under Article 226 of the Constitution before the High Court to impugn the orders of the Public Authority and of the Add.
District Judge, inter alia, on the ground that since he had been paying rent for the land which has been in his cultivating possession for a number of years preceding the eviction proceedings, he could not be said to be all 'unauthorised occupant ', but a hereditary tenant under Section 180(2) of the Tenancy Act The learned Single Judge of the High Court, who heard the writ petition, rejected this contention with the observation that 'the Khatauni of 1368 Fasli entered the petitioner 's possession over the disputed plots as ranging from 1 to 6 years.
The oral evidence led by the petitioner does not outweigh the force of the entries in the Khatauni.
The petitioner, therefore, did not acquire any title under Section 180 of the U.P. Tenancy Act before 1953.
" The learned Single Judge further observed that the decision of the Division Bench of that High Court in Shri Chandra vs State of U.P. & Ors.
(W.P. No. 3277 of 1966 decided on 13 2 67) was applicable to the case and the land in dispute will be public land and the possession of the appellant unauthorised.
In the result, the writ petition was dismissed with costs.
The appellant 's special Appeal was dismissed by a Division Bench of the High Court on July 28, 1967.
In the meantime, the Eviction Act was successfully challenged before the High Court in Writ Petitions 3755 and 3756 of 1962 which were decided on May 24, 1968.
Keeping in view the value of the subject matter which exceeded Rs. 20,000/ and the question of the Constitutional validity of the Eviction Act, the High Court granted a certificate under Article 133 (l)(a) and (c) of the Constitution, that the case was fit for appeal to this Court.
Hence, this appeal.
178 Mr M. section Gupta, appearing for the appeal, has now given up the challenge to the Constitutional validity of the Eviction Act on the ground of its being violative of Article 14 of the Constitution, because this ground of attack no longer survives in view of this Court 's judgement in Maganlal Chhagganlal vs Municipal Corporation of Greater Bombay & ors.(1) He, however, sought to make out these points: (i) The appellant had been in cultivatory possession of the land for a number of years and no action for his eviction was taken for a long time and since no steps were taken by the Government to evict him evict two years of his entry into possession, he became a here ditary tenant under Section 180(2) of the Tenancy Act.
(ii) Even if the appellant did not acquire the rights of a hereditary tenant in the disputed land, he had by long possession acquired the rights of a tenant or tenure holder of any other kind under the Government.
He has been paying rent in respect of the land to the Government, and, as such, was not in unauthorised occupation of the land.
Since the land was held by the appellant as a tenant, it did not fall within the definition of 'public land ' given in Section 2(a) of the Eviction Act.
(iii) Since the objections raised by the appellant in response to the show cause notice issued under Section 3(1) of the Eviction Act were substantial, the Public Authority was bound to refer the dispute to the Civil Judge under Sec. 7 of the Eviction Act.
Its failure to do so, vitiates the code of eviction passed by it.
(iv) one of the prerequisites of taking action under Section 3(1) of the Eviction Act is that title Public land is required "for one or more public purposed of this Act".
Sub section (2) (a) of Section 3 requires that the notice shall "specify the grounds on which the order of eviction is proposed to be made".
The impugned notice issued by the Public Authority did not comply with these, requirements of Section 3 and was therefore, illegal.
Points (i) and (ii): Mr. Gupta did not seriously press the first point, obviously because it was without substance.
It may be noted that Section 180 of the Tenancy Act is subject to the, restrictions contained in Section 30 of that Act, which provides: "Notwithstanding anything in Section 29, hereditary rights shall not accrue on. (1) [1975] I S.C.R. 1. 179 (3) land acquired or held for a public purpose or work of public A utility.
" Even if it is assumed that the appellant was at the material time in occupation of this land for more than two years, he would not acquire rightmost of a hereditary tenant under Section 180(2).
Omission of the State Government, therefore, to institute a suit under Section 180(l) within the prescribed period of limitation would not bring into existence relationship of landlord and tenant between the Government and the appellant, and the letter 's possession would remain, as it was at its inception, that of a trespasser or unauthorised occupant.
This point is further highlighted by the definition of "unauthorised occupation" given in clause (h) of Section 2 of the Eviction Act, which states: "Unauthorised occupation means occupation of a public land by any person without the authority of the owner for such occupation and includes its continued occupation after the expiry of the period of allotment, lease or grant. anything contained in.
O.P. Tenancy Act, 1939. to the contrary notwithstanding." n In the context, the definition of "Public Land" given in Section 2(e) of the Eviction Act may also be seen.
This definition, so far as material for our purpose, states: "Public land means land belonging to or owned by the State Government but does not include land (i) for the time being held by a tenure holder for the State Government under the U.P. Tenancy Act, 1939.
(ii) . .
" Section 2 (b) of this Act defines "Lease" to mean "a lease as defined in Section 105 of the ".
There is neither any factual nor legal basis for the appellant 's contention that he had acquired some kind of tenure as a tenant by remaining in twelve years ' continuous possession of the land in dispute.
As noticed by Additional District Judge and the learned Single Judge of the High Court, the Khasra tendered in evidence before the Public Authority, shows that in the years 1362, 1363, 1365 and 1367 Fasli (which we are told roughly corresponds to 16655 56, 1956 57, 1958 59 and 1960 61 A.D.) the land in dispute was lying Banjar (barren).
That is to say, in the years 1955 to 1961, the appellant was not in occupation of this land.
During these years, when the land was lying Banjar, its possession would be presumed to be of the lawful owner, viz., the State Government.
The appellant 's possession over the land is shown for the first time in Khasra of the year 1368 Fasli (roughly 180 corresponding to 1961 62) as "bila tasfia, Ziman 10 Ka".
Same is the position shown in the Khatauni 1368 Fasli "Bil Tasfia" obviously means "without settlement or allotment or grant".
The documentary evidence from the revenue records, accepted by the courts below, had thus discounted the appellant 's claim that he had been in cultivator possession of the disputed land for 12 years preceding the issue of the impugned notice under Section 3(1).
It was never the case of the appellant that he had lawfully entered into possession of the land.
On the contrary, his case was that he took possession of the land without any grant, settlement or lease from the land owner.
Indeed, by clanging acquisition of a hereditary tenancy under Section 180(2), he admitted that he had taken possession without any title and without the consent of the land owner.
Mr. Gupta has been unable to show that the appellant 's occupation of the land even for one or two years preceding the notice under Section 3(1) was that of a "tenure holder" within the contemplation of the saving sub clause (i) in the definition of "public land` ' in Section 2(e) of the Eviction Act.
The appellant 's contention that he has been paying rent for this land does not appear to be well founded.
No such plea appears to have been raised before the Public Authority, much less was any evidence, such as a rent receipt produced there.
The Public Authority has nob d in its order dated October 3, 1963, that the O.P. (appellant herein) did not produce any documentary evidence to show that he was holding the land with title permission of or under allotment from any competent authority.
Nor was this plea agitated or pressed before the learned Single Judge or the Division Bench of the High Court.
Even now, before us, counsel has not referred to any rent receipt or like document on record showing that the appellant had paid rent in respect of this land to the Government for the period of his possession preceding the notice under Section 3 (1) of the Eviction Act.
Even the Additional District Judge, to whom for the first time in appeal, some "rent receipts" appear to have been shown by the appellant, has not recorded any clear cut finding that those documents evidence the receipt of rent by the Government in respect of the disputed land for the relevant period preceding the issue of notice under Section 3(1).
This being the situation, in this appeal arising out of writ proceedings under Article 226, we decline to embark upon a speculative examination of this argument for which there is no firm factual foundation and was never raised before the Public Authority, nor pressed before the High Court.
181 Be that as it may, the provisions of Sections 2(18), 30, 180(2) of the Tenancy Act on the one hand and Sections 2(b), 2(e)(i) and 2(h) of the Eviction Act on the other, are to be construed in harmony with each other.
So construed, a person occupying land belonging to the State Government, as a trespasser or without title or a person holding over after the revocation or cancellation of the lease, allotment or grant in accordance with the conditions thereof, cannot be considered "a tenure holder from the State Government under .
the U.P. Tenancy Act, 1939" within the meaning of Section 2(e)(i) of the Tenancy Act.
There was thus no doubt that the disputed land was "public land" and the appellant was in its "unauthorised occupation" within the meaning of the Eviction Act.
Point (iii) : Section 7, (so far as material) reads thus: "7(1) Where an objection is taken on the ground that the disputed land is not public land and the Public Authority is of the opinion that the objection is not prima facie base less or frivolous, he shall refer the question to the Civil Judge, having jurisdiction, stating the facts of the case and the, point in issue.
" From a plain reading of Section 7(1), extracted above, it is clear that the obligation to refer the question whether or not the land is public land, is not absolute, but contingent.
It arises only if the Public Authority is of the opinion that objection is not prima facie baseless or frivolous.
In the instant case, a perusal of the impugned order would show that although the Public Authority did not say in the phraseology of the Statute that the objection raised by the appellant was prima facie "baseless", yet in substance, .
_ unhesitatingly came well nigh to the same conclusion when he observed: "The O.P. has not filed any documentary evidence to show that the land in dispute was allotted to him by a competent authority.
The documents filed on behalf of the State show that the land in dispute is a public land and the C.P. is a trespasser thereon.
" We are therefore of opinion that there was no infraction of Section 7.
Point (iv): This point was not raised before the Public Authority, nor in any of the Courts below.
It is sought to be raised for the first time in this Court, now.
We decline to entertain it at this state.
It is not 182 a pure question of law which could be decided on the basis of material already on record.
The appellant has not produced even the copy of the notice under Section 3 (1) which was served upon him and is supposed to be in his possession.
In the circumstances of the case, the maxim omnia praesumuntur rite essa acta will be attracted.
It will be presumed that the public purpose of the Act for which the appellant was sought to be evicted from the public land, was only specified in the notice in compliance with the requirement of sub section (2) of Section 3 of the Act.
Thus, all the contentions advanced by the appellant are devoid of merit.
In the result, the appeal fails and is dismissed with costs.
P.B.R. Appeal dismissed.
| IN-Abs | In appeal to this Court it was contended that the appellant had become a hereditary tenant under section 180(2) of the Tenancy Act by reason of the fact that he had been in cultivator possession of the land for a number of years and no steps had been taken to evict him within two years of his entry into possession of the land, (2) that since he had been paying rent to the Government he was not in unauthorised occupation of the land and (3) failure of the Public Authority to refer the dispute to a Civil Judge under Section 7 of the Act vitiated the order of eviction Dismissing the appeal, ^ HELD: l(a) The appellant 's claim was not that he lawfully entered into possession of the land but that he took possession without any grunt, settlement or leases from the owner.
By claiming acquisition of a hereditary tenancy) under section 180(2) he admitted that he had taken possession without any title anal without the consent of the land owner.
1180 C] (b) The provisions of Section 2(18), 30, 180(2) of the Tenancy Act are to be construed in harmony with each other.
So construed, a person occupying land belonging to the State Government, as a trespasser or without title or a person holding over after the revocation or cancellation of the lease, allotment or a grant in accordance with the condition thereof, cannot be "a tenureholder.
from the State Government under the U.P. Act, 1939.
" within the meaning of Sec.
2(e)(i) of the Tenancy Act.
There was thus no doubt that the land was "public land" within the meaning of the Eviction Act.
[181 A B] (2) The obligation to refer the question whether or not the land is public land, under Section 7, is not basic but contingent.
Although the Public Authority did not say in the phraseology of the statute that the objection raised by the 176 appellant was prima facie baseless, yet, in substance, it well nigh came to the same conclusion.
It was, therefore, not obligatory for the authority to refer the question to the Civil Court.
[181 F] (3) The plea that the notice did not comply with the requirements of section 3 of the Eviction Act and for that reason illegal had not been raised in the Courts below.
It is not a pure question of law.
The appellant has not produced a copy of the notice served on him.
Tn the circumstances, the maxim omnia prae sumuntur vite essa acta will be attracted.
It will be presumed that the purpose for which the appellant was sought to be evicted was duly specified in the notices compliance with the requirements of section 3(2).
[182 A B]
|
Civil Appeal Nos. 1286, 1287 and 2511 of 1969 From the Judgment and Order dated 20 8 1968 and 3 4 1969 of the Punjab and Haryana High Court in Civil Writ Nos.800/66, 2625/65 and LPA No 141 of 1969.
Harbans Singh and R. N. Sachthey for the Appellant in all the appeals.
E. C. Agarwala and M. L. Srivastava for the Respondent in C.A. 1286/69.
406 H.K. Puri for the Respondent in C. A. 1287/69 N. N. Keswani for the Respondent in C.A. 2511/69 The Judgment of the Court was delivered by SHINGHAL, J.
These three appeals by certificates granted by the High Court of Punjab and Haryana are directed against two judgments of that court dated August 20? 1966, and another judgment of that court dated November 22, 1968.
The High Court first decided the writ petition of constable Dwarka Das, which is the subject matter of appeal No.1286 of 1969, and disposed of the other two writ petitions, which are the subject matter of appeals Nos. 1287 and 2511 of 1969, on the basis of that judgment.
These three appeals therefore Raise common questions of law and have been heard together at the request of learned counsel for the parties and will be disposed of by a common judgment The writ petitioners in all the three cases were recruited as constables in the police force of the Punjab State.
It is not in dispute before us that (i) they were police officers of the State, (ii) they were enrolled as police officers, (iii) they had put in more than three years service after their recruitment and enrolment as police officers, and (iv) they were discharged under the provisions of rule 12.21 of the Punjab Police Rules, 1934, (hereinafter referred to as the Rules and not by way of punishment under the provisions of Chapter XVI of the Rules.
No attempt has been made to distinguish one case from the others on facts.
On the other hand learned counsel for the parties are in agreement that the facts of the three cases are quite similar and they raise the common question of law whether the orders of discharge were valid.
The respondents challenged the validity of those orders by writ petitions which were allowed by the impugned judgments of the High Court and the three appeals are before us for that reason.
It has been argued by Mr Harbans Singh, on behalf of the appellant State, that even though the respondents had put in more than three years service as police officers of the State Government, their appointments were temporary and could be terminated for that reason even if the termination could not strictly be said to fall within the purview of rule 12.21 of the Rules.
that in fact is the only question II for consideration in these appeals and can easily be answered with reference to the provisions of the , hereinafter refer red to as the Act, and the Rules.
407 Section 1 of the Act defines "Police" to include all persons who A shall be enrolled under it.
Section 2 provides that the entire police establishment under the State Government shall be deemed to be one police force, and shall be formally enrolled.
It further provides that the conditions of service of the members of the subordinate ranks of the police force shall be such as may be determined by the State Government.
Section 8 is also relevant, for it expressly provides that every police officer appointed to the police force of the State (other than an officer mentioned in section 4), shall receive on his appointment a certificate in the form annexed to the Act, by virtue of which he shall be vested with the powers, functions and privileges of a police officer.
The certificate states that the police officer concerned has been appointed a member of the police force under the Act, and vested with the powers.
functions and privileges of a police officer.
The certificate is not therefore the order of appointment or enrolment, but is subsequent to the appointment and the enrolment, even though it is a part of the process of appointment and enrolment, in as much as it certifies that the police officer has been vested with the necessary powers, functions and privileges of a police officer.
The certificate does not however have any bearing on the question whether its holder is a permanent or a temporary police officer, for that is a matter which has to be governed by the other conditions of his service.
It is not in dispute before us that such certificates were issued to all the three respondents and that they functioned as police officers for more than three years.
Chapter XII of the Rules deals with the appointment and enrolment of police officers.
Clause (3) of rule 12.2.
provides, inter alia, as follows, "(3) All appointments of enrolled police officers are on probation according to the rules in this chapter applicable to each rank.
" It is therefore obvious that as the respondents were enrolled police officers, they were on probation.
The period of probation has not been specified in the Rules, but rule 12.21 provides for the discharge of an inefficient police officer as follows "12.21.
A constable who is found unlikely to prove an efficient police officer may be discharged by the Superintendent at any time within three years of enrolment.
There shall be no appeal against an order of discharge under this rule.
" 408 So if rules 12.2(3) and 12.21 are read together, it will appear that the maximum period of probation in the case of 3 police officer of the rank of constable is three, years, for the Superintendent OF Police concerned has the power to discharge him within that period.
It follows that the power of discharge cannot be exercised under rule 12.21 after the expiry of the period of three years.
If therefore it is proposed to deal with an inefficient police officer after the expiry of that period, it is necessary to do so in accordance with the rules of Chapter XVI of the Rules which makes provision for the imposition of various punishments including dismissal from the police force.
It is not permissible to ignore those rules and make a simple order of discharge under rule 12.21 after the expiry of the period of three years for that will attract article 311 of the Constitution.
The Superintendent of Police concerned could not have ignored that requirement of the law and terminated the services of the three respondents after the expiry of the period of three years from their enrolment in the police force of the State.
The High Court therefore rightly set aside the orders of termination of the services of the three respondents and to that extent the impugned judgments are correct.
But we are constrained to say that it was not justified in holding that "a constable who has obtained a certificate under rule 12.22 cannot be dealt with under rule 12.21", and that "if he is to be removed from service, procedure prescribed in Chapter XVI has to be followed.
" The reason is that, as has been shown, the certificate prescribed under rule 12.22 is meant to serve the purpose of section 8 of the Act by vesting a police officer with the powers, functions and privileges of a police officer, and has to be issued on his appointment as such.
The certificate is thus a letter of authority, and enables the police officer concerned to enter upon his duties as a police officer.
It has to be granted almost from the inception, when a person is appointed and enrolled as police officer, and it is not correct to say that the mere issue of the certificate puts its holder beyond the reach of rule 12.21 even if it is found that he is unlikely to prove an efficient police officer and has not completed the period of three years after his enrolment.
Except for this slight clarification, we find no merit in these appeals and they are dismissed with costs.
M.R. Appeals dismissed.
| IN-Abs | The respondent writ petitioners were constables of the Punjab State Government, and had put in more than 3 years service, when they were discharged for inefficiency, under Rule 12.21 of the Punjab Police Rules, 1934.
the High Court allowed their writ petitions challenging the validity of their discharge orders.
It was contended by the State that although the respondents had put in more than three years service, their appointments were temporary and could be terminated for that reason, even if the termination could not strictly b said to fall within the purview of rule 12.21.
Dismissing the appeal.
the Court ^ HELD: If rules 12.2(3) and 12.21 are read together, it will appear that the maximum period of probation in the case of a police officer of the rank of constable is three years and the power of discharge cannot be exercised under rule 12.21 after expiry of that period.
If it is proposed to deal with an inefficient police officer after the expiry of three years, it is necessary to do so in accordance with the rules of Chapter XVI of the Rules which makes provision for the imposition of various punishments including dismissal from the police force.
[408A B] The High Court was not justified in holding that a constable who had obtained a certificate under rule 12.32 cannot be dealt with under rule 12.21 "I`hat certificate is meant to serve the purpose of section 8 of the Police Act.
1861, by vesting a public officer with the powers, functions and privileges of a police officer and has to be issued on his appointment as such.
The certificate is a letter of authority and enables the police officer to enter upon his duties as a police officer.
It has to be granted almost From the inception and it is not correct to say what the mere issue of the certificate puts its holder beyond the reach of rule 12.21 even if it is found that he is unlikely to prove an efficient police officer and has not completed the period of three years of his enrolment.
[408D G]
|
N: Criminal Appeal No. 144 of 1972.
Appeal by Special Leave from the Judgment and order dated 1 2 1972 of the Madhya Pradesh High Court in Criminal Revision No. 709/71.
R. Nagarathnam for the Appellant.
section K. Gambhir, Miss B. Ramrakhiani and J. M. Khanna for the Respondent.
The Judgment of the Court was delivered by KAILASAM, J.
This appeal is preferred by Dr. section L. Goswami by special leave granted by this Court against the judgment of the High Court of Madhya Pradesh at Jabalpur in Criminal Revision No. 709 of 1971.
Criminal Revision No. 709 of 1971 was filed by the appellant 387 before the High Court for quashing the order of the Magistrate, 1st , Class, Jabalpur committing the appellant to Sessions for trial under section 466 read with section 120 B of the Indian Penal Code.
The appellant was prosecuted before the Special Judge, Jabalpur, in Criminal Case No. S of 1967 for an offence under section 5 (1) (d) of the Prevention of Corruption Act, 1947, in connection with the defalcations of Government funds.
In that case one Dr. section C. Barat was examined as a defence witness.
The appellant was convicted and an appeal against his conviction before the High Court failed.
The appellant obtained special leave from this Court to appeal against the order of the High Court.
During the pendency of the appeal before the Supreme Court the High Court was required to prepare a paper book for use in the Supreme Court.
It is alleged that when the paper book was being prepared in the Supreme Court section of the High Court the appellant Dr. Goswami entered into a conspiracy with two of the translators and tampered with the original deposition of Dr. section C. Barat, D.W. 1.
The Additional Registrar of the High Court field a complaint before the First Class Magistrate, Jabalpur, against the appellant for an offence under section 466 read with section 120 B of the Indian Penal Code.
The case was taken on file by the Magistrate as Criminal Case No. 1924 of 1971.
Against the two persons who were alleged to have conspired with the appellant in tampering with the deposition of Dr. Barat a challan was filed by the police before the same First Class Magistrate.
The Magistrate by a common order on 15th November, 1971 committed the appellant as well as two others to the Sessions Court to take their trial for offences under section 466 read with section 120 B of the Indian Penal Code.
The appellant and another with whom we are not concerned preferred a revision petition against the order of his committal before the High Court.
The High Court dismissed the Fr revision filed by the appellant and hence this appeal.
The main contentions that are raised in this appeal are: (i) The Magistrate erred in taking cognizance of an offence under section 466 of the Indian Penal Code read with section 120 B, Indian Penal Code.
without sanction of the Government under section 196 A (2) of the Criminal Procedure Code; and (2) the offence, if any, was not committed in any court in respect of a document produced or given in evidence in such proceeding as required under section 195(i) (c) of the Code of Criminal Procedure.
We will take up the first contention urged by the learned counsel for 11 the appellant, namely that the trial court was in error in taking cognizance of the offence without a complaint by the State Government when the 388 offence charged is one of conspiracy under section 120 B of the Indian Penal Code as required under section 196 A(2) of the Criminal Procedure Code.
Section 196 A(2) reads as follows: "196 A. No court shall take cognizance of the offence! of criminal conspiracy punishable under section 120 B of the Indian Penal Code.
(1) * * * * (2) in a case where the object of the conspiracy is to commit any non cognizable offence, or a cognizable offence not punishable with death, imprisonment for life or rigorous imprisonment for a term of two years or upwards unless the State Government, or a Chief Presidency Magistrate or District Magistrate empowered in this behalf by the State Government had by order in writing consented to the initiation of the proceedings; Provided that where the Criminal Conspiracy is one to which the provisions of sub section (4) of section 195 apply no such consent shall be necessary.
" Section 466 deals with a non cognizable offence and the sub clause (2) to section 196A provides that where the object of the conspiracy is to commit a non cognizable offence an order in writing consenting to the initiation of proceedings is necessary by the State Government or the Chief Presidency Magistrate or the District Magistrate empowered in this behalf by the State Government.
No such consent in writing was obtained in this case.
An exception to this requirement is Made by the Proviso which states that if the criminal conspiracy is one to which the provisions of sub section (4) of section 195 apply no such consent shall be necessary.
It is, therefore, necessary to determine whether the offence complained of is one that falls under section 195(4) in which case consent for initiation of the proceedings is not necessary.
Section 195(1) (c) and section 195(4) which are necessary for the discussion may be extracted. "195.
(1) No Court shall take cognizance (a) * * * * (b) * * * * (c) of any offence described in Section 463 or punishable under Section 471, Section 475 or Section 476 of the same Code, when such offence is alleged to have been 389 committed by a party to any proceeding in any Court in respect of a document produced or given in evidence in such proceeding, except on the complaint in writing of such Court, or of some other Court to which such Court is subordinate.
(2) * * * * (3) * * * * (4) The provisions of sub section (1), with reference to the offences named therein, apply also to criminal conspiracies to commit such offences and to the abetment of such offences, and attempts to commit.
(5) * * * * Sub section (4) makes the provisions of sub section (1) with reference to the offences named applicable to criminal conspiracy to commit such offences also.
If the offence falls under provisions of subsection (1) to Section 195 then criminal conspiracy to commit such offences would also fall under section 195(1) and require the complaint in writing by the court before the offence can be taken cognizance of.
The requirements of section 195(1)(C) are: (1) The offence must be one as described in section 463 or punishable under sections 471, 475 or 476 of the I.P.C. (2) Such offences Should be alleged to have been committed by a party to any proceeding in any court; (3) Such offence should be in respect of a document produced or given in evidence in such proceeding.
The offence for which the appellant is committed to take his trial is that there was consent of the appellant also in committing the conspiracy for committing forgery of the record by tampering the evidence of Dr. Barat while the records were being prepared by the High Court for being sent to the Supreme Court for use in the appeal pending before the Supreme Court.
The first requirement is that the offence should be one as described in section 463 or punishable under section 471, section 475 or section 476 of the Indian Penal Code.
It was submitted that as section 466, Indian Penal Code, is not one of the sections mentioned, the offence will not fall under the provisions of section 195(1) (c) 390 and the section will not apply.
In support of this view a decision of his Court in Govind Mehta vs State of Bihar(1), was relied on.
In that case, on a complaint by the District Public Prosecutor the appellant before this Court was committed to the Sessions to take trial under sections 167, 466 and 467 of the Indian Penal Code.
One of the contentions raised before this Court was that the offence under section 466, Indian Penal Code, is not covered by clauses (b) and (c) of section 195(1) and therefore section 195 does not operate as a bar to taking cognizance of an offence under section 466, Indian Penal Code.
this Court after agreeing with the view of the High Court that section 195(1) (b) or (c) is no bar to the Magistrate taking cognizance for an offence under section 167 observed: "The offence under section 466 of the Penal Code is, admittedly, not covered by clause (b) or clause (c) of section 195(1) of the Code.
therefore, that section does not operate as a bar in respect of this office.
" Again at p. 785 this Court observed: "Section 463 of the Penal Code is, no doubt, taken in by Clause (c) of Section 195(1) of the Code.
Even on the basis that Section 465 of the Penal Code will also be covered by Clause (c) as the offence, under Section 463 is dealt with therein, nevertheless, Clause (c) will not operate as a bar to the jurisdiction of the Magistrate in taking cognizance of the said offence is not alleged to have been committed 'by a party to any proceeding in any court. ' We have also referred to the fact that the appellant has been committed only for the offence under Sections 167, 466 and 471 of the Penal Code.
Section 465 of the Penal Code is not the subject of the committal order.
" We have given our careful consideration to the view expressed in the above decision that section 466 of the Indian Penal Code is not covered by clause (c) of section 195(1) of the Criminal Procedure Code.
We regret our inability to subscribe to this view.
At p.785 of the Report the Court took the view that the section 465 of the Indian Penal Code is not specifically mentioned in section 195(1) (c) of the Criminal Procedure Code as the offence under section 463 Indian Penal Code is dealt with in section 465, Indian Penal Code, clause (c) of section 195(1) will not operate as a bar to the Magistrate taking cognizance the offence.
The Court, though section 465 is not specifically mentioned in section ;195(1) (c), held that section 195(1) (c) Is applicable as an offence under section 463 is dealt with under section 465, Indian Penal Code.
On the same reasoning section 466 should also be held to come within the purview of section 195(1)(c), Criminal Procedure Code, as the offence under section 463 is dealt with in section 466.
Section 463, Indian Penal Code, defines forgery.
The elements of (1) [1971] Supp.
S.C.R. 777.
391 forgery are: (1) The making of a false document or part of it; (2) Such making should be with such intention as is specified in the section.
Section 464 states when a person is said to make a false document which is one of the requirements under section 463.
Section 465 provides the punishment for an offence under section 463.
Section 466 is an aggravated form of forgery in that the forgery should relate to a document specified in the section.
One of the documents specified is a document purporting to be a record or proceeding of or in a Court of Justice.
Section 466, Indian Penal Code, is therefore an offence as described in section 463 which is committed in relation to a record or proceeding of or in a court of justice.
The offences that fall within the purview of section 195(1)(c) are offences described in section 463 and offences punishable under sections 471, 475 or 476 of the Indian Penal Code.
The language of section 195(1)(c) is very significant for while referring to sections 474, 475 or 476, Indian Penal Code, it uses the word publishable, in the case of section 463 the words used are the 'offences described in section 463 '.
An offence under section 466 is an offence which falls within the description of section 463 as the offence under section 463 is dealt with therein.
Section 195(1)(a) of the Criminal Procedure Code uses the words "of any offence punishable under section 172" while in clause (b) the words used are "offence punishable under any of the following sections" mentioned therein.
In clause (c) as already pointed out the words used are "of any offence described in section 463 or punishable under section 471, section 475 or section 476 of the same Code".
Thus a clear distinction is maintained in the section between offences punishable under various sections mentioned and the offences described in section 463.
Even on the test laid down by this Court in Govind Mehta vs State of Bihar (supra) section 466 would be included within the purview of section 195(1) (c).
We are, therefore, of the view that the decision that section 466 of the Indian Penal Code is not covered by clause (b) or clause (c) of section 195(1) is erroneous and not good law.
The question of law was not considered and the decision was reached on an admission made by the parties.
We will now deal with the other requirements of section 195 (1) (c) namely that The offence should be alleged to have been committed by a party to any proceeding and that it should be in respect cf a document produced or given in evidence in such proceeding.
It is admitted that the appellant was a party in the appeal that he preferred against his conviction before the High Court but the appeal was decided against him and the conviction confirmed.
Special leave was granted against his conviction and for hearing of the appeal before the 392 Supreme Court the paper book was being prepared by the High Court.
It was during that time that it is alleged that the appellant entered into a conspiracy and tampered with the evidence of one of the defence witnesses which is a record of the court.
The appellant was a party to a proceeding in the High Court when the appeal was heard but the document complained of as having been tampered with i.e. the evidence of the defence witness, was not produced or giver in evidence in the appeal before the High Court.
The document was certainly not produced or given in evidence in the High Court proceedings.
The alleged tampering was after the hearing of the appeal was concluded.
No doubt, the tampering was in a proceeding in relation to the preparation of the record whether such tampering would be in relation to a proceeding in Supreme Court in respect of a document produced or given in evidence before it does not arise for consideration before us as the complaint in the case is filed only by the High Court.
In Abdul Khader and ors.
vs Meera Saheb(1) a Bench of the Madras High Court held that where a decree against Certain defendants had been passed upon the oath of the plaintiffs and where 'the documents alleged to be forgeries have been put into Court but were not given in evidence it would not be an offence committed by a party lo any proceeding in any court in respect of a document given in evidence in such proceeding though the documents were put in court in a suit pending before it but were not given in evidence Subsequent to this decision section 195(1)(c) was amended so as to include documents "produced" in addition to documents given in evidence.
In Pendyala Subbarayudu vs (Gudivada) Gopayya(2) if was held that it was indispensable that the offence committed must in some manner have affected the proceedings or had been designed to effect them or come to light in the course of them but an offence committed after their close is wholly outside the scope of the provision.
We agree with the view expressed in the decision.
In Nirmaljit Singh Hoon vs The State of West Bengal and Anr.(3) it was held that a document produced in a proceeding before the court during the investigation by the police ordered under section 156(3) of the Criminal Procedure Code would not be a document produced ill a proceeding before the court so as to attract the ban under section 195(1) (c) of the Criminal Procedure Code.
This Court in a recent decision in Legal Remembrancer of Government of West Bengal vs Haridas Mundra(4) held that the requirement of section 195(1) (c) is that the document in question should be produced or given in evidence in the (1) I.L.R. 15 M d. 224.
(2) A.l.
R. (3) ; (4) ; 393 proceeding before the court.
We find on the facts of the case that it has not been established that the document was produced or given in evidence in a proceeding before the court.
The requirements of section 195(1)(c) having not been satisfied a complaint by the court in writing is not necessary.
Equally, under sub section (4) to section 195 relating to criminal conspiracy to commit such offence a complaint by the court is not necessary.
Therefore, section 196 A(2) is attracted and a complaint by the State Government or the Chief Presidency Magistrate or a District Magistrate compowered in this behalf by the State Government in writing consenting to the initiation of the proceedings for an offence under section 120 B, Indian Penal Code is necessary.
As in this case no such order consenting to the initiation of proceedings was passed we accept the contention of the learned counsel for the appellant that the Magistrate had no jurisdiction to take cognizance of the offence against the appellant.
In the result, we allow the appeal, reverse the judgment of the High Court and quash the order of committal passed by the Magistrate.
First Class, Jabalpur.
S.R. Appeal allowed.
| IN-Abs | On a complaint by the Additional Registrar of the Madhya Pradesh High Court alleging that, while the Paper Book in the Supreme Court appeal was being prepared, the appellant entered, into a conspiracy with two of the translators of the Court and tampered with the of original deposition of one Dr. section C. Barat (D.W. 1) in an earlier criminal case against the appellant which was under appeal in the Supreme Court for which the aforesaid paper book was being prepared, the First Class Magistrate committed the appellant and two others to the Sessions Court to take their trial for offences under section 466 read with section 120 B of the Penal Code.
The appellant and another preferred a revision petition before the High Court against the said order of committal.
The High Court dismissed the revision petition.
Allowing the appeal by special leave, the Court ^ HELD : 1.
An offence under section 466 I.P.C is covered by clause (c) of section 195(1) of the Criminal Procedure Code and comes within the purview of that section, as the offence under section 463 I.P.C. is dealt within section 466 I.P.C. Section 466 I.P.C. is on aggravated form of forgery in that the forgery should relate to a document specified in that section.
Section 466 I.P.C., is therefore an offence as described in section 463 I.P.C. which is committed in relation to a record or proceeding of or in a court of justice.
[390F, H, 391 A B] The offences that fall within the purview of section 195(1)(c) Criminal P C. are offences described in section 463 I.P.C. and offences punishable under section 471, 475 or 476 of the Penal Code.
The language of section 195(1) (c) of the Crl.
P.C. is very significant for while referring to sections 471, 475 or 476 I.P.C., it uses the word punishable in the case of section 463 I.P.C. the words are 'the offences described in section 463 '.
An offence under section 466 I.P.C. is an offence which falls within the description of section 463 I.P.C., as the offence under section 463 I.P.C. is dealt with therein.
[391B D] Section 195(1)(a) of the Criminal Procedure Code uses the words "of any offences punishable under section 172. " while in clause (b), the words used are "offences punishable under any of the following sections mentioned therein".
In clause (e) the words are "of any offence described in section 463 or punishable under section 471, section 475 or section 476 of the same code".
Thus a clear distinction is maintained in the section between offences 386 punishable under various sections mentioned and the offence described in section 463.
Even on the test laid down in Govind Mehta vs State of Bihar , section 466 I.P.C. would be included within the purview of section 195(1)(c) of the Criminal Procedure Code.
[391D E] Govind Mehta vs State of Bihar ; explained and over ruled.
The requirement; of section 195 (1)(c) is that the document in question should be produced or given in evidence in the proceeding before the Court.
The offence committed must in some manner have affected the proceedings or had been designed to affect them or come to light in the course of them, but an offence committed after their conclusion is wholly outside the scope of the provision.
[392F H, 393A] Legal Remembrancer of Govt.
Of West Bengal vs Hari Das.
Mundra ; , applied.
Pendyala Suhbarayudu vs Gudivada Gopayya A.I.R. 1932 Madras 290; approved.
Nirmal Jit Singh Hoon vs State of West Bengal and Anr. ; and Abdul Khadar and ors.
vs Meera Saheb I.L.R. ; referred to.
In the instant case (a) section 196A(2) of the Criminal Procedure Code is attracted and a complaint by the State Government or the Chief Presidency Magistrate empowered in this behalf by the State Government in writing consenting to the initiation of the proceedings for an offence under section 120 l.
P.C. is necessary.
[393B] (b) The requirement of section 195(1)(c) having not been satisfied a complaint by the Court in writing is not necessary.
[393A] (c) Equally under sub section (4) to section 195 relating to criminal conspiracy to commit such offence a complaint by the Court is not necessary.
[393A]
|
Appeals Nos. 123 to 127 and 135 of 1953.
102 On appeal from the judgment and decree dated the 12th May 1950 of the Patna High Court in Appeal from Original Orders Nos. 266, 267, 268, 271, 274 and 280 of 1948 arising out of the Order dated the 26th June 1948 of the Court of the District Judge, Purulia in Insolvency Cases Nos. 1/44, 13/46, 12/46, 10/46 and 44/41, respectively.
section C. Isaacs (P. K. Chatterjee, with him) for the appellant.
Bhabananda Mukherji, section N. Mukherji and B. N. Ghose, for the respondents.
February 14.
The Judgment of the Court was delivered by CHANDRASEKHARA AIYAR J.
These appeals are by a creditor of six employees in the Tin Plate Co. of India Ltd. who had been adjudged insolvents.
The employees are members in a Provident Fund of the Tin Plate Co. and there were amounts standing to their credit in the said Fund.
The creditor, Mukti Lal Agarwala, filed applications under section 4 of the Insolvency Act for orders that the amounts standing to the credit of the insolvents in the Provident Fund account were their properties and had vested in the court and were available for distribution amongst the creditors.
He sought a direction that the monies may be brought into Court.
The petitions were directed primarily against the Tin Plate Co. Ltd. and the Trustees of the Provident Fund.
They pleaded in answer that the amount standing to the credit of each insolvent in the Provident Fund represented the contributions of the Company and of the employees and that the corpus was a trust fund in the hands of the trustees of the fund; so they were not properties of the insolvents over which they had a disposing power and that they were not debts due to the insolvents.
It was said that according to the rules governing the Provident Fund the monies become payable to the employee or any other member of his family only on the happening of certain contingencies ' such as retirement, discharge, 103 dismissal or death and that till then no right accrued to the insolvent.
It was further urged that the trustees could not be removed from the custody and control of the fund by the Official Receiver.
The Insolvency Court, which was the court of the District Judge at Purulia, heard the petitions and found on a construction of the rules of the Provident Fund that the monies standing to the credit of A & C accounts in the name of each insolvent was his property over which he had a disposing power and hence they were available for distribution among the creditors under the Insolvency Act.
The trustees of the Fund and the Tin Plate Co. carried the matter on appeal to the High Court at Patna and the they were successful.
The learned Judges (V. Ramaswami and Sarjoo Prasad, JJ.) held that under the rules governing the Fund the insolvents had no present disposing power over the monies standing to their credit and that the Fund was really vested in the trustees.
As the amount involved in the several petitions taken together was over Rs. 20,000, the High Court granted leave to the creditors to appeal to this court.
The main contentions urged by Mr. Isaacs on behalf of the appellants were three in number: (a) The monies standing to the credit of each insolvent in the Provident Fund are his property, though payable at a future date and the question of present disposing power arises only for bringing within the scope of the definition what may not otherwise be regarded as "property".
(b) Though the Provident Fund rules speak of a trust Fund and trustees, in reality, there was no transfer of ownership by the employees in favour of the trustees and that there is no trust as such.
(c) In any event, even on the footing that a trust was created over the Fund, the beneficial interest continues in the employees and this interest would vest in the Official Receiver for the benefit of the creditors in insolvency.
We have to examine the soundness of these contentions.
104 The Provident Fund was started on the 1st January, 1929.
The rules and regulations of this Fund are found in the deed of trust dated the 15th July, 1930, marked as Exhibit 1.
These rules, as amended from time to time in certain respects by supplementary deeds, are given in the appendix to this judgment.
On the making of an order of adjudication, the whole of the property of the insolvent shall vest in the court or in a Receiver and shall become divisible among the creditors.
(Section 28 (2) of the ).
The property of the insolvent for the purposes of vesting shall not include any property which is exempted by the Code of Civil Procedure, or by any other enactment for the time being in force from liability to attachment and sale in execution of a decree (section 28(5)).
Section 2(d) of the Act states:" 'Property ' includes any property over which or the profits of which any person has a disposing power which he may exercise for his own benefit".
A person has a disposing power over property which he may exercise for his own benefit, such as a power of appointment conferred on him under a will or a settlement, or the power of a Hindu father who is the manager of a joint Hindu family to sell the shares of his sons in the family property in discharge of their pious obligation to pay off his debts.
In clause (b) of sub section (2) of section 38 of the English Bankruptcy Act, 1914, this power is specified in these words: "The capacity to exercise and to take proceedings for exercising all such powers in or over or in respect of property as might have been exercised by the bankrupt for his own benefit at the commencement of his bankruptcy or before his discharge, except the right of nomination to a vacant ecclesiastical benefice;".
All that we have to find out is whether the amounts standing to the credit of the several subscribers in the fund who have been adjudged insolvents are divisible among their creditors.
If so, they would vest 105 in the court or the Official Receiver and would become available for distribution.
Whether they have any present interest in the monies is the primary question that falls to be considered.
Section 60 of the Civil Procedure Code sets out what property is liable to attachment and sale and what items are not.
The first part of section 60 runs in these terms: "The following property is liable to attachment and sale in execution of a decree namely, lands, houses, or other buildings, goods, money, bank notes, cheques, bills of exchange, hundis, promissory notes, Government securities, bonds or other securities for money, debts, shares in a corporation and, save as hereinafter mentioned, all other saleable property, movable or immovable, belonging to the judgmentdebtor, or over which, or the profits of which, he has a disposing power which he may exercise for his own benefit, whether the same be held in the name of the judgment debtor or by another person in trust for him or on his behalf".
The exempted items do not apply.
Clause (k) deals with funds governed by the Provident Fund Act.
Reference has, however, been made to clause (m) which speaks of "an expectancy of succession by survivorship or other merely contingent or possible right or interest".
Let us now advert to the relevant rules of the Fund.
The object of the Fund as set out in rule 2 is to accumulate for the benefit of the Company 's employees who have joined the Fund certain sums as a future provision for them and for their families.
Under rule 3, any employee, who has completed one year 's service with the Company, shall be eligible for membership.
Rule 4 provides for a declaration as regards the disposition of the Fund in the event of death.
This declaration can be cancelled and changed.
Rule 5 provides that if the declaration becomes obsolete, the trustees could decide who were to be recognized as the next of kin and that payment by them to such person will be an absolute discharge.
Every member shall be allowed to contribute any 11 106 sum not exceeding one twelfth of his or her earnings and such amounts would be credited in the name of each member in an account called 'A ' Account (Rule 6).
At the end of each year, an amount equal to the contribution by the member shall be paid by the Company and credited to another account to be opened in the name of the member and to be denominated his or her 'B ' Account.
An increased contribution by the Company in certain events at particular specified rates is contemplated by rule 7(B).
This further sum will go into a 'C ' account to be opened in the name of each member.
Rule 8 provides that the moneys of the Fund shall be invested by the Trustees in accordance with the provisions from time to time in force under the Indian Income tax (Provident Funds Relief) Act, 1929.
Every year the A, B and C Accounts are to be made up including the income from the investments according to certain calculations.
Then come the important rules 10, 11, 12, 13, 15, 16, 17 & 18.
Though the Fund is intended as a future provision for the employees and their families, the membership is purely voluntary and arises on an application to the Company, the trustees having nothing to do with the admission.
It is only the management of the Fund and the control of its funds which vests in the trustees under rule 1.
There is no transfer of the ownership of the Fund.
The contributions made by the members are not compulsory in their nature.
The monies of the Fund may, no doubt, be invested by the trustees, but the subscriber does not divest himself or herself of control over the Fund in certain respects.
He or she can declare to whom the monies are to be paid in the event of his or her death.
This declaration can be changed at any time.
If the service terminates after fifteen years, the subscriber can get the full amount in the A,B & C Accounts.
If he or she retires with the Company 's consent before completion of fifteen years ' service, he or she can get the amounts standing in A & C Accounts together with a portion in B account.
Dismissal, or misconduct, or resignation without the 107 Company 's consent before completion of the 15 years would still entitle the subscriber to the payment of the moneys in A & C Accounts.
The provision in rule 16 that on the death of any member, the amount will be paid to the next of kin, of course proceeds on the same footing that the property belongs to the subscriber. , Whether the provisions that in the event of the declaration becoming obsolete, or a member becoming insane or demented, the moneys can be paid at the absolute discretion of the trustees to whomsoever they determine to be the next of kin, or hold to be a proper and suitable person to receive payment, are valid is not a question that arises in these appeals.
Retirement or death is not a mere possibility.
It is a contingency that is sure to happen, sooner or later.
Dismissal for misconduct or resignation without consent before 15 years ' service will secure earlier payment.
(Rule 11).
It is reasonably clear from these rules that a subscriber has a present interest in the Fund though the moneys may become payable to him, or his nominee or heirs only in the future.
Even where there is a declaration about the nominee who is to receive payment after the subscriber 's death, the fund would still be the property of the subscriber in the hands of the nominee for the satisfaction of his debts, as there is no present gift to take effect immediately.
It is not easy to see how it could be maintained that the subscribers have no right, title or interest in the fund, or that such interest as they may possess is dependent upon a possible contingency which may or may not occur.
The amount standing to the credit of a subscriber even if payable in future would be a debt due by the Company to him within the meaning of section 60 of the Code and hence liable to attachment and sale.
See Banchharam Majumdar vs Adyanath Bhattacharjee(1).
Rule 17, which provides that on the adjudication of the debtor as an insolvent the amounts standing to his credit in the Fund shall be liable to be forfeited (1) Cal 936.
108 to the Fund, was strongly relied upon by the respondents.
But such a condition or agreement is invalid.
A man may give (in India only by will) property or its income to a donee with a condition that the donee 's interest will cease on bankruptcy and the property will in that event go to another; if insolvency supervenes, the property will not vest in the Official Receiver.
If there is no gift over on the cesser of the donee 's interest, the property will revert to the donee and will vest in the Official Receiver on the donee 's insolvency.
But a person cannot enter into any arrangement or agreement by which his own title will cease in the event of bankruptcy, for it would then be a fraud perpetrated on the Insolvency Law.
This principle has been enunciated in an early English case Wilson vs Greenwood(1) in the following words and adopted in later cases too: "The general distinction seems to be, that the owner of property may, on alienation, qualify the interest of his alienee, by a condition to take effect on bankruptcy; but cannot, by contract or otherwise, qualify his own interest by a like condition, determining or controlling it in the event of his own bankruptcy, to the disappointment or delay of his creditors".
In Re Dugdale(2) we find the following observations of Kay, J. "The liability of the estate to be attached by creditors on a bankruptcy or judgment is an incident of the estate, and no attempt to deprive it of that incident by direct prohibition would be valid.
If a testator, after giving an estate in fee simple to A, were to declare that such estate should not be subject to the bankruptcy laws, that would clearly be inoperative.
I apprehend that this is the test.
An incident of the estate given which cannot be directly taken away or prevented by the donor cannot be taken away indirectly by a condition which would cause the estate to revert to the donor, or by a conditional limitation or executory devise which would (1) , 476; ; , 485.
(2) 176, 182.
109 cause it to shift to another person".
The proposition is thus stated in Williams on Bankruptcyt(1) at page 293: "But the owner of property cannot, by contract or otherwise, qualify his own interest by a condition determining or controlling it in the event of his own bankruptcy to the prejudice of his creditors".
It appears to us to be unnecessary to refer to all the decisions cited and relied upon in the course of the arguments on either side.
A few cases may, however, be dealt with.
The English decisions relied upon by the learned counsel for the appellant do not furnish much guidance.
Ex part Dever.
In re Suse and Sibeth(2) was a case of what is obviously a contingent interest dependent upon a mere possibility.
The decision in Hudson vs Gribble(3) dealt with a different question altogether.
Under a scheme framed by the Municipal Corporation, persons in its service were to contribute to a Fund for the encouragement of thrift among their officers and servants a certain percentage of their salaries to be deducted from time to time from those salaries.
Were they exempt from payment of income tax under the first rule of section 146 of the Income Tax Act, 1842, was answered in the negative.
The point was whether they were exempt because they were "sums payable or chargeable on the salaries by virtue of any Act of Parliament where the same have been really and bona fide paid and borne by the party to be charged".
It is true that Lord Justice Vaughan Williams says at page 525 that the sums contributed never ceased to be the property of the persons from whose salaries or wages they were deducted; and Lord Justice Stirling observes at page 528 "It is obvious that, though the amounts so deducted are not immediately paid to the person employed, they remain his property to a great extent".
Both of them refer to the fact that the subscribers were entitled to get back their contributions upon retiring from the service.
But they were dealing with particular words employed in an Act of Parliament (1) 16th Eaition.
(2) (3) [1903] 1.K.B. 517, 110 and the rules made under a Corporation Act.
General observations of the kind should not be extracted from the context in which they were used and applied to other facts and different language.
Coming to the Indian decisions, D. Palaiya vs T. P. Sen and another(1) is a case where the rules of a provident fund created by the Tata Steel Company were similar to the rules we have before us but the forfeiture clause was construed as applying only to the portion of the amount at the credit of members ' account contributed by the company and it was read to mean that it was inapplicable to the subscribers ' own contributions.
Secretary, Burma Oil Subsidiary Provident Fund (India) Ltd. vs Dadibhar Singh(2) which held against the vesting proceeded upon the footing that there was a trust created in favour of the trustees.
Even if so, what was to happen to the beneficial interest was not dealt with.
The relevant observations are: "The forfeiture does not vest the money in the trustees, the money having already vested in them.
The money cannot be attached as a 'debt ' due to the judgment debtor, because the word 'debt ' as used in section 60 and in 0. 21, R. 46, Civil Procedure Code means an actually existing debt that is a perfected and absolute debt, not merely a sum of money which may or may not become payable at some future time or the payment of which depends upon contingencies which may or may not happen".
The decision of Beaumont,, C. J. and Rangnekar, J. in Gajraj Sheokarandas vs Sir Hukamchand Sarupchand and another(1) does not apply because in that case there was a clause in the articles providing that all moneys received by the East India Cotton Association from its members would be under the absolute control of the Association and could be used by it as if the moneys belonged to it absolutely.
Further the deposit was also subject to certain liens.
Subject to the liability to forfeiture and to the satisfaction of the liens, the deposit with interest was repayable to (1) A.I.R. 1935 Pat. 211.
(2) A.I.R. 1941 Rang.
256, 259.
(3) A.I.R. 1939 Bom.90.
111 the member on his ceasing from any cause to be a member.
The facts were, therefore, very different.
Anandrao alias Adkoba s/o Risaramji vs Vishwanath Watuji Kalar and others(1) is again a case where the money ceased to belong to the employee and the title was in the trustees.
Referring to a Karachi case reported in Ismail Jakaria & Co. vs Burmah Shell Provident Trust Ltd.(2), Bose, J. distinguished it on the ground that there the money was not vested in the trustees but was only handed over to them for the purposes of management, which was not the case before him.
The learned counsel for the respondents strongly relied on Bishwa Nath Sao vs The Official Receiver(3) and argued that there can be no property within the meaning of the Insolvency Act unless the insolvent had a present absolute power of disposal over the same but the decision which is that of a Full Bench and which interpreted the decision of the Privy Council in Sat Narain vs Behari Lal(4) does not support any such position all that was held was that on the insolvency of a father, his power to sell the shares of his sons in the joint family property to discharge the pious obligation vests in the Official Receiver, though the shares themselves do not so vest.
Sufficient has been stated above to show that not withstanding the rules of the Fund in the present case, the subscribers have an interest in the moneys which can vest in the Official Receiver on their adjudication.
Even if we regard the deed creating the fund as a trust deed, notwithstanding that, no ownership has been transferred to the trustees and all that they have got is the right of the management and control, the subscribers, who joined the fund have undoubtedly got a beneficial interest which will vest in the Official Receiver as property liable to attachment and sale under section 60 which uses the language "whether the same be held in the name of the judgment debtor or by another person in interest for him or in his behalf".
(1) A.I.R. 1944 Nag.
(3) Patna 60.
(2) A.I.R. 1942 Sind 47.
(4) [1924] L.R. 52 I.A. 22, 112 The learned Judges of the High Court held that the 'property ' mentioned in the Insolvency Act must be such that the insolvent has an absolute and unconditional present disposing power over the same.
With great respect, this, however, does not seem to be a correct interpretation.
The word 'property ' is used in the widest possible sense which includes even property which may belong to or is vested in another but over which the insolvent has a disposing power which he may exercise for his own benefit; and as pointed out already, this part of the definition has reference obviously to powers of appointment and the power of a Hindu father who is the managing member of a joint family.
The fact that on the date of the adjudicationthe insolvent could not transfer the property doesnot militate against the view that be has a vested interest in the same.
Reference was made to section 56(3) of the which provides that "Where the Court appoints a receiver, it may remove the person in whose possession or custody any such property as aforesaid is from the possession or custody thereof: Provided that nothing in this section shall be deemed to authorise the court to remove from the possession or custody of property any person whom the insolvent has not a present right so to remove".
This has no relevancy to the point at issue.
Whenever possession and custody could be taken by the Receiver, the person in whose possession and custody the property is can be evicted.
If possession or custody could not be taken, still the right of the insolvent will vest in the Official Receiver.
Mention has been made of three accounts in the Fund called A, B and C; the first represents monies contributed by the subscriber, the second consists of monies paid by the Company and the third represents what may be roughly described as bonus which represents deferred wages.
The learned counsel for the appellant confined the relief he wanted to the .amounts standing to the credit of each subscriber in his A and C Accounts and conceded that the B Account monies would stand on a different footing.
In 113 fact, even in the Insolvency Court the creditor concerned himself only with the A & C Accounts.
Mr. Isaacs contended at first that he was entitled to an order that the monies in the A & C Accounts should be brought to the Insolvency Court but later he abandoned this contention.
For the respondents, it was urged that under section 10 of the Employees ' Provident Funds Act, 1952, which came into force after these proceedings were instituted, there could be no attachment.
This again is a question which is outside the scope of the present proceedings.
Once it is held that the right, title and interest of the insolvents in the A & C Accounts with the Fund vest in the Official Receiver, it is for him under the directions of the Insolvency Court to take steps to realize the same, in whatever manner the law allows him to do.
The learned counsel for the respondents handed to us a paper showing which of the respondents was still in service and which have been discharged, their dates of appointments and of joining the posts.
Mohibulla, Anjab Alli and Hasimulla, respondents insolvents in Civil Appeal No. 124, Civil Appeal No. 127 and Civil Appeal No. 126, have been shown as discharged from service.
A.M. Joseph, Rasid Alli alias Tasim Alli, and Baldev Singh, respondents in Civil Appeals 135, 125 and 123, joined the Fund in 1933, 1932 and 1936 respectively and are still in service.
In the result, the appeals are partly allowed and there will be a declaration that the right, title and interest of the above mentioned insolvents in the moneys standing to their credit in A & C Accounts respectively will vest in the Official Receiver.
In other respects the appeals will stand dismissed.
The Tin Plate Co. which is the respondent No. 2, will pay to the appellant his costs here and in the High Court.
But the costs in this Court will be limited only to one set.
APPENDIX.
This Indenture made the fifteenth day of July, one thousand nine hundred and thirty BETWEEN THE 15 114 TINPLATE COMPANY OF INDIA LIMITED a Joint Stock Company with Limited Liability duly incorporated under the Indian Companies Act and having its Registered Office at No. 4, Bankshall Street in the City of Calcutta (hereinafter called "the Company" of the first part HARRY DOUGHLAS TOWNEND CHARLES ROLAND HATFIELD AND JAMES PERCY AINSCOUGH all of No. 4, Bankshall Street aforesaid Merchants (hereinafter called the "the Trustees" which expression shall mean and include the said Harry Douglas Townend Charles Roland Hatfield and James Percy Anscough or other the " Trustees of the fund herein mentioned for the time being appointed as hereinafter mentioned) of the Second Part and the PERSONS whose names appear in the Schedule hereto or who may by separate writings agree to become parties hereto and bound hereby of the third part WHEREAS the Company has decided to start as from the first day of January one thousand nine hundred and twenty nine a Provident Fund for the benefit of the employees of the Company (hereinafter called "the said fund") and has accepted contributions from the employees from the first January, one thousand nine hundred and twenty nine and for the management and regulations of such fund has framed rules and 'regulations NOW THIS INDENTURE WITNESSETH and it is hereby agreed between the parties hereto that the said Fund shall be governed by the following rules and regulations: Rules and Regulations 1.
The Fund shall be called "THE PROVIDENT FUND OF THE TIN PLATE COMPANY OF INDIA LIMITED".
The management of the Fund and the control of its funds shall be vested in the Trustees who will undertake such management without remuneration.
The object of the Fund is to accumulate for the benefit of the Company 's Employees who have joined 115 the Fund certain sums as a future provision for them and for their families.
All employees of the Company (excepting only such covenanted employees on the higher grades of pay as may be excluded by the Trustees at their discretion) upon completion of one year 's services with the Company shall be eligible for membership of the Fund.
Applications to join the Fund shall be in writing to the Company in a specified form and written notification shall be given by the Company to applicants of their inclusion as members.
Every application for membership shall be accompanied by a declaration in a specified form signed by the applicant in the presence of two witnesses who shall not be in any way related to the applicant.
Such declaration shall set forth the disposition in the event of his or her death while a member of the Fund of the money which shall be standing to the applicant 's credit in the Fund.
Should a member at any time desire to cancel his or her form of declaration be or she may do so by submitting to the Company a revised or substituted form in writing duly signed and witnessed in the same manner as in the case of the original form which should specifically cancel and annul all previous forms of declaration deposited by the member with the Fund.
5.In the event of the declaration as made under rule 4 having become obsolete full discretion shall rest with the Trustees as to the disposition of any sums standing to the credit of a member on his or her decease and no person or persons shall be recognised as having any claims thereto save and except such as shall be ascertained by the Trustees or their delegate duly appointed to make enquiry in that be half upon satisfactory evidence adduced as to which the Trustees or their delegate appointed to conduct the enquiry shall be sole judge to be the next of kin of the deceased member and payment by the Trustees the moneys representing his or her share in the fund 116 to the persons or person so ascertained shall operate as an absolute discharge to the Trustees from all liability there for to all persons whomsoever.
Each member shall be allowed to contribute a definite proportion not exceeding one twelfth of his or her earnings during any one year which shall be deducted from his or her earnings in monthly or weekly instalments.
Contributions as above shall be credited to an account to be opened in the name of each member to be denominated his or her 'A ' Account.
For the purpose of this fund, earnings shall be deemed to mean solely the monthly or weekly sum paid to the Employee for wages excluding from the purview of such term all accretions thereto and perquisites in the way of acting allowance commissions bonus payments overtime messing housing allowance lodging money travelling expenses and all such similar payments.
7.(a) On or as at the thirty first December in each year a sum equal to the amount contributed by each member to his or her 'A ' account during that year shall be credited by the company to another account to be opened in the name of each member and to be denominated his or her 'B ' Account.
The Company reserves to itself liberty to make such further contributions as may be requisite for the purposes of Rule 14 below.
(b) If the net dividend paid by the Company on its ordinary share capital in respect of any financial year shall be at a rate of not less than seven and a half per cent on such ordinary share capital a further sum calculated as hereinafter set out shall be paid by the Company.
Unless the Company shall decide that such further sum shall be paid into a separate Fund or otherwise than into this Fund such further sum shall be paid into this Fund to another account to be opened in the name of each person who shall have been a member on the thirty first day of December in the said financial year and to be denominated his or her 'C ' account.
The amount of such further sum 117 shall depend upon the rate of such net dividend and shall be ascertained according to the following scale: Rate of net dividend paid Amount of the further sum as aforesaid.
sum payable.
Not less than 7 1/2% and not One week 's wages.
exceeding 8 3/4% Exceeding 8 3/4 but not ex Two week 's wages.
ceeding 11 1/4% Exceeding 11 1/4 but not Three weeek 's wages.
exceeding 13 3/4% Exceeding 13 3/4% but not Four week 's wages.
exceeding 16 1/4% Exceeding 16 1/4% but not Five week 's wages.
exceeding 181% Exceeding 18 3/4% but not Six week 's wages.
exceeding 211% For each additional 2 1/2% An additional week 's wages.
For the purpose of this clause one week 's wages 'shall mean in the case of a worker in receipt of daily wages six times his daily rate of pay at the thirty first day of December in such financial year as aforesaid and in the case of a worker in receipt of monthly pay one fifty second part of twelve times his monthly rate of pay at the thirty first day of December in such financial year".
"Provided always that if at any time the Company 's Ordinary share capital shall be increased by capitalisation of any of its undistributed profits (not including profits arising from a revaluation of assets, from the sale of assets or from the sale of shares at a premium) or reduced, then the rate of net dividend paid by the Company in respect of any financial year after the coming into force of any such increase or reduction shall for the purposes of this clause be deemed to be the rate of net dividend actually so paid by the company altered in the ratio which the nominal value of the Company 's paid up capital at the end of such financial year (excluding therefrom all 118 portions of such capital which represent capitalised profits derived from revaluation of assets sale of assets or issue of shares at a premium) shall bear to the value which it would have had if such increase or increases or reduction or reductions of capital as shall come into effect after the first day of January one thousand nine hundred and thirty eight had never taken place".
"The payment into each member 's 'C ' Account in accordance with the above provisions shall be made as soon as conveniently may be after the holding of the annual Ordinary General Meeting of the Company at which such net dividend as aforesaid is finally declared and ascertained".
The moneys of the Fund shall be invested by the Trustees in accordance with the provisions from time to time in force under the Indian Income tax (Provident Funds Relief) Act, 1929.
(1) (a) On or as soon as may be after the thirty first day of December in each year the Trustees shall determine the amount standing to the credit of each member in his 'A ', B and C accounts on that date and for that purpose a general account shall be taken of the assets of the fund and of the receipts payments dealings and transactions in connection therewith during the calendar year terminating on such thirty first day of December (hereinafter referred to as the period of account).
(b) Each such general account shall comprise three revenue Accounts to be known as the 'A ' Revenue Account, the 'B ' Revenue Account and the "C" Revenue Account respectively.
The "A" Revenue Account shall be credited with all income accrued or profits realised during the period of account in respect of the investments representing moneys lying to the credit of the "A" accounts and the appreciation (if any) of such investments during the period of account.
The "A" Revenue Account shall be debited with all losses (if say) in respect of 119 depreciation of such investments and all sums paid during the period of account in respect of interest on contributions to retiring members or the representatives of deceased members as herein before provided.
The 'B ' Revenue Account shall be credited with all forfeits and all income accrued or profit realised during the period of account in respect of the investments representing moneys lying to the credit of the 'B ' Accounts and the appreciation (if any) of such investments during the period of account.
The 'B ' Revenue account shall be debited with all losses (if any) in respect of depreciation of such investments and all expenses of the Fund.
The "C" Revenue Account shall be credited with all income accrued or profit realised during the period of account in respect of the investments representing moneys lying to the credit of the 'C ' Accounts of the members, the appreciation (if any) of such investments during the said period and all interest received by the Trustees or., withdrawals made under Rule 18 hereof.
The "C" Revenue Account shall be debited with all losses (if any) in respect of depreciation of such investment as last aforesaid.
(c) The balance of the "A", "B" and "C ' Revenue Accounts respectively shall be appropriated to the "A", "B" and "C" accounts of the members in each case in proportion to the amounts standing to the credit of their respective "A", "B" and "C ' accounts at the close of the period of accounts provided always that for the purpose of such appropriation the Trustees may if they think fit disregard any sum standing to the credit of any member in his "A" "B" or the "C" Revenue Account not exceeding on( rupee and may carry forward to the next period of account any part of the balance of the "A" revenue account, the "B" revenue account or the "C" Revenue account which will not suffice to pay a complete one half percent on the total amount standing to the "B" or "C" accounts as the casecredit of the "A", may be of all the members.
Provided also that in ascertaining the amount at credit of a member 's "C ' 120 account for the purpose of calculating the proportions herein mentioned there shall be deducted from such "C" Account only those sums withdrawn under the provisions of Rule 18 hereof on which interest is not payable by him to the Fund.
(d)For the purpose of such Revenue Account the Trustees shall value the investments and securities of the Fund, and if the same shall in their opinion, which shall be final and conclusive, have appreciated or depreciated since the date of purchase, or if a general account shall have been taken subsequent to the date of purchase then since the date of the last preceding general account the amount of such appre ciation or depreciation shall be credited or debited to such revenue account as though the same were a realised profit or loss as the case may be.
(2)Notwithstanding the terms of Rule 9(1) the Trustees shall have the right should they in their uncontrolled discretion deem it necessary in the interests of the members as a whole to take out a general account of the assets of the fund as at any date in any year other than or in addition to the thirty first day of December and Members "A", "B" and "C" accounts shall be adjusted accordingly.
(3)In the case of the taking of a general account under rule 9(2) the words "the period of account" used throughout these rules shall mean and refer to (where the context shall admit) the period whereof such general account of the assets of the fund was taken under rule 9(2).
10.On retirement of any member with the consent of the General Manager of the Company before completion of more than fifteen years service with the company he or she shall be paid the entirety of the amount then standing to the credit of his or her "A" and "C" account together with one fifteenth of the moneys standing to the credit of his or her "B" account for such completed years service.
If any member before completion of fifteen 121 years service with the company shall be dismissed for misconduct or shall resign therefrom without the consent of the General Manager he or she shall be paid only the amount then standing to his or her credit in "A" account and 'C" Account.
The residue of any moneys standing to the credit of a member 's "B" account after payment of the moneys payable to him or her there out under Rule 10 and the entirety thereof if he or she shall be dismissed or resign in the circumstances as mentioned in rule 11 shall be forfeited to the Fund and carried to the "B" Revenue Account to be dealt with under Rule 9 (1) 13.
Upon termination by any means of a member 's service if more than fifteen years thereof shall then have been completed he or she shall be paid the entirety of the amount then standing to the credit of his or her "B" and "C" account.
For the computation of length of service under the foregoing rules continuous service only shall be reckoned as from the date or last date on which the employee entered or re entered service.
If in consequence of depreciation of securities the amount as received by a member or his or her representatives in respect of his or her "A" account under the last preceding rules shall fall short of the total of the contributions as made thereto the company may make an additional and contingent contribution to the fund to the amount of the deficiency for payment thereof to the member. 15.
If it shall be proved to the satisfaction of any of the trustees that any member has become insane or otherwise incapacitated from exercising proper control over his affairs they make payment out of the moneys standing to his or her credit in the Fund and at such time or times to such person or persons on his or her account as they may in their absolute discretion think expedient.
The above provisions for 16 122 payment shall not apply to moneys forfeited under Rule 17 which shall be dealt with by the Trustees at their absolute discretion thereunder.
On the death of any member while still in the service of the Company the sum standing to his or her credit in "A", "B" and 'C" accounts shall be paid to the person or persons named in the declaration form signed under Rule 4 or failing such declaration to the person or persons who shall be ascertained to be next of kin under the provisions of Rule 5.
No member of the Fund shall have any claim on the moneys standing to his or her credit therein otherwise than in accordance with the provisions of these rules and no person or persons other than a member save and except such as shall be nominated in the declaration under the provisions of Rule 4 or shall be ascertained to be the member 's next of kin under Rule 5 shall have any claim thereto in any right whatsoever.
Any assignment by a member of the moneys which would otherwise be payable to him or her under these rules whether absolute or by way of charge shall be wholly void and in the event of any member executing any such assignment or being adjudicated insolvent or if any order shall be served upon the Trustees of the Company for payment of the moneys standing to his or her credit to any person under any attachment or other process of any Court the said moneys shall at the time when they would have otherwise become payable to the member but for such assignment insolvency or attachment be liable to be forfeited to the FUND PROVIDED ALWAYS that the Trustees shall at their absolute discretion and without any legal obligation so to do pay and apply the same for the benefit of the member or his or her dependents and relatives.
Withdrawals by members of the money standing to their credit with the Fund shall not be allowed by the Trustees except that withdrawals from the amount standing to the credit of a member 's 'C ' 123 account may be allowed on the special grounds to the extent and subject to the conditions laid down by the Indian Income Tax Act and the Rules made thereunder in that behalf as in force from time to time.
There shall be not less than three Trustees of the said Fund. 20.
If and whenever any Trustees shall die resign or become incapable of acting or shall permanently leave India one or more persons in his place shall be appointed by the Company as such Trustees.
No copy shall be furnished to any member of his or her account but member may have inspection thereof in the Books of the Fund at all reasonable times.
These Rules may from time to time be altered and amended and other Rules and Regulations may be added or substituted for the management and working of the Fund in every case by the Company and the Trustees and with out reference to the parties hereto of the third part, provided always that should such addition or alteration curtail the rights or increase the obligations of the members of the Fund any member shall be entitled to withdraw from and at his or her own request in writing to the Fund, cease to be a member of the Fund in which case he or she shall be paid the money standing to his or her credit in the Fund (provided that the same shall not have become forfeited under Rule 17) or such portion thereof as he or she would have been entitled to if he or she had then retired from the service of the Company with the consent of the General Manager of the Company.
Any such alteration or amendment shall, be notified in writing to the parties responsible for according recognition to the Fund under the provisions of the Indian Income Tax (Provident Fund Relief) Act, 1929.
124 23.
The Company may at any time in its discretion dissolve or terminate the Fund and shall in such case carry out the winding up of the Fund and the members of the Fund shall receive all the moneys standing to their credit provided they shall not then have become forfeited under Rule 17 'A ', 'B ' and C '.
Any payment made in accordance with the Rules of the Fund to the member, his nominee or next of kin as ascertained or to any person or persons other than the foregoing shall operate as a full and efficient discharge of all liability of the Fund in respect thereof 25 These Rules and Regulations shall come into force with effect from the 1st day of January, 1929.
| IN-Abs | The six employees in the Tin Plate Co. of India Ltd. were adjudged insolvents.
They were members in a Provident Fund of the said company, having certain amounts standing to their credit in the Fund.
The appellants creditor of the said employees filed applica tions under section 4 of the Insolvency Act against the company and Trustees of the Fund for orders that amounts standing to the credit of the insolvents in the Provident Fund account were their properties and had vested in the court and were available for distribution amongst the creditors and therefore should be brought into court.
The respondent pleaded in answer that the amount standing to the credit of each insolvent in the Provident Fund represented the contributions of the company and of the employees and that the corpus was a trust fund in the hands of the trustees of the fund; so they were not properties of the insolvents over which they had a disposing power and that they were not debts due to the insolvents.
It was said that according to the rules governing the Provident Fund the monies become payable to the employee or any other member of his family only on the happening of certain contingencies such as retirement, discharge, dismissal or death and that till then no right accrued to the insolvent.
It was further urged that the trustees could not be removed from the custody and control of the fund by the Official Receiver.
On a construction of the Rules of the Provident Fund, the Insolvency Court held in favour of the creditor.
On appeal, the High Court held that under the rules of the Fund, the insolvents had no present disposing power over the monies standing to their credit and that the Fund had vested in the Trustee.
On appeal to the Supreme Court: Held that it is reasonably clear from these rules that a subscriber has a present interest in the Fund though the moneys may become payable to him, or his nominee or heirs only in the future.
Even where there is a declaration about the nominee who is to receive payment after the subscriber 's death, the fund would still be the property of the subscriber in the hands of the nominee for the satisfaction of his debts, as there is no present gift to take effect immediately.
It could not be maintained that the subscribers had no right, title or interest in the fund or that such interest as they may possess was dependent upon a possible contingency which may or may not occur.
The amount standing to the credit of a subscriber even if payable in future would be a debt due by the company to him within the meaning of section 60 of the Code and hence liable to attachment and sale.
A person cannot enter into any arrangement or agreement by which his own title will cease in the event of bankruptcy for it would then be a fraud perpetrated on the Insolvency Law.
The liability of the estate to be attached by creditors on a bankruptcy or judgment is an incident of the estate, and no attempt to deprive it of that incident by direct prohibition would be valid.
Notwithstanding the rules of the Fund in the present case, the subscribers have an interest in the moneys which can vest in the Official Receiver on their adjudication.
The word "property" in the Insolvency Act is used in the widest possible sense which includes even property which may belong to or is vested in another but over which the insolvent has a disposing power which he may exercise for his own benefit; and this part of the definition has reference obviously to powers of appointment and the power of a Hindu father who is the managing ember of a joint family.
The fact that on the date of the adjudication the insolvent could not transfer the property does not militate against the view that he has a vested interest in the same.
Banchharam Mojumdar vs Adyanath Bhattacharjee, ([1909] I.L.R. , Dugdale vs Dugdale ([1888] 38 Ch. D. 176), Ex parte Dever.
In re Suse and Sibeth ([1887] , Hudson vs Gribble ([1903] 1 K.B. 517), D. Palaiya vs
T. P. Sen and another (A.I.R. 1935 Pat. 211), Secretary, Burma Oil Subsidiary Provident Fund (India) Ltd. vs Dadibhar Singh (A.I.R. 1941 Rang.
256), Gajraj Sheokarandas vs Sir Hukamchand Sarupchand and another (A.I.R. 1939 Bom.
Anandrao alias Adkoba s/o Risaram ji vs Vishwanath Watuji Kalar and others, (A.I.R. 1944 Nag. 144), Ismail Jokaria & Co. vs Burmah Shell Provident Trust Ltd. (A.I.R. 1942 Sind 47), Bishwa Nath Sao vs The Official Receiver ([1936] I.L.R. 16 Pat. 60), and Sat Narain vs Behari Lal and Others ([1924] 52 I.A. 22), referred to.
|
Civil Appeal No. 1271 of 1969.
Appeal from the Judgment and Order dated 17 8 1966 of the Andhra Pradesh High Court in Appeal Nos. 252 and 283 of 1960.
427 V. Gopala Krishnaiah,, A. K. Ganguli and D. P. Mukherjee for the Appellant.
Upendralal Waray and A. Subba Rao for the Respondent.
The Judgment of the Court was delivered by DESAI J.
This appeal by certificate granted under Article 133(1)(a) of the Constitution arises from Civil Suit No. 23/1 of 1952 filed by the appellant against 56 respondents for recovering possession of lands more particularly set out in the Schedule annexed to the plaint, mesne profits, accounts and injunction, which suit was largely dismissed and partly decreed by the trial Court but in appeals bearing A. section Nos. 252 and 283 of 1960 by the unsuccessful defendants and the plaintiff, respectively, as dismissed as a whole.
A brief narration of facts necessary for appreciating the contentions raised herein may be set out.
Plaintiff appellant is the son of late Kazim Yar Jung who was a Minister of H.E.H. the Nizam of Hyderabad.
The father of the plaintiff obtained grant of certain lands in Ryalamadugu village from the Government of Nizam, the patta having been granted in the name of the plaintiff.
At about the time of police action in 1948 when the local conditions in Hyderabad City and State were disturbed, the plaintiff, his father Kazim Yar Jung and his step brother Mustafa found it difficult to even approach their lands and the plaintiff was then contemplating to shift to Pakistan with others.
Defendant No. 1 Rami Reddy who was a police Patel approached the plaintiff and represented that he would manage the affairs of the plaintiff, his brother and father, out that is he was not keeping well a nominal Power of Attorney would have to be granted to defendant No. 34 Uppara Sattayya whereupon the plaintiff, his father and brother jointly executed a Power of Attorney, Ext.P 1 dated 10th April 1949 in favour of defendant No. 34 which was further supplemented by the deed Ext.P 2 dated 20th April 1949.
The plaintiff alleged that in October 1949 he came to know that defendants nos.1 and 34 were perpetrating fraud when on 25th October 1949 the plaintiff and his brother Mustafa published a notice in the newspapers and the Gazette cancelling the Power of Attorney granted in favour of defendant No. 34.
Plaintiff then came to know that defendant nos, 1 and 34 and other defendants in collusion with each other got Transferred the lands of the plaintiff for inadequate or 110 consideration and that a fraud was perpetrated.
The plaintiff further alleged that the Power of Attorney is vague and void and inoperative and would not clothe defendant No. 34 with legal authority to deal with the properties in the manner in which they have been dealt 428 with.
At any rate, the Power of Attorney did not clothe defendant no, 34 with the authority to sell the land and, therefore, the purchasers have not acquired any title to the lands purporting to have been sold by defendant No. 34.
The plaintiff accordingly sued for possession, mense profits and accounts from the defendants.
Different groups of defendants filed three separate written statements but more or less the contentions raised in the various written statements are identical.
The first contention is that the plaintiff was not the lull and absolute owner of the suit lands but was a benamidar inasmuch as the lands were granted to the father of the plaintiff who was a Minister in the Nizam 's Government but the patta was formally taken in the name of the plaintiff who was then a minor.
It was also contended that the Power of Attorney, Ext, P l with P 2 was legal and valid and binding and it clothed del`defendant 34 with an authority to sell the lands and different parcels of lands have been sold to different defendants for full consideration and the plaintiff was aware of it and is now trying to take an advantage on the basis of a technical plea.
There were some other contentions which at this stage are hardly relevant.
The trial Court held that the plaintiff was the full and absolute owner of the suit properties.
The Power of Attorney Ext.P 1 was not vitiated by fraud and has clothed defendant No. 34 with the necessary authority to sell the lands and the sale of different parcels of lands in favour of different defendants were not vitiated by fraud and each sale was for consideration and binding on the plaintiff.
The Trial Court further held that the properties bearing Items 27 to 40, 42 44, 46, 47, 55 67 and 69 set out in the ' Schedule annexed to the plaint were not proved to have been sold, the conclusion having been based on the only ground that no sale deeds were forthcoming and accordingly it was held that the plaintiff was entitled to recover possession of the aforementioned pieces of land.
The trial Court accordingly dismissed the suit except for the aforementioned pieces of land in respect of which a decree for possession and mesne profits was granted in favour of the plaintiff.
Two appeals came to be filed to the High Court.
Appeal bearing A. section 252/60 was preferred by original defendants 8, 9 and 11 to the extent decree was made against them by the trial Court.
Appeal bearing A.S. 283/60 was preferred by the plaintiff to the extent the suit was dismissed.
Both the appeals came to be disposed of by a Division Bench of the Andhra Pradesh High Court by a common judgment rendered on 17th August 1966 by which A.S. 252/60 preferred by original defendants 8. 9 and 11 was allowed and the decree made against them 429 in favour of the plaintiff was set aside, and A.S. 283/6 preferred by the plaintiff was dismissed.
As a consequence the entire suit of the plaintiff came to be dismissed with costs in one set.
The plaintiff thereupon approached the High Court for a certificate and on a certificate under Article 133(1) (a) being granted, the plaintiff lodged the present appeal.
When the appeal reached the stage of hearing on an earlier occasion, CMP. 17845/78 was filed requesting the Court to record a memorandum of compromise between the appellant and the legal representatives of respondents 1, 2, 3, and respondent 34 inviting the Court to dismiss the appeal of the plaintiff appellant against them.
By an order made by this Court, this compromise was recorded and the appeal was so down for further hearing against the remaining respondents.
We take note of this compromise because on the basis of this compromise a submission has been made on behalf of the remaining respondents that the appeal against them would no more survive.
Mr. V. Gopalakrishnayya, learned counsel for the appellant urged that it is impermissible in law to give a joint Power by three persons in favour of one agent.
Alternatively it was contended that if such a power of Attorney is legal and valid it would clothe the agent with the only authority to Act in respect of the joint affairs or property of the principals and not for any individual affair or property of any one of them.
It was further urged that upon a true construction of the authority conferred by the Power of Attorney, Ext P 1 the scope of authority only encompassed the management of the joint properties of the three co principals or at best the management of property of each one of the principal but it did not clothe him with an authority to sell the property of any one of them and the situation is not improved by the supplementary deed, Ext.
Alternatively it was contended that if exhibit P 1 conferred an authority to sell the land it was hedged in with a prerequisite that the property can be sold to finance the litigation or to repay the loan, if any, borrowed for the aforesaid purpose.
In this context it was submitted that the Court should bear in mind that the garden is on the party who seeks to rely on the authority of the constituted attorney to establish that the impugned transaction falls within the ambit of authority of the attorney, and in this connection it may be borne in mind that ordinarily the courts construe Power of Attorney strictly.
It was then urged that even if it is held that by the combined operation of Exts.P 1 and P 2 the Attorney had the authority to sell the land he had not acted on his own but merely completed the sale negotiated by an outsider and thereby he acted as a rubber stamp and such an act of the attorney would not bind the principal, and in that 430 event the purchaser did not acquire any title to the land.
It was also contended that the High Court was in error in admitting the three sale deeds by granting CMP. 2762/61 purporting to act under Order 41, rule 27, Civil Procedure Code, and if they are excluded from consideration, in the absence of sale deeds the decree of the trial Court against original defendants 8, 9 and 11 will have to be restored.
On behalf of the contesting respondents it was urged that the plaintiff being benamidar, cannot maintain the suit on the allegation that he is the full and absolute owner of the properties.
The first contention of the appellant is that it was impermissible in law for three persons to jointly grant a Power of Attorney in favour of defendant 34.
Barring the ipse dixit of the learned counsel nothing was shown to us to make such a joint power impermissible in law.
The relation between the donor of the power and the donor of the power is one of principal and agent and the expression 'agency ' is used to connote the relation which exists where one person has an authority or capacity to create legal relations between a person occupying the position of principal and third parties.
The relation of agency arises whenever one person called the agent has authority to act on behalf of another called the principal and ' consents so to act.
The relationship has its genesis in a contract.
If agency is the outcome of a contract between the principal and the agent, in order to show that three principals jointly constituting an agent by a deed called 'Power of Attorney ' was impermissible, provisions of Contract Act or the general law of contract should have been shown as having been violated by such a contract.
Nothing of the kind was pointed out to us.
On the contrary, in Halsbury 's Laws of England, Vol.I, 4th Edn.para 726, the following proposition has been stated: "Co principals may jointly appoint an agent to act for them and in such case become jointly liable to him and may jointly sue him.
" We are in agreement with this view and, therefore, three principals could jointly appoint an agent.
The next limb of the submission was that if three co principals jointly constituted an agent then unless contrary is indicated by the deed of the Power of Attorney, the necessary inference would be that the agent can act in respect of those affairs in which all the co principles are jointly interested.
In other words, it was said that such a Power of Attorney would clothe the agent with an authority to act in respect of joint affairs of the co principals.
We are unable to find any force in this 431 argument, for what the Power of Attorney authorises depends on its terms and the purpose for which it is executed.
It would, therefore, be necessary to refer to the Power of Attorney, Ext.P l and the supplementary deed, Ext.P l is dated 10th April 1949 and is styled as general Power of Attorney.
The co principals are: (1) plaintiff Syed Abdul Khader (2) Kazim Yar Jung, and (3) Syed Mustafa Hussain.
The purpose for which the power was executed is set out in Ext.P l in the following words: "that in view of our private needs and as we are unable to conduct cases and answer them in time, we therefore appoint Copper Sattayya son of Coper Durgayya resident of Ghanpur, Medak Taluq as our general power of Attorney to act on our behalf and we empower the said person through this power of Attorney that the said Muktar can conduct the cases (Parvi) of all sorts, question and answer, admit or deny, either orally or writing on our behalf in all departments, civil and criminal courts, in the High Court, in the judicial committee, in the Revenue Departments of the Districts, namely, in the offices of the IInd, IIIrd, and Ist Taluqdars, the Tahsil Offices etc and purchased or sell (sic) of lands and that he is authorised to appoint any pleader or special Muktar when occasioned (sic) and to stop or to take or file any copies in any suit or to file any suit or file any written statements with his own signature to fetch any loan for our business or lands or to pay the debts from out of the income of the estate or to purchase or sell the lands and to execute the sale deeds and get registered under his signature etc . " The last sentence is that "all the acts of the said Muktar shall be deemed to be acts done and effected by us which we hereby accept and approve".
Subsequently on 20th April 1949 a supplementary Power of Attorney in addition to Ext.P l was executed by the aforementioned three donors of Power in favour of defendant No. 34 in which it is specifically stated that they affirm earlier Power of Attorney dated 10th April 1949 and thereafter the relevant recital is as under: "But by the said document, the powers of sale and registration were not confirmed (sic) on him and that therefore through this deed the same is hereby confirmed (sic) on him '.
It was urged that the Court should bear in mind the first principle that a Power of Attorney has to be strictly construed.
Undoubtedly, where someone other than the person who has a right to act in respect 432 of certain things has, under a contract of agency, the right to ac.
On be half of principal, the authority conferred by the written instrument has to be strictly construed.
Ordinarily a Power of Attorney is construed strictly by Courts (vide Bryant, Powis and Bryant Ltd. vs La Banque du Peuple) (1).
Adopting the principle of strict construction of a Power of Attorney, the first question that is required to be answered is whether the Power of Attorney, Ext.P l was meant to confer the authority on the agent to act only in respect of the joint affairs or joint property of the co principals or it was in respect of the individual affairs and effects of each principal.
In Ext.P 1 at three places the expression used is: "our Power of Attorney to act on our behalf and we empower the said person"; then again "on our behalf in all departments", and then lastly, "acts done and effected by the agent shall be deemed to be the acts done and effected by the principals." Mr. Gopalakrishnayya said that it would be extraordinary to hold that the expression "on our behalf" as disclosing a conjoint action on behalf of more than one person could ever be interpreted by any canon of construction as one on behalf of each individual.
He said that apart from the strict construction the Court must put on a Power of Attorney, where the terms of the written contract are clear and unambiguous it is impermissible for the Court to take into consideration the other circumstances to determine the intention of the parties.
When a contract is reduced to writing, undoubtedly the Court must look at the terms of the contract and proceed on the assumption that the parties intended what they have said and if the terms are unambiguous the Court must give effect to the terms of the contract.
However, it is well establish ed that in considering a contract it is legitimate to take into account the surrounding circumstances for ascertaining the intention of the parties (vide Modi & Co. vs Union of India).(2) Exhibit P l being a Power of Attorney granted by three co principals in favour of one agent, the expression "on our behalf" would hardly be decisive of the scope of authority conferred by the deed.
The circumstances in which such Power of Attorney came to the executed and the fact that three different persons though near relations but having no joint property or venture joined in executing a Power of Attorney and the purpose and object for which it was executed when taken into consideration would throw light on the true, nature of the authority conferred by the deed.
In this connection it is an admitted position that the Power of Attorney was executed in April 1949 and that too, in the (1) at 177(2) ; 433 State of Hyderabad, the erstwhile Nizam 's State.
In the wake of police action in the fall of 1943 and thereafter there were unusually disturbed conditions in Hyderabad State.
Plaintiff himself has stated in plaint para 1 that the conditions in Hyderabad were disturbed that like himself, his father and brother found it difficult to make contact with their properties and it was being contemplated by the plaintiff that he might shift to Pakistan with others.
All the three persons, i.e. his father, brother and the plaintiff found it difficult even to approach the properties of each of them and that all of them were contemplating;, to migrate to Pakistan.
In his belated evidence in Court after defendants ' evidence was closed the plaintiff re affirmed that after police action he lost possession of his lands and it was difficult to approach the lands or manage the same.
Even his clerk was not willing to undertake the responsibility.
Further there is no evidence to show that all the three co principals had any joint property or any joint business or any joint venture in which they were jointly interested.
Plaintiff says in his evidence that all the three joined in executing Power of Attorney Ext.P 1 because each of them had his land in that area and each was unable to manage his land.
In this background it would be futile to say that the three co principals executed the power of Attorney in favour of the agent to lookafter their joint affairs and joint property alone.
In fact, plaint para I leaves no room for doubt that each of the three co principals neither could manage nor could have access to each one 's own property and that each one was contemplating to migrate to Pakistan and that therefore they all gathered together and executed one Power of Attorney in favour of defendant No. 34 as a matter of convenience for dealing with the property of each one of the co principals.
It thus clearly transpires that each one of the co principals had his land, that each one of them was unable to manage his land, and that all the three of them were contemplating to migrate to Pakistan and that they wanted possibly to dispose on their lands, collect cash and skip over to Pakistan.
If Power of Attorney Ext.P 1 was executed in this background it would illumine the scope and ambit of authority conferred by Ext.
It would clearly appear that each one wanted to constitute defendant 34 to be his agent in respect of his property.
Therefore, the contention that the power of attorney Ext.P 1 read with Ext.P 2 was a joint power only in respect of joint properties of the three co principals must be rejected.
An incidental submission may be disposed of at this stage.
It was urged that the Power of Attorney Ext.P 1 is legally invalid and defective in form and that the supplementary document Ext.P 2 does not render in valid.
The defect pointed out is that when Ext P 1 was offered for registration the Sub Registrar has nowhere noted in his endorsement 434 that the donors of the power who executed the Power of Attorney Ext.P 1 were identified to him by someone known to him or they were personally known to him.
Undoubtedly the Sub Registrar in order to be satisfied that there is no impersonation may require some person known to him to identify those who admit execution before him but in case the persons who have executed the deed before him are known to him the failure to endorse that fact on the deed does not render the deed invalid.
In any event if those who executed the deed admit having executed the deed, the fact that the Sub Registrar failed to endorse the fact of the persons being known to him would not render the deed invalid.
A General Power of Attorney is not a compulsorily registrable document.
No rule or regulation was pointed out to us in support of the submission that it was obligatory for the Sub Registrar to make the endorsement that those who have executed the deed were either personally known to him or were identified by someone known to him.
Therefore, there is no merit in the contention and it must be rejected.
The next contention is that upon a true construction of Ext.P 1, the authority conferred thereby was to manage the property of the donors of the power and it did not confer any authority to purchase or sell the property.
Simultaneously it was stated that Ext.P 2 does not improve the position in this behalf.
Both the Courts have rejected this submission and for very good and convincing reasons.
A bare perusal of Ext.P 1 clearly shows that apart from the power to manage the property, a further power to purchase and sell lands was conferred on the agent.
Power to purchase and sell lands has been expressly mentioned at two places in Ext.P 1., But even apart from this, the plaintiff in his cross examination has admitted that after executing Ext.P 1 the Registrar pointed out that the Power of Attorney Ext.P 1 does not confer the authority to sell land and offer for registration sale deed and requested them to execute a supplemental document expressly confer ring such authority and he identified Ext.P 2 to be the supplemental document.
P 2 has been reproduced in extenso by the High Court in its judgment and in no uncertain and most unambiguous terms it is stated therein that the power to sell and registration of sale deed was conferred by Ext.
But even if Ext.P 2 were to be excluded from consideration, the Power of Attorney Ext.P 1 clearly confers an authority on the agent to sell the property.
If we recall at this stage the circumstances in which Ext.P 1 came to be executed in favour of defendant No. 34, it clearly appears that plaintiff, his father and brother were keen to get the lands sold as they were contemplating to migrate to Pakistan.
In the face of this express and explicit power it could not be said that the authority was conferred only to manage the property.
435 In Ext.P 1 the expression 'to manage the property ' is nowhere to be found.
On the contrary the general Power of Attorney is couched in a language which confers wide authority to file suits, defend actions, engage advocates, appear in various offices, purchase and sell land and execute sale deeds and get them registered, to borrow money, to employ persons needed for carrying out affairs and to dismiss them.
It is difficult to appreciate the submission that the authority was only to manage the property.
The submission is not borne out by the contents of Exts.P l and P 2.
Incidentally in this connection it was urged that the power to purchase and sell land and to execute documents and to offer them for registration does not include the power to sell agricultural land.
This has only to be mentioned to be rejected because the expression 'lands ' would include both agricultural and non agricultural land.
The next contention is that even if the Court were to accept that the authority conferred by the Power of Attorney encompasses the authority to sell land, the power to sell land was hedged in with a pre condition 1 or with a pre requisite that the land could be sold either for Financing litigation or if for that purpose a loan was borrowed, to repay the loan.
Sustenance is sought to be drawn for this submission from the following few lines in Ext.P 1: "and purchase or sell (sic) of lands and that he is authorised to appoint any pleader or special Muktar when occasioned (sic) and to stop or to take or file any copies in any suit or to the any suit or file any written statements with his own signature to fetch any loan for our business or lands or to pay the debts from out of the income of the estate or to purchase or sell the lands and to execute the sale deeds and get registered under his signature and to obtain money or to enter into a compromise in any suit or get it settled through arbitration or to withdraw any suit. etc.
" In Ext.P 2 the supplemental Power of Attorney, it is stated that the power for sale and registration of documents was conferred on the agent The, construction suggested is not warranted by the language used in Ext.
The power to purchase or sell land was not hedged in by any pre requisite or pre condition.
Each recital constitutes a separate power, namely, (i) power to purchase or sell land, (ii) power to appoint a pleader or Mukhtar, (iii) power to file suit or appear and file written statement (iv) power to borrow money or to enter into any comprise in any suit or get it settled through arbitration and withdraw any suit each was an independent power.
There is nothing in Ext.P 1 which 436 would even remotely indicate that the land could be sold only for financing the litigation or if for that purpose a loan was borrowed, to repay the loan Such power of wide amplitude conferring such wide authority cannot by construction be narrowed down to deny an authority which the donors expressly granted.
The ordinary authority given in one part of the instrument will not be cut down because there are ambiguous and uncertain expressions elsewhere but the document will be considered as ? whole for interpretation of particular words or directions (see Halsbury 's Laws of England, 4th Edn., Volume I, Para 733).
The contention, therefore, must be negatived.
The next contention is that even if Ext.P 1 confers authority on dependant 34 to sell land, the authority so conferred on defendant 34 was to act on his own and not at the behest of an outsider or as a rubber stamp of someone and that in this case evidence clearly shows that it was Kazim Yar Jung, the father of the plaintiff who entered into an agreement, Ext.D 18 dated 14th February 1949, with defendant No. 1 for sale of land and the agent defendant 34 merely rubber stamped the sale and executed the sale deed and that such a sale is not binding on the plaintiff.
At first blush the argument is really attractive but it does not stand scrutiny.
Land involved in the dispute was granted by the Nizam when the father of the plaintiff was a Minister in the Nizam 's Government.
Patta evidencing the grant was taken in favour of the plaintiff who was then a minor.
The father of the plaintiff really believed that he was the owner of the land and in fact on 20th October 1949 he wrote to Tahsildar, Medak; that his son was a benamidar and that the lands may, therefore, be transferred in his name.
Thus, the father of the plaintiff acted as if he was the owner of the land but when a contention on; behalf of the respondents that the plaintiff was a benamidar would be presently examined, it would be painted out that the plain tiff we the real owner and was not a benamdar.
That is the true legal position.
the fact, however, remains hat the father of the plaintiff who must be a man of considerable influence being a Minister in the Government of Nizam, must have acted as if he was the owner of the land.
Undoubtedly, the agreement Ext.D 18 for sale of land was entered into between the father of the plaintiff and defendant No. l and pursuant to this agreement defendant No. 34 executed a sale deed in favour of defendant No. 31, but it may be noticed that the agreement Ext.D 18 was entered into two months prior to the grant of Power of Attorney, Ext.
There is, however, evidence to show that the agreement for sale of land and the sale deed were taken in the presence of and to the know ledge and with the full acquiescence of the plaintiff witness Kishta Reddy, D.W. 2 has stated in his evidence that defendant 1 Rami Reddy 437 paid the consideration for purchase of land pursuant to agreement Ext.D 18 to plaintiff in his own presence.
He has further stated that Kazim Yar Jung, Plaintiff 's father and daughter of Kazim Yar Jung and both of his sons including the plaintiff were present when the amount of consideration was paid.
This witness 's presence at the time of payment of consideration cannot be disputed because receipt Ext.
D 16 which evidences payment of consideration for the sale of land to defendant No. 1 though signed and passed by Kazim Yar Jung, the father of the plaintiff, was attested by him.
This evidence which has remained uncontroverted would show that the consideration for sale of land in favour of defendant 1 pursuant to agreement of sale Ext.D 18 was paid to the plaintiff in the presence of this witness and plaintiff accepted the same though the receipt Ext.D 18 was passed by the father of the plaintiff.
A feeble attempt was made to explain this inconvenient evidence by saying that in agreement Ext.D 18 lands are not especially described by setting out the Survey Numbers or the Khata Numbers and as in that very village plaintiff 's father had also his lands, the plaintiff may have as well remained under the impression that the father had sold his own lands and, therefore, could not raise any objection about the sale.
This explanation cannot be swallowed for the obvious reason that there was no reason for the plaintiff to accept the consideration or the consideration being put in his hands if his land was not being sold.
Even if the father of the plaintiff could be said to be an ostensible owner of the land and he purported to sell the land, the plaintiff the real owner as he claimed to be had acquiesced in the same and accepted the consideration and in this background he would be estopped from challenging the title which was transferred pursuant to the sale.
In the back drop of these circumstances the principle enunciated in section 41 of the Transfer of Property Act would come to the rescue of the transferee.
Section 41 of the Transfer of Property Act provides that where, with the consent, express or implied, of the person interested in immovable property, a person is the ostensible owner of such property and transfers the same for consideration, the transfer shall not be voidable on the ground that the transferor was not authorized to make it.
Section 41 codifies what was once treated as a principle in equity which the Judicial Committee had recognised in Ram coomar vs Macqueen,.(1) wherein the Judicial Committee observed as under: "It is a principle of natural equity which must be universally applicable that, where one man allows another to hold himself out as the owner of an estate and a third person purchases it, for value, from the apparent owner in the belief that (1) (1872) I.A. 11 Bengal L.R. 46.438 he is the real owner, the man who so allows the other to hold himself out shall not be permitted to recover upon his secret title, unless he can overthrow that of the purchaser by showing either that he had direct notice, or something which amounts to constructive notice, of the real title; or that there existed circumstances which ought to have put him upon an inquiry that, if prosecuted would have led to a discovery of it ' In this case the father of the plaintiff throughout acted in relation to others as the owner of the property though the plaintiff was the real owner of the property.
The father of the plaintiff executed agreement D 18 to sell the land to defendant 1.
The transaction was completed in the presence of the plaintiff and the consideration was put in the hands of the plaintiff.
Plaintiff would certainly be estopped from contesting the validity of the sale on the ground that the father had no authority to sell the land or on the ground that though his father entered into the agreement Ext.D 18, his constituted attorney defendant 34 acted as a mere rubber stamp.
In this connection it would be very profitable to refer to a notice served by the plaintiff on defendant 1, Ext.D 21 dated 19th December 1949.
Now, before the true impact of this notice can be gauged, a few dates may be recalled.
The Power of Attorney Ext.P 1 was executed in favour of defendant 34 on 10th April 1949.
Agreement Ext.D 18 was entered into between the father of the plaintiff and defendant No. 1 on 14th February 1949.
This would show that agreement D 18 was entered into between the father of the plaintiff and defendant 1 prior to the execution of the Power of Attorney, Ext.
The public notice cancelling the Power of Attorney was issued on 25th October 1949.
Now, notice Ext.D 21 is dated 19th December 1449.
Therefore, it clearly transpires that notice Ext.D 21 was issued by the plaintiff after he had developed a suspicion about the fraud alleged to have been perpetrated by defendants 1 and 34 and after cancelling the Power of Attorney in favour of defendant No. 34.
Yet by this notice Ext.D 21 plaintiff called upon defendant 1 to meet him to purchase the lands set out in the notice if he was so desirous, otherwise plaintiff would sell the same to others.
The lands described in the notice clearly exclude those pieces of lands sold under the authority of Power Of Attorney Ext.
Does it stand to reason to believe that plaintiff who suspected that he was the victim of a fraud at the hands of defendant 1 and that he had to take steps to cancel the Power of Attorney granted by him in favour of defendant 34 specifically at the instance of 439 defendant 1 would ever invite him to purchase some other land ?
If there was any substance in the case put forth by the plaintiff that the sale already completed by defendant 34 in favour of defendant 1 pursuant to the agreement, Ext.D 18 executed by the father of the plaintiff in favour of defendant 1 was not acceptable to him or was not binding on him he would not invite him to purchase other lands.
The conduct of the plaintiff belies his suspicion, and the allegation of fraud and want of authority is clearly an after thought.
Viewed from any angle, the contention of the plaintiff is without merits and must be rejected.
It was next contended that the High Court was in error in granting MP.2762/61 permitting the heirs of defendants 8, 9 and 11 to produce the sale deeds which they did not produce in the trial Court and after relying on the same, reversing the decree of the trial Court.
The High Court has given cogent reasons for granting CMP. 2762/61.
Order 41, Rule 27, C.P.C. enables the appellate Court to admit additional evidence in the circumstances or situation therein mentioned one such being where the appellate court requires any document to be produced or any witness to be examined to enable it to pronounce judgment or for any other substantial cause.
By a catena of decisions of this Court, it is well established that Order 41, Rule 27, C.P.C 'does not confer a right on the party to produce additional evidence.
But if the Court hearing the action requires any document so as to enable it to pronounce judgment, it has the jurisdiction to permit additional evidence to be produced.
The High Court has given cogent reasons why it felt impelled to permit production of registered sale deeds so as to enable it to pronounce judgment in the matter.
If the High Court considered the production of registered sale deeds essential so as to enable it to pronounce judgment, there is no reason why we should interfere with the discretionary power properly exercised by the High Court in the interest of justice.
Even otherwise, the High Court was justified in permitting additional evidence to be produced when it consisted of registered sale deeds.
Such additional evidence has to be read as part of the record.
Once these registered sale deeds are taken into consideration, a part of the decree of the trial Court granted in favour of the plaintiff awarding him possession of the land on the only ground that the sale deeds in respect of those pieces of lands were not produced, could not be maintained and the High Court rightly allowed the appeal of original defendant nos.8, 9 and 11 and no exception can be taken to it.
We may now turn to two contentions raised on behalf of the respondents.
440 The first contention on behalf of respondents is that the plaintiff being a benamidar, he is not entitled to seek possession of the land on the basis of his title as full and absolute owner of the suit lands.
The High Court in this connection has not specifically dealt with this contention though the trial Court raised a specific issue in respect of it and answered it in favour of the plaintiff '.
The High Court has, however, ob served that the plaintiff 's father was the real owner of the suit lands and he was managing the property although the patta was issued in the name of his son, the plaintiff.
The High Court then observed that Kazinm Yar Jung for the reason that he was an employee of the Nizam in order to avoid embarassment to himself nominally made the plaintiff, his minor son, the pattadar.
In the opinion of the High Court this is borne out by the fact that after executing the Power of Attorney, Ext.P 1 in favour of defendant 1, he wrote to the Tahsildar, Medak on 20th October 1949 that his son was a benamidar and that the lands may therefore be transferred in his name.
However, after making these observations the High Court has not chosen to non suit the plaintiff on the ground that he n was a benamidar Undoubtedly, Kazim Yar Jung was holding a high office in Nizam 's Government It is rational to believe that he may have influenced the decision of the Nizam to grant the land and that he may not have taken the patta in his own name.
The patta may, therefore, have been grant ed in favour of his minor son, the plaintiff.
Does that make the plain tiff a benemidar Section 82 of the , provides that where property is transferred to one person for a consideration paid or provided by another person, and it appears that such other person did not intend to pay or provide such consideration for the benefit of the transferee, the transferee must hold the property for the benefit of the person paying or providing the consideration.
Now, there is no evidence to show that the patta was for consideration.
It is said that there was a grant of land and it is not clear that it was meant to be a gift of land.
Even if the Nizam in appreciation of the services rendered by the plaintiff 's father granted the land to the plaintiff, it could not be said that any consideration flowed from the father of the plaintiff so as to make the plaintiff a benamidar.
The genesis of the concept of benami is the consideration for a transfer must flow from one person and the transfer is taken in the name of the other person and the consideration so flowing for the transfer was not intended to be a gift in favour of the person in whose name the transfer is taken All these ingredients of benami are absent in this case and, therefore, the contention that the plaintiff was a benamidar cannot be accepted.
441 lt was also contended that the plaintiff came to the Court with an allegation that defendant 1 induced the plaintiff, his father and brother to execute a nominal Power of Attorney in favour of defendant No. 34, and defendants 1 and 34 in collusion with each other defrauded the plaintiff his property.
It was said that if defendants 1 and 34 were the perpetrators of the fraud, the plaintiff having compromised with them and withdrawn the appeal against them, the appeal would not survive against the rest.
There is absolutely no merit in this contention.
The plaintiff may have valid reasons for entering into a compromise with defendants 1 and 34 who might have made good a part of the loss suffered by the plaintiff.
But apart from the allegation of fraud, the suit was substantially based on the scope of authority conferred by Exts.P l and P 2 to sell lands and the acquisition of the title by the purchasers From the attorney defendant 34 in exercise of the authority conferred by Exts.
P l and P 2 and, therefore, a compromise with defendants 1 and 34 would not render the appeal against the rest of the defendants infructuous or untenable.
The third contention was that the plaintiff left India and his evidence having remained incomplete, the same could not be read in evidence.
After we explained the relevant documents, we are satisfied that there is no substance in this contention.
As all the contentions raised by the appellant fail, the appeal fails and is dismissed with costs.
N.V.K. Appeal dismissed .
| IN-Abs | The plaintiff (appellant), his father and step brother were owners of lands in a village in the former State of Hyderabad.
Coming to know that the two brothers and father were contemplating to migrate to Pakistan, defendant No. 1 suggested to the plaintiff that he would manage their properties but that since he was not in good health, a nominal power of attorney might be granted in favour of defendant No. 34.
The power of attorney (Ext.
Pl) was granted tc defendant 34 by all of them.
It was later supplemented by another deed (Ext. P2).
The plaintiff alleged that sometime thereafter he realised that the two defendants in collusion with each other transferred his lands to others for no consideration or inadequate consideration and that thereby a fraud was perpetrated upon him by the defendants.
Thereupon, it was further alleged, the plaintiff and his brother published in the newspapers and the official gazette a notice cancelling the power of attorney granted to defendant No. 34.
The plaintiff sued the defendants for recovery of possession of lands and certain other benefits.
The defendants on the other hand claimed that the two documents being valid the plaintiff could not resile from them.
They also alleged that the plaintiff was not the full and absolute owner of the lands but was a benamidar.
The trial court dismissed the plaintiff 's suit holding that the documents were valid The High Court upheld the trial court 's order.
It however held that the plaintiff was the absolute owner of the suit properties Dismissing the appeals. ^ HELD 1(a) There is no force in the contention that it is impermissible for three persons to jointly grant a power of attorney in favour of defendant No. 34.
Co principals may jointly appoint an agent to act for them and in such a case they become jointly liable to him and may jointly sue him.
[430C,F] (b) The relation of agency arises when one person, called the agent, has authority to act on behalf of another called the principal and consents so to act.
The relationship has its genesis in contract.
In order to show that it is imper 425 missible for three principals to jointly constitute an agent by a common power of attorney it should be shown that the provisions of Contract Act or the general law of contract have been violated by such a contract.
[430E] In the instant case there is no such violation.
Halsbury 's Laws of England Vol.
1 4th Edn.
para 726 referred to. 2.
There is no force in the contention that since the two documents confer a joint power of attorney in respect of properties of the three co principals, the agent could look after the joint properties of the donors alone and not their individual affairs.
What a power of attorney authorises depends on its terms and the purposes for which it was executed.
Where someone other than the person Who has the right to act in respect of certain things, has under a contract of agency, the right to act on behalf of the principal, the authority conferred by the written instrument has to be strictly construed.
Ordinarily the power of attorney is construed strictly by courts.
It is equally well established that in considering a contract it is legitimate to take into account the surrounding circumstances for ascertaining the intention of the parties.
[430H, 431A, 431H 432A, F] Bryant, Powis and Bryant Ltd vs La Banque du Peuple, at 177, Modi & Co. vs Union of India, referred to.
In the instant case in Ext.
P1 at three places the expressions used are" our power of attorney to act on our behalf and we empower the said person` '. 'on our behalf in all departments", and lastly, "acts done and effected by the agent shall be deemed to be acts done and effected by the principals.
" The power of attorney having keen granted by three co principals in favour of one agent the expression "on our behalf" would hardly be decisive of the scope of authority conferred by the deed.
The surrounding circumstances clearly established that each of the co principals had his land, each of them could not have access to this land and therefore could not manage them, and with a view to migrating to Pakistan each of them apparently wanted to dispose of his lands and collect cash and therefore for this purpose each of them wanted to constitute defendant No. 34 to be his agent in respect of his individual property.
1432C. G, 433F] 3.
A general power of attorney is not a compulsorily registrable document.
When those who executed a deed admit having executed it, the tact that the Sub Registrar failed to endorse that the executants were known to him would not render the deed invalid.
Nor is there a legal obligation on the part of the Sub Registrar to make an endorsement that the persons executing a deed were either personally known to him or were identified by someone known to him.
[434C, B] 4.
There is no force in the submission that the authority given under exhibit P1 was only to manage the property and not to sell it.
P1 clearly shows that apart from the power to manage the property a further power to purchase and sell lands was conferred on the agent.
The general power of attorney conferred wide authority on defendant No. 34 to file suits, defend actions.
engage lawyers.
purchase and sell land and execute sale deeds and so on.
[434D E, 435A] 5.
A document will be considered as a whole for interpretation of particular words or directions.
An ordinary authority given in one part of the instrument will not be cut down because there are ambiguous and uncertain expressions elsewhere.
A power of wide amplitude conferring wide authority cannot by 9 978 SCI/78 426 construction be narrowed down to deny an authority which the donor expressly wanted to confer.
[436B] Halsbury 's Laws of England 4th Edn.
1 para 733; referred to.
(a) By a catena of decisions of this Court it is well established that Order 41 Rule 27 C.P.C. does not confer a right on a party to produce additional evidence before an appellate court.
But if the court hearing the action requires any document to enable it to pronounce judgment, it has the jurisdiction to permit additional evidence to be produced.
If the High Court considered production of registered sale deeds essential to enable it to pronounce judgment, there is no reason why this Court should interfere with the discretionary power properly exercised by the High Court in the interest of justice.
[439E F] 7.
(a) The contention that defendant No. 34 who was the constitute attorney acted as a mere rubber stamp in certain transactions has no force.
Section 41 of the Transfer of Property Act provides that where, with the consent, express or implied of the person interested in immovable` property, a person is the ostensible owner of such property and transfers the same for consideration, the transfer shall not be voidable on the ground that the transferor was not authorised to make it.
[436D, 437F] (b) Even if the father of the plaintiff could be said to be the ostensible owner of the land and he purported to sell the land, the plaintiff had acquiesced in the sale and accepted the consideration.
He would therefore be estopped from challenging the tile which was transferred pursuant to the sale.
[437E] Ramcoomar vs Macqueen, 1872 I.A. 11 Bengal LR 46; referred to.
(a) The contention that the plaintiff was a benamidar cannot be accepted.
The genesis of the concept of benami is that consideration for a transfer must flow from one person and the transfer is taken in the name of the other person and the consideration so flowing for the transfer was not intended to be a "gift in favour of the person in whose name the transfer is taken.
All these ingredients of benami ale absent in the instant case.
[440H] (b) Section 82 of the provides that where property is transferred to one person for a consideration paid or provided by another person, and it appears that such person did not intend to pay or provide such consider for the benefit of the transferee, the transferee must hold the property for the benefit OF the person paying or providing, the consideration.
[440F] (c) The plaintiff 's father held a high office in the Nizam 's Government.
He might have influenced the Nizam to grant the land to his son.
There is no evidence to show that the patta was for consideration.
Even if the Nizam in appreciation of the service rendered by the plaintiff 's father granted the land to the plaintiff it could not be said that any consideration flowed from the father of the plaintiff so as to make him a benamidar.
[440E, G]
|
Civil Appeal No. 2302 of 1977.
Appeal by Special Leave from the Judgment and Order dated 6th December.
1976 of the Delhi High Court in Civil Revision No.247 of 1976.
Rameshwar Nath, for the Appellant.
G. L. Sanghi.
section section Ray, section R. Agarwal, Praveen Kumar and B. Mohan for the Respondent.
This appeal is by special leave by the landlord against; the judgment of the High Court of Delhi whereby it allowed a revision of the respondent tenant and set aside the order of eviction passed by the Rent Controller, Delhi, rejecting the application of the respondent seeking permission to contest the proceedings for eviction filed by tile appellants under section 14(A)(1) of the Delhi Rent Control Act.
412 The appellant, Shri B. N. Muttoo, Inspector General of Police, Leased the property No. F 9, East of Kailash, New Delhi, to the respondent from 15th September, 1972 at a monthly rent o.` Rs. 2,200/ exclusive of electricity and water charges.
The lease was for the use of the premises for residential and/or professional purposes only and not for commercial purposes.
The lease agreement was renewed from time to time and the respondent became a monthly tenant under the Delhi Rent Control Act, 1958.
On 18th July, 1974 the landlord filed a petition for eviction of the respondent on the grounds OF mis user, subletting and bona fide requirement.
The petition was registered as Suit No. 182 of 1974 and is still pending.
The first appellant, B. N. Muttoo, retired as Inspector General of Police on 30th November, 1975.
While in office he was occupying premises bearing No. C II/ 77 Moti Bagh I, New Delhi, allotted to him by the Government.
On 9th September, 1975 the Government took a decision that Government servants who own houses in the locality should vacate the Government accommodation allotted to them within 3 months from 1st October, 1975.
On 9th December, 1975 a notice was served on the first appellant by the Deputy Director (Admn.) stating that the Government by its Office Memorandum No. 12031(1)/ 74 Pol.
II dated 9th September 1975 required all Government officials who, own houses in Delhi and New Delhi and have also been allotted I` Government.
residence to vacate the Government residence before the stipulated date failing which penal rate of licence of market rate shall be charged besides necessary action to evict him from the Government residence.
On the same day the appellant filed the present Suit for eviction of the respondent.
On 16th January, 1976 the respondent applied 'or leave to defend.
On 10th March, 1976 the Rent Controller refused leave and decreed the suit filed by the landlord.
A revision petition was filed by the respondent before the High Court which allowed the revision and set aside the order of the Rent Controller and remanded the proceedings to the Rent Controller for disposal according to law.
Against the order of the High Court allowing the revision by the respondent the present appeal has been preferred to this Court by the landlord.
The question that arises in this appeal is whether the Rent Con troller was right in refusing leave to the respondent to defend the eviction petition filed by the landlord.
In order to appreciate the point that arises for consideration it is necessary to refer to the relevant provisions of the Delhi Rent Control Act.
Delhi Rent Control Act (Act 59 of 1958) came into force on 413 31st December, 1958.
By Chapter III the right of the landlord to evict the tenant was restricted.
Section 14 prohibited any order or decree for recovery of possession of any of the premises being made by any court in favour of a landlord except under certain circumstances.
The landlord was required to make an application to the Controller for recovery of the possession on one of the grounds mentioned in sub clauses (a) to (1) in section 14(1).
The provisions of section 14(1)(e) which are relevant may be referred to: "14.
(1) Notwithstanding anything to the contrary contained in any other law or contract, no order or decree for the recovery of possession of any premises shall be made by any court or Controller in favour of the landlord against a tenant: Provided that the Controller may, on an application made to him in the prescribed manner, make an order for the recovery of possession of the premises on one or mote of the following grounds, namely: (a) X X X (b) X X X (c) X X X (d) X X X (e) that the premises let for residential purposes are required bona fide by the landlord for occupation as a residence For himself or for any member of his family dependent on him, if he is the owner thereof, or for any person for whose benefit the premises are held and that the landlord or such person has no other reasonably suitable residential accommodation: Explanation the purposes of this clause "premises let for residential purposes" include any premises which having been let for use as a residence are, without the consent of the landlord, used incidentally for commercial or other purposes; By the Delhi Rent Control Act (Amendment) Ordinance (No. 24 of 1975), 1975 the Delhi Rent Control Act was amended.
the Ordinance was eventually replaced by the Delhi Rent Control (Amendment) Act No. 18 of 1976.
The Amending Act continued the provisions of the Ordinance but extended the summary procedure which was applicable to section 14(1)(e) to evictions on the ground set out in section 14A of the Act.
The Amending Act came into force on February 9, 1976 but by virtue of sub section (2) of section 1 it was 414 deemed to have come into force on 1st December, 1975 i.e. On the date on which the Ordinance came into force.
Section 14A conferred a right to recover immediate possession of premises to certain persons.
The amended section 14A(1) reads: "(1) Where a landlord who, being a person in occupation of any residential premises allotted to him by the Central Government or any local authority is required, by, or in pursuance of, any general or special order made by that Government or authority, to vacate such residential accommodation, or in default, to incur certain obligations, on the ground that he owns, in the Union territory of Delhi a residential accommodation either in his own name or in the name of his wife or dependent child, there shall accrue, on and from the date of such order, to such landlord, notwithstanding anything contained elsewhere in this Act or in any other law for the time being in force or in any contract (whether express or implied), custom or usage to the contrary, a right to recover immediately possession of any premises let out by him:" This section confers on a landlord who owns a residential accommodation.
in his own name or in the name of his wife or dependent child in the Union territory of Delhi and was in occupation of any residential premises allotted to him by the Central Government or any local authority and is required by any general or special order made by the Government or the authority to vacate such residential accommodation or in default to incur certain obligations on the ground that he owns a residential accommodation in Delhi either in his own name or in the name of his wife or dependent child, a right shall accrue to such landlord to recover immediate possession of any premises let out by him.
Apart from conferring rights under section 14A a summary procedure for trial of applications made under section 14(1)(e) and section 14A is provided under sections 25A, 25B and 25C. Section 25A provides that the provisions of Chapter IIIA which contains sections 25A, 25B and 25C and any rule made thereunder shall have effect notwithstanding anything inconsistent therewith contained else where in this Act or any other law for the time being in force.
The special procedure for disposal of application for eviction under section 14(1)(e) and section 14A is prescribed by section 25B.
The procedure envisaged is that when an application under section 14(1)(e) 415 or Section 14A is filed by the landlord the Controller shall issue summons in the prescribed form.
Sub section (4) to section 25B restricts the right of the tenant to defend by providing that the tenant shall not contest the prayer for eviction from the premises unless he files an affidavit stating the grounds on which he seeks to contest the application for eviction and obtains leave from the Controller.
In default of his appearance in pursuance of the summons or his obtaining such leave, the statement made by the landlord in the application for eviction shall be deemed to be admitted by the tenant and the applicant shall be entitled to an order for eviction on the ground aforesaid.
Sub section (5) to section 25B states the conditions under which the Controller shall give leave to the tenant to contest the application.
It requires that the affidavit filed by the tenant should disclose such facts as would disentitle the landlord from obtaining an order for the recovery of possession of the premises on the ground specified in clause (e) of the proviso to sub section (1) of section 14, or under section 14A. When once the leave is granted to the tenant to contest the application the Controller shall commence hearing of the application as early as practicable.
The introduction of section 14A became necessary as the Government took a decision on 9th September, 1975 that the Government servants who own houses in the Union territory of Delhi shall be required to vacate Government accommodation allotted to them within 3 months from 1st October, 1975.
If they fail to vacate the accommodation they were to be charged licence fee at market rates.
The Government servants who were owing houses in the Union territory of Delhi could not get possession of their residential accommodation.
It became necessary to confer on them the right to recover immediate possession of their premises and also to prescribe an expeditions procedure for achieving the object.
According to the procedure specified in section 25B it was made incumbent on the tenant to apply for and obtain leave to contest the application for eviction Coming to the facts of the case the Government took the decision to require the Government officers who have been allotted premises by the Government and who own their own houses in the area specified to vacate the premises allotted by the Government within 3 months from 1st October, 1975.
Notice of such intention was conveyed to be landlord on 9th December, 1975.
In the meantime on 30th November, 197 '; the officer retired from service.
Thus on the date 11 on which notice was served on him he had already retired.
The petition for eviction was also filed on 9th December, 1975 after the 416 officer retired.
The main contentions raised by the tenant in the petition for leave to contest were;(1) the landlord cannot invoke the provisions of section 25B(5) as he was not a Government servant on the date of the petition; (2) the landlord had already filed a petition for eviction which was registered as O.S. No. 182 of 1974 and was pending before the Additional Rent Controller.
As the eviction is sought on the same ground in the present petition it was submitted that this petition could not be entertained; (3) the premises which the respondent is occupying were let for the purpose of residential or professional purposes and therefore the landlord is not entitled to ask for eviction as the premises are not let for residential purposes.
The Rent Controller rejected all the contentions put forward by the respondent.
He held that the question as to whether the landlord was a Government servant or not on the date when the notice was received and on the date when he filed the petition is irrelevant so long as he satisfied the requirements laid down in section 14(1) of the Act.
on the second contention the Rent Controller found that the ground for eviction under section 14A is a new cause of action and different from the one that was raised in the previous petitions and hence the present petition is not barred.
On the third point the Rent Controller found that it is not necessary for an application under section 14(1) that the building should have been let for residential purposes as required under section 14(1) (c) and it is sufficient if the landlord requires the premises for residential accommodation.
The Rent Controller held that the grounds on which leave to resist an application can be granted are those that are specified in section 25B(5) alone.
On appeal the High Court allowed the revision by the tenant mainly on the ground that the application for eviction must fail on account of the admitted t`act that the landlord had retired from service on 30th November, 1975 before the Ordinance came into force and was on that account liable to vacate the premises independently of his owner ship of the premises in dispute.
The important question that arises for consideration is whether the landlord who retired from service on 30th November, 1975 before the Ordinance came into force could avail himself of the provisions of section 14A(1).
A reading of section 14A discloses that a right to recover immediate possession of premises accrues to certain persons if the requisite conditions are satisfied.
The conditions are: (1) the landlord must be in occupation of any residential premises allotted to him by the Central Government or any local authority; (2) such 417 landlord is required by a general or special order made by the Government or authority to vacate such residential accommodation or in default to incur certain obligations on the ground that he owns in the Union territory of Delhi a residential accommodation either in his on name or in the name of his wife or dependent child If the aforesaid conditions are satisfied a right shall accrue to such a landlord on and from the date of such order to recover immediate possession of any premises let out by him.
It may be noted that the section does not require that the person who is in occupation of the premises allotted by the Government should be a Government servant.
It is necessary that the person is required by the Government or authority to vacate such accommodation imposing certain consequences in the event of his not vacating.
The policy decision taken by the Government on 9th September, 1975 only related to Government servants who were in occupation of premises allotted to them by the Government.
If the Government servant had another house in the locality he was to vacate within 3 months from the 1st October, 1975.
This general order no doubt relates only to government servants.
After the decision was taken it was realized that some provision should be made to enable the persons in occupation of buildings allotted to them by the Government to get possession of the houses they own but have been let to tenants.
In order to enable them to get possession of the premises let by them expditiously section 14A(1) was enacted and the expeditious procedure under section 25 B was made applicable.
It may also be noted that the order served on the landlord on 9th December, 1975 mentions that all Government officials who own houses in Delhi and have also been allotted Government residence are to vacate Government accommodation.
the general circular dated 9th September, 1975 as well as the notice served on the landlord thus support the view that the intention of the Government was to enable only those Government servants who are in occupation of Government accommodation and who own houses to get immediate possession, though section 14A does not restrict the right to recover immediate possession to Government servants alone.
In these circumstances, the conclusions arrived at by the High Court that a Government servant who had retired before the date on which he had filed the application is not entitled to the benefits of section 14(1) is understandable.
This view was expressed by this Court in Nihal Chand vs Kalyan Chand Jain(1) wherein it was observed "There appears to be some force in the view taken by the High Court that the provision of section 14A(1) was not intended for Govern (1) ; at p. 190. 418 ment servant who have retired from Government service or who have been transferred outside Delhi .
" But this Court did not decide the issue because on the facts of the case it was of the view that the landlord was entitled to invoke the provisions of section 14A(1) notwithstanding the fact that he had retired from Government service with effect from 30th November, 1975.
In that case the notice was served on the appellant landlord on 30th September, 1975 which was before the date of retirement which was on 31st November ', 1975.
On the ground that the right to evict the tenant accrued to the landlord when he was in service it was held that he was entitled to the rights conferred under section 14A. In this case the notice was served on 9th December, 1975 and the officer had retired on 30th November, 1975.
On the reasoning in the above case the appellant will not be entitled to the relief.
The question therefore squarely arises in this case as to whether a Government servant who retired before the notice was served on him requiring to quit the Government accommodation is entitled to the benefit of section 14A(1).
It is not clear as to why the right to recover immediate possession is not confined to Government servants alone under section 14A.
It is clear that according to Government 's policy statement the intention was only to require the Government servants to vacate the premises allotted to them by the Government if they had their own houses in the area.
It cannot be said that it was by inadvertance that the Legislature mentioned persons instead of Government servants and made the section applicable to persons other than Government servants.
It is stated at the Bar that Government accommodation is provided not only to Government servants but also to Members of Parliament and other non officials who occupy important positions in public life.
The Court will not be justified in presuming that when the legislature used the word "persons" it meant only Government servants.
The rule as to construction of the statutes is well known and has been clearly laid down.
Craies on Statute Law (6th Ed.
p. 66) relying on Tasmania vs Common wealth(1) has stated the rule as follows: "The cardinal rule for the constructions of Acts of Parliament is that the should be construed according to the intention expressed in the Acts themselves.
The Court has to determine the intention as expressed by the words used.
If the words of statutes are themselves precise and unambiguous then no more can be necessary than to expound those words in their ordinary and natural sense.
The words themselves alone do in (1) ; 419 such a case best declare the intention of the lawgiver.
Taking into A account the object of the Act there could be no difficulty in giving the plain meaning to the word "person" as not being confined to Government servants for it is seen that accommodation has been provided by the Government not only to Government servants but to others also.
In the circumstances, the Court cannot help giving the plain and unambiguous meaning to the section.
It may be that the Retired Government servants as well as others who are in occupation of Government accommodation may become entitled to a special advantage, but the purpose of the legislation being to enable the Government to get possession of accommodation provided by them by enabling the allottee to get immediate possession of the residential accommodation owned but let by them, the Court will not be justified in giving a meaning which the words used will not warrant.
On this question therefore we find ourselves unable to concur with the view taken by he High Court.
The next question that arises is whether the rights conferred under section 14A(1) are available to premises that had been let for residential as well as professional purposes.
It is admitted that the premises were let for residential as well as professional purposes.
Section 14(1)(e) requires that in order to avail the provisions of section 14(1)(e) the premises should be "let for use as a residence '.
It has been held that when premises are let for residential as well as commercial or for residential and professional purposes the provisions of section 14(1)(e) will not apply.
This Court in Dr. Gopal Dass Verma vs Dr. section K. Bhardwaj and Anr.,(1) in construing section 13(1)(e) of the Delhi and Ajmer Rent Control Act, 1952 held that premises let for residential purposes but used by the tenant with the consent of the landlord incidentally for commercial professional or other purposes cease to be premises let for a residential purpose alone and as such the landlord would not be entitled to eject the tenant under section 13(1)(e) of the Act.
Section 13(1)(e) allowed a decree for ejectment to be passed if the Court is satisfied that the premises let for residential purposes are required bona fide by the landlord who is the owner of such premises for occupation as a residence tor himself or his family and that he has no other suitable accommodation.
On the facts of the case it was found that right from the commencement of the tenancy a substantial part of the premises was used by respondent I for his professional purpose, and they have also found that this has been done obviously with the consent of the landlord.
The Court held that the professional use of a substantial part Or the premises with (1) ; 420 the consent of the appellant clearly takes the case outside section 13(1)(e).
The view expressed in the above case was reiterated by this Court in Kartar Singh vs Chaman Lal & Ors.(1) On the facts it was found that the premises had been taken for residential cum business or professional purposes.
By the rent deed the owner inducted as a tenant Labha Mal Arora who was practising advocate.
Along with the rent deed a letter was written by the landlord to the tenant stating that he had no objection to the tenant having his professional office along with the residence.
After the tenant 's death in 1952 the premises were used only for residence by his sons and widow till 1957.
In August, 1957 the first respondent who qualified himself as a legal practitioner started having an office in the premises.
Another son also started practising as a lawyer in the same premises sometime later.
The landlord served a notice on the sons and widow of the deceased for requiring them to vacate the premises.
The court found two rooms were used by the original tenant as his office, one room by his clerk and the premises had been let for residence cum business purposes.
The plea that the tenant was only granted a licence to use the premises for residence cum profession which was personal to him and which came to an end on his death was not accepted.
The court agreed with the view expressed in Dr. Gopal Dass Verma 's case (supra) that a tenant could not be ejected under section 13(1)(h) because the tenancy of premises let out or used for residence and carrying on of profession could not be terminated merely by showing that the tenant had acquired a suitable residence.
the court rejected the contention that the tenant, Labha Mal Arora, had been merely given a permission or licence which was of a personal nature of his office.
It also was unable to find that any test of dominant intention was applied in Dr. Gopal Dass Verma 's case.
It is not necessary for us to go into the question whether the words "let for residential purposes" would exclude premises let predominantly for residential purposes with a licence to use an insignificant part for professional purposes such as lawyer 's or doctor 's consulting room.
The words used in section 14A are clearly different.
Section 14A contemplates the owning by the landlord in the Union territory of Delhi a residential accommodation.
If he owns a residential accommodation he has a right to recover immediately possession of any premises let out by him.
The emphasis is on residential accommodation.
If the premises are one intended for residential accommodation it will not make any difference if the premises are let for residential (1) 421 as well as other purposes.
Even though the residential accommodation is let for professional or commercial purposes the premises will not cease to be for residential accommodation.
It is common ground that the Premises let were put up under the Delhi Development Authority 's scheme for residential purposes.
The only plea was that though it was put up for residential purposes it was let for residential as well as for professional purposes.
The requirement in section 14(1)(e) that in order to enable the landlord to recover possession the premises ought to have been let for residential purposes is not there in section 14A(1).
In this view we agree with the High Court that it is not necessary in a petition for eviction under section 14A to satisfy that it was let for residential purposes only.
This view has been taken by this Court in Busching Schmitz Private Ltd. vs P. T. Menghani and Anr.
(1) The submission that as a previous application for possession by the landlord was pending this petition would not be permissible cannot be accepted as the grounds on which an application for possession is filed under section 14A(1) are different and based on special rights conferred on the class of persons who occupied Government accommodation.
The only other question that remains to be considered is the scope of the right to contest the suit, that is, on what grounds can the tenant seek leave to resist the suit filed by the landlord under section 14A(1).
The special procedure prescribed under section 25B is made applicable in cases where the landlord applies for recovery of possession on any o f the grounds specified in clause (c) of the Proviso to subsection (1) of section 14 or under section 14A. Sub section (5) of section 25B says that the Controller shall give leave to the tenant to contest it ' the affidavit filed by the tenant discloses such facts that would disentitle the landlord from obtaining an order for the recovery of possession of the premises on the grounds specified in clause (e) of the proviso to sub section (1) of section 14 or section 14A. Under section 14(1)(e) the tenant may resist the application on the grounds specified namely that the premises are not let for residential purposes, that they are not required holla fide etc.
So far as the facts which would disentitle the landlord from obtaining an order under section 14A are concerned they call only be that the landlord is not a person in occupation OF residential premises allotted to him by the Central Government or that no general or special order has been made by the Government requiring him to vacate such residential accommodation (1) ; 422 on the terms specified in the section.
Leave to contest an application under section 14A(1) cannot be said to be analogous to the provisions, of grant of leave to defend as envisaged in the Civil Procedure Code.
Order XXXVII, Rule 2, sub rule (3) of the Code of Civil Procedure provides that the defendant shall not appear or defend the suit unless he obtains leave from a Judge as hereinafter provided so to appear and defend.
Sub rule (1) of Rule 3 of Order XXXVIII lays down the procedure to obtain leave.
Under the provisions leave to appear and defend the suit is to be given if the affidavit discloses such facts as would make incumbent on the holder to prove consideration or such other facts as the court may deem sufficient to support the application.
The scope of section 25B(5) is very restricted for leave to contest can only be given if the facts are such as would disentitle the landlord from obtaining an order for recovery of possession on the ground specified in section 14A. The learned counsel for the tenant submitted that the requirements of section 14(1)(e) should also be satisfied before the landlord could take advantage of the procedure provided under section 25B.
The learned counsel drew our attention to section 25C(1) and section 25C(2) and submitted that the reading of these two sub sections would indicate that before an eviction could be ordered under an application under section 14A(1) the requirements of sections 14(6) and (7) should be satisfied.
While section 14(1) enumerates the grounds on which the landlord can get a decree for recovery of possession against a tenant sub sections (2) to (11) place certain restrictions.
Subsection (2) provides restriction as to right for recovery of possession under section 14(1)(e).
Restriction regarding the right to recover possession under clause (e) is laid down ill sub sections (6) and (7) of section 14.
Section 14(6) states that where a landlord has acquired any premises by transfer no application for recovery of possession shall lie under sub section (1) on the ground specified in clause (e) of the proviso thereto, unless a period of five years has elapsed from the date of the acquisition.
Sub section (7) to section 14 lays down that where an order for the recovery of possession of any premises is made on the ground specified in clause (e) of the proviso to sub section (1), the landlord shall not be entitled to obtain possession thereof before The expiration of a period of six months from the date of the order.
Section 25C makes an exception to the requirement of section 14(6) to the effect that where a landlord is in occupation of any residential premises allotted to him by the Central Government or any local authority and who fulfils the requirements of section 14A(1) the requirement under section 14(6) that he would not be entitled to 423 possession unless a period of five years has elapsed from the date of his acquisition of the premises is not applicable In other words, he can straightway obtain possession without the impediment imposed under section 14(6).
Great stress was laid by the learned counsel for the tenant on section 25C(2) which provides that in the case of a landlord who, being a person of the category specified in sub section (1), has obtained, on the ground specified in clause (e) of the proviso to sub section (1) of section 14 or under section 14A, an order for the eviction of a tenant from any premises, the provisions of subsection (7) of section 14 shall have effect as if for the words "six months", occurring therein, the words "two months" were substituted The contention was that if section 14A(1) stood by itself and if a landlord applying under section 14A(1) would straightway get the possession after the tenant cannot contest the suit on the grounds specified in section 25B(5) there is no need for mentioning the provisions of section 14(1)(6) and section 14(1)(7) and prescribing a lesser period for a prescribed period under section 14(7).
In other words, the submission was that an application for possession under section 14A should also satisfy the requirements of section 14(1)(e).
The provisions of section 25B and 25C are applicable to both applications under section 14(1)(e) and under section 14A. Applications under section 14(1)(e) are governed by section 14(6) and section 14(7).
By introduction of section 25C the condition imposed in section 14(6) is varied.
The condition imposed under section 14(6) is made not applicable to persons who satisfy the requirements under section 14A meaning thereby that this restriction will be applicable only to an application under section 14(1)(e).
Section 25C(2) makes it clear that not only in the case of an application under section 14(1)(e) but also under section 14A the term of six months prescribed in section 14(7) is educed to two months.
The reason for specifying the period or two months in the case of section 14A is understandable for otherwise an applicant under section 14A would be entitled to possession immediately.
By prescribing a specific period of two months under sec ion 25C(2) it is made clear that even an applicant under section 14A would have to satisfy the conditions laid down by section 25C i.e. a period of two months should elapse before the landlord is entitled to obtain possession from the date of an order for recovery of possession.
This submission also fails.
In the result we hold that the landlord who retired before the date on which the notice to quit was given by the Government is also entitled to the benefits of section 14A and allow the appeal.
| IN-Abs | Section 14 of the Delhi Rent Control Act, 1958 prohibits a court from making any order or decree in favour of a landlord for recovery of possession of any premises except under certain circumstances.
One of the grounds on which the landlord can make an application to the Rent Controller for recovery of possession is provided in section 14(1)(e) of the Act is that the premises let for residential purposes are required bonafide by the landlord for occupation a a residence for himself and that the landlord has no other reasonably suitable residential accommodation.
In September, 1975 the Central Government decided that Government servants who owned houses in the Union Territory of Delhi should, within three months from 1st October, 1975, vacate Government accommodation let out to them.
By the Delhi Rent Control Act (Amendment) Ordinance, 1975 the Act was amended and eventually the Amendment Act, 1976 replaced the Ordinance.
By a deeming provision the Act came into force on the date of the Ordinance i.e. 1st December, 1975.
Section 14A which was added by the amendment Act provides that a, land lord who, being a person in occupation of any residential premises allotted to him by the Central Government is required to vacate such residential accommodation on the ground that he owns in the Union Territory of Delhi a residential accommodation, a right shall accrue to such landlord to recover immediately possession of the premises let out by him.
Section 25B provides for special procedure for disposal of application for eviction under section 14(1) (e) and section 14A, Section 25B provides that when an application is filed by the landlord under either section 14(1)(e) or section 14A, the tenant shall not contest the prayer for eviction unless he files an affidavit and obtains leave from the Controller.
Sub section (5) requires that the affidavit filed by the tenant should disclose such facts as would disentitle the landlord from, obtaining, an order for the recovery of possession of the premises on the ground specified in section 14 (1)(e) or section 14A.
The appellant (landlord) let out his residential accommodation in New Delhi to the respondent (tenant).
The landlord was a Government servant who had been allotted Government accommodation in New Delhi.
On 9th December.
1975 the Government issued a notice to the landlord calling upon him to vacate Government accommodation allotted to him.
Tn the meantime the landlord retired from service on 30th November, ]975.
On 9th December, 1975 the landlord filed a petition for eviction of the tenant from his house.
The tenant raised three objections as to the maintainability of the petition: (i) that the landlord could not invoke the provisions of section 25B(5) because he was not a Government servant on the date of the petition; (ii) that since the ground on 8 978SCI/78 410 which eviction was sought in the petition was the same which had already been filed by the landlord and was pending before the Rent Controller, the petition could not be entertained, and (iii) that the premises occupied by him were let out for residential or professional purposes and therefore the landlord was not entitled to ask for eviction as the premises were not let for residential purposes alone.
The Rent Controller rejected all the contentions and refused leave to the tenant to defend the landlord 's eviction petition.
He held that (i) the question whether the landlord was a Government servant or not on the date when the notice was received and on the date when he filed a petition was irrelevant so long as he satisfied the requirements laid down in section 14(1), (ii) the ground for eviction under section 14A was a new cause of action and different from the one raised in the previous petition and, therefore the petition was not barred, (iii) it was not necessary for an application under section 14(1) that the building should have been let for residential purposes as required under section 14(1) (e), it is sufficient if the landlord required the premises for residential accommodation .
Allowing the tenant 's revision, the High Court held that since the landlord had retired from service On 30th November, 1975 before the Ordinance came into force, the tenant was not liable to vacate the premises independently of his ownership in the Premises in dispute.
Allowing the appeal.
^ HELD: 1 (a) Section 14A does not require that the person who was in, occupation of the premises allotted by the Government should be a Government servant.
The policy decision of 9th September.
1975 related only to Government servants who were in occupation of premises allotted to them by the Government.
But later the Government seemed to have realised that some provision should be made to get possession of the premises let to persons other than Government servants and who owned their own houses in Delhi and whose premises had been let out to tenants.
Although the circular dated 9th September, 1975 as well as the notice served by the Government on the landlord support the view that the intention of the Government was to enable only those Government servants who were in occupation of Government accommodation and who owned houses to get immediate possession .
section 14A does not restrict the right to recover immediate possession to Government servants alone.
Therefore, taking into account the object of the Act, the meaning of the word "person" cannot be confined to Government servants because Government accommodation was provided not only to Government servants but to others as well.
[417C F] Nihal Chand vs Kalyan Chand lain.
; at p. 190, referred to.
(b) It is not necessary in a petition for eviction under section 14A to specify that the premises were let for residential purpose only.
The words used in section 14A are clearly different.
This section contemplates the owning by the landlord in Delhi of a residential accommodation.
If he owns a residential accommodation he had the right to recover immediately possession of any premises let out by him.
If the premises were one intended for residential accommodation it would not make any difference if the premises were let for residential as well 411 as other purposes.
Evendif the residential accommodation was let for professional or commercial purposes, the premises would not cease to be for residential accommodation.
Moreover the requirement in section 14(1)(e) that to enable the landlord to recover possession the premises ought to have been let for residential purposes is not found in section 14A(1).
[421A C] Busching Schmitz Private Ltd. vs P. T. Mengham & Anr. ; , referred to.
The submission that as a previous application for possession by the land lord was pending, a petition under section 14A would not be permissible has no force because the grounds on which the application for possession was file under section 14A(1) Are different and ale based on special rights conferred on the class of persons who occupied Government accommodation.
[421D] (a) The scope of section 25B is very restricted, for leave to contest can only be given if the facts are such as would disentitle the landlord from obtaining an order for recovery of possession on the ground specified in section 14A. Leave to contest an application under section 14A(1) cannot be said to be analogous to the provisions of grant of leave to defend envisaged in the C.P.C. [422C & A] (b) The provisions of section 25B and section 25C are applicable to both applications under section 14(1)(e) and under s 14A. By the introduction of section 25C the condition imposed in section 14(6) is varied.
The condition imposed under section 14(6) is made not applicable to persons who satisfy the requirements under section 14A meaning thereby that this restriction will be applicable only to an application under section 14(1)(e).
Section 25C(2) makes it clear that not only in the case of an application under section 14(1)(e) but also under section 14A the term of six months prescribed in section 14(7) is reduced to two months.
By prescribing a specific period of two months under section 25C(2) it is made clear that even an applicant under section 14A would have to satisfy the conditions laid down by s.25C, that is, period of two months should elapse before the landlord is ' entitled to obtain possession from the date of an order for recovery of possession.
[423D G]
|
Civil Appeal No. 571 of 1969.
Appeal by Special Leave from the Order dated the 6th September, 1968/26th October 1968 of the Government of India, Ministry of Finance (Department of Revenue and Insurance) bearing No. 5262 of 1968.
J. L. Nain, Mrs. A. K. Verma for J. D. Dadachanji & Co., for the Appellant.
R. B. Datar and Miss A. Subhashini, for the Respondent.
The Judgment of the Court was delivered by SARKARIA, J.
This is an appeal by special leave against an order of the Government of India, Ministry of Finance (Department of Revenue and Insurance).
The order was passed by Shri B. Sen, Commissioner (Revision applications), Government of India.
Indian Hard Metal (P) Ltd., the appellant, had imported 15 metric tonnes of wolfram ore from London.
The Customs authorities classified the said ore under item 87 of the Indian Customs Tariff and charged duty at the rate of 60 per cent ad valorem amounting to Rs. 62,871.03P., instead of classifying the imported ore either under item 26 of item 70(7) which are free from duty.
These relevant items, as entered in the Imported Tariff, may be set out as under: Item Name of Article Nature of Standard No. duty rate of 26 Metallic ores all X Free X sorts except ores and pigments ores and antimony ore.
70(7) Cobalt chromium tungsten X Free magnesium and all other nonferrous virgin metals not otherwise specified.
SECTION XXII (ARTICLES NOT OTHERWISE SPECIFIED) 87 All other articles not otherwis specified.
Revenue 60 per cent ad valorem.
The classification made under the residuary item 87 at the time of the import was upheld by the Assistant Collector of Customs; and the Commissioner of Customs dismissed the appeal of the assessee by an order dated July 31, 1965, holding that the 381 bags of wolfram ore was correctly assessable at the rate of 60 per cent duty under item 87 of the Indian Customs Tariff, and not being covered either 471 by entry 26 or 70(7) of the Indian Customs Tariff, was not duty free.
The appellant preferred a revision petition under section 131 of the Customs Act to the Government of India who declined to interfere and dismissed the revision.
Hence this appeal.
Mr. Nain, appearing for the appellant, submits that the ore in question contained a concentrate of 74% of tungsten from wolfram and the rest were impurities.
This concentration is the result of 'selective mining ' process which involves crushing, washing and magnetic separation.
It does not bring about any chemical change in the metal.
At the minepit in its natural form, the ore is not of marketable quality because the tungsten content in ' it, then is hardly 0.5 to 2 per cent.
By the aforesaid concentrating process, the ore is converted into ore of commercial quality.
It is maintained that in commercial parlance wolfram ore of marketable quality must contain a minimum of 655 'o to 70% of the metal, and in one of better quality, the content may be as high as 79%.
Even after being subjected to such process, the ore concentrate does not cease to be tungsten 'ore ' within the contemplation of item 70(7) of the Indian Import Tariff.
In sup port of his contentions, learned counsel has relied upon the judgment of this Court in Minerals & Metals Trading Corporation of India Ltd. vs Union of India & Ors.(1) and certain Certificates of experts, as also an extract from the treatise on 'Tungsten ', by C.J. Smithells Chapman Hall.
As against this, Mr. Datar has drawn our attention to the order, dated July 31, 1965, wherein the Appellate Collector of Customs has observed that no evidence was adduced by the importer to substantiate the contentions that the ore in question had undergone no chemical process before being imported, and that the inference is that such high purification of the concentrate could have been possible only by applying process other than by water, crushing and magnetic separation.
It is stressed that the decision of this Court in Minerals & Metals Trading Corporation of India Ltd. (supra), is not applicable because in that case the percentage of tungsten in the ore was 65% only and that much concentration could be reached by physical process only, such as, crushing washing etc.; while in the instant case, the percentage of the wolfram contained in the goods concerned is little over 75%.
In our opinion, the mere fact that the percentage of tungsten in the ore concentrate in the instant case is about 75 per cent, does not take the case out of the ratio of this Court 's decision cited by Mr. Nain.
(1) [l973] I S.C.R. 997. 472 In Minerals & Metals Trading Corporation of India Ltd. (supra), the appellant had imported 200 metric tons of wolfram concentrate from Russia, under a contract which prescribed minimum contents of 65 % of W03 in the concentrate.
The Customs authorities levied duty at the rate of 60% ad valorem under item 87 of the First Schedule The appellant claimed refund on the ground that no duty was leviable as the goods imported was an "ore" and fell, under item 27 or 70(7) of the Import Tariff.
The Assistant Collector of Customs held that the appellant was not entitled to refund because the term "ore" mentioned in the text of item 26 is confined to articles which are in form and condition in which they are mined and not as wolfram ore concentrate in powder form as in that case.
On appeal by the importer, the Appellate Collector head that the goods in question were in the manufactured form made by special specifications by dressing and were thus not "ores".
The Central Government rejected the revision application filed by the appellant, holding that the examination by the Chemists showed that the uniform granules of the material were not only separated from rock but also from various impurities and had been subjected to such processing as would take them out of the category of metallic ore mentioned in Intern 26.
This Court, speaking through Grover J., allowed the importer 's appeal, with these apposite observations: "There is a good deal of force in the argument of Mr. Setalvad for the appellant that the normally acceptable merchantable quality of wolfram or tungsten contains a minimum 65 % WO33.
This is the usable ore and it is in that sense that it is commercially understood.
Wolfram ore when , mined contains only 0.5 to 2 per cent W03 and in order to make it usable and merchantable ore with minimum 65% W03, concentration is necessary.
If item 26 of the Import Tariff is to be restricted to wolfram being material containing 0.5 to 2 per cent W03, it would be mainly rock which can neither be imported in large quantity and which will have no market.
The separating of wolfram ore from the rock to make it usable ore is a process of selective mining.
It is not a manufacturing process.
The important test is that the chemical structure of the ore should remain the same.
Whether the ore imported is in powder or granule form is wholly immaterial.
What has to be seen is what is meant in international trade and in the market by wolfram ore containing 60% or more W03.
On that there is a 473 preponderant weight of authority bath of experts and books and of writings on the subject which show that wolfram ore when detached and taken out from the rock in which it is embedded, either by crushing the rock and sorting out pieces of wolfram ore by washing or magnetic separation and other similar and necessary process, it becomes a concentrate but does not cease to be ore." (emphasis added) There is ample authority for the view that the tungsten content in the wolfram ore of marketable quality may vary from 60 to 79 per cent, and a concentration within these limits, of the metal in the ore can be attained simply by a process of a "selective mining", that is, by physical process not involving any chemical change in the metal.
The following passage (vide Annexure "I ' in the record) culled out from the Introduction to the treatise on "Tungsten" by C.J. Smithells Chapman Hall, fully bears out this conclusion: "Mining.
Tungsten ores, although so widely distributed rarely occur in massive form.
The ores are usually found in narrow veins, but in some of the rich deposits the veins may in places be several metres wide.
Castrate is the commonest metallic mineral associated with tungsten, but minerals containing bismuth, molybdenum, lead and copper are frequently found; pyrite and arsenopyrite are objection able minerals, which may be present in appreciable amounts, and other common minerals are quartz and fluorite.
There are several kinds of ore deposits classified as segregates, pegmatites replacement deposits, veins and placers.
The tungsten content of the ore as it is mined is usually from 0.5 to 2 per cent, although it amounts to 6 per cent in rare instances.
The concentration of tungsten ores depends chiefly on gravity methods, taking advantage of the high density of the metal, ,although flotation methods are also used.
the concentrates, which contain 60 70 per cent W03, to or the better qualities 75 79 per cent should be virtually free from S.P, As, sb, Bi, Cu, Sn, Ti, and Mo. Magnetic are employed to separate the tin and tungsten in the concentrates.
Scheelite, however, is non magnetic, but when it occurs with garnet, as it does in Tasmania, the garnet may be removed magnetically.
The concentration of Wolframite ores is difficult on account of their mica like formation.
Excessive crushing leads to high losses in tabling and as far as 12 978 SCI178 12 978SCI/78 474 possible the ore should be separated when coarsely crushed " (Emphasis supplied ) There is on the record another Certificate in the form of a letter, dated February 3, 1965, from the Director, National Metallurgical Laboratory, Jamshedpur, addressed to the Controller of Customs, Calcutta, in which it is opined: "The wolfram ore is always selectively mined in the techllical terminology. such "selective mining" does not constitute a manufacturing process.
Unless selective mining is done, the tungsten ore cannot be exported or even sold in the country of its origin.
In view of the above, the import of selectively mined tungsten ore containing 65 % W03 or more should not be regarded as the import of a product which has been manufactured overseas and has passed through the manufacturing process.
By the expression 'selectively mined ', we mean that the wolfram ore is detached and taken out from the rock in which it is embedded and this is done by crushing the rock and sorting out piece of wolfram ore therefrom either by hand or by washing or magnetic separation.
" Then, there is another Certificate from R. V. Briggs & Co. Pvt. Ltd., who claim to have been analysing various ores and minerals including wolframite for over 60 years.
According to these experts, wolframite is always concentrated as part of the mining operation.
The normal method is by washing the crushed ore, thereby freeing the mineral from the gangue.
These experts have further certified that the wolfram ore, which they have analysed for M/s. India Hard Metals, is processed except for physical concentration by washing.
It may be observed that in the Minerals & Metal Trading Corporation (ibid), also, this Court had relied upon a similar Certificate from R. V. Briggs & Co. Still, another Certificate, dated January 13, 1965, which is more or less to the same effect as the Certificate of the National Metallurgical Laboratory, was brought in evidence.
A similar Certificate from this Laboratory was relied upon as authentic expert opinion in the earlier case, also, decided by this Court.
No authority or expert opinion has been cited before us that a concentration of 75 per cent tungsten in wolframite ore of commercial quality, cannot be achieved merely by 'selective mining ', i.e. the physical process of crushing, washing, gravitation, magnetic separation or the like.
Nor is there any evidence on the record to show 475 that the mined ore was subjected to any chemical process which caused a change in the chemical structure of the ore.
The finding of the Appellate Collector of Customs that such a high degree (75%) of tungsten metal virtually free from impurities in the material, could be attained only by some chemical manufacturing process and not merely by crushing, washing or magnetic separation, is not based on any evidence whatever.
It is contrary to the opinions of expects and authorities on the subject, which were brought on the record.
It is evident from the passage extracted from Smithells ' treatise, and the other Certificates of experts, mentioned above, that in order to bring mined wolframite ore to a marketable quality, it has to be concentrated by physical methods, such as, crushing, washing, gravitation, magnetic separation etc.
And by such physical process only, a concentration of WO3 varying from 60 per cent to 79 per cent in the ore can be achieved.
Wolframite (WO3) of ordinary merchantable quality contains 60 to 70 per cent of tungsten, while wolframite ore of better commercial quality contains 75 to 79 per cent of the metal In the light of the above discussion, there is no manner of doubt that the goods imported by the appellants had to be classified as imported ore, falling either under item 26 or item 70(7) of the Import Tariff, and as such, no duty was leviable on them.
The appellants are, therefore, entitled to the refund of the duty paid by them on the goods in question.
In the result, the appeal is allowed with costs, and the impugned orders including the Order dated October, 26, 1968, of the Central Government, are set aside.
The respondents are directed to make appropriate orders for refunding the amounts collected from the appellants by way of import duty on the goods in question.
N.V.K. Appeal allowed .
| IN-Abs | The appellant imported wolfram ore.
The Customs Authorities classified the said ore under the residuary Item 87 of the Indian Customs Tariff and charged duty at the rate of 60% ad valorem.
Metallic ores (Item 26) and cobalt, chromium, tungsten magnesium etc.
[Item No. 70(7)] are allowed to be imported free of duty.
The aforesaid classification was upheld by the Assistant Collector of Customs and the appeal to the Commissioner of Customs was dismissed.
The appellant 's revision petition under section 131 of the Customs Act to the Government was also dismissed.
n In the appeal to this Court it was contended on behalf of the appellant that the imported ore contained a concentrate of 74% of tungsten from wolfram and the rest were impurities, that the concentration was the result of 'selective mining ' process which involves crushing, washing and magnetic separation that in better quality ore the content may be as high as 79% and that even after being subjected to such process, the ore concentrate does not cease to be tungsten 'ore ' within the contemplation of Item 70(7) of the Indian Customs Tariff.
Allowing the appeal, ^ HELD: 1.
The goods imported had to be classified as imported ore, falling either under Item 26 or Item 70(7) of the Import Tariff, and no duty was leviable on them.
The appellants are entitled to refund of duty paid by them.
[475 E] 2.
The mere fact that the percentage of tungsten in the ore concentrate in the instant case is about 75% does not take the case out of the ratio of this Court 's decision in Minerals & Metal Trading Corporation of India Ltd. vs Union of India & Ors., [471 H] 3.
There is ample authority for the view that the tungsten content in the wolfram ore of marketable quality may vary from 60 to 79%, and a concentration within these limits of the metal in the ore can be attained simply by a process of a "selective mining", that is by physical process not involving any chemical change in the metal.
Wolframite of ordinary merchantable quality contains 60 to 70% of tungsten, while wolframite ore of better commercial quality contains 75 to 79% of the metal.
[473 C, 475D] "Tungsten" by C.J. Smithells Chapman Hall Introduction.
referred 4.
The finding of the appellate Collector of Customs that such a high degree (75% ) of the tungsten metal virtually free from impurities in the material, could be attained only by some chemical manufacturing process and not merely by 470 crushing, washing or magnetic separation, is not based on any evidence whatever.
It is contrary to the opinion of experts and authorities on the subject, which were brought on the record.
[475B]
|
Civil Appeal No.1293 of 1969.
Appeal from the Judgment and Order dated the 25th April, 1968 of the Madhya Pradesh High Court in Misc.
Petition No. 404/64.
S.T. Desai, J.B. Dadachanji K.J.John, Mrs. A.K. Varma for the Appellant.
S.K. Gambhir for Respondents 1, 2 and 4.
E.C.Agarwala and R.N. Sachthey for Respondent No. 3.
607 The Judgment of the Court was delivered by SHINGHAL J.
This appeal by a certificate issued by the Madhya Pradesh High Court is directed against its judgment dated April 25, 1968.
The appellant is a company which cultivates sugarcane and manufactures sugar in its factory in Sehore, Madhya Pradesh, by crushing the sugarcane cultivated by it and purchased from other cultivators.
The State Legislature enacted the Madhya Pradesh Sugarcane (Regulation of Supply and Purchase) Act, 1958, hereinafter referred to as the State Act, which came into force on July 1, 1959.
The State Government issued a notification on November 28, 1959, which appeared in the State Gazette dated December 4, 1959, under section 23 of the State Act imposing a cess of 12 paise per maund on the entry of sugarcane during a crushing season in the area comprised within "such of the factories in which the total quantity of cane entering for consumption, use or sale to the factory during such season exceeded 10 lakh maunds".
The appellants challenged the validity of the imposition, and the High Court, on August 31, 1961, held that the notification was illegal as the imposition of the levy was with reference to particular premises.
A similar view was taken in regard to the Acts in some other States and Parliament thereupon enacted the , hereinafter referred to as the Validation Act, which came into force on December 26, 1961.
Section 3 of the Validation Act was taken to validate the imposition and collection of the cess under the State Act.
The Manager of the appellant company received an intimation from the Additional Collector of Sehore dated April 13/15, 1964, stating that a sum of Rs. 5,49,262.92 was due from it on account of cess for the period "1959 60 to December 25, 1961" and asking for a bank guarantee for payment of the balance.
The appellant wrote back saying that the amount of the cane cess worked out to Rs. 5,44,835.69 and not Rs. 5,49,262.92, and that as the collector had not assessed the amount of the cess in accordance with the rules, it was not payable by the appellant.
As the Collector ignored the objection of the appellant, a demand notice was served upon it under section 146 of the Madhya Pradesh Land Revenue Code 1959, asking it to deposit Rs. 5,49,262.92 by August 1, 1964.
Once again the appellant denied its liability, but as that was not acceptable to the Collector, the appellant filed a writ petition in the High Court stating that the Collector 's demand on account of the cess was illegal as the Validation Act was ultra vires the Constitution.
The State of Madhya Pradesh traversed the claim in the writ petition.
The High Court upheld the imposition of the cess but reduced 608 it to Rs. 5,44,835.69, by its impugned judgment dated May 25, 1968, and that is why the Company has come up in appeal to this Court.
It has been argued by Mr. Desai on behalf of the appellant that section 23 of the State Act was not ultra vires the Constitution and there could be no question of validating a valid Act.
According to him, the State Act fell within the scope of Entry 52 of List II of the Seventh Schedule of the Constitution and was valid, and Parliament could not legislate in respect of that occupied field and pass the Validation Act.
These arguments have been based on the main contention that the expression "an area" in Sub section (1) of section 23 of the State Act really means "a local area" within the meaning of the aforesaid Entry 52 and no other area.
Sub section (1) of section 23 of the State Act reads as follows, "23.
Levy of cess on cane. (1) The State Government may, by notification, impose a cess not exceeding 25 paise a maund, on the entry of cane into an area, specified in such notification, for consumption, use or sale therein", There are two provisos to the sub section, but they are not relevant for the purpose of the controversy before us.
It would appear from sub section that it permits the State Government to impose the cess on the entry of sugarcane into any area that may be specified in its notification, and there is nothing in it to confine the imposition to a "local area".
As has been held by this Court in Diamond Sugar Mills Ltd and Another vs State of Uttar Pradesh and Another when a similar point arose for consideration with the U.P. Sugarcane Cess Act, 1956, the proper meaning to be attached to the words "local area" in Entry 52 List II of the Seventh Schedule of the Constitution, (when the area is a part of the State imposing the law) is an area administered by a local body like a municipality, a district board, a local board, a union board, a panchayat or the like".
It has been clearly laid down that the premises of a factory are therefore not a "local area".
This court accordingly struck down section 3 of the U.P. Act empowering the Governor to impose a cess on the entry of sugarcane into the premises of the factory on the ground that it did not fall within Entry 52 of the State List and there was no other Entry in the State List or the Concurrent List in which the Act could fall.
It is therefore futile for the appellant to contend that section 23 of the State Act was not ultra vires the Constitution or that it can be upheld on such a construction of the words "an area" in section 23 as to restrict it to mean a "local area".
609 The decision in Diamond Sugar Mills case came up for consideration in this Court in Jaora Sugar Mills (P) Ltd. vs State of Madhya Pradesh and others with a specific reference to the provisions of the State Act, and it was once again held, following that decision, that the imposition of the cess was outside the legislative competence of the State.
While examining that aspect of the controversy, this Court made it clear that what Parliament had done by enacting section 3 of the Validation Act was not to validate the invalid State Statutes, but to make a law concerning the cess covered by the said Statutes and to provide that the said law shall come into operation retrospectively.
This Court clarified that by virtue of section 3 of the Validation Act, the command under which the cess would be deemed to have been recovered would be the command of the Parliament, because the relevant sections, notification, orders, and rules had been adopted by the Parliamentary Statute itself.
It will thus appear that the argument of Mr. Desai to the contrary is of no consequence.
The other argument of Mr. Desai that the writ of mandamus issued by the High Court on August 31, 1961, quashing the notification dated November 28, 1959, could not be made, and was not in fact made, ineffective by the Validation Act, is also of no consequence.
Section 3 of the Validation Act makes this quite clear for it provides as follows. "3.
Validation of imposition and collection of cesses under State Acts.
Notwithstanding any judgment, decree or order of any Court, all cesses imposed, assessed or collected or purporting to have been imposed, assessed or collected under any State Act before the commencement of this Act shall be deemed to have been validly imposed, assessed or collected in accordance with law, as if the provisions of the State Acts and of all notifications, orders and rules issued or made thereunder, in so far as such provisions relate to the imposition, assessment, collection of such cess had been included in and formed part of this section and this section had been in force at all material times when such cess was imposed, assessed or collected; and accordingly 610 (a) no suit or other proceedings shall be maintained or continued in any Court for the refund of any cess paid under any State Act; (b) no Court shall enforce a decree or order directing the refund of any cess paid under any State Act; and (c) any cess imposed or assessed under any State Act before the commencement of this Act but not collected before such commencement may be recovered (after assessment of the cess where necessary) in the manner provided under that Act.
(2) For the removal of doubts it is hereby declared that nothing in sub section (1) shall be construed as preventing any person (a) from questioning in accordance with the provisions of any State Act and rules made thereunder the assessment of any cess for any period; or (b) from claiming refund of any cess paid by him in excess of the amount due from him under any State Act and the rules made thereunder.
" The section thus specifically validates the notification in question in regard, inter alia, to the imposition of the cess.
The mandamus which was issued by the High Court on August 31, 1961, could not therefore avail the appellant thereafter.
It has lastly been argued by Mr. Desai that when a law provides for the assessment of a cess or tax, it is necessary that it should be done by a specific order to that effect, and that an order of assessment cannot be presumed when it has not really been made.
It has therefore been argued that as an order of assessment was not made in the present case, it could not be presumed or deemed to have been made simply because a demand was raised for the purpose of affecting the recovery of the cess from the apellant.
The charging provision for the levy of the cess is to be found in section 23 of the State Act, to which we shall continue to refer for the sake of convenience even after the passing of the Validation Act.
Sub section (2) of that section provides that the State Government shall make rules specifying the authority empowered to assess and collect the cess and the manner in which it shall be collected.
The Madhya Pradesh Government accordingly made the Madhya Pradesh Sugarcane (Regulation of Supply and Purchase) Rules, 1959, hereinafter referred to as the Rules which were also "validated" by Section 3 of the Validation Act.
Rules 60 of the Rules provides that the col 611 lector shall be the authority empowered to "assess and collect" the cess.
Rule 61 makes it obligatory for the occupier of a factory to maintain a correct account, day to day, in the prescribed form, of the cane entering the area specified in the notification under section 23.
Rule 62 provides further that the occupier of the factory shall submit to the Collector, before the close of each month, a return in the prescribed form, showing the quantity of cane that has entered the specified area during the immediately preceding month.
It further provides that within 15 days of the close of the crushing season, the occupier shall deposit the cess leviable on the total quantity of cane which has entered the specified area during the crushing season and shall send the treasury receipt showing the amount of cess deposited to the Collector.
Then comes rule 63, which places the following responsibility on the Collector, "63.
The Collector shall check the amount of cess deposited by the, occupier of the factory from the returns submitted under rule 62 and see if the full amount of cess due from the occupier has been credited into the Treasury.
If the Collector finds that the full amount of cess due from the occupier of the factory has not been deposited he shall by a written notice call upon the occupier to deposit the amount due from him within the period specified in such a notice and the occupier shall deposit the amount within the period specified.
" The responsibility of the Collector for purposes of assessing and collecting the tax under rule 60 of the Rules is therefore to check the amount of the cess deposited by the occupier of the factory.
The check has to be made with the returns submitted by the occupier, and the Collector has to see that the full amount of the cess has been credited to the treasury.
If he finds that this is not so, it is his duty to call upon the occupier, by a written notice, to deposit the amount due from him within the period specified in the notice.
The State Act and the Rules do not therefore require that the Collector shall make a formal order of assessment, and then collect the cess.
It has to be appreciated that the purpose of an assessment is to compute the amount of the cess payable by the person concerned.
"Assess" is a comprehensive word, and in a taxing statute it often means the computation of the income of the assessee, the determination of the tax payable by him, and the procedure for collecting or recovering the tax.
In a case where there is a dispute about the identity of the assessee, the order of assessment serves the purpose of estab 612 lishing that identity and naming the person from whom the tax has to be recovered.
In the present case there is no controversy regarding the identity of the assessee, and the provision regarding the assessment of the cess in sub section (2) of section 23 of the State Act and rule 60 of the Rules related to the checking of the quantity of cane which had entered the specified area, and the amount of cess deposited in respect of it.
It is for that purpose that form 4 provides the details to be submitted by the occupier of the factory, and a duty is cast on him to deposit the cess leviable on the total quantity of the cane, within 15 days of the close of the crushing season, and to send the receipt evidencing the deposit to the Collector.
As has been pointed out by the High Court, the Appellant 's letter (Ext.
R I) dated May 25, 1964, shows that it admitted that the amount of the cess payable by it worked out to a total of Rs. 5,44,835.69 That was therefore the admitted amount of the cess which had to be recovered.
The Collector recorded an order (exhibit R 2) dated July 21, 1964, in which he clearly stated that he had gone through the case and that the Tehsildar should immediately recover the entire amount of the cess due from the appellant forthwith.
He further directed that the "entire amount of the cane cess due from the B.S.I." should be recovered and monthly progress report sent to him.
This shows that the Collector did apply his mind to the matter, and made an express order for the recovery of the total amount of the cess admitted by the appellant.
It seems that the Naib Tehsildar increased the amount beyond what had been admitted by the appellant and directed by the Collector, but the High Court rightly confined the recovery to Rs. 5,44,835.69 which was admitted by the appellant to be due from it on account of cess for the two seasons.
There is thus no force in the argument of Mr. Desai to the contrary.
The appeal fails and is dismissed with costs.
M.R. Appeal dismissed.
| IN-Abs | The appellant company cultivates sugarcane and manufactures sugar in its factory, by crushing the sugar cultivated by it and purchased from other cultivators.
The State Government enacted the M.P. Sugarcane (R.S.P.) Act, 1958 which came into force on July 1, 1959.
The State Government issued a notification under section 23 of the Act imposing a cess of 12 paise per maund on the entry of sugarcane during a crushing season in the area comprised within "such of the factories in which the total quantity of cane entering for consumption, use or sale to the factory during such season exceeded 10 lakh maunds.
" The High Court, on a writ application by the appellants, declared the notification illegal as the imposition of the levy was with reference to particular premises.
The Parliament thereupon enacted the .
Section 3 of the Validation Act was taken to validate the imposition and collection of the cess under the State Act.
In April, 1964, the appellant received an intimation from the Additional Collector stating that a sum of Rs. 5,49,262.92 was due from it as cess for the period 1959 60 to December 25, 1961, and asking for a bank guarantee for payment of the balance.
The appellant replied that the amount of cess worked out only to Rs. 5,44,835.69 and the Collector had not assessed the cess in accordance with the rules.
Its objection was ignored and a demand notice was served on it under s.146 of the M.P. Land Revenue Code, 1959, for Rs. 5,49,262.92.
The appellant filed a writ petition challenging the constitutionality of the Validation Act under which the Collector had demanded the cess.
The High Court upheld the imposition of cess but reduced it to Rs. 5,44,835.69.
It was contended that section 23 of the State Act was not ultra vires the Constitution, as the expression "an area" in section 23(1) means "a local area" within the meaning of Entry 52 of List II, 7th Schedule of the Constitution, and the Parliament could not, therefore, enact an Act validating a valid Act.
It was further contended that when a law provides for the assessment of a cess or tax, it is required to be done by a specific order to that effect, but it was not made in this case.
Dismissing the appeal, the Court, 606 ^ HELD: 1.
Section 23 of the State Act was ultra vires the Constitution, and cannot be upheld on such a construction of the words "an area" in section (1) as to restrict it to mean a "local area".
The proper meaning to be attached to the words "local area" in Entry 52, List II of the Seventh Schedule of the Constitution; (when the area is a part of the State imposing the law) is an area administered by a local body like a Municipality, a district board, a local board, a union board, a panchayat or the like.
The premises of a factory are therefore not a "local area" falling within Entry 52 of the State List, and there is no other Entry in the State List or the Concurrent List in which the Act could fall, [608 E H] Diamond Sugar Mills Ltd. and Anr.
vs State of U.P. & Anr.
; and Jaora Sugar Mills (P) Ltd. vs State of M.P. and Ors.
, ; followed.
What the Parliament had done by enacting section 3 of the Validation Act, was not to validate the invalid State statute, but to make a law concerning the cess covered by the said statute and to provide that the said law shall come into operation retrospectively.
By virtue of section 3, the command under which the cess would be deemed to have been recovered, would be the command of the Parliament, because the relevant sections, notifications, orders and rules had been adopted by the Parliamentary Statute itself.[609 B C] 3.
The State Act and the Rules do not require that the Collector shall make a formal order of assessment, and then collect the cess.
The purpose of an assessment is to compute the amount of the cess payable by the person concerned.
"Assess" is a comprehensive word and in a taxing statute it often means the computation of the income of the assessee, the determination of tax payable by him, and the procedure for collecting or recovering the tax.
In a case where there is a dispute about the identity of the assessee, the order of assessment serves the purpose of establishing that identity and naming the person from whom the tax is to be recovered.
The responsibility of the Collector for purposes of assessing and collecting the tax under section 60 of the Rules, is to see that the full amount of the cess has been credited to the treasury by the occupier of the factory.
If he finds that this is not so, it is his duty to call upon the occupier by a written notice to deposit the amount due from him within the period specified in the notice.
[611E H,612A]
|
N: Criminal Appeals Nos.
25 28 of 1972.
Appeals by Special Leave from the Judgment and Order dated the 9th December, 1970 of the Orissa High Court in Crl.
188, 190, 191 and 192 of 1968.
D. Mukherjee, G. section Chatterjee for the Appellant.
Pishori Lal Arora (Not Present) for Respondent in Crl.
A. No. 25/72.
Frank Anthony, (Crl. A. 26/72), Har Dayal Hardy (Crl. A. 27 28/72), Mrs. section Bhandare, A. N. Karkhnis and Miss Malini Peduvel in Crl.
A. Nos. 26 28/72 for Respondents.
The Judgment of the Court was delivered by JASWANT SINGH, J.
By his judgment and order dated November 30, 1965, the Sub Divisional Magistrate, Bhubaneswar convicted Gopinath Patra, respondent in Appeal No. 26 of 1972 under section 409 of the Indian Penal Code and sentenced him to two years rigorous imprisonment and a fine of Rs. 2,000/ .
By the same judgment.
the Sub Divisional Magistrate also convicted Nakula Sahu, respondent in Appeal No. 25 of 1972, Brahmananda Misra, respondent in Appeal No. 27 of 1972 and Niranjan Naik, respondent in Appeal No. 28 of 1972 under section 409 read with section 109 of the Indian Penal Code and sentenced each one of them to two years rigorous imprisonment and a fine of Rs. 2,000/ .
By the same judgment, the Sub Divisional Magistrate also found all the four respondent guilty of the offence under sections 120B of the Indian Penal Code but in view of the fact 'that they were found guilty of the offence of criminal breach of trust for which they had entered into conspiracy, no separate sentence was awarded to them for that offence.
By the same judgment and order the Sub Divisional Magistrate acquitted Nakula Sahu of the charge under section 420 of the Indian Penal Code.
On appeal, the Sessions Judge, Cuttack upheld the judgment and order of the Sub Divisional Magistrate and affirmed the conviction and sentence of the respondents by his judgment and order dated May 1, 1968.
On the matter being taken in revision before it, the High Court of Orissa set aside the aforesaid judgments and orders passed by the trial court and the Sessions Judge and acquitted the respondents of all the charges by its common judgment and order dated December 9, 1970.
[t is M against this judgment and order that the aforesaid appeals have been filed by special leave.
444 The facts giving rise to these appeals are: During the year 1961 62, the Public Health Department had a budget provision of Rs. 1,95,420/ for purchase of wash hand basins and other sanitary fittings required for four items of work.
Though as Controlling Officer, the Superintending Engineer, Public Health Department was required under the financial Code to watch the expenditure against the budget allotments Of the circles under him, it was the Executive Engineer, Public Health Department, who was the drawing and disbursing officer for the aforesaid budget provision of Rs. 1,95,420/ and was responsible for any wastage or excess of appropriation.
At the request of the Executive Engineer, Public Health Department, Bhubaneswar, Lingaraj Das (P.W.7), the then Public Health Engineer, Orissa issued circular letter C(Exh.1) dated September 30, 1961 to several dealers in sanitary goods inviting quotations for supply of 2,000 best Indian make earthen ware wash hand basins with white glazed, straight front, smooth top, and one tap hole and waste holes.
In response to the said invitation, twelve firms including the Cuttack Plumbing Stores of which Nakula Sahu, respondent was the proprietor submitted their tenders.
In his tender (Exh. 2), Nakula Sahu quoted the following rates: 1.
Wash Hand Basins 22" X 16" Barang make First Quality: Rs. 70/ each 2.
Wash Hand Basin 22" X 16" Barang make Second Quality: Rs. 58/ each On the comparative statement (Exh. 33 of the quotations received in response to the aforesaid circular letter being put up before him, P.W.7 accepted the quotation of the Cuttack Plumbing Stores for supply of 1000 22" X 16", Barang make, First Quality, wash hand basins vide Exhibit 3(4) at the rate of Rs. 70/ per wash hand basin plus sale tax at 7% which meant that the basins should be free from all manufacturing defects like dents, fire cracks, warpage or other undulation on the surface etc.
Under Exhibit (4) dated October 13, 1961, the Cuttack Plumbing Stores was asked to supply the wash hand basins to the sub Divisional Officer, Project Sub Division No. 1 and submit the bills in triplicate to the Executive Engineer, Public Health Department, Bhubaneswar for payment.
Under Exhibit 4(4), copies of the aforesaid order (Exh. 4) were forwarded to Gopinath Patra, respondent and Brahmananda Misra, respondent the then Executive Engineer and Sub Divisional Officer, Project No. I Sub Division, Bhubaneswar respectively for information and necessary action.
The supplies were to be received by the Overseer, Niranjan Naik, who was the Section Officer, according to the specifications noted in the order of supplies.
Pursuant to work order (Exh. 5), Nakula Sahu, proprietor of the 445 Cuttack Plumbing Stores supplied 1000 wash hand basins in three instalments representing them to be of first quality Barang Make and submitted bills in regard thereto as detailed below: No.
Of the wash Date of supply Exh.
Of Amount of the Bill hand basins supplied the bill accord ing to which payment demanded 494 27 10 1961 19 Rs. 37,000.60 400 13 11 1961 22 Rs. 29,960.00 106 3 1 1962 25 Rs. 7,939.40 On receipt of the supplies at the Public Health Department Store, Niranjan Naik, respondent, who was incharge of Store, took delivery thereof and entered the same in the Measurement Book certifying therein that the supplies were according to the specifications of the order.
thereafter respondent, Brahmananda Misra, Sub Divisional Officer checked the supplies according to the specifications in the supply order and signed the Measurement Book in token of the fact that the supplies had been correctly made.
Simultaneously with the supplies, Nakula Sahu submitted running bills on behalf of the Cuttack Plumbing Stores on each of which Niranjan Naik, Section Officer appended the following certificate: "Verified the materials received on . and found correct, entered in M.B. (Measurement Book) No. . in Page . .
Taken into stock A/C in (Date and Year).
" Underneath the certificate of Niranjan Naik, Section Officer Brahmananda Misra Sub Divisional Officer appended his certificate and signed the same.
Therefore, the bills were checked in the office of the Executive Engineer who made the payments by means of the cheques.
On November 16, 1961 i.e. after the first two supplies but before the third supply, Lingaraj Das (P.W.7) addressed confidential communication (Exh. 6) to Gopinath Patra hinting to him that according to the information received by him the supplies made by Nakula Sahu were not according to the specifications in the supply order but were of lower class and requiring him to 'verify the quality of each and every wash hand basin and to give a certificate if they were of first class quality as per specification in the tender.
By means of the aforesaid confidential letter, Gopinath Patra was also told to submit a detailed 446 report about the quality of the wash hand basins within four days in case he found that they were not of first quality as per specifications in the tender.
Gopinath Patra was also asked to intimate the number of wash hand basins supplied by the Cuttack Plumbing Stores and the amount paid to it.
As Gopinath Patra did not comply with the aforesaid communication within the aforesaid time, P.W. 7 sent him a reminder to expedite the reply but it was not before December 9 1961 that the former sent the reply (Exh. 7) certifying that 894 wash hand basins which had been supplied by then by the Cuttack Plumbing Stores were all of first quality.
By means of Exhibit (7), Gopinath Patra further informed the Public Health Engineer, Orissa that the Cuttack Plumbing Stores had so far been paid Rs. 66,960.60, including sales tax, for the aforesaid 894 wash hand basins.
On December 19, 1961, P.W. 7 placed order (Exh. 5) with Cuttack Plumbing Stores for further supply of 500 wash hand basins of the aforesaid quality and make at the rate of Rs. 68/ per basin to be delivered to the Public Health Department 's Godown at Bhubaneswar and sent intimation thereof to Gopinath Patra.
Accordingly, Nakula Sahu supplied 50 wash hand basins on January 4, 1962, 410 wash hand basins on October 1, 1962 and 40 wash hand basins on October 14, 1962 and submitted bills (Exhibits 29, 32 and 35) for Rs. 3,638.00, Rs. 29,831.60 and Rs. 2,910.40 respectively.
On these three bills also, Brahmananda Misra, Sub Divisional Officer and Niranjan Naik, Section Officer appended certificates similar to those which they had given on the previous bills.
On the basis of the said certificates, running account bills were prepared and signed by Gopinath Patra, Executive Engineer, and payments were made to Nakula Sahu.
On March 28,1963, the Inspector of Police, Vigilance, Cuttack seized vide seizure Memo (Exh. 73) from the Public Health Godown Bhubaneswar, of which Niranjan Naik, Section Officer was incharge, 593 Barang Make wash hand basins alleged to have been supplied to the Department by the Cuttack Plumbing Stores and A.B. Ghosh (P.W.8), Executive Engineer, Stores Verification Division, attached to the Works Department inspected these basins under the orders of the Secretary, Works and Transport Department and submitted his report (Exh. 49) dated September 9/13,1963 enclosing therewith statements (Exhibits 50 and 51) containing his remarks in respect of each and every one of 593 basins examined by him.
In his report (Exh. 49) A.B. Ghosh inter alia stated: "Not a single basin of first quality could be found during verification.
Three type of basins with manufacturer marks II and III class and with no marks are found.
All the basins which have been verified have different types of defects as noted against each number in the enclosed statements.
In several cases major defects have been noticed in all the type of basins and the nature of major 447 defects have also been noted in the statements.
" Thereupon the. authorities made an inquiry from M/s Orissa Industries Ltd. Barang (Producers of the Basins) which revealed that the Cuttack Plumbing Stores had during its entire transactions with the former purchased only three first quality wash hand basins and the rest of the wash hand basins purchased by it by auction or otherwise from the Company and dishonestly passed not to and accepted by respondents, Niranjan Naik, Brahmananda Misra and Gopinath Patra as first quality wash hand basins were either second quality or rejected ones which did not at all conform to the specifications mentioned in the tender quotations (Exh. 23 and the supply order (Exh. 4).
On these facts, the respondents were charged with and proceeded against for commission of various offences of criminal conspiracy, abetment of and commission of the offence of criminal breach of trust in respect of a sum of Rs. 1,11,280/ entrusted by the State to Gopinath Patra, respondent for purchase of best quality wash hand basins with the result as stated above In these appeals, it has been urged by counsel for the State of Orissa that the facts and circumstances proved in the case are incompatible with the innocence of the respondents and are incapable of explanation on any hypothesis other than the guilt of the respondents for the offences with which they were charged and that the order of their acquittal passed by the High Court in exercise of revisional jurisdiction which as acknowledged by this Court is a limited one has resulted in grave failure of justice.
On the other hand, it has been contended by counsel for the defence that there is no infirmity in the impugned order and the High Court was justified in acquitting the respondent in exercise of its plenary revisional power as the material on record was not sufficient to sustain their conviction On the submission of counsel for the parties, two principal points arise for consideration by us (1) the scope of the power of revision under section 439 read with section 435 of the Code of Criminal Procedure, 1898 and when it should be exercised and (2) whether in arriving at concurrent findings, the trial court and the Sessions Judge committed any manifest error on a point of law which had resulted in flagrant miscarriage of`justice.
So far as the first point is concerned, it is to be emphasized that although the revisional power of the High Court under section 439 read with section 435 of the Code of Criminal Procedure, 1898 is as wide as the power of Court of Appeal under section 423 of the Code, it is now well settled that normally the jurisdiction of the High Court under section 439 is to be exercised only in exceptional cases when 448 there is a glaring defect in the procedure or there is a mainfest error on a point of law which has consequently resulted in flagrant miscarriage of justice.
Reference in this connection may be made to the decisions of this Court in Amar Chand Agarwalla vs Shanti Bose & Anr.
etc.(1) and Akalu Ahdr vs Ramdeo Ram(2), In the latter case viz. Akalu Ahir vs Ramdeo Ram (supra) this Court follolwing its earlier decision in Amar Chand Agarwalla vs Shanti Bose & Anr etc.
(supra) held that in spite of the wide language of section 435 of the Code of Criminal Procedure, 1898 which empowered it to satisfy itself as to the correctness legality or propriety of any finding, sentence or order recorded or passed by any inferior court situate within the limits of its jurisdiction and as to the regularity of any proceeding of such inferior court and in spite of the fact that under section 439 of the Code it can exercise inter alia the power conferred on a court of appeal under section 423 of the Code, the High Court is not expected to act under section 435 or section 439 as if it is hearing on appeal.
The power being discretionary, it has to be exercised judiciously and not arbitrarily or lightly.
Judicial discretion, as has often been said, means a discretion which is informed by tradition, methodised by analogy and disciplined by system.
This takes us to the consideration of the second point.
In relation to this point, it may be observed that nothing has been brought to our notice on behalf of the respondents to indicate that there was any glaring defect in the procedure adopted by the lower courts or that there was a manifest error on a point of law in the judgments and orders passed by them which had resulted in flagrant miscarriage of justice which needed to be set right by the High Court.
A scrutiny of the evidence which we have made at the request of the counsel for the parties shows that there was not even any misappreciation of evidence on the record by the lower courts which could be said to have resulted in gross failure of justice warranting interference by the High Court.
We may at this stage indicate that while adverting to the evidence, we shall be confining ourselves to the case against Gopinath Patra and Niranjan Naik, respondents in Appeals Nos. 26 and 28 of 1972 respectively, as the other two appeals Nos. 25 and 27 of 1972 against Nakula Sahu and Brahmananda Misra have abated due to their death during the pendency of the appeals in this Court.
Out of the 17 witnesses examined by the prosecution to bring home the aforesaid offences to the respondents, the evidence of (1) ; (2) ; 449 P. Ws. 2, 14, 5, 7, 8, 11, 12, 13, 15 and 17 deserve special mention.
P. P. Bahuguna (P.W. 2) who is the Sales Manager of Orissa Industries Ltd., Barang, since 1956 has deposed that accused Nakula Sahu used to transact business with his Company as proprietor of N. C. Sahu & Sons and Cuttack Plumbing Stores; that detailed entries showing the date, invoice No. and total bill amount of every sale effected by his Company are made in the Sales Day Book, cash book and ledger of the Company and that in the ledger, the transactions with different customers are mentioned in separate folios.
The witness has by reference to copies of invoices existing on file No. C. 157 (Exh. 11) consisting of 391 pages containing the record relating to all the transactions of Orissa Industries Ltd. with the Cuttack Plumbing Stores and Nakula Sahu & Sons and ledgers [Exh. 12 to 12(4)] evidencing all transactions with Nakula Sahu, Cuttack Plumbing Stores and N. C. Sahu & Sons and containing cross references to invoices testified that it was for the first time in June 8, 1959 that the Cuttack Plumbing Stores purchased three wash hand basins 22" X 16" of Class I quality from his Company; that from June, 1961 to February, 1962, the Cuttack Plumbing Stores purchased 1704 Class II and 300 Class III wash hand basins 22"X16" from his concern; that apart from these sales there has been no other sale of wash hand basins to accused Nakula Sahu or Cuttack Plumbing Stores or N. C. Sahu & Sons; that Nakula Sahu was transacting business with his Company in respect of all the aforesaid invoices; that in the years 1961 and 1962, the price of class I wash hand basin 27 ' 'X16 was about Rs. 53/ per piece and price of Class II and Class III wash band basin 27 ' 'X16 ' ' was about Rs. 38.50 and Rs. 23/ per piece respectively; that glass and ceremic products became subject to Central Excise duty for the first time with effect from the mid night of February 28,1961 and that from that date marking of gradations by stamp and indelible ink were given on wash hand basins produced by his Company; that wash hand basins produced by his Company are marked with rubber stamp as 1st, or 2nd or Com.
Or 3rd according to the different gradations of the products; that in some cases, the wash hand basins are marked as I, II, Com., or Ill, in place of 1st, 2nd, Com.
Or 3rd respectively; that of all the gradations 1st or I are the best quality; that first quality products are those which have no blemish; that the second quality basins are those having minor defects without affecting their utility; that the third quality products are those having major defects either affecting or not affecting their utility; that by II submitting quotations his Company had made known to the Government Departments that there were wash hand basins of different 450 gradations in his concern; that the gradation marks 011 the wash hand basins made by his concern are the surest guide to the customers regarding the quality of goods.
The witness has further affirmed that during the years 1961 and 1962 i.e. from February 28, 1961 to the end of 1962, only 70 to 80 first quality i.e. Class I wash hand basins were produced by his Company and were stamped as such; that from February 28, 1961 to the end of February, 1962 only 54; Class I (first quality) wash hand basins 22 ' 'X16 ' ' were produced by his Company; that in November, 1961 and December, 1961, no First quality wash hand basins were manufactured.
in the factory of his Company and that though his Company has been attempting to produce first quality wash hand basins, it has not succeeded in producing them in large numbers.
K. L. Sigtia (P.W. 14) who is the Secretary, orissa Industries Ltd., Barang, since 1951 has corroborated the statement of P. P. Bahuguna (P.W. 2) in all material particulars with regard to all the business transactions made by his Company with the Cuttack Plumbing Stores, Nakula Sahu and M/s Nakula Sahu & Sons including 200 numbers of wash hand basins 26"X16" which as per invoice 1] (24) were sold in auction by the Company to the Cuttack Plumbing Stores at Rs. 15/ per piece.
He has also stated that the wash hand basins produced in his factory prior to March 1, 1961 (when the Central Excise duty was levied on the potteries including the wash hand basins) were sorted out and stocked separately according to their grades; that after the introduction of excise duty, his Company graded the wash hand basins into there classes viz.
First, Second and Third and the markings were given on the said wash hand basins as l, II or III according to the gradations as directed by the Central Excise office; that after six months, the Excise staff told them to change the markings as 1st, IInd or IIIrd according to the aforesaid three gradations and accordingly for first grade, they gave marking 1st, for second grade, they gave marking IInd and for third grade, they gave marking IIIrd and that 'Orissa ' is the trade mark of their firm.
The witness has by reference to file Exhibit (ll) affirmed that it was on June 8, 1959 that the Cuttack Plumbing Stores for the first time purchased three 22" X 16" wash hand basins for 'first quality from his concern vide Exhibit 11 (2) which bears the signature of Nakula Sahu; that during the period 1959 to 1962 Nakula Sahu or Nakula Sahu & Sons or Mis Cuttack Plumbing Stores did not purchase any wash hand basins from his Company 's factory except those entered in Sales Day Book [Exh. 65 to Exh. 65 (18) ].
He has further affirmed that his Company does not produce any wash 451 hand basins called the best quality wash hand basins.
The witness A; has denied that his concern ever sold any second class wash hand basins representing them to be of best quality.
Nabaghan Misra (P.W. 5) who is the Head Clerk in the office of the Executive Engineer, Public Health Department, Bhubaneswar has stated that on receipt of copy of the work order, The concerned Executive Engineer of the Public Health Department directs his subordinates to receive the commodities; that after the commodities are supplied, the suppliers submit their bills to the authority who receives the commodities.
Ultimately, the Executive Engineer of the concerned Division makes payment by cheques.
He has further stated that the commodities supplied are physically received by the Overseer who is the Section Officer of the concerned Division; that the Section Officer is required to receive the supplies according to the specifications noted in the order for supply, to enter the commodities received by him in the Measurement Book and to give a certificate in that book that the supplies are according to the specifications of the order; that thereafter the Sub Divisional Officer of the Division has to check the supplies with reference to the specifications given ill the order and put his signatures in the Measurement Book; that the stock registers of the supplies received are maintained in the office of the Sub Divisional Officer; that Section Officer and the Sub Divisional Officer endorse certificates on the order as to the correctness of the supplies in terms of the specifications in the order; that thereafter the bill is checked in the office of the concerned Executive Engineer and after payment order is made by the Executive Engineer on duplicate voucher prepared by the Section Officer and countersigned by the Sub Divisional Officer, payment is made by cheque issued by the Executive Engineer; that Exhibit 19 is the bill for Rs. 37,060/ submitted by the Cuttack Plumbing Stores of which the accused Nakula Sahu is the proprietor, in respect of the supply of wash hand basins, 494 in number of the specifications and quality mentioned therein; that the corrections in ink arc made by accused Niranjan Naik, the then Section Officer and are initialled by him; that the endorsement and the certification at the bottom are in the writing of the accused Niranjan Naik and contain his signature dated October 28, 1961; that the corrections in the endorsement have been initialled by accused Niranjan Naik; that Exhibit 20 is the running account bill prepared in the office of Niranjan Naik, the then Section Officer in relation to Exhibit 29 and bears the signatures of both Niranjan Naik, Overseer and Brahmananda Misra, Sub Divisional Officer.
The witness has also identified the signature and initial of the accused Gopinath Patra on Exhibit 20(4) and has stated that alter compliance 452 with all the formalities, cheque for the aforesaid amount was made over to accused Nakula Sahu on October 28, 1961.
The witness has likewise proved bills (Exhibits 22 and 25) ill regard to payment of Rs. 29,960/ and Rs. 7,939.40 respectively.
Lingaraj Das (P.W. 7) who was the Public Health Engineer and also the Controlling Officer of the Public Health Department during the relevant time has stated that on receipt of the quotations called by him vide Exhibit 1, he accepted the quotations of the Cuttack Plumbing Stores and placed an order (Exh. 4) with the latter for supply of wash hand basins of the make, specifications and quality and at the rate and on the conditions noted therein.
The witness has also proved the aforesaid letter (Exh. 6) addressed by him to Gopinath Patra and the reply (Exh. 7) received from the latter certifying that 894 wash hand basins were of first quality.
He has further stated that by first quality, he meant that the wash hand basins should be without any manufacturing defects.
A. B. Ghosh (P.W. 8) who has passed the examination in Sanitary Engineering and Water Supply as a special subject has stated that he was working as Executive Engineer, Verification Officer, for all departments under the Public Works Department; that under orders of the Secretary, Sanitary Works Department, he inspected and verified 593 numbers of "Orissa" 22" X 16" wash hand basins supplied by accused Nakula Sahu and stocked inside the Public Health Department Godown at Bhubaneswar, the key of which was with accused Niranjan Naik; that the inspection and verification was commenced by him on August 30, 1963 and completed on August 31, 1963 in the presence of accused Niranjan Naik who pointed out the 593 wash hand basins, which were in a separate stock, as having been supplied by accused Nakula Sahu; that on verification, he did not find any class I wash hand basins in the said 593 wash hand basins and that almost all the said wash basins had manufacturing defects and bore markings II or IInd or III and only a few had no marks as stated by him in his inspection and verification report (Exh. 49).
During his deposition before the courts also, the witness examined the said wash hand basins and gave in detail the manufacturing defects observed by him on each one of them.
He has further stated that fire cracks, dents, blisters, uneven surface, unglazed patches, undulating surface and uneven holes in any place of basins are the manufacturing defects and those defects cannot occur after manufacture is over; that on verification, he found almost all the aforesaid wash hand basins bearing the marks II or III which led him to presume that those were the marks of classification.
The witness has 453 denied that glazed patches will become unglazed due to bad storage and handling or that any wash hand basin would become unglazed by friction.
Pursottam Kar (P.W.10 ) who, took over as Sub Divisional Officer, Project I., Public Health Department, Bhubaneswar in January, 1963 has on the basis of monthly stock register (Exh. 45) of Project I stated that 22"X16" wash hand basins numbering 494, 400, 106, 410 and 40 were received at the godown of the Public Health Department, Bhubaneswar from the Cuttack Plumbing Stores on October 28, 1961, November 13, 1961, January 3, 1962, January 31, 1962 an(l February 13, 1962 respectively.
He has further stated that in 1957 only thirty 22"X16" wash hand basins were received; that in 1958 and 1959, no 22"X16" wash hand basins were received and that in 1960 only eight 22"X16" wash hand basins were received.
He has further stated that at the time of verification, accused Niranjan Naik told him that the wash hand basins verified vide Exhibits 50 and 55 were supplied by accused Nakula Sahu.
D. N. Singhdeo (P.W. 11) who is the Executive Engineer, Public Health Department has stated that in April, 1963, he went to the Store of the Public Health Department, Bhubaneswar with Misra, Assistant Pottery Manager of Orissa Industries, Rao, Inspector of Central Excise and Dass, Intelligence Officer and verified some of the wash hand basins.
The stock of the wash hand basins which were to be verified were shown to him by accused Niranjan Naik, the then Overseer incharge of the Store.
Sachidananda Misra (P.W. 12) who was Incharge of Production in Konark Ceramics, Athgarh from 1960 to 1964 has affirmed that the first quality wash hand basins mean wash hand basins having no manufacturing; defect.
P. Ram Krishna Rao (P.W. 13) who is the Central Excise Inspector, Mauza Jaipur has stated that during the time he was working in Orissa Industries Ltd., Barang as Assistant Pottery Incharge, rubber stamp marks were put on the wash hand basins produced in the factory showing their quality and gradation such as I or IInd or only II or IIIrd or only III or IVth or only 'IV ' as the case was; that very small number of first quality wash hand basins were being produced and that at the time of the aforesaid verification, rubber stamp marks II or III were there.
Abdul Rasid Khan (P.W. 15), L.D.C. in Sales Tax Office, Cuttack, West Circle has by reference to the record stated that in the application (Exh. 68) made by the Cuttack Plumbing Stores, 454 Nakula Sahu has signed as proprietor/Manager/Partner/Principal Officer of the said firm; that on the said application, Registration Certificate No. CU 12681 dated December 27, 1956 showing Nakula Sahu as Proprietor of the Cuttack Plumbing Stores and that Exhibit 69 is the office copy of the said certificate and that on October 20, ]963, the said certificate was renewed for the year 1963 64.
Prasanta Chandra Das (P.W. 17) who is the Inspector of Police attached to Vigilance Branch has stated that on March 28, 1963 he seized 593 wash hand basins of Barang Make bearing 'Orissa ' Trade Mark from Public Health Department Stores, Bhubaneswar as pointed out by Niranjan Naik, accused.
From the resume of the prosecution evidence as given above, it is abundantly clear that quotations in regard to the supply of first quality, barang make, 22"X16" wash hand basins submitted by the Cuttack Plumbing Stores, of which Nakula Sahu was the proprietor were accepted by P.W. 7 and work order for supply of 100 wash hand basins of the aforesaid quality, make and size was issued to the former by the latter; that Gopinath Patra who as Executive Engineer, Public Health Department Bhubaneswar, was entrusted with and had dominion over Rs. 1,95,420/ for purchase of wash hand basins and other sanitary fittings entered into criminal conspiracy with Niranjan Naik, who was Section Officer of Project No. 1 Sub Division, Public Health Department, Bhubaneswar and other accused for commission of criminal breach of trust punishable under section 409 of the Indian Penal Code; that in pursuance of the said conspiracy, Gopinath Patra committed criminal breach, of trust in respect of a huge amount of Government funds by dishonestly purchasing between October, 1961 and February, 1962 wash hand basins from the Cuttack Plumbing Stores which were not of first quality, barang make as specified in the tender but were substantially inferior in quality and value to those basins; that pursuant to the said conspiracy, Niranjan Naik, accused dishonestly accepted and took delivery of sub standard wash hand basins differing materially in quality and value from those which were contracted to be supplied and indented for knowing pretty well from their gradation marks which were a sure guide about their quality that they were of inferior quality and appended false certificates in the Measurement Book and on the aforesaid bills Nos. 19, 22 and 25 presented by the Cuttack Plumbing Stores to the effect that the supplies of wash hand basins made by it were correct according to .
the specifications mentioned in the order and consequently abetted Gopinath Patra in the commission of the offence of criminal breach of trust punishable under section 409 of the Indian Penal Code and 455 thereby committed an offence under section 409 read with section A 109 of the Indian Penal Code; that from February 28, 1961 to the end of 1962 A.D.
Only seventy to eighty first quality wash hand basins were produced by Orissa Industries Ltd., Barang; that except for three first quality wash hand basins purchased by the Cuttack Plumbing Stores in June, 1959 from Orissa Industries Ltd., Barang, the rest of the wash hand basins purchased by Nakula Sahu either in his individual capacity or as proprietor of N. C. Sahu & Sons or as proprietor of the Cuttack Plumbing Stores from the said Company were all of II or III gradation and as such were substantially inferior in quality and value to the specifications mentioned in the tender (Exh. 2) and the work order (Exh. 4) and that save and except the number of wash hand basins detailed ill their depositions before the Court by P.Ws. 2 and 14, who are Sales Manager and Secretary respectively of Orissa Industries Ltd., Barang, no other wash hand basins were purchased by Nakula Sahu or N. C. Sahu & Sons or cuttack Plumbing Stores, of which Nakula Sahu was the proprietor.
The plea of Gopinath Patra that he acted bonafide on the certificates of the Section Officer and Divisional Officer whose duty it was to verify the quality of each and every wash hand basins on receipt of the consignments and passed bills Nos. 19, 22 and 25 in a casual manner and that 894 wash hand basins which he inspected under orders of the Public Health Engineer conveyed to him vide Exhibit 6 were of Barang Make, first quality, and 593 wash hand basins which were seized by P.W. 17 under Exhibit 73 were not from 894 wash hand basins verified by him in Exhibit 7 is totally falsified by the clinching evidence furnished by Exhibit 7 dated December 9, 1961 which.
it will be recalled was sent by Gopinath Patra in rely to the confidential communication addressed to him by P.W. 7.
In this Exhibit 7 Gopinath Patra clearly informed P.W. 7 that he had inspected each and every one of the 894 wash hand basins which had up to that date been supplied by the Cuttack Plumbing Stores and found them all of Class 1 Barang make.
The conclusion is, therefore, irresistible that Gopinath Patra actively connived at the delivery and acceptance of inferior quality of wash hand basins by the supplier which did not at all conform to the specifications given in the tender submitted by it or in the supply order placed by him and dishonestly passed orders for payment of first quality goods knowing that the wash hand basins supplied were of inferior quality and thus committed criminal breach of trust in respect of a huge amount of Government funds and that in order to conceal his guilt he purposely gave false certificate vide Exhibit 7 that 894 wash band basins supplied by the Cuttack Plumbing Stores (out of which 593 456 were seized by P.W. 17 and verified by P.W. 8 to be defective and of II or III quality) were all of first quality and conformed to the specifications in the supply order although in the proved facts and circumstances, none could be of first quality.
That this was so and he furnished the aforesaid certificate even without caring to visit the Public Health Department Store, Bhubaneswar for physical verification as directed by his superior is further evident from the fact that he omitted to make even a mention in Exhibit 7 about the quality of 106 numbers of wash hand basins which had been indisputably received in the Store before he sent reply Exhibit 7 to the aforesaid confidential query made by P.W. 7 vide Exhibit 6.
The further plea of the accused that 593 wash hand basins seized from the Public Health Department Store by P.W. 17 were not from amongst those supplied by the Cuttack Plumbing Stores also stands negatived from the evidence of P.W. 8 (who verified the said wash hand basins at the pointing out of Niranjan Naik) as also from the evidence of P.Ws. 10, 11, 12, 13 and 17.
Thus it is manifest that neither the trial court nor the Sessions Judge committed any error of fact or of law in arriving at their conclusions and the High Court misdirected itself in upsetting their concurrent findings ignoring the well recognised principles for the exercise of revisional jurisdiction.
From the material on the record.
we are satisfied that the offences with which Gopinath Patra and Niranjan Naik were charged were brought home to them beyond any reasonable doubt.
From the foregoing reasons, we set aside the aforesaid judgment and order of the High Court acquitting Gopinath Patra and Niranjan Naik and convict them for the offences with which they were charged and held guilty by the trial court.
Keeping however, in view the fact that the said respondents are likely to lose their jobs and must have gone through a lot of mental and financial strain during the prolonged proceedings before the courts lasting for over fourteen years, we think that a consolidated fine of Rs. 10,000/ in ease of each of the respondents will meet the ends of justice.
Accordingly while remitting the substantive sentence of imprisonment, we impose a sentence of fine of Rs. 10,000/ on each one of the said respondents viz. Gopinath Patra and Niranjan Naik.
In default of payment of fine, each one of the said respondents shall undergo imprisonment for a period of six months.
The fine shall be deposited within a 457 period of two months from today failing which the aforesaid respondents shall surrender themselves to their bail bonds to undergo the aforesaid imprisonment imposed on them in default of payment of fine.
P.B.R. Appeal allowed.
| IN-Abs | The respondents in each of the four appeals were convicted and sentenced under section 409 IPC by the Sub Divisional Magistrate.
On appeal the Sessions Judge affirmed the conviction and sentences passed against them.
In revision the High Court set aside the judgments and orders passed by the trial court and the Sessions Court and acquitted the respondents of all the charges.
On the question of (i) the scope of the power of revision of the High Court under section 439 read with section 435 Cr.
P.C. 1898 and when it should be exercised; and (ii) whether, in arriving at a concurrent finding, the trial court and the Sessions 1 judge committed a manifest error on a point of law which had resulted in flagrant miscarriage of justice.
Allowing the appeal, ^ HELD: (1) Although the revisional power of the High Court under section 439 read with 9.
435 of the Code of Criminal Procedure, 1898 is as wide as the power of Court of Appeal under section 423 of the Code, it is well settled that normally y the jurisdiction of the High Court under section 439 is to be exercised only in exceptional cases when there is a glaring defect in the procedure or there is a manifest error on a point of law which has consequently resulted in flagrant miscarriage of justice.
In Akalu Ahir vs Ramdeo Ram, ; this Court held that in spite of the wide language of section which empowered it to satisfy itself as to the correctness, legality or properiety of any finding.
sentence or order recorded or passed by any inferior court situate within the limits of its jurisdiction and as to regularity of any proceeding of such inferior court and in spite of the fact that under section 439 of the Code it can exercise, inter alia, the power conferred on a Court of appeal under section 423, the High Court is not expected to act under section 435 or section 439 as if it is hearing an appeal.
The power being discretionary it has to be exercised judiciously and not arbitrarily or lightly.
Judicial discretion means a discretion which is in formed by tradition, methodised by analogy and disciplined by system.
[447H; 448A B] Amar Chand Agarwalla, vs Shanti Bose & Anr.
; , and Akalu Ahir vs Ramdeo Ram, ; followed.
(2) Neither the trial court nor the Sessions Court committed any error of fact or of law in arriving at their conclusions and the High Court misdirected itself in upsetting their concurrent findings ignoring the well recognised principles for the exercise of revisional jurisdiction.
From the material on record it is clear that the offences with which the respondents were charged were brought home to them beyond reasonable doubt.
[456E] 443
|
Civil Appeal No. 1280 of 1969.
Appeal from the Judgment and Order dated 7 9 1968 of the Bombay High Court in L.P.A. No. 117 of 1968.
588 U. R. Lalit, Nanjul Kumar and K. J. John for the Appellant.
R. B. Datar and Lalit Bhardwaj for Respondents 1 5 (d).
The Judgment of the Court was delivered by DESAI, J.
This appeal by certificate arises out of Special Civil Suit No. 39/66 filed by the appellant original plaintiff for specific performance of a contract dated 15th December 1965 for sale of land admeasuring 45 acres 5 gunthas bearing Survey No. 25 situated in Sholapur Mouje Dongaon in Maharashtra State for a consideration of Rs. 42,000/ out of which Rs. 5,000/ were paid as earnest money and a further amount of Rs. 5,000/ was paid on 22nd April 1966 when the period for performance of the contract for sale was extended by six months, which suit was dismissed by the trial Court and the plaintiff 's First Appeal No. 117/68 was dismissed by the Bombay High Court Plaintiff claimed specific performance of a contract dated 15th December 1965 coupled with supplementary agreement dated 26th April 1966 for sale of agricultural land.
This suit was resisted by the defendant, inter alia, contending that the land which was the subject matter of contract was covered by the provisions of the Bombay Tenancy and Agricultural Lands Act, 1948 ( 'Tenancy Act ', for short) and as the intending purchaser, the plaintiff was not an agriculturist within the meaning of the Act, section 63 of the Tenancy Act prohibited him from purchasing the land and, therefore, as the agreement was contrary to the provisions of, the Tenancy Act the same cannot be specifically enforced.
The plaintiff sought to repel the contention by producing a certificate Ext.
78 issued by the Mamlatdar certifying that the plaintiff was an agricultural labourer and the bar imposed by section 63 of the Tenancy Act would not operate.
Plaintiff also contended that if the Court does not take note of Ext 78, an issue on the pleadings would arise whether the plaintiff is an agriculturist and in view of the provisions contained in section 70(a) read with sections 85 and 85A of the Tenancy Act the issue would have to be referred to the Memlatdar for decision and the Civil Court would have no jurisdiction to decide the issue.
The trial Court held that the certificate Ext.
78 had no evidentiary value and was not valid.
On the question of the plaintiff being an agriculturist the trial Court itself recorded a finding that the plaintiff was not an agriculturist.
On the question of jurisdiction to decide the issue whether the plaintiff is an agriculturist, the trial Court was of the opinion that it being an incidental issue in a suit for specific performance of contract, which suit the Civil Court has jurisdiction to try, it will also have jurisdiction to decide the incidental or subsidiary issue 589 and recorded a finding that the plaintiff was not an agriculturist.
In accordance with these findings the plaintiff 's suit was dismissed.
In appeal by the plaintiff, the High Court agreed with the finding of the trial Court with regard to the validity of certificate Ext.
On the question of jurisdiction of the trial Court to decide the issue about the plaintiff being an agriculturist, the High Court agreed with the trial Court observing that Civil Court has undoubtedly jurisdiction to entertain a suit for specific performance, and while considering the main issue whether specific performance should be granted or not, civil Court will have to consider whether there are prima facie any facts on account of which granting of specific performance would result into a transaction forbidden by law and, therefore, civil Court will have jurisdiction to decide the subsidiary issue whether the plaintiff is an agriculturist.
The High Court accordingly dismissed the appeal while agreeing with the trial Court that the plaintiff had failed to prove that he was an agriculturist and specific performance of contract for sale of agricultural land cannot be granted in his favour.
Mr. Lalit for the appellant did not invite us to determine the validity of certificate Ext.
78 certifying that plaintiff is an agricultural labourer.
Therefore, the question which must engage our attention is whether Civil Court will have jurisdiction to decide an issue arising in a suit for specific performance of contract for sale of agricultural land governed by the provisions of the Tenancy Act that the person seeking specific performance was or was not an agriculturist and, therefore, ineligible to purchase the land in view of the bar imposed by section 63 of the Tenancy Act.
This necessitates examination of the relevant provisions of the Tenancy Act.
Section 2(2) of the Tenancy Act defines agriculturist to mean a person who cultivates land personally.
The expression 'land ' is defined in section 2(8) to mean; (a land which is used for agricultural purposes or which is so used but is left fallow and includes the sites of farm buildings appurtenant to such land; and (b) for purposes of sections including sections 63, 64 and 84C (i) the sites of dwelling houses occupied by agriculturists, agricultural labourers or artisans and land appurtenant to such dwelling houses; (ii) the sites of structures used by agriculturists for allied pursuits.
Section 63 which forbids transfer of agricultural land to non agriculturists, reads as under: "63.
(1) Save as provided in this Act (a) no sale (including sales in execution of a decree of a Civil Court or for recovery of arrears of land revenue or 590 for sums recoverable as arrears of land revenue), gift, exchange or lease of any land or interest therein, or (b) no mortgage of any land or interest therein, in which the possession of the mortgaged property is delivered to the mortgagee, shall be valid in favour of a person who is not an agriculturist or who being an agriculturist will after such sale, gift, exchange lease or mortgage, hold land exceeding two thirds of the ceiling area determined under the Maharashtra Agricultural Lands (Ceiling on Holdings) Act, 1961, or who is not an agricultural labourer; Provided that the Collector or an officer authorised by the State Government in this behalf may grant permission for such sale, gift, exchange, lease or mortgage, on such conditions as may be prescribed".
The next important section in this context is section 70 which defines duties and prescribes function of the Mamlatdar, the relevant portion of which reads as under: "70.
For the purposes of this Act the following shall be the duties and functions to be performed by the Mamlatdar: (a) to decide whether a person is an agriculturist; x x x (mb) to issue a certificate under section 84A, and decide under section 84B or 84C whether a transfer or acquisition of land is invalid and to dispose of land as provided in section 84C".
Section 85 bars jurisdiction of the civil Courts to decide certain issues and section 85A provides for reference of issues required to be decided under the Tenancy Act to the competent authority set up under the Tenancy Act.
They are very material for decision of the point herein raised and they may be reproduced in extenso: "85.
(1) No Civil Court shall have jurisdiction to settle, decide or deal with any question (including a question whether a person is or was at any time in the past a tenant and whether any such tenant is or should be deemed to have purchased from his landlord the land held by him) which is by or under this Act required to be settled, decided or dealt with by the 591 Mamlatdar or Tribunal, a Manager, the Collector or the Maharashtra Revenue Tribunal in appeal or revision or the State Government in exercise of their powers of control.
(2) No order of the Mamlatdar, the Tribunal, the Collector or the Maharashtra Revenue Tribunal or the State Government made under this Act shall be questioned in any Civil or Criminal Court.
Explanation For the purposes of this Section a Civil Court shall include a Mamlatdar 's Court constituted under the Mamlatdars ' Courts Act.
1906".
"85A. (1) If any suit instituted in any Civil Court involves any issues which are required to be settled, decided or dealt with by any authority competent to settle, decide or deal with such issues under this Act, (hereinafter referred to as the "competent authority") the Civil Court shall stay the suit and refer such issues to such competent authority for determination.
(2) On receipt of such reference from the Civil Court, the competent authority shall deal with and decide such issues in accordance with the provisions of this Act and shall communicate its decision to the Civil Court and such court shall thereupon dispose of the suit in accordance with the procedure applicable thereto.
Explanation For the purpose of this section a Civil Court shall include a Mamlatdar 's Court constituted under the Mamlatdars ' Courts Act, 1906".
There is no controversy that the land purported to be sold by the contracts for sale of land Exts.
82 and 83 is land used for agricultural purposes and is covered by the definition of the expression 'land ' in section 2(8) (a).
The plaintiff thus by the contracts for sale of land Exts.
82 and 83 purports to purchase agricultural land.
Section 63 prohibits sale of land inter alia, in favour of a person who is not an agriculturist.
If, therefore, the plaintiff wants to enforce a contract for sale of agricultural land in his favour he has of necessity to be an agriculturist.
The defendant intending vendor has specifically contended that the plaintiff not being an agriculturist he is not entitled to specific performance of the contract.
Therefore, in a suit filed by the plaintiff for Specific performance of contract on rival contentions a specific issue would arise whether the plaintiff is an agriculturist because if he is not, the Civil Count would be precluded from enforcing the contract 592 as it would be in violation of a statutory prohibition and the contract would be unenforceable as being prohibited by law and, therefore, opposed to public policy.
The focal point of controversy is where in a suit for specific performance an issue arises whether the plaintiff is an agriculturist or not, would the Civil Court have jurisdiction to decide the issue or the Civil Court would have to refer the issue under section 85A of the Tenancy Act to the authority constituted under the Act, viz., Mamlatdar.
Uninhibited by the decisions to which our attention was invited, the matter may be examined purely in the light of the relevant pro visions of the statute.
Section 70(a) constitutes the Mamlatdar a forum for performing the functions and discharging the duties therein specifically enumerated.
One such function of the Mamlatdar is to decide whether a person is an agriculturist.
The issue arising before the Civil Court is whether the plaintiff is an agriculturist within the meaning of the Tenancy Act.
It may be that jurisdiction may be conferred on the Mamlatdar to decide whether a person is an agriculturist within the meaning of the Tenancy Act but it does not ipso facto oust the jurisdiction, of the civil Court to decide that issue if it arises before it in a civil suit.
Unless the Mamlatdar is constituted an exclusive forum to decide the question hereinabove mentioned conferment of such jurisdiction would not oust the jurisdiction of the civil Court.
It is settled law that the exclusion of the jurisdiction of the civil courts is not to be readily inferred, but that such exclusion must either be explicitly expressed or clearly implied (see Secretary of State vs Mask) (1).
However, by an express provision contained in section 85 the jurisdiction of the Civil Court to settle, decided or deal with any question which is by or under the Tenancy Act required to be settled, decided or dealt by the competent authority is ousted.
The Court must give effect to the policy underlying the statute set out in express terms in the statute.
There is, therefore, no escape from the fact that the legislature has expressly ousted the jurisdiction of the civil Court to settle, decide or deal with any question which is by or under the Tenancy Act required to be settled, decided or dealt with by any of the authorities therein mentioned and in this specific case the authority would be the Mamlatdar as provided in section 70(a).
When the Tenancy Act of 1948 was put on the statute book, section 85A did not find its place therein.
A question arose while giving effect to the provisions contained in sections 70 and 85 as to what should be done where in a suit in a civil Court an issue arises to settle, decide or (1) 67 I.A. 222.
593 deal with which the jurisdiction of the civil Court is ousted under section 85.
The Bombay High Court which had initially to deal with this problem, resolved the problem by holding that in such a situation the civil suit should be stayed and the parties should be referred to the competent authority under the Tenancy Act to get the question decided by the authority and on such decision being brought before the Civil Court, it will be binding on the civil Court and the civil Court will have to dispose of the suit in accordion therewith.
While so resolving the problem immediately facing the Court, an observation was made that provision should be introduced in the Tenancy Act for enabling the civil Court to transfer the proceeding to the competent authority under the Tenancy Act having jurisdiction to decide the issue and in respect of which the jurisdiction of the Civil Court is barred (see Dhondi Tukaram Mali vs Dadoo Piraji Adgale) (1).
The Legislature took note of this suggestion and promptly introduced section 85A in the Tenancy Act by Bombay Act XIII of 1956.
The legislative scheme that emerges from a combined reading of sections 70, 85 and 85A appears to be that when in a civil suit properly brought before the Civil Court an issue arises on rival contentions between the parties which is required to be settled, decided or dealt with by a competent authority under the Tenancy Act, the Civil Court is statutorily required to stay the suit and refer such issue or issues to such competent authority under the Tenancy Act for determination.
On receipt of such reference from the civil Court the competent authority shall deal with and decide such issues in accordance with the provisions of the Tenancy Act and shall communicate its decision to the civil Court and such errata shall; thereupon dispose of the suit in accordance with the procedure applicable thereto.
To avoid any conflict of decision arising out of multiplicity of jurisdiction by civil Court taking one view of the matter and the competent authority under the Tenancy Act taking a contrary or different view, an express provision is made in section 85(2) that no order of the competent authority made under the Act shall be questioned in any civil Court.
To complete the scheme.
sub section
(2) of section 85A provides that when upon a reference a decision is recorded by the competent authority under the provisions of the Tenancy Act and the derision is communicated to the civil Court, such Court shall thereupon dispose of the suit in accordance with the procedure applicable thereto.
Thus, the finding of the competent authority under the Tenancy Act is made binding on the civil Court.
It would thus appear that the jurisdiction of the civil Court to settle, decided, or deal with any issue which is required to be settled, decided or dealt with by any competent authority under the Tenancy Act is totally ousted.
This would lead to inescapable conclusion that the (1) 594 Mamlatdar while performing the function and discharging duties as are conferred upon him by section 70, would constitute an exclusive forum, to the exclusion of the civil Court, to decide any of the questions that may arise under any of the sub clauses of section 70.
Section 70(a) requires the Mamlatdar to decide whether a person is an agriculturist.
Therefore, it an issue arises in a civil Court whether a person is an agriculturist within the meaning of the Tenancy Act, the Mamlatdar alone would have exclusive jurisdiction under the Tenancy Act to decide the same and the jurisdiction of the Civil Court is ousted.
The Civil Court as required by a statutory provision contained in section 85A, will have to frame the issue and refer it to the Mamlatdar and on the reference being answered back, to dispose of the suit in accordance with the decision recorded by the competent authority on the relevant issue.
To translate it into action, if the Mamlatdar were to hold that the plaintiff is not an agriculturist, obviously his suit for specific performance in the Civil Court would fail because he is ineligible to purchase agricultural land and enforcement of such a contract would be violative of statute and, therefore, opposed to public policy.
The High Court was of the view that the jurisdiction of the Civil Court to settle, decide or deal with any question which arises under the Tenancy Act and which is required to be settled, decided or dealt with by the competent authority under the Tenancy Act would alone be barred under section 85.
Proceeding therefrom, the High Court was of the opinion that if an issue arises in a properly constituted civil suit which the civil Court is competent to entertain, an incidental or subsidiary issue which may arise with reference to provisions of the Tenancy Act, the jurisdiction of the Civil Court to decide the same would not be ousted because the issue is not required to be decided or dealt with under the Tenancy Act.
This view overlooks and ignores the provision contained in section 85 A.
There can be a civil suit properly constituted which the Civil Court will have jurisdiction to entertain but therein an issue may arise upon a contest when contentions are raised by the party against whom the civil suit is filed.
Upon such contest, issues will have to be framed on points on which parties are at variance and which have to be determined to finally dispose of the suit.
if any such issue arises which is required to be settled, decide or dealt with by the competent authority under the Tenancy Act, even if it arises In a civil suit, the jurisdiction of the civil Court to settle, decide and deal with the same would be barred by the provision contained in section 85 and the civil Court will have to take recourse to the provision contained in section 85A for reference of the issue to the competent authority under the Tenancy Act.
Upon a proper construction the expression "any issues which are required to be settled, decided or dealt with by any authority 595 competent to settle, decide or deal with such issues under this Act" in section 85A would only mean that if upon assertion and denial and consequent contest an issue arises in the context of the provisions of the Tenancy Act and which is required to be settled, decided and dealt with by the competent authority under the Tenancy Act, then notwithstanding the fact that such an issue arises in a properly constituted civil suit cognizable by the Civil Court, it would have o be referred to the competent authority under the Tenancy Act.
Any other view of the matter would render the scheme of sections 85 and 85A infructuous and defeat the legislative policy (see Bhimaji Shanker Kulkarni vs Dundappa Vithappa Udapudi & Anr.)(1) The construction suggested by the respondent that the bar would only operate if such an issue arises only in a proceeding under the Tenancy Act, could render section 85A infructuous or inoperative or otiose.
Neither the Contract Act nor the Transfer of Property Act nor any other statute except the Tenancy Act prohibits a non agriculturist from buying agricultural land.
The prohibition was enacted in section 63 of the Tenancy Act.
Therefore, if a person intending to purchase agricultural land files a suit for enforcing a con tract entered into by him and if tile suit is resisted on the ground that the plaintiff is ineligible to buy agricultural land, not for my other reason except that it is prohibited by section 63 of the Tenancy Act, an issue whether plaintiff is an agriculturist would directly and substantially arise in view of the provisions of the Tenancy Act.
Such an issue would indisputably arise under the Tenancy Act though not in a proceeding under the Tenancy Act.
Now, if, section 85 bars the jurisdiction of the Civil Court to decide or deal with an issue arising under the Tenancy Act and if section 85A, imposes an obligation on the civil Court to, refer such issue to the competent authority under the Tenancy Act, it would be no answer to the provisions to say that the issue is an incidental issue in a properly constituted civil suit before a civil Court having jurisdiction to entertain the same.
In fact section 85A comprehends civil suits which civil Courts are competent to decide but takes note of the situation where upon a contest an issue may arise therein which would be required to be settled, decided or dealt with by the competent authority under the Tenancy Act, and, therefore, it is made obligatory for the civil Court not only not to arrogate jurisdiction to itself to decide the same treating it as a subsidiary or incidental issue, but to refer the same to the competent authority under the Tenancy Act.
This is an inescapable legal position that emerges from a combined reading of sections 85 and 85A.
This can be clearly demonstrated by an illustration.
Plaintiff may file a suit on title against a defendant for possession of land on the allegation that defendant is a trespasser.
The (1) [1966]1 S.C.R. 145 at 150.
596 defendant may appear and contend that the land is agricultural land and he is a tenant.
The suit on title for possession is clearly within l he jurisdiction of the civil Court.
Therefore, the civil Court would be competent to entertain the suit.
But upon the defendant 's contest the issue would be whether he is a tenant of agricultural land.
Section 70(a)(ii) read with sections 85 and 85A would preclude the civil Court from dealing with or deciding the issue.
In a civil Suit nomenclature of the issue as principal or subsidiary or substantial or incidental issue is hardly helpful because each issue, if it arises, has to be determined to mould the final relief.
Further, sections 85 and 35A oust jurisdiction of civil Court not in respect of civil suit but in respect of questions and issues arising therein and section 85A mandates the reference of such issues as are within the competence of the competent authority.
If there is an issue which had to be settled, decided or dealt with by competent authority under the Tenancy Act, the jurisdiction of the civil Court, notwithstanding the fact that it arises in an incidental manner in a civil suit, will be barred and it, will have to be referred to the competent authority under the Tenancy Act.
By such camouflage of treating issues arising in a suit as substantial or incidental or principal or subsidiary, civil Court cannot arrogate to itself jurisdiction which is statutorily ousted.
This unassailable legal position emerges from the relevant provisions of the Tenancy Act.
Turning to some of the precedents to which our attention Was invited, it would be advantageous to refer to the earliest decision of the Bombay High Court which had the opportunity to deal with the scheme of law under discussion in Trimbak Sopana Girime vs Gangaram Mhatarba Yadav(1).
In that case plaintiff filed a suit against the defendant for actual possession on the allegation that the defendant was a trespasser and the defendant contested the suit contending that he was a protected tenant within the meaning of the Tenancy Act. 'the trial Court came to the conclusion that an issue would arise whether the defendant was a protected tenant and such an issue was triable by the Mamlatdar under section 70(b) of the Tenancy Act, and the trial Court had no jurisdiction to try the issue.
Accordingly the trial Court ordered the plaintiff to present the suit to the proper court.
It may be noticed that at the relevant time section 85A was not introduced in the Tenancy Act.
In an appeal by the plaintiff the appellate court reversed the finding that a suit on title for possession alleging that the defendant was a trespasser was a properly constituted civil suit and if in such a suit defendant raises a contention that he is a protected tenant it would be a subsidiary issue and would not oust the jurisdiction of the (1) 597 Court because if the civil Court proceeding with the suit comes to the conclusion that the defendant is a trespasser it would be fully competent to dispose of the suit.
The defendant carried the matter to the High Court and Chagla, C.J., analysing the scheme of sections 70 and 85 of the Tenancy Act, held that in order to avoid the conflict of jurisdiction and looking to the scheme of the sections, the legislature has left to the Mamlatdar to decide the issue whether the defendant is a protected tenant or not and it implies that he must decide that the defendant is not a trespasser in order to hold that he is a tenant or protected tenant, and that he must also hold that he is a trespasser in order to determine that he is not a tenant or a protected tenant, and even while strictly construing the provisions of a statute ousting the jurisdiction of the civil Court, the conclusion is inescapable that all questions with regard to the status of a party, when the party claims the status of a protected tenant, are left to be determined by the Revenue Court and the jurisdiction of the Civil Court is ousted.
This very contention kept on figuring before the Bombay High Court and J. C. Shah, J. in one of the Second Appeals before him analysed some conflicting decisions bearing on the interpretation of sections 70 and 85 specifically with regard to the ouster of jurisdiction of civil court to settle, decide or deal with those questions which are required to be settled, decided or dealt with by the competent authority under the Tenancy Act, and referred the matter to a Division Bench.
The Division Bench in Dhondi Tukaram Mali, (supra) while affirming the ratio in Trimbak Sopana Girme, (supra) further observed that the legislature should by specific provision provide for transfer of such suits where issues arise in respect one which the competent authority under the Tenancy Act is constituted a forum of exclusive jurisdiction so as to avoid the dismissal of the suit by the civil Court or being kept pending for a long time till the competent authority disposes of the issue which it alone is competent to determine.
The legislature took note of this decision of the Bombay High Court and introduced section 85A by Bombay Act XIII of 1956 which came into force from 23rd March 1956.
In Bhimaji Shanker Kulkarni, (supra) this very question arose in a suit filed by the plaintiff for possession of the suit property on redemption of a mortgage and taking of accounts on the allegation that defendant No. 1 was a usufructuary mortgagee under a mortgage deed, dated 28th June 1945.
The defendants pleaded that the transaction of June 28, 1945 was an advance lease and not a mortgage, and they were protected tenants within the meaning of the Tenancy Act.
The trial Court passed a decree holding that the transaction evidenced 598 by the deed is a composite document comprising of a mortgage and a lease and on taking accounts of the mortgage debt it is found that plaintiff owed nothing to the defendants on the date of the suit and the mortgage stood fully redeemed.
A further direction in the decree was that the plaintiff is at liberty to seek his remedy for possession of the suit lands in the revenue courts.
The plaintiff carried the matter in appeal to the appellate court who partly allowed tile appeal affirming that the mortgage is satisfied and nothing is due under the mortgage and the direction of the trial Court that plaintiff was at liberty to seek his remedy for possession of the suit lands in the revenue courts was confirmed and the rest of the decree, namely, that the document Ext.
43 evidencing the transaction was a composite document showing a mortgage and a lease was set aside and a direction was given that the record and proceedings do go back to the trial court who should give three months ' time to the plaintiff for filing, proper proceedings in the Tenancy Court for determining as to whether defendant 1 is a tenant.
Some consequential order was also made.
The plaintiff carried the matter in second appeal to the High Court of Mysore which, while dismissing the appeal observed that the civil court had no jurisdiction to determine the nature of the transaction when the contention was that it evidenced advance lease followed by the tenancy of defendant No. 1 and, therefore, the only proper direction is the one given by the trial Court to refer the issue to the Mamlatdar as to whether the defendant is a lessee under Ext.
43 and Of the reference being answered back, the suit should be disposed of in accordance therewith.
the plaintiff brought the matter before this Court.
This Court in terms approved the decision of the Bombay High Court in Dhondi Tukaram Mali (supra) observing as under: "In Dhondi Tukaram 's case the Court expressed the hope that the legislature would make suitable amendments in the Act.
The Bombay Legislature approved of the decision, and gave effect to it by introducing section 85A by the amending Bombay Act III of 1956.
Section 85A proceeds upon the assumption that though the Civil Court has otherwise jurisdiction to try a suit, it will have no jurisdiction to try an issue is rising in the suit, if the issue is required to be settled, decided or dealt with by the Mamlatdar or other competent authority under the Act, and on that assumption, section 85A provides for suitable machinery for reference of the issue to the Mamlatdar for his decision.
Now, the Mamlatdar has jurisdiction under section 70 to decide the several issues specified therein "for the purposes of this Act", and before the intro diction of section 85A, it was a debatable point whether the 599 expression "for the purposes of this Act" meant that the Mamlatdar had jurisdiction to decide those issues only in some proceeding before him under some specific provision of the Act, or whether he had jurisdiction to decide those issues even though they arose for decision in a suit property cognisable by a Civil Court, so that the jurisdiction of the Civil Court to try those issues in the suit was taken away by section 85 read with section 70, Dhondi Tukaram 's case settled the point, and held that the Mamlatdar had exclusive jurisdiction to decide those issues even though they arose for decision in a suit properly cognisable by a Civil Court.
The result was somewhat startling, for normally the Civil Court has jurisdiction to try all the issues arising in a suit properly cognisable by it.
But having regard to the fact that the Bombay Legislature approved of Dhondi Tukaram 's case and gave effect to it by introducing section 85A, we must hold that the decision correctly interpreted the law as it stood before the enactment of section 85A.
It follows that independently of section 85A and under the law as it stood before section 85A come into force, the Courts below were bound to refer to the Mamlatdar the decision of the issue whether the defendant is a tenant".
It would thus appear that even when a properly constituted suit is brought to the civil Court having jurisdiction to try the same, prima facie on a contention being raised by the defendant an issue may arise which the Civil Court would not be competent to try and the legislature stepped in to avoid the conflict of jurisdiction by introducing section 85A making it obligatory upon the Civil Court to refer such an issue to the competent authority under the Tenancy Act.
Any controversy that such an issue is a primary issue or a subsidiary issue and hence triable by Civil Court must be said to have been resolved by laying down that the Civil Court will have, no jurisdiction to try the same even if such are issue arose in a properly constituted civil suit cognisable by the civil Court.
And the ratio of the decision is that a contention raised by the defendant may have the necessary effect to oust the jurisdiction Or the civil Court in respect of the contention which is to be disposed of before the suit can be disposed of one way or the other.
In Ishverlal Tha Thkorelal Almaula vs Motibhai Nagjibhai, (1) the plaintiff appellant had filed a suit against the defendant respondent in the civil Court for possession of agricultural land and mesne profits.
The defendant contended that he was a tenant who was entitled to the protection of the Tenancy Act in view of the proviso to section 43C of the Tenancy Act (1) [1966] 1 S.C.R. 367.
600 despite the fact that at the relevant time the suit land was not governed by the provisions of the Tenancy Act.
The trial Court decreed the suit but in first appeal the District Judge reversed the decree of the trial Court and dismissed the suit as in his view under the proviso to section 43C incorporated in the Tenancy Act by Bombay Act XIII of 1956 the respondent continued to enjoy the protection of the Tenancy Act and the civil Court had no jurisdiction to grant a decree for possession of the land in dispute.
A second appeal to the High Court by the original plaintiff was dismissed in limine and the matter came up before this Court by special leave.
This Court first affirmed that whatever may have been the position before Act XIII of 1956, the legislature has unequivocally expressed an intention that even in a suit properly instituted in a civil Court, if any issue arises which is required to be decided by the revenue Court, the issue shall be referred for trial to that Court and the suit shall be disposed of in the light of the decision.
The Legislature has clearly expressed itself that issues required under Act 67 of 1948, viz., Tenancy Act, to be decided by a revenue court, even if arising in a civil suit, must be decided by the revenue Court and not by the Civil Court.
The view expressed by the Bombay High Court in Pandurang Hari vs Shanker Maruti(1), and the Gujarat High Court in Kalicharan Bhayya, vs Rai Mahallaxmi & Anr.(2), that in such suit the civil Court is competent to adjudicate upon the issues which are by Act 67 of 1948 required to be decided by the revenue Court, was disapproved.
This Court held that the question whether the defendant being a tenant on the day on which the Tenancy Act was put into operation and whether he retained the, protection in view of the proviso to section 43C was within the exclusive jurisdiction of the Mamlatdar under the Tenancy Act and, therefore, the District Judge was in error in dismissing the suit.
It was necessary for him to refer the very question for determination to the competent authority under the Tenancy Act and it was not open to him to dispose of the suit.
Accordingly the appeal was allowed and the matter was remanded to the District Court with a direction that it should restore the appeal to its original number and proceed according to law.
This decision does not depart from the ratio in Bhimji Shanker Kulkarni 's case (supra).
It was, however, said that a suit for specific performance of a con tract for sale of land is cognizable by the Civil Court and its jurisdiction would not be ousted merely because contract, if enforced, would violate some provisions of the Tenancy Act.
If contract when enforced would (1) (2) 601 violate some provisions of the Tenancy Act it may be that the competent authority under the Tenancy Act may proceed to take action as permissible under the law but the Court cannot refuse to enforce the contract.
And while so enforcing the contract the Court need not refer any subsidiary issue to the competent authority under the Tenancy Act because if there is any violation of the Tenancy Act the same would be taken care of by the competent authority under the Tenancy Act in view of the power conferred upon the Mamlatdar under section 84C of the Tenancy Act.
In this connection reference was made to Naminath Appayya Hanammannaver vs Jambu Rao Satappa Kocheri.
We need not examine this decision in detail because an appeal against the decision of Mysore High Court granting decree for specific performance was brought to this Court.
A brief resume of the fact in Jambu Rai Satappa Kocheri vs Neminath Appayya Hanammannaver, is necessary to grasp the ratio of this decision.
In a suit for specific performance the defendant contended that if the contract is enforced it would violate section 35 of the Tenancy Act in that the plaintiff 's holding after the appointed day would exceed the ceiling and the acquisition in excess of the ceiling is invalid.
A contention appears to have been raised that the question whether an acquisition in excess of the ceiling would be invalid would be within the exclusive jurisdiction of the Mamlatdar under section 70(mb) and that the Civil Court cannot decide or deal with this question and a reference ought to have been made to the Mamlatdar.
Negativing this contention it was observed that the Civil Court had jurisdiction to entertain and decree a suit for specific performance of agreement to sell land.
If upon the sale being completed it would violate some provision of the Tenancy Act an enquiry has to be made under section 84C and s.84C provides that if an acquisition of any land is or becomes invalid under any of the provisions of the Tenancy Act, the Mamlatdar may suo motu inquire into the question and decide whether the transfer or acquisition is or is not valid.
This inquiry has to be made after the acquisition of title pursuant to a decree for specific performance.
It is in the context of these facts that it was held that even though civil Court has no jurisdiction to determine whether the acquisition would become invalid but there is nothing in section 70 or any other provision of the Act which excludes the Civil Court 's jurisdiction to decree specific performance of a contract to transfer land which would be anterior to the acquisition.
While disposing of this contention this Court took note of the fact that the transfer may not be invalid at all because the purchaser may have already disposed of his prior holding and it was further observed that 602 when the scheme of the Act is examined it becomes clear that the legislature has not declared the transfer or acquisition invalid, for section 84C provides that the land in excess of the ceiling shall be at the disposal of the Government when an order is made by the Mamlatdar.
The invalidity of the acquisition is, therefore, only to the extent to which the holding exceeds the ceiling prescribed by law and involves the consequence that the land shall vest in the Government.
lt would thus transpire that after the acquisition is completed, the question may arise whether ceiling has been exceeded and in that event the Mamlatdar in a suo motu inquiry can declare the transfer invalid to the extent the holding exceeds the ceiling.
The distinguishing feature of the present case is that section 63 bars purchase of agricultural land by one who is not an agriculturist and, therefore, the disqualification is at the threshold and unless it is crossed the Court cannot decree a suit for specific performance of contract for sale of agricultural land and in order to dispose of the contention which stands in the forefront a reference to the Mamlatdar under section 70 read with sections 85 and 85A is enevitable.
Therefore, there is no conflict between the decision in Kulkarni 's case and Jamburao 's case (supra) nor the latter decision, overrules the earlier one.
In fact, Kulkarni 's case (supra) was not referred to in Jamburao 's case (supra) because the question before the Court was entirely different from the one in Kulkarni 's case (supra).
In Mussamiya Imam Haider Bax Razvi vs Rabari Govindbhai Ratnabhai & Ors.
,the question that came up for consideration of this Court was whether when in a suit in the civil Court for possession of agricultural land a contention is raised that defendant has become a statutory owner on the tillers 'day under section 32 of the Tenancy Act implying that he was a tenant on 1st April 1957, would the civil Court have jurisdiction to decide the question of past tenancy in the context of section 70 of the Tenancy Act ? The contention was negatived observing that section 70 imposes a duty on the Mamlatdar to decide whether a person is a tenant but the sub section does not cast a duty upon him to decide whether a person was or was not a tenant in the past, whether recent or remote.
Approaching from this angle, it was held that the contention whether a defendant has become a statutory owner on the tillers ' day involving the question of past tenancy was not within the exclusive jurisdiction of the Mamlatdar and, therefore, the civil Court has jurisdiction to decide the question.
In the context of the language employed in section 70(b) which, as it then stood, did not confer jurisdiction on the Mamlatdar to decide the question of past tenancy, it can be said that the civil Court 's jurisdiction to decide the same was not ousted.
It appears that the question 603 was argued in the context of section 70 only and has been answered in the context of the language employed in section 70(b) only.
Otherwise, the question whether a person has become a statutory owner on the tillers ' day, i.e. on 1st April 1957 which would imply whether the person so contending was a tenant of the land on 1st April 1957 and hence would become the owner of the land by operation of law, was exclusively with in the purview of the Tribunal set up under section 67 in chapter VI of the Tenancy Act.
Section 67 imposes a duty on the State Government to set up Agricultural Land Tribunal for each taluka or mail or for such area as the State Government may think fit.
Section 68 prescribes the duties of the Tribunal which inter alia include the duty to decide any dispute under sections 32 to 32R (both inclusive).
A dispute under section 32 would comprehend whether the plaintiff was the owner of the land on the tillers ' day i.e. 1st April 1957 and the person claiming to have become a statutory owner by operation of law on that day should of necessity be a tenant and that this question would be within the exclusive jurisdiction of the Tribunal as provided by section 68.
Section 85 refers to the Tribunal meaning Agricultural Land Tribunal to be a competent authority to settle, decide and deal with the question set out in section 68 and it would have exclusive jurisdiction to settle, decide and deal with the same.
No submission was made in Mussamiya 's case (supra) with reference to the provisions contained in chapter VI and especially section 68 and, therefore, that decision cannot lend support to the submission that past enancy being a subsidiary issue, as such was within the competence of the Civil Court.
A question similar to the one under discussion in the context of provisions contained in sections 132, 133 and 142(1)(a) of Mysore Land Reforms Act,1961, came up before this Court very recently in Noor Mohd. Khan Ghouse Khan Soudagar vs Fakirappa Bharmappa Machenahalii & Ors.
The majority decision, after approving Kulkarni, (supra) and distinguishing Mussamiya, (supra) and referring to Dhondi Tukaran, (supra) held that a question arose during the pendency of the suit and the execution proceeding whether by the final allotment of the land to the appellant, respondent No. 1 had ceased to be a tenant in view of section 52 of the Transfer of Property Act.
This question according to the opinion of the majority fell squarely and exclusively within the jurisdiction of the revenue authorities and the civil Court had no jurisdiction to decide it and a reference to the competent authority was inevitable, and no discretion was left in the Civil Court in this behalf.
So observing, the majority upheld the decision of High Court which had 604 set aside the decree of the trial Court awarding possession because in the opinion of the High Court no actual delivery of possession can be given against the person claiming to be a tenant unless the requirements of the Mysore Land Reforms Act, 1961, were satisfied.
It may be noticed that the scheme of the provisions in Mysore Land Reforms Act, 1961, under discussion in the decision were in pari materia with the scheme of ss.70, 85 and 85A of the Tenancy Act.
Thus, both on principle and on authority there is no escape from the conclusion that where in a suit properly constituted and cognizable by the Civil Court upon a contest an issue arises which is required to be settled, decided or dealt with by a competent authority under the Tenancy Act, the jurisdiction of the Civil Court to settle, decide or deal with the same is not only ousted but the civil Court is under a statutory obligation to refer the issue to the competent authority under the Tenancy Act to decide the same and upon the reference being answered back, to dispose of the suit in accordance with the decision of the competent authority under the Tenancy Act.
If plaintiff sued for specific performance of a contract for sale of agricultural land governed by the provisions of the Tenancy Act in the Civil Court and the defendant appeared and raised a contention that in view of the provisions contained in section 63 of the Tenancy Act the plaintiff being not an agriculturist he is barred from purchasing the land, the issue would arise whether the plaintiff is an agriculturist.
Such an issue being within the exclusive jurisdiction of the Mamlatdar, it is incumbent upon the Civil Court to refer the issue to the competent authority under the Tenancy Act and the civil Court has no jurisdiction to decide or deal with the same.
That issue arises in the suit from which the present appeal arises and both the trial Court and the High Court were in error in clutching at a jurisdiction which did not vest in them and, therefore, on this ground alone this appeal will succeed.
Accordingly this appeal is allowed and the decree of the trial Court dismissing the suit, affirmed by the High Court, is set aside and the suit is remanded to the trial Court to proceed further according to law in the light of the observations made in this judgment.
Costs would abide the final outcome of the suit in the trial Court.
As the case is very old one, the trial Court and the competent authority to which a reference would be made pursuant to the direction in this judgment, should give top priority to the matter and dispose it of as expeditiously as possible.
N.V.K. Appeal allowed.
| IN-Abs | Section 63 of the Bombay Tenancy and Agricultural Lands Act, 1948 prohibits the sale of agricultural land to a person who is not an agriculturist.
One of the duties of the Mamlatdar, under section 70, of the Act, is to decide whether a person is an agriculturist and whether a transfer or acquisition of land is invalid being in contravention of the Act.
Section 85 bars the jurisdiction of a civil court to settle, decide or deal with any question which is by or under the Act is required to be settled, decided or dealt with by the Mamlatdar, or the authority mentioned in the section The Bombay High Court in a case coming before it on the interpretation of section 85 held that where in a suit in a civil court an issue arises which has to be decided under the provisions of section 70, the civil court should refer the parties to the competent authority under the Tenancy Act to get the question decided and such decision would be binding on the civil court.
Taking note of this decision section 85A was added to the Tenancy Act, enabling the civil court to refer the issue to the competent authority to decide which the jurisdiction of the civil court is barred under section 85.
The plaintiff 's suit for specific performance of a contract for sale of land was resisted by the defendant alleging that since he (the plaintiff), was not an agriculturist, he was prohibited by section 63 of the Tenancy Act from purchasing agricultural land and the contract being contrary to the provisions of the Act is not capable of being specifically enforced.
The trial court dismissed the plaintiff 's suit on the ground that he was not an agriculturist.
It held that the issue whether or not the plaintiff was an agriculturist being incidental in a suit for specific performance of a contract the civil court had jurisdiction to decide such incidental issues.
On appeal the High Court held that the civil court which had jurisdiction to entertain a suit for specific performance, it would have jurisdiction to decide the incidental issue whether the plaintiff was an agriculturist or not.
The question before the Supreme Court was where in a suit for specific performance, an issue arose whether the plaintiff was an agriculturist or not on the date of agreement whether the civil court would have jurisdiction to decide the issue or it is required to refer it to the Mamlatdar under section 70 read with section 85A.
Allowing the appeal and remitting the case to the trial court for disposal.
587 ^ HELD: 1.
The Legislature having expressly ousted the jurisdiction of the civil court to settle, decide or deal with any question which is by or under the Tenancy Act required to be settled, decided or dealt with by any of the authorities therein mentioned the authority to decide the issue whether the vendee was an agriculturist would be the Mamlatdar as provided in section 70(a).
[592 G] 2 .
The expression "any issues which are required to be settled, decided or dealt with by any authority competent to settle, decide or deal with such issues under this Act" in section 85A would only mean that, if upon contest an issue which is required to be settled, decided and dealt with by the competent authority under the Tenancy Act arises, notwithstanding the fact that such an issue arises in a properly constituted civil suit cognizable by the civil court, it would have to be referred to the competent authority under the Tenancy Act.
[594H 595 B] 3.
Mere because jurisdiction is conferred on the Mamlatdar to decide whether a person is an agriculturist within the meaning of the Tenancy Act, it does not ipso facto oust the jurisdiction of the civil court to decide that issue if it arises before it in a civil suit.
Unless the Mamlatdar is constituted an exclusive forum to decide the question, conferment of such jurisdiction would not oust the jurisdiction of the civil court.
It is settled law that exclusion of jurisdiction of the civil court is not to be readily inferred but that such exclusion must either be explicity expressed or clearly implied.
[592 D E] Secretary of State vs Mask, 67 IA 222: referred to.
The finding of the competent authority under the Tenancy Act is made binding on the civil court.
The jurisdiction of the civil court to settle, decide or deal with any issue which is required to be settled, decided or dealt with by any competent authority under the Act is totally ousted.
This would lead to the conclusion that the Mamlatdar while performing the function and discharging his duties conferred on him by section 70 would constitute an exclusive forum.
Section 70(a) requires the Mamlatdar to decide whether a person is an, agriculturist.
Therefore, if an issue arises in a civil court whether a person is an agriculturist within the meaning of the Tenancy Act, the Mamlatdar alone would have exclusive jurisdiction under the Act to decide the same and the jurisdiction of the civil court is ousted.
The civil court, as required by section 85A, will have to frame an issue and refer it to the Mamlatdar and on the reference being answered back, to dispose of the suit in accordance with the decision recorded by the competent authority.
[593G, 594 C] Dhondi Tukaram Mali vs Dadoo Piraji Adgale, , Trimbak Sopana Girme vs Gangaram Mhataraba Yadav, ; approved.
Mussamiya Imam Haider Bax Razvi vs Rabari Govindbhai Ratnabhai & Ors. ; , explained.
Bhimaji Shanker Kulkarni vs Dundappa Vithappa Udapudi ,& Anr.
, ; at 150; Ishverlal Thakorelal, Almaula vs Motibhai Nagjibhai, [1966] 1 SCR 367; Jambu Rao Satappa Kocheri vs Neminath Appayya Hanammannaver, ; ; and Noor Mohd. Khan Ghouse Khan Soudagar vs Eakirappa Bharmappa Machenahalli & Ors., ; ; referred to
|
Civil Appeal Nos. 722, 1016 and 1221 of 1967.
Appeal from the Judgment and Decree dated 9 8 1966 of the Bombay High Court in Appeal Nos. 31 and 34 of 1963.
K. D. Mehta and D. N. Mishra for the Appellant In CA 722/67.
section T. Desai, R. B. Datar and Girish Chandra for RR 3 and 65 in CA 722/67.
I. N. Shroff and H. section Parihar for R 48 in CA 722/67.
section T. Desai, R. B. Datar for the Appellant and Respondent 40 in 1016/67.
I. N. Shroff and H. section Parihar for RR 27 28 in CA 1016/67 and also for the appellant in CA 1221/67.
section T. Desai and Girish Chandra for Respondent No. 63 in CA 1221/67.
The Judgment of the Court was delivered by PATHAK, J.
These appeals, on certificate granted by the High Court of Judicature at Bombay, are directed against the judgment and order 703 dated August 9, 1966 passed by the High Court in its appellate jurisdiction against orders and directions issued by a learned Single Judge of the High Court on a petition filed by the Official Trustee of Maharashtra in regard to the properties of the former Sir Currimbhoy Ebrahim Baronetcy Trust.
On July 21, 1911, His Majesty King George V issued Letters Patent conferring the "dignity, state and degree" of a Baronet of the United Kingdom of Great Britain and Ireland on Sir Currimbhoy Ebrahim of Bombay and the heirs male of his body lawfully begotten and to be begotten.
In order to provide for the upkeep and dignity of the Baronetey, the then Governor General of India in Council enacted the Sir Currimbhoy Ebrahim Baronetcy Act, 1913 (hereinafter referred to simply as "the Baronetcy Act") by virtue of which considerable properties belonging to Sir Currimbhoy Ebrahim were settled upon the trustee, and for the purposes, declared in the Act.
The Trust was created by statute at the instance of Sir Currimbhoy Ebrahim.
The Trustees who included the Baronet for the time being and three officials of the Government of Bombay designated by their office, were constituted as a Corporation with perpetual succession and a common seal for the purpose of executing the trusts, powers and purposes of the Act.
By virtue of section 8 of the Baronetcy Act, the residue of the income from the properties settled under trust, after payment to the credit of a Sinking Fund and a Repairs Fund, and payment of rates, taxes and cost of ordinary repairs in respect of buildings comprising the trust properties was to be paid to the First Baronet and the heir male of his body who would for the time being have succeeded to the title of Baronet.
The successive Baronets were also entitled in the circumstances mentioned in section 10 to the use and benefit of additional hereditaments vesting in the Corporation.
Section 27 provided for the vesting of the trust properties and funds "upon failure and in default of heirs male of the body of the last Baronet".
The First Baronet, Sir Currimbhoy Ebrahim, died on May 29, 1924 leaving behind a Will dated October 22, 1916 in respect of certain other properties.
His oldest son, Mohamedbhoy, assumed the title and became the Second Baronet.
Mohamedhoy died on March 31, 1928.
He was succeeded by his son, Hussainbhoy, who became the Third Baronet.
The third Beronet migrated to Pakistan some time between 1947 and September, 1949.
On September 29, 1949 he was declared an evacuee under the Bombay Evacuees (Administration of Property) Act, 1949, and certain properties belonging to him were declared vested in the Custodian of Evacuee Property by an order of that date.
704 On November 15, 1949, a notification was issued under sub.s.(1) of s.7 of the Administration of Evacuee Properties Ordinance, 1949 notifying two further immovable properties as well as the right, title and interest of the Third Baronet in the Sir Currimbhoy Ebrahim Baronetcy Trust as evacuee property vesting in the Custodian of Evacuee Property.
An appeal by the Third Baronet against the orders dated September 29, 1949 and November 15, 1949 was dismissed by the Custodian of Evacuee Property on February 13, 1950.
Two years later, on March 4, 1952, the Third Baronet died in Pakistan.
He was succeeded by his son, Mohamedbhoy, as the Fourth Baronet.
It seems that Mohamedbhoy was at the time residing in India, but shortly thereafter he left for Pakistan.
On June 10, 1952, the Deputy Custodian of Evacuee Property made an order declaring the Fourth Baronet an evacuee under the and directing that his beneficial interest in the Sir Currimbhoy Ebrahim Baronetcy trust be notified as evacuee property.
Therefore, on June 16, 1952, a notification was issued under sub s.(3) of s.7 of the declaring that the beneficial interest of the Fourth Baronet in the Sir Currimbhoy Ebrahim Baronetcy Trust was evacuee property vesting in the Custodian of Evacuee Property The Fourth Baronet preferred an appeal to the Custodian General of Evacuee Property, Delhi, but the appeal was dismissed on August 26, 1960 on the ground that it was barred by time.
Meanwhile, the Fourth Baronet having migrated to Pakistan alongwith his son Zoolfikar Ali, the Bombay Legislature passed an Act titled the Sir Currimbhoy Ebrahim Baronetcy (Repealing & Distribution of Trust Properties) Act, 1959, which we shall refer to as "the Repealing Act)" The Act, as its name shows, repealed the Baronetcy Act and, inter alia, revoked and extinguished "the trusts, powers, provisions, declaration and purposes" declared and expressed in that Act.
It provided for the vesting of the properties and funds in the Official Trustee, Bombay for the purpose of distributing them "amongst the persons rightfully entitled thereto according to law".
Acting under the Repealing Act, the Official Trustee called upon persons claiming interest in the "trust properties", an expression which includes the properties and funds settled and created under the Baronetcy Act, to submit their claims.
As he found that the claims were contested and was unable to say which of them were justified, he applied to the Bombay High Court under sub section(2) of section 7 of the Repealing Act for orders and directions as regards the distribution of 705 the trust properties amongst the several claimants.
The properties were valued at Rs. 30 lakhs for the purposes of court fees.
The petition was entertained in the High Court under its general and inherent jurisdiction and was registered as Trust Petition No. 3 of 1962.
It was disposed of by Tarkunde, J.On December 20, 1962.
A contention raised by some of the claimants that the Repealing Act was ultra vires was rejected.
As regards the claim of the Custodian of Evacuee Property, the learned Judge took the view that the beneficial interest of the Fourth Baronet, which had vested in the Custodian, came to an end on the extinction of the trust and the Custodian was not entitled to the share of the Fourth Baronet in the trust properties.
He ordered, however, that so much of the net income of the trust properties accruing upto March 15, 1960, as had remained unpaid be transferred to the Custodian.
He rejected the claim to maintenance made by the Third Baronet 's widow, the Dowagar Lady Amine Currimbhoy Ebrahim.
On the material before him the learned Single Judge held that the Repealing Act had the effect of giving rise to a resulting trust in favour of the Settlor, the First Baronet, that the trust properties reverted to his estate as on his death on May 29, 1924 and that they must be deemed to pass by inheritance according to the Muslim personal law as on an intestacy occurring on the death of the First Baronet.
He observed that the residuary clause in the will dated October 22, 1916 executed by the First Baronet did not cover the rust properties.
On those findings, he directed the Official Trustee to distribute the net trust properties amongst the several claimants according to the shares mentioned in an agreed statement subscribed to by the claimants.
Against the order of Tarkunde, J., two appeals were filed in he High Court.
Appeal No.31 of 1963 was filed by the Dowagar Lady Amine Currimbhoy Ebrahim, the Fourth Baronet, Sir Currimbhoy Ebrahim, and his son, Zoolfikar Ali Currimbhoy Ebrahim, and Appeal No. 34 of 1963 was filed by the Custodian of Evacuee Property.
The appeals were heard by a Division Bench of two learned Judges, Kotval, C.J. and Mody, J. The Division Bench rejected the challenge to the constitutional validity of the Repealing Act, but on the point whether a resulting trust had come into existence the learned Judges held that in view of the surrounding circumstances, particularly the terms of the will executed by the First Baronet on October 22, 1916, it must be taken that contrary intention had been manifested by the First Baronet that in the event of the failure of the trust, the trust properties should after his life time be held for the benefit of the Baronet for the time being.
Accordingly, the learned 706 Judges laid down that the Fourth Baronet was entitled to the trust properties absolutely in his own right.
On the claim of the Dowager Lady Amine Currimbhoy Ebrahim, they pointed out that her son, the Fourth Baronet, had made a statement through counsel in court that the would pay the amount to her out of the corpus received by him.
Appeal No.31 of 1963 was allowed in part.
In regard to the appeal filed by the Custodian of Evacuee Property, the learned Judges rejected his claim to the corpus of the trust properties, holding him entitled to a sum of Rs. 1,334.06 only, representing the unpaid amount of the net income of the trust properties upto March 14, 1960.
Appeal No.34 of 1963 was dismissed.
Three appeals have been filed in this Court.
Civil Appeal No.722 of 1967 has been filed by Sir Fazalbhoy Currimbhoy, Civil Appeal No. 1016 of 1967 has been filed by the Custodian of Evacuee Property and Civil Appeal No.1221 of 1967 has been filed by Munira Fazal Chinoy and Mumtaz Mohamed Rahimtoola, daughters of the Third Baronet.
The case of Sir Fazalbhoy Currimbhoy, the appellant in Civil Appeal No.722 of 1967 is that the effect of the Repealing Act on the trusts created by the Baronetcy Act is to revoke and extinguish those trusts and to give rise to a resulting trust in favour of the estate of the First Baronet as on the date of his death, and that the estate would devolve as on an intestacy under the Muslim personal law.
The case of Munria Fazal Chinoy and Mumtaz Mohamed Rahimtoola, the appellants in Civil Appeal No.1221 of 1967 is that no resulting trust comes into existence consequent on the repeal because a contrary intention must be presumed in the First Baronet that the trust properties should go to the Fourth Baronet.
It is also contended by these appellants that alternatively the trust must be deemed to have extinguished on the death of the Third Baronet and that the trust properties devolved on them, their mother the Dowager Lady Amine Currimbhoy and the Fourth Baronet as the heirs of the Third Baronet.
The case of the Custodian of Evacuee Property, the appellant in Civil Appeal No. 1016 of 1967 is that the trust properties would ordinarily have passed to the Fourth Baronet but because of sub s.(4) of s.7 of the Repealing Act the Official Trustee is required to transfer and vest the trust properties in the Custodian.
It is contended on behalf of Sir Fazlbhoy Currimbhoy that the trust having been created by the Baronetcy Trust Act, a legislative statute, it must be regarded as a statutory trust and, thereafter, when the Baronetcy Act was repealed and the trust was revoked and 707 extinguished by the Repealing Act, another legislative enactment, the necessary and only result was that the trust properties reverted to the estate of the settler, the First Baronet.
Now, no doubt the trust was created by statute.
But it was created at the instance of the First Baronet.
It had to be a trust in perpetuity in order that the upkeep of the dignity and title of the Baronetcy should always be ensured.
A trust such as this has been regarded as a private trust.
Indeed, throughout the trial before the learned Single Judge and during the hearing of the appeals before the Division Bench of the High Court the case proceeded on the footing that the trust created by the Baronetcy Act was governed by the law relating to a private trust.
The parties proceeded as if the trust was a private trust created directly by the First Baronet himself, and it was assumed throughout that the repeal by the legislature was a repeal effected by him.
We must, therefore, proceed in this case as if we are dealing with a private trust.
The contention on behalf of Sir Fazalbhoy Currimbhoy that a resulting trust follows the revocation and extinction of the trust created by the Baronetcy Act rests on the provisions of section 83 of the Indian Trusts Act.
Section 83 provides: "83.Where a trust is incapable of being executed, or where the trust is completely executed without exhausting the trust property, the trustee, in the absence of a direction to the contrary, must hold the trust property, or so much thereof as is unexhausted, for the benefit of the author of the trust or his legal representative.
" The section incorporates in codified form the concept of what is known as a resulting trust.
On the terms of section 83, a resulting trust can arise only "in the absence of a direction to the contrary".
It is not disputed that if there is no direction to the contrary the trust properties must be held for the benefit of the estate of the First Baronet.
Can an intention to the contrary be inferred?
Scott on Trusts declares: "If an owner of property transfers it inter vivos upon a trust which fails either at the outset or subsequently, and he has not indicated what disposition should be made of the property in the event of the failure of the trust, the trustee cannot retain it but will be compelled in equity to 708 restore it to the settlor.
In such a case the trustee holds the property upon a resulting trust for the settlor.
Since the trustee was not intended to have the beneficial interest, and since the beneficial interest was not otherwise disposed of, it reverts or results to the settlor.
On the failure of the trust the court will put the parties in status quo by restoring the property to the settlor.
But if the settlor properly manifested an intention that no resulting trust should arise in the event of the failure of the trust, it will not arise, but the property will be disposed of in accordance with his intention, whether that intention is expressed in specific language or not.
No resulting trust arises if it appears by evidence properly admissible that in the event of the failure of the trust the property should be transferred by the trustee to a third person, or held upon a different trust, or that it should be retained by the trustee free of trust.
" And further it is said: "The resulting trust is rebutted when it is shown that the settlor intended that in the event of the failure of the trust the property should be held in trust for other purposes."
In Cock vs Hutchinson Lord Longdale, M. R. Observed: "Upon this deed a question is made, whether there is or is not a resulting trust to the grantor as to the surplus, with respect to which there is no declaration of trust; and for the purpose of determining that question, it is necessary to look carefully to the language of the deed, and to the circumstances of the particular case.
In general, where an estate or fund is given in trust for a particular purpose, the remainder, after that purpose is satisfied, will result to the grantor; but that resulting trust may be rebutted even by parole evidence, and certainly cannot take effect where a contrary intention to be collected from the whole instrument, is indicated by the grantor.
The distinctions applicable to cases of this kind are pointed out in the case of King vs Dinison (1 V. & D. 260) by Lord Eldon, who adopts the principles laid down by Lord Hardwicks in Hill vs The Bishop of London ; The conclusion to which Lord Hardwicks comes is, that the question whether there 709 is or is not a resulting trust must depend upon me intention of the grantor. ."
Now, it appears clearly from clause 2 of the will dated October 22, 1916 executed by the First Baronet that a substantially large sum of Rs.47,50,000/ was gifted by the First Baronet in equal shares to each of his sons excepting the eldest son, Mohamedbhoy.
The gift was made inter vivos in respect of the major sons and under the will in respect of the minor son, Ismail.
Clause 18 of the will, which constitutes the general residuary clause, discloses that the residue of the property was bequeathed by the First Baronet to all his sons, except Mohamedbhoy.
Mohamedbhoy was apparently not included in those dispositions because he would succeed as Baronet to the benefit of the trusts constituted under the Baronetcy Act.
He was the eldest son, and there is no reason to suppose that the First Baronet intended to exclude Mohamedbhoy from the benefit of his bounty.
The First Baronet planned to provide for all his sons.
Had he intended to exclude Mohamedbhoy for any reason, he would not have provided by clause 15 of the will that each one of his sons, including Mohamedbhoy, would enjoy an equal share in the mercantile business in Bombay and Calcutta in India, Hongkong and Shanghai in China and at Kobe in Japan.
The benefit of the trusts created under the Baronetcy Act, according to the terms of that enactment, were to devolve on the male heir of the body of the First Baronet who took the name "Currimbhoy Ebrahim", and when executing the Will the First Baronet had that benefit in mind for Mohamedbhoy as is apparent from clause 21 of the will, wherein he declared: "Lastly it is my special desire that my son Mohamedbhoy on succeeding to the title of Baronet and every succeeding Baronet shall forthwith on such succession adopt the names of Currimbhoy Ebrahim and continue to do so as long as he holds the title.
" The First Baronet had the line of Mohamedbhoy in mind for supplying the line of future Baronets.
He gave a special position to him, his eldest son.
By clause 7 of the Will, he bequeathed to Mohamedbhoy all the addresses, testimonials and caskets presented to him, symbols of the high status and dignity of the family, to be retained and passed down as heirlooms.
It is true that under section 4 of the Baronetcy Act the possibility could be envisaged that in the event of an existing descendant of Mohamedbhoy not using the name "Currimbhoy Ebrahim" the Baronetcy would pass to a descendant of 710 the next son of the First Baronet.
But that envisions a very remote possibility.
It is difficult to presume in reason that any male heir in the line of Mohamedbhoy would refuse to use the name "Currimbhoy Ebrahim" and deprive himself of the very real and substantial benefits of the Baronetcy.
Therefore, the only conclusion can be that the trust properties created under the Baronetcy Act were intended by the First Baronet to vest in Mohamedbhoy and his heirs.
In that light, section 27 of the Baronetcy Act assumes material importance in relation to the controversies before us.
Section 27 reads: "Upon failure and in default of heirs male of the body of the said Sir Currimbhoy Ebrahim to whom the same title of Baronet may descend the said Corporation shall stand possessed of the said hereditaments and premises particularly described in the first Schedule hereunder written and of any other hereditaments of a freehold tenure and of the funds which may then be vested in them by virtue and operation of this Act upon trust for the heirs of the last Baronet absolutely and shall also stand possessed of the said hereditaments and premises particularly described in the Second Schedule hereunder written or such of them as may be still vested in the said Corporation and any other hereditaments of a leasehold tenure which may then be vested in the said Corporation by virtue of this Act upon trust for the heirs of the last Baronet for all the then residues of the terms granted by the lessees by which the same are demised.
" Although section 27 can come into play only "upon failure and in default of heirs male of the body of the said Sir Currimbhoy Ebrahim" and that condition is absent in the present case the provision provides evidence, in the light of what has been said above, of the intention of the First Baronet that the trust properties and funds should be confined even ultimately to the line of Mohamedbhoy.
They would go to the heirs of the last Baronet, and not be distributed among his own heirs.
We are of opinion that upon the provisions of the Baronetcy Act and of the Will, a direction by the first Baronet must be necessarily presumed that if the trust created by the Baronetcy Act fails or is revoked, the trust properties and funds must go to the last Baronet.
The Division Bench of the High Court has found that the Fourth Baronet is entitled to the trust properties and funds, and a resulting trust does not come into existence.
For the reasons which have prevailed with us, we hold that such a conclusion should ordinarily follow.
However, the ultimate determination must turn on the validity of the claim made by 711 the Custodian of Evacuee Property that by virtue of sub section(4) of section 7 of the Repealing Act the trust properties and funds to which the Fourth Baronet would be entitled must vest in the Custodian.
In understanding the import of sub section(4) section 7 of the Repealing Act it is imperative to note that it is a part of the scheme embodied in section 7 providing for the distribution of trust properties by the Official Trustee to "the persons rightfully entitled thereto".
It comes into play as a step in the proceedings taken for that purpose.
It is considered for application when the Official Trustee under sub section(1) or the High Court under sub section(2) is determining who are the persons entitled to the trust properties on distribution.
Sub section(1) declares that if the claims received by the Official Trustee are justified and uncontested he must distribute the trust properties in accordance with such claims.
Sub section(2) provides that if the Official Trustee is of the opinion that the claims are not justified, or if they are contested, he may apply to the High Court for orders and directions as regards the distribution of the trust properties amongst the several claimants.
Sub section(3) provides that on obtaining such orders and directions, he must distribute the trust properties amongst the persons rightfully entitled thereto in accordance with the final decree or order passed in that behalf.
Sub section (4) declares: "If any person entitled to the trust properties, or any part thereof, has been or is declared an evacuee within the meaning of the , and if any right, title and interest of such person in the trust properties has been or is declared to be evacuee property under that Act, then the Official Trustee shall, subject to any order or direction which the High Court may make or give, transfer and vest in the Custodian the trust properties, or so much thereof as is found to be evacuee property, and the provisions of the law relating to evacuee property shall as far as may apply to such right, title and interest in the trust properties as they apply to any other evacuee property under that law".
An analysis of the provisions of this sub section is necessary.
It applies where: (a) a person is entitled to the trust properties or any part thereof; (b) such person has been or is declared as an evacuee with in the meaning of the and 712 (c) his right, title and interest in the trust properties has been or is declared to be evacuee property under the .
If the three conditions are satisfied, the Official Trustee is required to transfer and vest in the Custodian the trust properties, or so much thereof as is found to be evacuee property.
And the law relating to evacuee property, the sub section says, shall apply to such right, title and interest in the trust properties as they apply to any other evacuee property under that law.
When the sub section speaks of "any person entitled to the trust properties" it refers to the person found entitled to the trust properties by the Official Trustee under sub section(1) of section 7 or by the High Court under sub section(2) of that section.
In the present case, the Fourth Baronet has been found by us to be entitled to Repealing Act has been defined by cl.(d) of section 2 of that Act to mean all the trust properties and funds settled and created under the Baronetcy Act.
The second condition is also satisfied because the Fourth Baronet was declared an evacuee on June 10, 1952 under the .
The third condition is similarly fulfilled.
The right, title and interest of the Fourth Baronet in the trust properties, that is to say, his beneficial interest therein, was declared to be evacuee property on June 16, 1952 under the .
All three conditions being satisfied, sub section(4) takes effect and the direction contained in it must be carried out.
The Official Trustee is required to transfer and vest in the Custodian the trust properties found to be evacuee property.
Now, the expression "evacuee property" has not been defined in the Repealing Act and, therefore, it must take its meaning from the definition in the Clause (f) of section 2 defines "evacuee property" to mean "any property of an evacuee".
The definition does not require that for property to be evacuee property, there must be a direction under the that it is evacuee property.
A perusal of the relevant provisions of the indicates that the Act contemplates the necessity of a declaration that property is an evacuee property in order that it should vest in the Custodian of Evacuee Property.
Unless that declaration is made the evacuee property, even though it belongs to an evacuee, cannot vest in the Custodian.
But there may be another law under which evacuee property may vest in the Custodian sub section(4) constitutes that law.
It provides for another kind of case where evacuee property may also vest in the Custodian sub section(4) of section 7 of the Repealing Act, in essence, is a law in addition 713 to the for vesting evacuee property in the Custodian.
The provision in sub section(1) that the Official Trustee shall transfer and vest in the Custodian the trust properties found to be evacuee property has the same statutory consequence is a declaration made under section 7 of the ,.
In opposition to the claim of the Custodian, it was pointed out that a declaration that evacuee property is vested in the Custodian is barred after May 7, 1954 by section 7A of the .
The provision in sub section(4) of section 7, on which the Custodian relies, is not a declaration under that Act.
As we have held the Fourth Baronet to be entitled to the trust properties, it must be taken that those properties in virtue of the definition of "evacuee property mentioned above have been found to be evacuee property.
The words "found to be evacuee property" mean found to be evacuee property in proceedings under section 7 of the Repealing Act.
Therefore it is beyond dispute that the Official Trustee must, by virtue of sub section (4), transfer and vest in the Custodian the trust properties.
Sub section(4) of section 7 further declares that the law relating to evacuee property shall apply to such right title and interest in the trust properties as they apply to any other evacuee property under the law.
The words "such right, title and interest in the trust properties" mean the right, title and interest in the trust properties which we have found the evacuee entitled to in this proceeding under section 7, and which now vest in the custodian.
That is distinct from the right, title and interest of the Fourth Baronet in the trust properties which were declared to be evacuee property under the .
It is urged on behalf of Sir Fazalbhoy Currimbhoy that if sub section(4) of section 7 of the Repealing Act is construed as declaring the trust properties to be evacuee property to which the provisions of the law relating to evacuee property would apply, the sub section must be regarded as ultra vires on the ground that the State Legislature is not possessed of legislative competence to declare any property as evacuee property.
The submission is misconceived.
Sub section(4) of section 7 of the Repealing Act can be attributed to the legislative power of the State Legislature in respect of Entry 41 of List III of the Seventh Schedule to the Constitution of India, which speaks of: "41.Custody, management and disposal of property (including agricultural land) declared by law to be evacuee property".
Reference may also be made to Entry 27 of List III of the Seventh Schedule, which speaks of: 714 "27.Relief and rehabilitation of persons displaced from their original place of residence by reason of the setting up of the Dominions of India and Pakistan.
" The Repealing Act received the assent of the President.
In case of any repugnancy between the Repealing Act and the , the former will prevail by reason of Article 254(2) of the Constitution.
On the view taken by us, how ever, the sub section is not repugnant to any provision of the for, as we have pointed out already, it is in the nature of additional legislation on the subject.
It is also submitted on behalf of Sir Fazalbhoy Currimbhoy that as the definition of the expression "the law relating to evacuee property ' in the Repealing Act has been defined by cl.(b) of section 2 of that Act to include the , the Legislature must be taken to have intended that a part of the trust properties would be distributed among the heirs of the First Baronet.
It seems to us that by defining the words "the law relating to evacuee property" in cl.(b) of section 2 of the Repealing Act to mean the , the , the and any other law for the time being in force in relation to evacuees or evacuee property, the Legislature intended to give the same powers to the Custodian in dealing with the trust properties as he enjoys in respect of other evacuee property.
The object in enacting sub section(4) of section 7 of the Repealing Act is apparent.
The Fourth Baronet had been declared an evacuee.
His interest in the trust properties under the Baronetcy Act had been declared evacuee property under the .
With the repeal of the Baronetcy Act and the revocation and extinction of the trust, that interest came to an end and the declaration ceased to have effect.
The Legislature presumed that when the Official Trustee took proceedings for the distribution of the trust properties under section 7 of the Repealing Act, the Fourth Baronet would be found entitled to the trust properties or part thereof.
He had already been declared an evacuee, and consistently with the earlier declaration vesting his interest in the trust properties as evacuee property in the Custodian now lapsed in consequence of the Repealing Act the Legislature intended that the trust properties falling in full ownership to the Fourth Baronet on repeal, should likewise be vested in the Custodian.
That could not be accomplished by a declaration under the , in view of section 7A 715 thereof which prohibited such a declaration after May 7, 1954.
The result could be accomplished under some other law, and sub.section (4) of section 7 was included in the Repealing Act to make provision accordingly.
The trust properties were evacuee property because they belonged to an evacuee, and by the operative clause in sub section(4) of section 7, they were vested in the Custodian.
The law relating to evacuee property was applied to the right, title and interest of the evacuee in the trust properties, even as they applied to any other evacuee property under that law.
The terms in which the law relating to evacuee property has been applied to the trust properties fully confirms the conclusion that the trust properties falling to the Fourth Baronet were to be treated at par with evacuee property generally.
It has been urged on behalf of the appellants in Civil Appeal No. 1221 of 1967 that the trust failed on March 14 1952, on the death of the Third Baronet, even before the Repealing Act was passed, and that the trust properties devolve, therefore on the heirs of the Third Baronet, that is to say his widow, son and two daughters, The submission was made before a Division Bench of the Bombay High Court and was rejected.
We are also of the view that there is no substance in this contention.
On the death of the Third Baronet, the benefit of the trusts created by the Baronetcy Act passed to the Fourth Baronet.
Towards the conclusion of the hearing, it was contended by learned counsel for Sir Fazalbhoy Currimbhoy that by virtue of the Notifications bearing No. 12/2/65 E PTY and No.12/3/65 E PTY dated September 10, 1965 and September 11, 1965 respectively the trust properties which could be rightfully claimed by the Fourth Baronet would stand vested in the Custodian of Enemy property under the Defence of India Rules, 1962.
For that reason, it is said, the Fourth Baronet cannot be held entitled to the trust properties, and therefore they would not vest in the Custodian of Evacuee Property.
The record before us does not show that the Custodian of Enemy Property filed any claim before the Official Trustee under sub section(1) of section 7 of the Repealing Act and, consequently, we consider it inappropriate to enter into this matter.
The Division Bench of the High Court has held that the Custodian of Evacuee Property is entitled to be paid a sum of Rs. 1,334.06 representing the unpaid amount of the net income of the trust properties upto March 14, 1960.
This finding has not been challenged, and we affirm it.
716 The Official Trustee has pointed out that various liabilities on account of Income tax, Wealth tax, House tax and other taxes are outstanding in respect of the trust properties.
He prays for directions that those tax liabilities be allowed to be cleared before the trust properties are transferred by him.
He also points out that there are fees, charges, costs and other expenses to be paid off.
We propose to remand the case to the High Court for making necessary orders in that regard after satisfying itself as to the existence and amount of these liabilities.
In the result, Civil Appeal No. 722 of 1967 and Civil Appeal No. 1221 of 1967 are dismissed, and Civil Appeal No. 1016 of 1967 is allowed.
There is no order as to costs of these appeals in this Court except an order for costs in favour of the Official Trustee, who shall be entitled to recover his costs of these appeals from the trust funds in his hands.
The judgment and order dated August 9, 1966 of the Division Bench of the Bombay High Court are set aside, except in so far as they contain the direction for payment of Rs. 1,334.06 to the Custodian of Evacuee Property and in so far as they direct, and make provision for, the payment of the costs of the Official Trustee and other parties and affirm the order for costs made by the learned Single Judge.
The Official Trustee shall transfer to and vest, in the Custodian of Evacuee Property the accumulated trust properties and funds settled and created under the Sir Currimbhoy Ebrahim Baronetcy Act, 1913, subject, however to the aforesaid directions and orders and to the directions and orders by the Bombay High Court for prior payment of the liabilities, if any, on account of Income Tax, Wealth Tax, House tax and other taxes and other charges, expenses, fees and costs incurred by the official Trustee.
The case is remanded to the Bombay High Court for that purpose.
P.B.R. C. A. Nos. 722 & 1221 of 1967 dismissed.
C. A. No. 1016 of 1967 allowed.
| IN-Abs | In 1911 King George V conferred the "dignity, status and degree" of a Baronet on Sir Currimbhoy Ebrahim of Bombay.
To provide for the upkeep and dignity of the Baronetcy the Sir Currimbhoy Ebrahim Baronetcy Act, 1913 was passed by virtue of which considerable properties belonging to Sir Currimbhoy Ebrahim were settled upon the trust.
Section 8 of the Baronetcy Act provided that the residue of income from the properties settled under the trust was to be paid to the first Baronet and the heir male of his body, who would, for the time being succeed to the title of Baronet.
Section 27 provided for the vesting of all properties and funds in the Trust "upon failure and in default of heirs male of the body of the last Baronet.
" The First Baronet left behind a Will in respect of certain other properties.
On the death of the First Baronet his eldest son assumed the title of Second Baronet and on the death of the Second Baronet his eldest son Hussainbhoy became the Third Baronet.
The Third Baronet migrated to Pakistan between the years 1947 and 1949.
He was, therefore, declared an evacuee.
Certain properties belonging to him were declared vested in the Custodian of Evacuee Property.
Two other immovable properties as well as the right, title and interest of the Third Baronet in the Sir Currimbhoy Ebrahim Baronetcy Trust were declared as evacuee properties and vested in the Custodian of Evacuee Property.
On the death of the Third Baronet in Pakistan in 1952 his eldest son Mohamedbhoy succeeded as the Fourth Baronet.
At that time the Fourth Baronet was residing in India, but shortly thereafter he migrated to Pakistan.
The Deputy Custodian of Evacuee Property made an order declaring the Fourth Baronet an evacuee and notified his beneficial interest in the Trust as evacuee property vesting in the Custodian of Evacuee Property.
The Fourth Baronet having migrated to Pakistan along with his son, the Bombay Legislature passed the Sir Currimbhoy Ebrahim Baronetcy (Repealing & Distribution of Trust Properties) Act, 1959.
The Repealing Act inter alia revoked and extinguished the trusts, powers, provisions, declaration and purposes declared and expressed in the Sir Currimbhoy Ebrahim Baronetcy Act and vested the properties and funds in the Official Trustee for the purpose of 700 distributing them amongst the persons rightfully entitled thereto, according to law.
The Official Trustee thereupon called upon the persons claiming interest in the trust properties to submit their claims.
On the Official Trustee 's application under section 7(2) of the Repealing Act seeking orders and directions of the High Court as regards distribution of the trust properties amongst the several claimants, a single Judge of the High Court took the view that the Custodian was not entitled to the share of the Fourth Baronet in the Trust properties because the beneficial interest of the Fourth Baronet which had vested in the Custodian came to an end on the extinction of the Trust that the Repealing Act had the effect of giving rise to a resulting trust in favour of the settlor, the first Baronet; that the trust properties reverted to his estate on his death, that they must be deemed to pass by inheritance, according to the Muslim personal law, and that the residuary clause in the will executed by the First Baronet did not cover the trust properties.
A Division Bench of the High Court on appeal held that on the terms of the Will a contrary intention had been manifested by the First Baronet that in the event of the failure of the Trust the trust properties shall, after his life time, be held for the benefit of the Baronet for the time being and therefore the Fourth Baronet was entitled to the trust properties absolutely in his own right.
The claim of the Custodian of Evacuee Property to the corpus of the trust properties was rejected.
^ HELD: 1.
Upon the provisions of the Baronetcy Act and of the Will a direction by the First Baronet must necessarily be presumed that if the trust created by the Baronetcy Act failed or was revoked the trust properties and funds must go to the last Baronet.
[710 G].
(a) Although the trust was created by statute, it was created at the instance of the First Baronet so as to keep the trust in perpetuity for the upkeep of the dignity and title of the Baronetcy at all times.
A trust of this nature has been regarded as a private trust.
[707 B].
(b) Section 83 of the Indian Trusts Act provides that where a trust is incapable of being executed or where the trust is completely executed without exhausting the trust property, the trustee, in the absence of a direction to the contrary, must hold the trust property for the benefit of the author of the trust or his legal representatives.
On the terms of this section, which incorporates in codified form the concept of what is known as a resulting trust, a resulting trust can arise only in the absence of a direction to the contrary.
[707 E F].
(c) In the instant case the various clauses of the will show that substantially large sums of money were gifted by the First Baronet in equal shares to each of the sons except the eldest son.
In all these clauses the eldest son Mohamedbhoy was not included because he would succeed as Baronet to the benefit of the trust constituted under the Act.
There is no reason to suppose that the First Baronet intended to exclude Mohamedbhoy from the benefit of his bounty.
According to the terms of the Act, the benefits of the trust created under the Baronetcy Act were to devolve on the male heirs of 701 the body of the First Baronet who took the name of Currimbhoy Ebrahim, and when executing the will, the First Baronet had that benefit in mind for Mohamedbhoy.
The First Baronet had the line of Mohamedbhoy in mind for supplying future Baronets.
Therefore the only conclusion that can be drawn is that the trust properties created under the Act were intended by the First Baronet to vest in Mohamedbhoy and his heirs.
Although section 27 comes into play only upon the failure and in default of heirs male of the body of the said Currimbhoy Embrahim, the intention of the First Baronet was that the trust properties and funds should be confined even ultimately to the line of Mohamedbhoy his eldest son.
They would go to the heirs of the last Baronet and not be distributed among his own heirs.
[709 B 710F] 2.
While ordinarily the trust properties and funds would have devolved on the Fourth Baronet, the ultimate determination of the case must turn on the validity of the claim made by the Custodian of Evacuee Property under section 7(4) of the Repealing Act.
[710H] (a) The Repealing Act was passed by the State Legislature under Entry 41 of List III of the Seventh Schedule to the Constitution and received the assent of the President.
In case of any repugnancy between the Repealing Act and the the former will prevail by reason of article 254(2) of the Constitution.
Section 7(4) is not repugnant to any provision of the 1950 Act.
It is in the nature of additional legislation on the subject.
[714 B].
(b) Section 7(4) of the Repealing Act was passed because the Fourth Baronet had been declared an evacuee and his interest in the trust properties under the Baronetcy Act had been declared evacuee property under the 1950 Act.
With the repeal of the Baronetcy Act and the revocation and extinction of the trust, that interest came to an end and the declaration ceased to have effect.
The Legislature presumed that when the Official Trustee took proceedings for the distribution of the trust properties under section 7 of the Repealing Act, the Fourth Baronet would be found entitled to the trust properties or part thereof.
He had already been declared an evacuee and consistently with the earlier declaration vesting his interest in the trust properties as evacuee property in the Custodian, the Legislature intended that the trust properties falling in full ownership to the Fourth Baronet on repeal should likewise be vested in the Custodian.
That could not be accomplished by a declaration under the , in view of section 7A thereof which prohibited such a declaration after May 7, 1954.
The result could be accomplished under some other law and section 7(4) of the Repealing Act was passed to make provision accordingly.
The trust properties were evacuee property because they belonged to an evacuee [vide section 2(f) , [1950], and by the operative clause in section 7(4) of the Repealing Act they were vested in the Custodian.
The law relating to evacuee property was applied to the right, title and interest of the evacuee in the trust properties even as they applied to any other evacuee property under that law.
The terms in which the law relating to evacuee properties has been applied to the trust properties fully confirms the conclusion that the trust properties falling to the Fourth Baronet were to be treated at par with evacuee property generally.
[714 F H].
(c) Section 7(4) of the Repealing Act requires three conditions to be satisfied.
They are: (i) that a person is entitled to the trust properties or 702 any part thereof; (ii) that such person has been or is declared as an evacuee within the meaning of the , and (iii) that his right, title and interest in the trust properties has been or is declared to be evacuee property under the .
If these conditions are satisfied the official trustee is required to transfer and vest in the Custodian the trust properties or so much thereof as is found to be evacuee property and the law relating to evacuee property shall apply to such right, title and interest in the trust properties as they apply to any other evacuee property under that law.
[711 G H].
In the present case the first condition is satisfied because the Fourth Baronet had been found to be entitled to all the trust properties and funds settled and created under the Baronetcy Act.
The second condition is satisfied because the Fourth Baronet was declared an evacuee.
Similarly, the third condition is satisfied because the right, title and interest of the Fourth Baronet in the trust properties was declared to be evacuee property.
All three conditions having been satisfied, section 7(4) takes effect and the direction contained in it must be carried out.
The Official Trustee is required to transfer and vest in the Custodian the trust properties count to be evacuee property.
[712 B D].
There is no substance in the contention that on the death of the Third Baronet before the Repealing Act was passed, the trust properties devolved on the heirs of the Third Baronet i.e. his widow, son and two daughters.
On the death of the Third Baronet the benefit of the trust created by the Baronetcy Act passed to the Fourth Baronet.
[715 D].
|
Civil Appeal No. 1188 of 1976.
Appeal by special leave from the Award dated 27 2 1976 of the Industrial Tribunal, Maharashtra in Complaints (I.T.) Nos.
48 53 and 55 63 of 1973 in Ref.
(I.T.) No. 375 of 1972 published in the Maharashtra Govt.
Gazette L dated 3 6 1976.
M. K. Ramamurthi and Naunit Lal for the Appellant.
Sachin Chaudhuri and B. R. Aggarwala for the Respondent.
The Judgment of the Court was delivered by JASWANT SINGH, J.
This appeal by special leave is directed against the common award dated February 27, 1976 of the Industrial Tribunal, 615 Maharashtra, Bombay rejecting as not maintainable complaints Nos.
48 of 1973 to 63 of 1973 made by the appellants against the respondent (hereinafter referred to for brevity as 'the Company) under section 33(A) of the (hereinafter called 'the Act ') in reference (IT) No. 336 of 1972.
The facts material for the purpose of this appeal are: The appellants (hereinafter described as 'Workmen ') were employees of the Company.
During the pendency of the above mentioned reference No. 336 of 1972 before the Second Labour Court, Bombay for adjudication of a dispute, 344 workmen of the Company including the appellants went on an indefinite peaceful strike with effect from August 30, 1972, pursuant to the strike notice given to the Company by their registered union called 'The Association of Chemical Workers ' in support of its demand for re instatement of three of the union leaders who had been dismissed by the Company.
On the even date i.e. August 30, 1972, the Company put up a notice stating that the strike embarked upon by the workmen was illegal and those participating in the said strike were liable to disciplinary action for misconduct as per Company 's certified standing orders Nos.
22(b) and 24(a).
On September 7, 1972, the Company issued notices to the appellants and 10 others asking them to report for duty on or before September 18, 1972, failing which their absence would be construed as voluntary abandonment of service and their names would be struck off from the muster rolls of the Company.
On September 19, 1972, the Company sent separate communications to the appellants and 10 others informing them that since "by not reporting for duty they had confirmed its presumption that they were no longer interested to continue in service of the Company and had totally abandoned the Company 's service" their names had been struck off from the rolls of the Company from that date.
Along with its communication, the Company sent a cheque to each one of the appellants for the amount due to him on account of gratuity, leave salary and one month 's salary.
On September 26, 1972, the appellants wrote to the Company returning the cheques sent by the Company and stating that its letter dated September 7, 1972 which had reached them only on September 20, 1972 had already been replied by letter dated September 21, 1972, that they were interested in the service of the Company and had neither voluntarily abandoned the service of the Company and did they wish to do so, and that they would, report for work the moment the strike was called off 616 by their union.
On October 23, 1972 the Company wrote to the appellants acknowledging their letter dated September 26, 1972 but stating therein that it did not wish to revise its earlier decision under which their names had been struck off the rolls.
It is to be noted that in its letter the Company did not refute the averment made by the appellants in their letter dated September 26, 1972 that the Company 's letter dated September 7, 1972 had reached them only on September 20, 1972.
On the even date i.e., September 26, 1972, the appellants ' union wrote to the Labour Commissioner complaining about the arbitrary termination of service of 25 workmen (including the appellants) and emphasising that they had not abandoned service.
On October 2, 1972, the appellants and other striking workmen addressed letters to the Works Manager of the Company protesting against the action of the Company in removing them from service and asserting that the said action was by way of victimization for their participation in the strike.
On March 30, 1973, the union made a formal demand calling upon the Company to re instate the appellants and others who had been removed from service on the ground that they had abandoned their service.
On May 19, 1973, certain proposals for settlements were made on behalf of the employees whose services were terminated by the Company and requesting the Company for re instatement of the appellants and 10 other workmen.
On July 5, 1973, the union wrote a letter to the Assistant Commissioner of Labour, Naupada, soliciting his intervention in the dispute concerning the re instatement of the 16 employees including the appellants.
The Assistant Commissioner thereupon summoned the parties for discussion on July 19, 1973 but his attempts at conciliation did not bear any fruit.
Thereafter, the appellants made the aforesaid complaints before the Industrial Tribunal with the result as stated above.
Appearing in support of the appeal Mr. Ramamurti has vehemently urged that the action of the Company in removing the names of the appellants from its rolls was illegal and arbitrary, that the appellants had not abandoned the Company 's service, that at any rate the termination of their services could only be in terms of the Company 's standing orders and since the standing orders did not provide for treating the workmen as having abandoned service in case they were absent in connection with the notified strike, the Company 's action was manifestly illegal and invalid.
Three questions arise for consideration in this case, namely: (1) what is the true meaning of the expression 'abandonment of service '; 617 (2) whether in the circumstances of the case it could be said that the appellants had voluntarily abandoned the service of the Company; and (3) whether the action of the Company in removing the names of the appellants from its rolls on the presumption that they had abandoned service would constitute a change in the conditions of service of the appellants ? We will deal with these questions seriatim: Re.
Question No. 1: In the Act, we do not find any definition of the expression 'abandonment of service '.
In the absence of any clue as to the meaning of the said expression, we have to depend on meaning assigned to it in the dictionary of English language.
In the unabridged edition of the Random House Dictionary, the word 'abandon ' has been explained as meaning 'to leave completely and finally; for sake utterly; to relinquish, renounce; to give up all concern in something '.
According to the Dictionary of English Law by Earl Jowitt (1959 edition) 'abandonment ' means 'relinquishment of an interest or claim '.
According to Blacks Law Dictionary 'abandonment ' when used in relation to an office means 'voluntary relinquishment.
It must be total and under such circumstances as clearly to indicate an absolute relinquishment.
The failure to perform the duties pertaining to the office must be with actual or imputed intention, on the part of the officer to abandon and relinquish the office.
The intention may be inferred from the acts and conduct of the party, and is a question of fact.
Temporary absence is not ordinarily sufficient to constitute an abandonment of office '.
From the connotations reproduced above it clearly follows that to constitute abandonment, there must be total or complete giving up of duties so as to indicate an intention not to resume the same.
In Buckingham Co. vs Venkatiah & Ors.
it was observed by this Court that under common law an inference that an employee has abandoned or relinquished service is not easily drawn unless from the length of absence and from other surrounding circumstances an inference to that effect can be legitimately drawn and it can be assumed that the employee intended to abandon service.
Abandonment or relinquishment of service is always a question of intention, and normally, such an intention cannot be attributed to an employee without adequate evi 618 dence in that behalf.
Thus, whether there has been a voluntary abandonment of service or not is a question of fact which has to be determined in the light of the surrounding circumstances of each case.
Question No. 2: This takes us to the consideration of the second question, namely, whether in the circumstances of the instant case, it could be said that the appellants had voluntarily abandoned the service of the Company.
It may be recalled that the appellants had along with 229 other workmen gone on indefinite and peaceful strike which ended on October 22, 1972) in response to the strike notice given by the union to the Company to press its demand for re instatement of its three dismissed leaders and had not only by their letters dated September 21, 1972 and September 26, 1972 unequivocally intimated to the Company that they did not intend to abandon the service but had also returned the cheques sent to them by the Company on account of their leave salary gratuity etc.
The appellants stand that the letter of the Company dated September 7, 1972 was received by them on September 20, 1972 and not earlier was never denied or refuted by the Company in the correspondence that passed between the parties.
Thus, there was nothing in the surrounding circumstances or the conduct of the appellants indicating or suggesting an intention on their part to abandon service which in view of the ratio of Gopal Chandra Misra 's case, can be legitimately said to mean to detach, unfasten, undo or untie the binding knot or link which holds one to the office and the obligations and privileges that go with it Their absence from duty was purely temporary and could by no stretch of imagination be construed as voluntary abandonment by them of the Company 's service.
In Express Newspaper (P) Limited vs Michael Mark & Anr.,(2) which is on all fours with the present case, it was held that if the employees absent themselves from the work because of strike in enforcement of their demands, there can be no question of abandonment of employment by them.
In the present case also the appellant 's absence from duty was because of their peaceful strike to enforce their demand.
Accordingly, we are of the view that there was no abandonment of service on the part of the appellants.
Re Question No. 3: Let us now advert to the last but the most crucial question, namely, whether the action of the Company in removing the names of the appellants from its rolls during the pendency of the proceedings before the Labour Court in respect of the industrial dispute on the presumption that they had abandoned Company 's service 619 constituted an alteration in the conditions of service applicable to them immediately before the commencement of the said proceedings which prejudiciously affected them.
Although the learned counsel appearing on behalf of the respondent has taken us through the certified standing orders as applicable to the appellants, he has not been able to point out anything therein to indicate that the company could terminate the services of the appellants on the ground of abandonment of service because of their going on strike in enforcement of their demands.
Thus, their being no provision in the certified standing orders by virtue of which the Company would have terminated the services of the appellants in the aforesaid circumstance, the impugned action on the part of the Company clearly amounted to a change in the condition of service of the appellants during the admitted pendency of the industrial dispute before the Labour Court which adversely affected them and could not be countenanced.
We are fortified in this view by the aforesaid decision of this Court in Express Newspapers (P) Limited vs Michael Mark & Anr.
(Supra) where repelling an identical contention to the effect that the failure of the workmen to return to work by a notified date clearly implied abandonment of their employment, it was held that the management cannot by imposing a new term of employment unilaterally convert the absence of work into abandonment of employment.
It was further held in that decision that if the strike was in fact illegal, the management could take disciplinary action against the employees under the standing orders and dismiss them.
If that were done, the strikers would not have been entitled to any compensation under standing orders but that was not what the appellants purported to do and the respondents were, therefore, entitled to relief.
For the foregoing reasons, we are unable to uphold the impugned action of the Company and the award under appeal which are manifestly illegal.
In the result, we allow the appeal, set aside the aforesaid award of the Industrial Tribunal and direct the Company to reinstate the appellants.
The appellants shall also be entitled to the costs of the appeal.
A point which requires to be clarified and has been brought to the notice of the Court after the judgment was delivered relates to back wages from 19 9 72 to the date of reinstatement.
The rule in such cases is that where reinstatement has been directed by the Court, the entire back wages must follow as a matter of course.
Of course there is a discretion in the court having regard to special circumstances if any to modify this normal rule.
In the present case the period stretches over six years and Shri Sachine Chaudhary brings to our notice the fact that 620 back wages have to be computed, if ordered in full, on a much higher scale because of two settlements which have raised the scales of wages substantially.
While there is no case specifically put forward that the workmen concerned have been employed elsewhere during this period, still we take a total view the whole case and direct that for the entire period from 1972 to the date of reinstatement, 75 per cent of the wages will be paid to all the workmen concerned on the scales and revised scales as the case may be.
P.B.R. Appeal allowed.
| IN-Abs | In support of their demand for reinstatement of certain dismissed union leaders a number of workmen, including the appellants had gone on an indefinite peaceful strike.
The Company (respondent) put up a notice that the strike was illegal and that the striking workmen were liable to disciplinary action for misconduct.
A week later, the company issued individual notices to the appellants and other workmen calling upon them to report for duty, failing which their absence would be construed as voluntary abandonment of service and that their names would be struck off the muster rolls.
A few days later the company informed the workmen concerned that by not reporting for duty they had confirmed its presumption that they were no longer interested to continue in its service that they had totally abandoned its service.
The names of the appellants had been struck off the rolls.
In final settlement of the workers ' claims for gratuity, leave salary and a month 's salary a cheque was sent to each of the appellants.
But the appellants returned the cheques to the company pointing out that they were interested in the service of the company and that they had neither voluntarily abandoned the service nor did they wish to do so and that they would report for work as soon as the strike was called off.
Thereafter, although there were prolonged negotiations between the union and the company, the company did not take them into its service.
Since a dispute was pending before an Industrial Tribunal application was made under section 33A of the .
The Tribunal rejected the workers ' demand for reinstatement.
In appeal to this Court it was contended on behalf of the appellants, that (i) removing their names from the rolls was illegal and arbitrary; (ii) the appellants had not voluntarily abandoned the company 's service and (iii) since termination of service could only be in accordance with standing orders, and since the standing orders in this case did not provide for treating the workmen as having abandoned the service in case they were absent in connection with a strike, the company 's action in terminating the appellants ' services was illegal.
Allowing the appeal, ^ HELD: The impugned action of the company and the award of the Tribunal were illegal.
[619 E] 1.
To constitute abandonment there must be total or complete giving up of duties so as to indicate an intention not to resume the same.
Failure to perform duties pertaining to an office must be with actual or imputed intention on 614 the part of the officer to abandon and relinquish the office.
The intention may be inferred from the acts and conduct of a party and is a question of fact which could be determined in the light of surrounding circumstances in each case.
Temporary absence is not ordinarily sufficient to constitute abandonment of office.
[617 D F] Buckingham Co. vs Venkatiah & Ors., ; ; referred to.
The absence of workmen from duty was purely temporary and cannot be construed as their voluntary abandonment of the company 's service.
There was nothing in the surrounding circumstances or the conduct of the workmen indicating or suggesting an intention on their part to abandon service.
To abandon service means to detach, unfasten, undo or untie the binding knot or link which holds one to the office and obligations and privileges that go with it.
[618 C E] In the instant case the workmen went on a peaceful strike.
By their letters they unequivocally intimated to the company that they did not intend to abandon service.
They had returned the cheques sent to them by the company.
Union of India vs Gopal Chandra Misra ; referred to.
Since there was no provision in the certified standing orders, by virtue of which the company could have terminated the services of the workmen, the impugned action amounted to change in the conditions of service of the workmen during the pendency of the industrial dispute which adversely affected them.
[619 A] Express Newspapers (P) Ltd. vs Michael Mark & Anr., ; applied.
In cases where reinstatement had been directed by the Court it is the rule that the entire back wages must follow as a matter of course.
In the special circumstances of this case the workmen are entitled to wages at 75% for the entire period from the date of termination of their services to the date of reinstatement.
|
N: Criminal Appeal No. 233 of 1978.
Appeal by Special Leave from the Judgment and Order dated the 20th April, 1978 of the Madras High Court in Writ Petition No. 988 of 1978.
AND WRIT PETITION NO.
4327 OF 1978 (Under Article 32 of the Constitution of India) Ram Jethmalani M. G. Kurnali and Vineet Kumar for the Appellant/Petitioner.
A. V. Rangam for the Respondent.
635 The Judgment of the Court was delivered by CHINNAPPA REDDY, J.
Bhawarlal Ganeshmalji whose application for the issue of a Writ of Habeas Corpus was rejected by the High Court of Madras, is the appellant in Criminal Appeal No. 233 of 1978.
He has also filed Writ Petition No. 4327 of 1978 for the issue of a Writ of Habeas Corpus under Article 32 of the Constitution in which he has raised certain grounds which had not been raised before the Madras High Court.
The appeal and the Writ petition were heard together by us and are disposed of by this common order.
The impugned detention order was made on 19th December, 1974 by the Government of Tamil Nadu and the grounds for the order were contained in a memorandum dated 20th December, 1974 of the Government of Tamil Nadu.
The order of detention could not be executed immediately as the appellant petitioner was absconding and could not be apprehended despite a proclamation made pursuant to Section 7 of the .
The appellant petitioner, however, surrendered himself before the Commissioner of Police, Madras on 1st February, 1978.
First the order of detention and later the grounds of detention were served on the appellant petitioner.
There were two grounds of detention which were as follows: "(i) On 23 2 1972 an inland registered parcel bearing No. 325 emanating from one T. Chowdiah No. 2, Sanjeev appa Lane, Bangalore, and addressed to M/s. Raj Metal House, 77, Mint St. Madras was intercepted by Preventive Officers of the Madras Customs at the Madras General Post Office and it was found to contain Indian currency amounting to Rs.1,20,000/ and the currency was seized under the Customs Act.
Sukanraj, owner of M/s. Raj Metal House on being questioned admitted in a written statement dated 23 2 1972 that the currency was sent by one R. G. Bhandari 's man from Bangalore, to be received by him and handed over to one Bhoormal, a partner of R. G. Bhandari, residing with the latter.
He also stated that he knew well that R. G. Bhandari was dealing in smuggled gold at Ban galore; Sukanraj further stated that within the previous two months, 5 or 6 parcels were received by him and by his brother Motilal.
Motilal also gave an independent statement on the same day corroborating the facts mentioned by his brother that R. G. Bhandari was dealing in smuggled gold and that the currencies in post parcels were the sale proceeds of smuggled gold.
On enquiry at the Park Town 636 Post Office it was found that seven registered parcels had been delivered to M/s. Raj Metal Works between 18 1 1972 and 17 2 1972 and received either by Sukhanraj or Motilal.
At Bangalore, the premises at No. 2, Sanjeev appa Lane the address mentioned on post parcel, was searched on 23 2 1972.
T. Chowdiah, the sender of the said parcel was not there.
But one Ghaverchand Samarthajee was present.
He admitted in his statement dated 24 2 1972 that he was an employee of R. G. Bhandari and on the latter 's instructions he was disposing of smuggled gold in Bangalore on behalf of his master and despatching the sale proceeds to Madras.
The postal receipt bearing the No. 325 Avenue Road Post Office, Bangalore, in respect of the parcel which was seized at Madras was also seized.
This and his confessional statement revealed that he had previously despatched seven registered parcels to M/s. Raj Metal Works containing amounts to the tune of Rs.8,84,000/ using the name of T.Chowdiah and that he had disposed of 3900 bars of smuggled gold valued at Rs.80 lakhs within a short time of less than a month.
Bhawarlal, the servant of Bhoormal in Madras identified Ghaverchand Samarthajee as an employee of R. B. Bhandari used for gold smuggling business at Bangalore.
The case was adjudicated and the currency was confiscated.
personal penalty of Rs.5000/ was imposed on Thiru R. section Bhandari.
(ii) On 20 4 1974, 40 bars of gold weighing 23,274.100 grams valued at Rs.12,75,420/ was seized by Thiru Ramanathan Supdt.
Central Excise, Madras from a secret vacity of an Ambassador can MDE 9399 at the commercial Check Post, Hosur.
T. Ramamurthy of Porayar (driver) and Thiru Ganesan occupied the car.
Their statements revealed that the gold was sent by Sikku Govidaswami of Porayar, a noted transport agent for contraband goods.
Ganesan also admitted that the car with the contraband was to be handed over to one Marwari, at Bangalore at an appointed place.
The intelligence report dt.
17 4 74 and 19 4 74 by the Intelligence officer tc the .
Directorate of Revenue Intelligence which had been received earlier on the basis of which the aforesaid car was intercepted and the seizure was effected, had disclosed that the Marwari referred to was R. G. Bhandari 637 Shri Jethmalani learned Counsel for the detenu submitted that the order of detention which was made more than three years before its execution must be considered to have lapsed or ceased to be effective without a fresh application of the mind of the detaining authority to the facts and circumstances of the case and the necessity for preventive detention.
Otherwise, the learned Counsel submitted the order of preventive detention would change its character and be come an order of punishment for an unproven crime.
In regard to the first ground mentioned in the Memorandum of the Government, the learned Counsel submitted that all the four persons who had made statements on 23rd February, 1972 and 24th February, 1972, and which were the basis of the first ground, had resiled from their statements long before the order of detention was made.
The circumstance that all of them had resiled from their earlier statements was not brought to the notice of the detaining authority and the failure of the detaining authority to consider such vital material before arriving at its subjective satisfaction vitiated the ground and, therefore, the order of detention itself.
Shri Jethmalani urged that the order of detention had necessarily to be struck down even if a single ground out of many was bad since the order had been made at a time when Section 5A of the COFEPOSA had not yet been brought into the Statute Book.
In regard to the second ground of detention the submission of Shri Jethmalani was that it was not based upon any "rationally probative" material The ground was invalid inasmuch as it was based upon an intelligence report.
It was further contended that the ground would be innocuous without the aid of the intelligence report mentioned therein and since no privilege was claimed in respect of the intelligence report, the identity of the author of the report should have been disclosed as also the material on which the report was based.
Failure to do so had resulted in a denial of the petitioner 's fundamental right, under Article 22(5) of the Constitution.
Shri A. V. Rangam, learned Counsel for the State of Tamil Nadu urged that the appellant petitioner was himself responsible for the long delay in the execution of the order of detention and he could not be allowed to take advantage of his own wrong.
With regard to the first ground of detention he submitted that the circumstance that the persons who had incriminated the detenu had resiled from their former statements had been mentioned in the judication order passed by the Customs authorities and that order had been placed before the detaining authority before the order of detention was made.
In regard to the second ground of detention the learned Counsel argued that it was not based merely on the intelligence 638 report and in any case, since no privilege was claimed, it was always open to the detenu to have asked for more particulars if he so desired, but which he failed to do.
It is true that the purpose of detention under the COFEPOSA is not punitive but preventive.
The purpose is to prevent organised smuggling activities and to conserve and augment Foreign Exchange.
It is true that the maximum period for which a person may be detained under the COFEPOSA is one year.
It is further true that there must be a 'live and proximate link ' between the grounds of detention alleged by the detaining authority and the avowed purpose of detention namely the prevention of smuggling activities.
We may in appropriate cases assume that the link is 'snapped ' if there is a long and unexplained delay between the date of the order of detention and the arrest of the detenu.
In such a case we may strike down an order of detention unless the grounds indicate a fresh application of the mind of the detaining authority to the new situation and the changed circumstances.
But where the delay is not only adequately explained but is found to be the result of the recalcitrant or refractory conduct of the detenu in evading arrest, there is warrant to consider the 'link ' not snapped but strengthened.
That, precisely, is the state of affairs before us.
The order of detention was made on 19th December, 1974.
The detenu was found to be absconding.
Action was taken pursuant to Section 7 of the COFEPOSA and he was proclaimed as a person absconding under Section 82 of the Criminal Procedure Code.
The proclamation was published in several leading English and local language daily newspapers.
His photograph was exhibited in Cinema halls A reward of Rs. 5.000/ was also announced for his apprehension.
Despite all this effort he could not be arrested until he surrendered on 1st February, 1978.
We do not have any hesitation in over ruling the submission of Shri Jethmalani based on the delay in the execution of the order of detention The second submission made on behalf of the detenu that the detaining authority had not before it the circumstance that the four persons who had made statements implicating the detenu had later, but long before the order of detention, resiled from their statements is also devoid of force.
The proposition that the failure to place before the detaining authority relevant and material facts which may influence the mind of such authority one way or the other will vitiate the order of detention is unexceptionable.
But a perusal of the first ground of detention shows that the detaining authority took into 639 consideration the circumstance that there were 'adjudication ' proceedings, that the currency was confiscated and that a penalty of Rs.5,000/ was imposed on the detenu.
It was not disputed and it was not alleged in the petition that the order of adjudication by which the currency was confiscated and penalty was imposed did refer to the circumstance that persons who had made incriminating statements against the detenu had resiled from those statements.
The circumstance that persons who had earlier incriminated the detenu had later resiled from those statements was therefore before the detaining authority.
There is thus no factual foundation for this submission of the learned Counsel, which we accordingly reject.
We now proceed to consider the last submission of the learned Counsel based on the reference to the contents of the intelligence report in the second ground of detention.
It was pointed out by the petitioner 's learned Counsel that the statement of Ramamurthy and Ganesan merely showed that the contraband was to be delivered to a Marwari at Bangalore at an appointed place.
It was the intelligence report alone that fixed the identity of the Marwari as the detenu.
Without the intelligence report it would be impossible to connect the detenu with the person mentioned as the Marwari in the statements of Ganesan and Ramamurthy.
Now the submission of the learned Counsel was that the identity of the author of the intelligence report as well as the report and the material on which the report was based ought to have been disclosed to the detenu if the detenu was to effectively exercise his fundamental right under Article 22(5) of the Constitution and to make a representation against the order of detention We agree with the learned Counsel for the petitioner that in order to make a representation against the order of detention and thus to exercise the fundamental right guaranteed by Article 22(5) of the Constitution, a detenu is entitled to be furnished with all essential particulars forming the basis of the grounds of detention.
so it is that where insufficient particulars are mentioned in the grounds, the detenu is entitled to call for better particulars.
That is a right which flows from the Constitutional right to be afforded a reasonable opportunity to make representation.
Of course, where the grounds are vague.
no question would arise of the detenu asking for better particulars.
But the present case is not a case of a vague ground.
The ground is specific enough.
If the detenu wanted any more particulars such as the name of the intelligence officer or other information, he could have well asked for the particulars before making his representation.
That he never did.
It was not as if any privilege had been claimed by the Government in respect of the 640 intelligence reports.
In fact, we find that the intelligence reports were produced before the learned Judges of the High Court at the hearing of the Writ Petition there.
There was no complaint before us that the detenu or his Counsel wanted to peruse the reports and were denied the opportunity of doing so.
We do not think that the detenu could be said to have been denied a reasonable opportunity of making a representation merely because particulars which he neyer desired in respect of a ground which was not vague were not furnished to him.
We are unable to see any force in any of the submissions advanced on behalf of the detenu.
In the result, we reject the appeal and the writ petition.
| IN-Abs | An order of detention under the was passed in December 1974 against the appellant.
But it could not be executed because the detenu was absconding and could not be apprehended 'despite a proclamation made under section 7 of the Act.
More than three years after the order was passed, the appellant surrendered in February, 1978.
His application for a writ of habeas corpus was rejected by the High Court.
In his appeal against the judgment of the High Court as well as in a petition under article 32 of the Constitution raising grounds not raised before the High Court, the appellant contended that ( I ) the detention order made more than three years before its execution must be considered to have lapsed without fresh application of the mind of the detaining authority to the facts and circumstances of the case, (2) all the four persons who had made statements against the detenu had resiled from their earlier statements long before the order of detention and the failure of the detaining authority to consider such vital material vitiated the order of detention.
and (3) the detention order was not based upon any "rationally probative" material, inasmuch as it was based upon an intelligence report, not disclosed to the detenu and that this had resulted in denial to the detenu of his fundamental right under article 22(5) of the Constitution Dismissing the appeal and writ petition, ^ HELD: 1.
It is well settled that the purpose of detention under the COFEPOSA is not punitive but preventive, that is to say, its purpose is to prevent organised smuggling activities and to conserve and augment Foreign Exchange, that the maximum period of detention under the Act is one year, and that there must be a 'live and proximate link ' between the grounds of detention and the avowed purpose of detention.
But in appropriate cases the Court can assume that the link is 'snapped ' if there is a long and unexplained delay between the date of the order of detention and the arrest of the 634 detenu.
Where the delay is not only adequately explained but is found to be the result of the detenu 's recalcitrant or refractory conduct in evading arrest, there is warrant to consider the 'link ' not snapped but strengthened.
[638 B D] In the instant case, the order was made in December, 1974.
He was absconding, a proclamation was published in several leading newspapers that he was a person absconding and a reward was of offered for his apprehension.
Despite all this he could not be arrested until he surrendered in February, 1978.
Therefore the submission pseud on delay had no force.
[638 E F] 2.
There is no force in the contention that material facts which might influence the mind of the authority one way or the other, were not placed before it and that this vitiated the order of detention.
The detaining authority took into consideration the circumstance that there were 'adjudication ' proceedings, that the currency which the appellant was carrying was confiscated and that a penalty of Rs.5,000/ was imposed on him.
The order of adjudication by which the currency was confiscated and penalty was imposed did refer to the circumstance that persons who had made incriminating statements against the detenu had resiled from those statements.[638 H 639B] 3.
It cannot be said that the detenu had been denied a reasonable opportunity of making a representation merely because particulars which he never desired in respect of a ground which was not vague were not furnished to him.
The ground was specific enough.
If the detenu wanted any more particulars such as the name of the intelligence officer or other information, he could have asked for them before making his representation.
That he never did.
It was not as if any privilege had been claimed by the Government in respect of the intelligence reports.
The intelligence reports were produce before the High Court at the hearing of the writ petition.
There was no complaint that the detenu wanted to peruse the reports but was denied the opportunity of doing so.
[649 B, 639 H 640 A]
|
REFERENCE No. 1 OF 1978 (Under article 143(1) of the Constitution of India).
section V. Gupte, Attorney General, R. N. Sachthey and R. B. Datar for the Attorney General for India.
section N. Kackar, Sol.
Genl., R. N. Sachthey and section Markandaya for the Union of India.
K. D. Chattered, Adv.
(Bihar), U. P. Singh for the Adv.
(Bihar).
A. K. Malik, Adv.
Genl., (J&K), Altaf Ahmed and Brij, Behari Singh for the A.G. J&K. R. N. Byra Reddy, Adv.
Genl., section section Ray and A. K. Sen, N. Nettar, J. section Sinha and Mrs. Alva Margaret for the A. G. Karnataka.
Abdul Khader, Adv.
, Kerala and K. M. K. Noir for the, A.G., (Kerala) R. section Bhonsle, Adv.
Genl., (Maharashtra), V. C. Kotwal and M. N. Shroff, for the A.G. Maharashtra.
B. M. Patnaik, Adv.
Genl., (Orissa), Miss Uma Mehta and R. K. Mehta for the A.G., (Orissa).
491 R. K. Rastogi, Adv.
(Rajasthan), section M. Jain and M. I. Khan, for the A.G., Rajasthan.
V. P. Raman, Adv.
(Tamil Nadu) and A. V. Rangam, for the A.G." Tamil Nadu.
O. P. Rana, for the A.G. (U.P.).
section K. Acharya, Adv.
(West Bengal), Sukumar Basu and section Chatterjee, for the A.G., West Bengal.
F. R. Mridul, H. K. Puri, Vijendra Jain, Arunashwar Gupta, Vivek Sethi and Vijay Behl, for the Intervener (Mr. V. C. Shukla) .
section Wasu and O. P. Sharma, for the Intervener (Gyani Zail Singh) .
M. C. Bhandare and O. P. Sharma of the Intervener (Harideo Joshi).
A. K. Sen, Bishambar Lal and Miss Manisha Gupta for the Intervener (Dhirendra Brahmachari).
M. C. Bhandare, Mrs. Sunanda Bhandare, R. Nagarathnan, Wazir Singh and Miss Malini Poduval, for the Interveners (Bansi Lal, Shiv Kumar Agarwal and Surinder Singh).
A. section Bobde, M. R. Barot, Mrs. Sunanda Bhandare, R. Nagarathnan, Wazir Singh, Miss Malini Poduval and R. N. Mittal, for the Intervener (C. M. Stephen).
Frank Anothony, Mrs. section Bhandare, M. R. Barot, R. N. Mittal R. Nagarathnam and Miss Malini Poduval, for the Intervener (Kamlapati Tripathi).
P. Shiv Shankar and B. Goburdhan, for the Intervener (Pranab Mukherjee) .
D. D. Chawla and N. section Das Bahl, for the Intervener (R. K. Dhawan) .
Shiva Pujan Singh, for the Intervener (Jagmohan and P. section Bhinder) .
M. C. Bhandare, N. Nettar, J. section Sinha and Mrs. Alva Margaret for the Intervener (Dev Raj Urs).
A. N. Karkhanis, for the Intervener (Narain Dutt Tiwari).
A. section Bobde, 1.
N. Misra, V. C. Mahajan, Ram Lal, D. Goburdhan, for the Interveners (Jagannath Misra and Ram Lal).
A.G. Noorani, Miss Rani Jethmalani and H. N. Hingorani, for the Intervener (Ram Jethamalani) P. Silva Shankar, Frank Anthony, P. P. Rao and G. N. Rao, Interveners for the State of Andhra Pradesh.
492 section section Ray, P. N. Ramalingam and A. T. M. Sampath for the applicant Intervener (State of J&K and for the Advocate General, Haryana) .
section C. Mohanta, Adv.
Genl (Haryana), Naubat Singh (Dy.
Genl.), R. N. Sachthey and Girish Chandra, for the Advocate General, Haryana Chandrachud, C.J. delivered the Opinion on behalf of Bhagwati, Sarkaria and Fazal Ali, JJ.
and himself.
Krishna Iyer, Untwalia and Shinghal, JJ. delivered separate Opinions.
CHANDRACHUD, C.J.
On August 1, 1978 the President of India made a reference to this Court under article 143(1) of the Constitution for consideration of the question whether the "Special Courts Bill, 1978" or any of its provisions, if enacted, would be constitutionally invalid.
The full text of the reference is as follows: "WHEREAS certain Commissions of Inquiry appointed by the Central Government under the (Central Act 60 of 1952) have submitted reports which indicate that there is reason to believe that various offences have been committed by persons holding high political and public offices during the period of operation of the Proclamation of Emergency dated the 25th June, 1975, and the period immediately preceding that Proclamation; AND WHEREAS investigations into such offences are being made in accordance with law and are likely to be completed soon; AND WHEREAS suggestions have been made that the persons in respect of whom the investigations reveal that a prima facie case has been made out should be tried speedily in Special Courts constituted for that purpose; AND WHEREAS a proposal has been made that legislation should be enacted for the creation of an adequate number Or Special Courts for the speedy trial of such offences on the lines of the Bill, a copy whereof is annexed hereto (hereinafter referred to as the "Bill"); AND WHEREAS doubts have been expressed with regard to the constitutional validity of the Bill and its pro visions; AND WHEREAS there is likelihood of the.
Constitutional validity of the provisions of the Bill, if enacted, and any action taken thereunder, being challenged in courts of law involving protracted and avoidable litigation; 493 AND WHEREAS in view of what has been hereinbefore stated, it appears to me that the question of law hereinafter set out is likely to arise and is of such a nature and of such public importance that it is expedient to obtain the opinion of the Supreme Court of India thereon; NOW, THEREFORE, in exercise of the powers conferred upon me by clause (1) of Article 143 of the Constitution, I, Neelam Sanjiva Reddy, President of India, hereby refer the following question to the Supreme Court of India for consideration and report thereon, namely: Question (1) Whether the Bill or any of the provisions thereof, if enacted, would be constitutionally invalid ? New Delhi, Dated: 1st day of August, 1978 PRESIDENT OF INDIA" Annexed to the order of reference is a copy of the Bill which runs thus: "THE SPECIAL COURTS BILL, 1978 A BILL to provide for the trial of a certain class of offences WHEREAS Commissions of.
Enquiry appointed under the Commissions of Enquiry Act, 1952 have rendered reports disclosing the existence of prima facie evidence of offences committed by persons who have held high public or political offices in the country and others connected with the commission of such offences during the operation of the Proclamation of Emergency dated 25th June, 1975, and during the preceding period commencing 27th February, 1975 when it became apparent that offenders were being screened by those whose duty it was to bring them to book; AND WHEREAS investigations conducted by the Government through its agencies have also disclosed similar offences committed during the period aforesaid; AND WHEREAS the offences referred to in the recitals aforesaid were committed or continued during the operation 494 of the Promulgation of Emergency dated 25th June, 1975, during which a grave emergency was clamped on the whole country, civil liberties were withdrawn to a great extent, important fundamental rights of the people were suspended, strict censorship on the press was placed and judicial powers were crippled to a large extent; AND WHEREAS it is the constitutional, legal and moral obligation of the State to prosecute persons involved is the said offences; AND WHEREAS the ordinary criminal courts due to congestion of work and other reasons cannot reasonably be expected to bring those prosecutions to a speedy termination; AND WHEREAS it is imperative for the functioning of parliamentary democracy and the institutions created by or under the Constitution of India that the commission of offences referred to in the recitals aforesaid should be judicially determined with the utmost dispatch; AND WHEREAS it is necessary for the said purpose to create additional courts presided over by a sitting judge of a High Court in India or a person who has held office as a judge of a `High Court in India; AND WHEREAS it is expedient to make some procedural changes whereby avoidable delay in the final determination of the guilt or innocence of the persons to be tried is eliminated without interfering with the right to a fair trial; BE it enacted by Parliament in the Twenty ninth year of the Republic of India as follows: 1.
(1) This Act may be called the Special Courts Act, 1978.
(2) It shall come into force at once.
The Central Government shall by notification create adequate number of courts to be called Special Courts.
A Special Court shall take cognisance of or try such cases as are instituted before it or transferred to it as hereinafter provided.
(1) If the Central Government is of the opinion that there is prima facie evidence of the commission of an offence 495 alleged to have been committed during the period mentioned in the preamble by a person who held high public or political office in India and that in accordance with the guidelines contained in the Preamble hereto the said offence ought to be dealt with under the Act, the Central Government shall make a declaration to that effect in every case in which it is of the aforesaid opinion.
(2) Such declaration shall not be called in question in any court.
On such declaration being made any prosecution in respect of such offence shall be instituted only in a Special Court designated by the Central Government and any prosecution in respect of such offence pending in any court in India shall stand transferred to a Special Court designated by the Central Government.
If at the date of the declaration in respect of any offence an appeal or revision against any judgment or order in a prosecution in respect of such offence, whether pending or disposed of, is itself pending in any court of appeal or revision, the same shall stand transferred for disposal to the Supreme Court of India.
A Special Court shall be presided over by a sitting judge of a High Court in India or a person who has held office as a judge of a High Court in India and nominated by the Central Government in consultation with the Chief Justice of India.
A Special Court shall have jurisdiction to try any person concerned in the offence in respect of which a declaration is made under section 4 either as principal, conspirator or abettor and all other offences and accused persons as can be jointly tried therewith at one trial in accordance with the Code of Criminal Procedure, 1973.
A Special Court shall in the trial of such cases follow the procedure prescribed by the said Code for the trial of warrant cases before a Magistrate and save as otherwise provided in this Act be governed by the said Code.
(1) Notwithstanding anything in the said Code, an appeal shall lie as of right from any judgment or order of a Special Court to the Supreme Court of India both on fact and on law.
496 (2) Except as aforesaid, no appeal or revision shall lie to any court from any judgment or order of a Special Court".
After receipt of the reference On August 1, a notice was issued to the Attorney General on the 2nd to appear before the Court on the 4th for taking directions in the matter.
On the 4th August, upon hearing the Attorney General the Court directed, inter alia that: (1) Notice of the reference be given to the Union of India and the Advocates General of the States requiring them to submit their written briefs before September 4, 1978; (2) Notices be published in five newspapers at Bombay, New Delhi, Calcutta, Madras and Bangalore inviting all persons likely to be affected by the passage of the Bill to apply for permission to appear or intervene in the proceedings; (3) Interveners will be permitted to submit their written arguments but will not be entitled to be heard orally unless the Court considers it fit and proper to do so; (4) Parties concerned shall appear before the Court on August 21 for taking further directions; and (5) that the hearing of the reference will commence on September 11, 1978 subject to the reasonable convenience of all concerned.
Notices were issued by the Registry of this Court on the 4th August itself to the Union of India and Advocates General of 22 States.
The newspaper notices were published soon thereafter.
By August 21, a large number of applications were received by the Court asking that the applicants should either be impleaded to the reference as parties or in the alternative that they should be allowed to intervene in the proceedings.
On August 21, the Court passed an order after hearing all the interested parties that it did not consider it necessary to implead anyone as a formal party to the reference.
The Court, however, granted permission to 18 persons and 2 State Governments to intervene in the proceedings.
Those eighteen are: Sarvashree V. C. Shukla, Gyani Zail Singh, Dhirendra Brahmchari, Bansi Lal, Harideo Joshi, Pranab Mukherjee, R. K. Dhawan, Jagmohan, P. section Bhinder, Shiv Kumar Aggarwal, Surinder Singh, Dev Rai Urs, Narain Dutt Tiwari, Jagannath Misra, Ram Lal, Ram Jethmalani, C. M. Stephen and Kamlapati Tripathi.
The two State Governments which were allowed to intervene are the State of Karnataka and the State of Andhra Pradesh.
The applications of all others for being impleaded as parties or for intervention were rejected.
Written briefs were filed by the Union of India, the Advocates General, the two State Governments and the interventionists.
The 497 State of Jammu and Kashmir complained on the date of hearing that its Advocate General had taken a stand in his written brief which did not reflect the view of the State Government on the question referred to the Court by the President.
Thereupon, the State of Jammu and Kashmir was permitted to file its written brief, such as it was advised, and through such advocate as it desired.
The State Government filed its brief through another advocate.
At the commencement of the hearing of the reference on September 19, counsel appearing for some of the interventionists as also some of the Advocates General raised a preliminary objection to the maintainability of the reference contending that for various reason which were mentioned by them in their written briefs, the reference was incompetent and invalid and therefore the Court should refuse to answer the question submitted by the President for its consideration and report.
As the preliminary objection required for its appreciation and determination an understanding of the case of the Union of India, we postponed the consideration of that objection until after the arguments in support of the reference were over.
Accordingly we first heard the learned Attorney General, the learned Solicitor General who appeared on behalf of the Union of India, the Advocates General who supported the reference and Shri Ram Jethmalani, one of the interventionists on all conceivable aspects of the reference.
Thereafter we heard the other side on all its contentions including the preliminary objection that the reference was not maintainable.
We are indebted to the learned counsel on both sides for the able assistance rendered by them through their written briefs and oral arguments.
The written briefs facilitated a clearer perception and understanding also their respective points of view and enabled counsel, without much persuasion, to reduce their oral submissions to reasonable pro portions.
We will dispose of the preliminary objection before taking up the other points for consideration.
The preliminary objection to the maintainability of the reference is founded on a variety of reasons and circumstances which may be stated as follows: Shri A. K. Sen who appears for the State of Karnataka and for Shri Dhirendra Brahmchari contends that we will be well advised to refuse to answer the reference because it is of a hypothetical and speculative character and is also vague.
The reference was made by the President on August 1, 1978 which was even before the Special Courts Bill was introduced in the Look Sabha by a Private Member, Shri Ram Jethmalani, on August 4, 1978.
The Bill may or may not become a law and even if it is passed by both the Houses of legislature, its 498 provisions may undergo fundamental changes during the parliamentary debate.
As regards vagueness, Shri Sen contends that the President has posed a broad and omnibus question as to whether the Bill, if enacted, will be constitutionally invalid without particularising the reasons or the grounds on which it may become invalid.
A law can be constitutionally invalid either for want of legislative competence or for the reason that it violates any of the fundamental rights conferred by the Constitution.
Not only does the reference, according to the learned counsel, not specify which of these two reasons may invalidate the bill if it becomes an Act, but the reference does not even mention the fundamental right or rights which are likely to be violated if the Bill is passed by the Parliament.
Reliance was placed in support of these contentions on the judgment of the Privy Council in Attorney General for the Dominion of Canada vs Attorney General for the Provinces of Ontario, Quebec and Nova Scotia(1) Attorney General for Ontario vs The Hamilton Street Railway Company and others(2).
Attorney General for the Province of Alberta vs Attorney General for the Dominion of Canada(4).
In re The Regulation and Control of Aeronautics in Canada(4) and Attorney General for Ontario and Others vs Attorney General for Canada and Others.
(5) Counsel also relied on the decision of the Federal Court in the Estate Duty Bill(6) case and on the decisions of this Court in the references relating to The Kerala Education Bill(7).
The Berubari Union and Exchange of Enclaves(8), The Sea Customs Act Bill(9), the U.P. Legislative Assembly(10) and the Gujarat Legislative Assembly(11) as showing that whenever a reference is made by the President under article 143(1) of the Constitution, a specific question or questions are referred for the opinion of this Court.
Our attention was finally drawn to a judgment of the Canadian Supreme Court (12) in a reference made by the Governor General in Council to the Supreme Court of Canada under section; 55 of the Supreme Court Act, 1927 regarding the validity of three Bills passed by the Legislative Assembly of the Province of Alberta which were reserved for signification of the Governor General 's pleasure.
(1) (2) (3) (4) (5) (6) (7) [1959] S.C.R. 995 (8) [1960] 3 .C.R. 250 (9) ; (10) [1965] I S.C.R. 413 (11) [1975] I S.C.R. 504 (12) [1938] Canada Law Reports 100 (S.C.) 499 The learned Advocate General for the State of Karnataka, while adopting Shri Sen 's arguments on the preliminary objection, added that we should refuse to answer the reference because the opinion of the Supreme Court was being sought as if it were a Joint Select Committee of the Parliament, a position which it is neither equipped to fill nor one which it ought to acquiesce in.
It was contended that article 143(1), in sharp contrast with article 143(2), uses the word "may" which leaves a wide margin of discretion to this Court whether or not to answer a reference Shri Mridul who appears for Shri V. C. Shukla objected to the maintainability of the reference on the additional ground that whereas 1 all references made by the President to the Supreme Court in the past were of institutional significance, the present one was an isolated and unique case of a reference of individual significance.
Learned counsel contended that the vice of the reference lies in the President seeking the opinion of this Court on a purely political question which ought to restrain the Court from expressing its opinion.
Shri Frank Anthony who appears for Shri Kamlapati Tripathi leader of the opposition in the Rajya Sabha opened his argument by contending that there is no such thing as the Special Courts Bill in existence and therefore the reference is incompetent.
He said in all solemnity that if anything were to happen to the mover of the Bill in terms of his physical existence the Bill will lapse and then there will be nothing 1 for this Court to answer.
It must, however, be stated in fairness to Shri Anthony that he expressed the hope that the mover of the Bill may live for a hundred years.
Learned counsel drew our attention to rule 110 of the Rules of Procedure and Conduct of Business in Lok Sabha relating to withdrawal of Bills which shows that a member in charge of a Bill can, normally, withdraw the Bill whenever has desires to do so.
Counsel expostulated that the Bill which was moved by a "public prosecutor" was influenced by oblique political motives.
We have no power to "lift" the Bill from the Lok Sabha said the counsel, and consider its constitutional validity.
Shri M. C. Bhandare who appears for Shri Bansi Lal and others contended that we should refuse to answer the reference because the expediency which prevailed upon the President to make the reference is political and not constitutional.
Counsel further urged that article 143(1) cannot be resorted to in a manner which will lead to the virtual abrogation of article 32 of the constitution.
Counsel drew copiously on an article by Felix Frankfurter who later became a celebrated Judge of the United States Supreme Court, which appeared in the Harvard Law Review.
The author says therein that it was extremely 500 dangerous to encourage extension of the device of advisory opinion too constitutional controversies, that the Supreme Court of America was not a House of Lords with revisory powers over legislation, that the legislature cannot be deprived of its creative function and that if the Supreme Court were called upon tender its advisory opinion on the validity of laws, it will lead to weakening of legislative and popular responsibility.
After extracting a passage from James Bradley Thayer 's 'Life of Marshall ' to the effect that references to courts dwarf the political capacity of the people and deaden its sense of moral responsibility, the learned author concludes his article thus: It must be remembered that advisory opinions are no merely advisory opinions.
They are ghosts that slay.
Shri Shiv Shankar who appears for the State of Andhra Pradesh and for Shri Pranab Mukherjee founded his preliminary objection on the ground that since the Parliament is seized of the Bill we should not answer the reference.
Shri Bobade who appears for Shri C. M. Stephen, leader of the opposition in the Lok Sabha, and for Shri Jagannath Misra contended that article 105(3) contains a constitutional bar against our entertaining the reference since it is the power and privilege of the Parliament and not of this Court to decide whether the Bill should become an Act and whether the provisions of the Bill are unconstitutional.
Shri O. P. Sharma who appears for Shri Zail Singh and for Shri Harideo Joshi made a similar argument by contending that notwithstanding our opinion, the Parliament would be within its power in passing the Bill after a due discussion of its provisions and therefore we ought not to answer the reference.
Shri Shiv Pujan Singh appearing on behalf of Shri Jagmohan and Shri P. section Bhinder contended that the reference is incompetent because it violates articles 107(1), 108 and 111 of the Constitution.
His argument is that if we were to answer the reference, the powers and privileges of the Parliament and indeed of the President himself which are conferred by the aforesaid provisions of the Constitution shall have been curtailed or encroached upon.
Whenever interveners having a common interest m the subject matter of a proceeding appear through different counsel, there is, unavoidably, a certain amount of overlapping in their arguments howsoever each counsel may begin with the assurance, and quite genuinely, that he will not cover the same ground once over again.
Striking a 501 new path when so many who have preceded have already walked on the same field is easier assured than achieved though, we cannot deny that counsel before us strove to their utmost to keep to the time schedule and to throw some new light on the question whether the reference is valid and whether we should or should not answer it.
Analysing the various points of view converging on the preliminary objection, the following contentions emerge for our consideration: (1) That the reference is hypothetical and speculative in character; , (2) that the reference is vague, general and omnibus; (3) that since the Parliament is seized of the Bill, it is its exclusive function to decide upon the constitutionality of the Bill and if we withdraw that question for our consideration and report, we will be encroaching upon the functions and privileges of the Parliament; (4) that the reference, if entertained, will virtually supplant the beneficent and salutary provisions of article 32 of the Constitution; (5) It is futile for us to consider the constitutionality of the Bill because whatever may be our view, it will be open to the Parliament to discuss the Bill and to pass or not to pass it, with or without amendment; (6) The reference raises a purely political question which we should refrain : from answering; and (7) Considering the repercussions of the exercise of advisory jurisdiction, both expediency and propriety demand that we should return the reference unanswered.
We will consider these contentions seriatim.
Article 143 of the Constitution under clause (1) of which the President has made this reference to the Supreme Court reads as follows: 143(1) If at any time it appears to the President that a question of law or fact has arisen, or is likely to arise, which is of such a nature and of such public importance that it is expedient to obtain the opinion of the Supreme Court upon it, he may refer the question to that Court for consideration and the Court may, after such hearing as it thinks fit, report to the President its opinion thereon.
(2) The President may, notwithstanding anything in the proviso to article 131 refer a dispute of the kind mentioned in the said proviso to the Supreme Court for opinion and the Supreme Court shall, after such hearing as it thinks fit, report to the President its opinion thereon.
502 Article 143 (1) is couched in broad terms which provide that any question of law or fact may be referred by the President for the consideration of the Supreme Court if it appears to him that such a question has arisen or is likely to arise and if the question is of such a nature and of such public importance that it is expedient to obtain the opinion of the Court upon it.
Though questions of fact have not been referred to this Court in any of the six references made under article 143(1), that article empowers the President to make a reference even on questions of fact provided the other conditions of the article are satisfied.
It is not necessary that the question on which the opinion of the Supreme Court is sought must have arisen actually It is competent to the President to make a reference under article 143(1) at an anterior stage, namely, at the stage when the President is satisfied that the question is likely to arise.
The satisfaction whether the question has arisen or is likely to arise and whether it is of such a nature and of such public importance that it is expedient to obtain the opinion of the Supreme Court upon it, is a matter essentially for the President to decide.
The plain duty and function of the Supreme Court under article 143(1) of the Constitution is to consider the question on which the President has made the reference and report to the President its opinion, provided of course the question is: capable of being pronounced upon and falls within the power of the Court to decide.
If, by reason of the manner in which the question is framed or for any other appropriate reason the Court considers it not proper or possible to answer the question it would be entitled to return the reference by pointing out the impediments in answering it The right of this Court to decline to answer a reference does not flow merely out of the different phraseology used in clauses (1) and (2) of article 143, in the sense that clause (1) provides that the Court "may" report to the President its opinion on the question referred to it, while clause (2) provides that the Court "shall" report to the President its opinion on the question.
Even in matters arising under clause (2), though that question does not arise in this reference, the Court may be justified in returning the reference unanswered if it finds for a valid reason that the question is incapable of being answered.
With these preliminary observations we will consider the contentions set forth above.
We are unable to agree that the reference is of a hypothetical or speculative character on the ground that the Bill has yet to become an Act.
It is true that the mover of the Bill may withdraw the Bill or the Bill may undergo extensive amendments of a fundamental charac 503 ter before it is passed, if it is passed at all.
But these considerations cannot affect the validity of the reference on the score that the reference raises questions of a hypothetical or speculative nature.
The assumption of every reference under article 143 has to be the continued existence of a context or conditions on the basis of which the question of law or fact arises or is likely to arise.
The political life of a nation has but few eternal verities, for which reason every aspect and fact of that life can justly be described as transient.
But the possibility of a change, even of a fundamental change, cannot make the exercise of the Presidential jurisdiction under article 143 speculative or hypothetical.
The stark facts are that Parliament has before it a Bill called the Special Courts Bill, the Bill has been moved by a Private Member and that the Bill consists of ten clauses which provide for the trial of certain offences and offenders.
There is no speculation about the present existence of the Bill and there is nothing hypothetical about its contents as they stand today.
The Bill may undergo changes in the future but so may the Constitution itself, including article 143, under which the President has made the reference to this Court.
The former possibility cannot make the reference speculative or hypothetical any more than the latter possibility can make it so.
The Special Courts Bill is there in flesh and blood for anyone to see and examine.
That sustains the reference, which is founded upon the satisfaction of the President that a question as regards the constitutional validity of the Bill is likely to arise and that the question is of such a nature and of such public importance that it is expedient to obtain the opinion of this Court upon it.
Three references were made in the past under our Constitution, in regard to a contemplated legislation and not in regard to a measure which had already become an Act.
In the Estate Duty Case (supra), the Governor General had made a reference to the Federal Court under section 213(1) of the Government of India Act 1935 which corresponds to article 143(1) of the Constitution, except that under the former provision the power of the Governor General to make a reference to the Federal Court was limited to questions of law.
Sir Patrick Spens, C.J., delivering the majority opinion observed that the fact that the questions referred related to future legislation could not by itself be regarded as a valid objection to the reference, particularly because section 213 empowered the Governor General to make a reference even when questions of law were "likely to arise".
The learned Chief Justice added that instances were brought to the notice of the Court in which references had been made under the corres 504 ponding provision in the Canadian Supreme Court Act when the matter was at the stage of a bill.
In the Kerala Education Bill case, (supra) a reference was made by the President under article 143(1) of the Constitution regarding the validity of the provisions of a bill which was passed by the State Legislative Assembly but which had not become an Act since the Governor had reserved the bill for the consideration of the President.
Das, C.J., who spoke for the majority (Venkatarama Aiyar J. dissented on another point relating to the validity of clause 20 of the bill), referred approvingly to the view expressed by Sir Patrick Spens C.J. in the Estate Duty Bill case (supra) and adopted his reasoning that the fact that reference was made at the stage of the bill was no impediment to the consideration by the Court of the questions referred to it for its opinion.
In the Sea Customs Act Bill, (supra) it was proposed to amend sub section (2) of section 20 of the and sub section (1A) of section 3 of the .
The question referred by the President for the opinion of this Court under article 143(1) was whether the proposed amendments will be inconsistent with the provisions of article 289 of the Constitution.
In Canada, the Governor General in Council referred a question to the Supreme Court of Canada under section 55 of the Supreme Court Act, 1927 for considering the validity of a Bill which provided for abolition of appeals to the Privy Council and for vesting exclusive ultimate jurisdiction in the Supreme Court of Canada.
Notwithstanding the fact that the bill was pending consideration before the Canadian Parliament when the reference was made, the Supreme Court of Canada entertained and answered the reference.
In appeal, the Privy Council confirmed the majority judgment of the Supreme Court of Canada on merits of the reference.
Neither the Canadian Supreme Court nor the Privy Council considered that the circumstance that the reference related to a bill and not to an Act affected the validity of the reference.
The judgment of the Privy Council is reported in Attorney General for Ontario and others vs Attorney General for Canada and others.(1) There is another Canadian case which may be referred to as the Three Bills Case(2) which is similar to the Kerala Education Bill(3) case.
Three bills which were passed by the Legislative Assembly of the province of Alberta were reserved by the Lieutenant Governor for the signification of the Governor General 's pleasure.
(1) [1947] A.C.127 (2) [1938] Canada Law Reports, 100.
(3) [1959] S.C.R. 995 505 Doubts having arisen as to whether the legislature of the province of Alberta had legislative jurisdiction to enact the provisions of the bills, the Governor General in Council made a reference to the Supreme Court of Canada on the question whether the bills were intra vires of the legislature of the province of Alberta.
The fact that the Bills had not yet become Acts was not treated by the Canadian Supreme Court as affecting the validity of the reference.
We will discuss in due course some of the other decisions cited by the interventionists who raised the preliminary objection to the maintainability of the reference.
But we are unable to hold, for reasons aforesaid, that the reference is hypothetical or speculative in character and must, therefore, be returned unanswered.
The second objection to the maintainability of the reference is that it is vague, general and of an omnibus nature.
The question referred by the President to this Court is Whether the Bill or any of the provisions thereof, if enacted, would be constitutionally invalid ? It is true that the reference does not specify with particularity the ground or grounds on which the Bill or any of its provisions may be open to attack under the Constitution.
It does not mention whether any doubt is entertained regarding the legislative competence of the Parliament to enact the Bill or whether it is apprehended that the Bill if enacted. will violate any of the fundamental rights and if so, which particular fundamental right or rights.
A reference in such broad and general terms is difficult to answer because it gives no indication of the specific point or points on which the opinion of the Court is sought.
It is not proper or desirable that this Court should be called .
upon to embark upon a roving inquiry into the constitutionality of a Bill or an Act.
Such a course virtually necessitates the adoption of a process of elimination with regard to all reasonably conceivable challenges under the Constitution.
It is not expected of us while answering a reference under Article 143 to sit up and discover, article 'by article.
which provision of the Constitution is most likely to be invoked to assailing the validity of the Bill if it becomes a law.
The Court should not be driven to imagine a challenge and save it or slay it on hypothetical considerations.
As observed in Hamilton Street Railway Company(1), speculative opinions on hypothetical questions are worthless and it is contrary to principle, inconvenient and inexedient that opinions should be given upon such questions at all.
(1) , 529.
14 978 SCI/78 506 We were, at one stage of the arguments, so much exercised over the undefined breadth of the reference that we were considering seriously whether in the circumstances it was not advisable to return the reference unanswered.
But the written briefs filed by the parties and the oral arguments advanced before us have, by their fullness and ability, helped to narrow down the legal controversies surrounding the Bill and to crystallise the issues which arise for our consideration.
We propose to limit our opinion to the points specifically raised before us.
It will be convenient to indicate at this stage what those points are The first point raised before us is whether Parliament had the legislative competence to enact the provisions contained in the Special Courts Bill.
The second point raised before us is whether the Bill or any of its provisions violate the rights guaranteed by articles 14 and 21 of the Constitution.
We propose to limit our opinion to these points.
Relying upon the judgments of the Privy Council in Dominion of Canada(1) and Regulation and Control of Aeronautics,(2) it was argued that the reference seeks the opinion of this Court on an abstract question and therefore we should decline to answer it.
We are not disposed to agree with the submission that the question referred for our opinion, though with and general, is in any sense abstract.
The question which is referred to us is as regards the constitutionality of the Bill or of any of its provisions.
To the extent to which our opinion is sought on the constitutional validity of the Bill it is impossible to say that the question referred to us is of an abstract nature.
In the former of the two cases cited above.
the Privy Council found it inconvenient to determine in the reference proceedings as to what exactly fell within the ambit of the expression "public harbour".
It therefore characterised the question in regard thereto as abstract.
It was impossible, in the circumstances before the Privy Council, to attempt an exhaustive definition of the expression "public harbour" which would be applicable to all cases, since it was thought that such a definition was likely to prove "misleading and dangerous".
In the latter case, the Privy Council appreciated the difficulty which the court must experience in endeavouring to answer questions of the kind which were framed for the opinion of the Supreme Court of Canada but all the same, the questions were answered since they were not of a kind which it was not possible to answer satisfactorily.
(1) , 711.
(2) , 66.
507 We hope that in future, whenever a reference is made to this Court under article 143 of the Constitution, care will be taken to frame specific questions for the opinion of the Court.
Fortunately, it has been possible in the instant reference to consider specific question as being comprehended within the terms of the reference but the risk that a vague and general reference may be returned unanswered is real and ought to engage the attention of those whose duty it is to frame the reference.
Were the Bill not as short as it is, it would have been difficult to infuse into the reference the comprehension of the two points mentioned by us above and which we propose to decide.
A long Bill would have presented to us a rambling task in the absence of reference on specific points, rendering it impossible to formulate succinctly the nature of constitutional challenge to the provisions of the Bill.
The third contention betrays a total lack of awareness of the scheme of division of powers under our Constitution.
The first limb of the argument under this head is that since the Parliament is seized of the Bill, it is its exclusive function to decide upon the constitutionality of the provisions of the Bill.
There are a few people here as elsewhere who, contending against the powers of judicial review of legislation, argue that it is the legislature which possesses and ought to possess the right to interpret the Constitution and that the legislative interpretation should not be open to attack in courts of law.
But we are concerned not with fanciful theories based on personal predilections but with the scheme of our Constitution and the philosophy underlying it.
Our federal or quasi federal Constitution provides by a copious written instrument for the setting up of a judiciary at the Union and State levels.
Article 124, which occurs in Chapter IV of the Constitution called "The Union Judiciary", provides for the establishment of the Supreme Court of India.
Its powers and functions as defined in article 32(2), article 129, articles 131 to 140 and in article 143 of the Constitution.
Likewise, article 214 provides subject to article 231, for the establishment of a High Court for each State.
Article 226 confers powers on the High Courts to issue certain writs while article 227 confers upon them the power of superintendence over all courts subordinate to their appellate jurisdiction.
These provisions` show that the power of reviewing the constitutional validity of legislations is vested in the Supreme Court and the High Courts and in no other body.
The British Parliament, being supreme, no question can arise in England as regards the validity of laws passed by it.
The position under our Constitution is fundamentally different because, the validity of laws passed by the Indian Legislatures has to be tested 508 having regard to the scheme of distribution of legislative powers and on the anvil of other constitutional limitations like those contained in article 13 of our Constitution.
The right of the Indian judiciary to pronounce a legislation void if it conflicts with the Constitution is not merely a tacit assumption but is an express avowal of our Constitution.
The principle is firmly and wisely embedded in our Constitution that the policy of law and the expediency of passing it are matters for the legislature to decide while, interpretation of laws and questions regarding their validity fall within the exclusive advisory or adjudicatory functions of Courts.
The function of courts in that be half is not "The Great Usurpation ' as some American critics of the power of judicial review called it after the American Supreme Court rendered its decision in Dred Scott(1) in 1856.
Rather.
the true nature of that function is what President Lincoln described it: We believe as much as Judge Douglas (perhaps more) in obedience to and respect for the judicial department of government.
We think its decisions on constitutional questions when fully settled, should control not only the particular cases decided, but the general policy of the country, subject to be disturbed only by amendments of the Constitution as provided in that instrument itself.
More than this would be revolution, but we think the Dred Scott decision is erroneous.
We know the court that made it has often overruled its own decisions, and we shall do what we can to have it overrule this.
We offer no resistance to it.
The second limb of the contention is that if we withdraw the question of validity of the Bill for our consideration while the Bill is pending consideration before the Parliament, we will be encroaching upon the functions and privileges of the Parliament.
In the first place.
in dealing with the reference we are not withdrawing any matter from the seizin of the Parliament, much less "lifting" the Bill from the Lok Sabha, as was argued by one of the counsel.
The President has made a reference to this Court in exercise of the powers conferred upon him by article 143(1) and we are under a constitutional obligation to consider the reference and report thereon to the President as best as we may.
Secondly, it is difficult to appreciate which particular function or privilege of the Parliament is wittingly or unwittingly.
encroached upon by our consideration of the constitutional validity of the Bill.
As we have just said, the question whether the provisions of the Bill suffer from any constitutional invalidity falls (1) 15 Lawyers ' Edition 691.
509 within the legitimate domain of the courts to decide.
Parliament can undoubtedly discuss and debate that question while the Bill is on the anvil but the ultimate decision on the validity of a law has to be of the court and not of the Parliament.
Therefore, we will not be encroaching upon any parliamentary privilege if we pronounce upon the validity of the Bill.
We must also mention that though it was argued that the privileges of the Parliament are being encroached upon, none of the counsel was able to specify which particular parliamentary privilege was involved in our consideration of the reference.
May 's Parliamentary Practice was not even mentioned.
Article 105(3) of the Constitution on which a passing reliance was placed provides that the powers, privileges and immunities of each House of Parliament and of the members and the committees of each House, shall be such as may from time to time be defined by Parliament by law and until so defined, shall be those of the House of Commons of the Parliament of the United Kingdom, and of its members and committees, at the commencement of the Constitution.
In the absence of any text or authority showing what are the privileges of the British Parliament in regard to the kind of matter before us, it is impossible to hold that there is a violation of the Parliament 's privileges.
We also see no substance in the argument that there is any violation of the Parliament 's powers under articles 107(1), 108 and 111 of the Constitution.
The reference then is said to be a virtual abrogation of article 32 of the Constitution, an argument which we find to be equally untenable.
Article 32(1) confers a fundamental right on all persons to move the Supreme Court by appropriate proceedings for the enforcement of the rights conferred by Part III of the Constitution.
That right is available to persons whose fundamental rights are encroached upon.
In the proceeding before us the question is whether the bill which is pending before the Parliament contains provisions which are open to a constitutional challenge.
If we hold that the Bill is valid, the Parliament may proceed with it and, we suppose, that if we hold that the Bill is invalid, the Parliament will not spend any time over passing a constitutionally invalid Bill.
The proceeding under article 32(1) being of an entirely different nature from the proceeding contemplated by article 143 (1) of the Constitution, there is neither supplanting nor abrogation of article 32, if we pronounce upon the question referred to us by the President.
Learned counsel for the interveners who oppose the reference urged as one of the planks of attack on the reference that it is futile 510 for us to consider the constitutional validity of the Bill because whatever view we may take, it will still be open to the Parliament to discuss the Bill and to pass or not to pass it as it pleases.
This argument proceeds upon an unrealistic basis, its assumption being that the Parliament will not act in a fair and proper manner.
True, that nothing that we say in this opinion can deter the Parliament from proceeding with the Bill or dropping it.
That is because, no court will issue a writ or order restraining the Parliament from proceeding with the consideration of a bill pending before it.
But we cannot assume, what seems to us to be unfair to that august body, that even if we hold that the Bill is unconstitutional, the Parliament will proceed to pass it without removing the defects from which it is shown to suffer.
Since the constitutionality of the Bill is a matter which falls within the exclusive domain of the courts, we trust that the Parliament will not fail to take notice of the court 's decision.
We are also not disposed to accept the submission that the reference raises a purely political question.
The policy of the Bill and the motive of the mover may be to ensure a speedy trial of person holding high public or political offices who are alleged to have committed certain crimes relating to the period of emergency.
The President, however, has not asked us to advise him as to the desirability of passing the Bill or the soundness of the policy underlying it.
Whether special courts should be established or not, whether political offenders should be prosecuted or not and whether for their trial a speedy remedy should be provided or not, are all matters which may be said to be of a political nature since they concern the wisdom and policy underlying the Bill.
But the question whether the Bill or any of its provisions are constitutionally invalid is not a question of political nature which we should restrain ourselves from answering.
the question referred by the President for our opinion raises purely legal and constitutional issues which is our right and function to decide.
The last submission which requires consideration, the 7th, is that considering the repercussions of the exercise of advisory jurisdiction we should in the interest of expediency and propriety, refuse to answer the reference.
The dissenting opinion of Zafrulla Khan, J. in Estate Duty Bill(1) contains as scatching a criticism of reference jurisdiction as can possibly be imagined.
The learned Judge has referred to the history of advisory jurisdiction, the laws of various countries which provide for advisory jurisdiction, the approach of the courts of those countries to matters concerning advisory jurisdiction, the opinion of (1) , 322.
511 eminent writers like Prof. Felix Frankfurter (who later became a judge of the American Supreme Court) and Prof. Carleton Kemp Allen, and to various decisions of the Privy Council and the House of Lords In short, every possible criticism which can be made against the exercise of advisory jurisdiction has been noticed and made by Zafrulla Khan J in his dissenting opinion.
But, after referring to texts and authorities, the leaned Judge observed that in spite of all that the British Parliament had before it, it thought it wise to incorporate section 213 in the Government of India Act, 1935.
Eventually, the learned Judge held that if the proposal was cast in a form which does not give rise to difficulties, the court might find it possible to pronounce upon it and added that one precaution which might be taken in that behalf was to attach to the reference a draft of the bill which was proposed to be placed before the legislature.
Since the bill on which the Governor General had made the reference to the Federal Court was a fiscal measure, the learned Judge thought that attaching a copy of the bill to the reference was indispensable and in the absence of the bill, it was not possible to answer the reference.
The ultimate conclusion to which the learned Judge came was that in the State of the material made available to the court, no useful purpose could be served by attempting to answer the questions referred to the court.
We have pointed out during the course of our discussion of the various facets of the preliminary objection that since the question referred for our opinion by the President raises a purely constitutional issue and since it is possible to limit the consideration of the reference the two points mentioned by us, it is neither difficult nor inexpedient to answer the reference.
The difficulty pointed out by Zafrulla Khan T. in Estate Duty Bill( ') has been removed in this reference by supplying to us a copy of the Special Courts Bill which is annexed to the reference.
It is no answer then that the Bill might eventually emerge from the legislature in a shape very different from that in which it has been considered by us.
As observed by Zafrulla Khan J., (page 343) in such a case, the opinion of the court will always be read with reference to the proposal placed before it and there will be no danger of its being read with reference to the form which the legislation finally takes.
We will only add that the Constituent Assembly having thought fit to enact article 143 of the Constitution, it is not for us to refuse to answer the reference on the ground that it is generally inexpedient to exercise the advisory jurisdiction.
The argument relating to the inexpediency of advisory jurisdiction was known to the eminent architects of the Constitution and must be deemed to have been considered and rejected by them.
The difficulty of answering a reference in a (1) , 322.
512 given case by reason of the defective frame of questions, msufficiency of data or the like is quite another matter which, as we have indicated, presents no insurmountable difficulty in this reference.
We do not consider it necessary to discuss the American decisions like Baker vs Carr(1) and Powell vs McCormack(2) which were cited in support of the argument that the Court ought not to answer hypothetical questions.
We have already disposed of that contention by pointing out that there is nothing hypothetical or speculative about the reference made by the President in this case.
But apart from that, the American decision have no application because of three main considerations: the American Constitution ' does not contain any provision under which the President can make a reference to the American Supreme Court for obtaining its opinion.
Secondly, there is a rigid separation of powers under the American Constitution; and thirdly, article III, section 2(1) of the American Constitution provides that the judicial power of the United States which, by section1 1 of that article is vested in the Supreme Court, shall extend to all "cases" and "to controversies to which the United States shall be a party; to controversies between two or more States between a State and citizens of another State between citizens of different States, and between a State, or the citizens thereof, and foreign States, citizens or subjects".
In matter, arising under the advisory jurisdiction where there is no lis property so called, there is neither a "case" nor a "controversy" between party and party.
That is why the American Supreme Court has taken the view that "The rule that the United States Supreme Court lacks appellate jurisdiction to consider the merits of a moot case is a branch of the constitutional command that the judicial power extends only to cases or controversies; a case is moot when the issues presented are no longer live or the parties lack a legally cognizable interest in the outcome." (3) That disposes of the preliminary objection to the maintainability of the reference.
For reasons above mentioned, we over rule that objection and proceed to answer the reference, limiting our opinion to the two points mentioned earlier.
Out of the two principal questions which we propose to consider in this reference, the first pertains to the legislative competence of the Parliament to enact certain provisions of the Bill.
The main argument on legislative competence was made by Shri Shiv Shankar who appears (1) ; (2) ; (3) ; 491, 493. 513 on behalf of the State of Andhra Pradesh.
Since the contentions of A the other counsel on that question only highlight different facets of that argument it will be enough to sit out and deal with the main argument.
The attack on Parliament 's power to legislate on matters contained in the Bill raises three issues: ( I ) Has the Parliament legislative competence to provide for the creation of Special Courts as enacted by 1 clause 2 of the Bill ? (2) was the Parliament legislative competence to confer appellate powers on the Supreme Court from judgments and orders of Special Courts as provided in clause 10(1) of the Bill ? and (3) Is it competent to the Parliament to confer jurisdiction on the Supreme Court to entertain and decide appeals and revisions pending before any other court on the date of declaration, as provided in clause 6 of the Bill ? To recapitulate briefly, clause 2 of the Bill provides that the Central Government shall by notification create adequate number of courts to be called Special Courts.
Clause 10(1) of the Bill provides that notwithstanding anything contained in the Code of Criminal Procedure, 1973 an appeal shall lie as of right from any judgment or order of the Special Court to the Supreme Court both on fact and on law.
By clause 6 of the Bill, if at the date of the declaration in respect of any offence, an appeal or revision against any judgment or order in a prosecution in respect of such offence is itself pending in any court of appeal or revision, the same shall stand transferred for disposal to the .Supreme Court.
Shri Shiv Shanker 's argument runs thus: (a) Articles 124 to 147 which occur in Chapter lV, Part V of the Constitution, called "The Union Judiciary" contain an exhaustive enumeration of the class of matters over which the Supreme Court possesses or may be empowered to exercise jurisdiction.
Article 131 confers original jurisdiction on the Supreme Court in certain matters, articles 132, 133 and t34 confer appellate powers upon it in civil, criminal and other proceedings, article 135 saves its jurisdiction and powers, until Parliament by law otherwise provides, with respect to any matter to which the provisions of articles 133 and 134 do not apply if jurisdiction and powers in relation to that matter were exercisable by the Federal Court immediately before the commencement of the Constitution under any existing law, article 136 empowers it to grant, in its discretion, 514 special leave to appeal from any judgment, decree, determination, sentence or order in any cause or matter passed or made by any court or tribunal in India other than a court or tribunal constituted by or under any law relating to the Armed Forces, article 137 confers upon it the power to review any judgment pronounced or order made by it, article 139A confers upon it the power in certain circumstances to withdraw cases pending before the High Court for its own decision, article 142(2) confers upon it the power, inter alia, in regard to investigation or punishment of any contempt of itself and finally, article 143 confers upon it advisory jurisdiction in matters mentioned therein.
The jurisdiction of the Supreme Court, whether appellate or of any other kind, cannot be extended to matters other than those expressly enumerated in these articles.
Clause 10 of the Bill which confers appellate power on the Supreme Court from judgments and orders of Special Courts is therefore unconstitutional.
Chapter IV, Part V, empowers the Parliament by various articles to pass laws for the purpose of confer ring further jurisdiction on the Supreme Court, in addition to that conferred: upon it expressly by the other provisions of that Chapter.
For example, article 133(3) provides that notwithstanding anything contained in th,e article, no appeal shall lie to the Supreme Court from the judgment, decree or final order of one Judge of a High Court(in a civil proceeding), unless Parliament by law otherwise provides.
The Parliament thus is given the power to pass a law providing that, in civil proceedings, an appeal shall lie to the Supreme Court from the judgment, decree or final order of one Judge of a High Court.
Article 134(2) empowers the Parliament to confer by law on the Supreme Court any "further powers" than those conferred by clause 1 of the article, to entertain and hear appeals from any judgment, final order or sentence in a criminal proceeding of a High Court subject to such conditions and limitations as may be specified in such law.
By article 138(1), the II Supreme Court shall have such further Jurisdiction and powers with respect to any of the matters in the union List as Parliament may by law confer.
By 515 article 138(2), the Supreme Court can exercise such A further jurisdiction and powers with respect to any matter as the Government of India and the Government of any State may by special agreement confer, if Parliament by law provides for the exercise of such jurisdiction and powers by the Supreme Court.
Article 139 empowers the Parliament by law to confer on the Supreme Court power to issue directions, orders or writs for any purposes other than those mentioned in article 32(2).
Under article 140, Parliament may make a law for conferring upon the Supreme Court such supplemental powers not inconsistent with any of the provisions of the Constitution as may appear to be necessary or desirable for the purpose of enabling the Court more effectively to exercise the jurisdiction conferred upon it by or under the Constitution.
These provisions being exhaustive of the cases and circumstances in which additional powers or jurisdiction may be conferred on the Supreme Court, Parliament has no competence to pass a law confer ring upon the Supreme Court appellate powers against the judgments and orders of Special Courts, which is a matter neither envisaged nor covered by any of the aforesaid provisions of Chapter IV.
Clause l O of the Bill is therefore beyond the legislative power of the Parliament to enact.
(c) Though Parliament has the power, and exclusively, to legislate on matters enumerated in List I, that power, as provided in article 245(1), is "subject to the provisions of" the Constitution.
Accordingly, the power of Parliament to legislate on matters mentioned, for example, in entry 77 of List I (Constitution, organisation, jurisdiction and powers of the Supreme Court . ), entry 95 ( jurisdiction and powers of all courts, except the Supreme Court, with respect to any of the matters in List I . ), and entry 97 (any other matter not enumerated in List II or List III . ) has to be exercised consistently with and subject to the other provisions of the Constitution.
The law made by the Parliament by virtue of its power to legislate on matters enumerated in Lists I and III will not be valid, if it contravenes any other 516 provision of the Constitution, apart from the provisions of Part III on Fundamental Rights.
(d) Considering the width of the provisions contained in article 136(1), it might have been open to the Parliament to provide that the Supreme Court may, in its discretion, grant special leave to appeal from any judgment or order of the Special Court.
But since, the outer limits of the Supreme Court 's powers are exhaustively dealt with in that article and in the other articles which occur in Chapter IV, Part V of the Constitution, Parliament cannot confer upon .my person the right to file an appeal to the Supreme Court from judgments or orders of Special Courts.
(e) By parity of reasoning, the provision contained in clause 6 of the Bill for the transfer of pending appeals and revisions to the Supreme Court is ultra vires the provisions of Chapter IV, Part V of the Constitution.
The constitutional scheme contained exhaustively in Chapter IV does not contemplate the exercise of revisional jurisdiction by the Supreme Court an(l there fore, the conferment of that jurisdiction by clause 6 is beyond the Parliament 's competence.
If revisions transferred to the Supreme Court are considered as falling within the special jurisdiction of the Supreme Court under article 136(1), clause 6 of the Bill will offend against the provisions of that article because the pre requisite for the exercise of the jurisdiction under that article is the grant of special leave by the Supreme Court.
The main plank of the reply of the learned Attorney General and the learned Solicitor General in answer to these contentions is that the provisions of Chapter IV, Part V of the Constitution are not exhaustive of the class of matters in which the Supreme Court possesses jurisdiction or in which the Parliament, by law, can confer jurisdiction upon it.
The provisions of Chapter IV, it is argued, cannot override the power conferred by the Constitution on the Parliament to legislate on matters which fall within Lists I and III of the Seventh Schedule.
That is to say, Chapter I of Part XI of the Constitution which deals with 'Distribution of Legislative Powers ' must be permitted to have its full sway and nothing containing in Chapter lV, Part V can be construed as derogating from that power.
No implications can arise from the provisions of that Chapter so as to nullify the legislative competence 517 the Parliament to legislate on matters which fall within the Union h and the Concurrent Lists.
Therefore, it is argued Parliament 's power by to enlarge the jurisdiction of the Supreme Court, quantitatively and qualitatively, is unquestionable so long as the law creating or conferring that jurisdiction is with respect to matters enumerated in l in I or List III.
Learned counsel rely on the provisions of article 138(1) and article 246(1) and on entries 77 and 97 of List I for sustaining the Parliament 's power to enact clauses 6 and 10(1) of the Bill.
As regards the power to enact clause 2, reliance is placed on entry 11A of list III as supporting Parliament 's competence to provide for the creation of Special Courts.
The challenge to the legislative competence of Parliament to provide for the.
creation of Special Courts is devoid of substance.
Entry 11A of the Concurrent List relates to "Administration of justice; constitution and organisation of all courts, except the Supreme Court and the High Court. ' By virtue of article 246(2), Parliament has clearly the power 'to ma1.e laws with respect to the constitution and organisation, that is to say, the creation and setting up of Special Courts.
Clause 2 of the n Bill is therefore within the competence of the Parliament to enact.
The field of legislation covered by entry 11A of List III was originally a part of entry 3 of List II.
By section 57(b) (iii) of the 42nd Amendment Act, 1976 which came into force on January 3, 1977 that part was omitted from entry 3, List II and by clause (c) of section 57, it was inserted into list III as item 11A.
This transposition has lel to the argument that the particular amendment introduced by section 57(b) (iii) and (c)" is invalid since it destroys a basic feature of the Constitution as originally enacted, namely, federalism.
We are unable to appreciate how the conferment of concurrent power on the Parliament, in place of the exclusive power of the States, with respect to the constitution and organisation of certain courts affects the principle of federalism in the form in which our Constitution has accepted and adopted it.
But assuming for the sake of argument that vesting of such power in the States was a basic feature of the Constitution, we hare to take the Constitution as we find it for the purposes of this reference.
The plainest implication of the question referred to us by the President is whether, on the basis of the existing constitutional provisions, the Bill or any of its provisions.
if enacted, would be invalid We cannot, therefore, entertain any argument in this proceeding that a constitutional provision introduced by an amendment of the Constitution is invalid.
Having seen that the Parliament has legislative competence to create Special Courts, the next branch of the argument which falls falls consideration is whether it is competent to the Parliament to confer 518 appellate jurisdiction on the Supreme Court so as to enable or require it to hear appeals from judgments and orders of Special Courts.
The argument, put in another form, is that it is not competent to the Parliament to confer upon a litigant the right of right an appeal to the Supreme Court from the judgment or order of a Special Court.
the provision for appeal, it is contended, might at the highest have been made subject to the pre condition of the grant of special leave to appeal by the Supreme Court, as under article 136 of the Constitution .
The very foundation of this argument is fallacious.
The argument rests on the plea that the provisions of Chapter IV, Part V of the Constitution are exhaustive and therefore, no more and no greater jurisdiction can be conferred on the Supreme Court than the provisions of that Chapter authorise or warrant.
It is impossible to accede to the contention that any such implications can arise out of the provisions of Chapter IV.
The contention if accepted ' will result in the virtual abrogation of the legislative power conferred on the Parliament by article 246 (1) and (2) of the Constitution.
Such a construction which renders illusory or nugatory other; important provisions of the Constitution must be avoided, especial when it seeks its justification from a more implication arising out of the fasciculus Or articles contained in Chapter IV.
The Constitution does not pro vide that notwithstanding anything contained in article 246(1) and(2), the Parliament shall have no power or competence to enlarge the jurisdiction of the Supreme Court, quantitatively or qualitatively, except in accordance with and to the extent to which it is permissible to it to do so under any of the provisions of Chapter IV Part V.
The provisions of that Chapter must therefore be read in harmony and con junction with the other provisions of the Constitution and not in derogation thereof.
A pertinent question was posed by Shri Shiv Shanker or this aspect of the matter.
He asked: If Parliament is to be conccded the power to enlarge the jurisdiction of the Supreme Court in the manner impugned herein, what was the object and purpose behind provisions like those contained in articles 133(3), 134f2), 138(1 ) 138( '), 139 and article 140? What these articles empower the Parliament to do could with equal competence and validity have been done by the Parliament in the exercise of its powers under article 246(1) and (2).
The reason why, according to the learned counsel, the framers of the Constitution thought it necessary to incorporate special provisions in the Constitution empowering or enabling the Parliament to pass laws in respect of the Supreme Court 's jurisdiction was to limit its powers 519 in that behalf to specific matters and circumstances mentioned expressly in those special provisions.
In other words the contention is that specific provisions of the Constitution under which the jurisdiction of the Supreme Court can be enlarged must override the general provisions under which Parliament can pass laws in respect of matters enumerated in Lists I and III of the Seventh Schedule We consider it impossible to accept the argument that the conferment of power to pass laws on specific matters limits th.e Parliament 's power to pass laws to those matters only and takes away its power to pass laws on matters which are otherwise within its legislative competence.
The language of article 246(1) and (2) is clear and explicit and admits of no doubt or difficulty.
It must, therefore, be given its due effect.
In the first place, therefore, no implication can be read into the provisions of Chapter IV, Part V of the Constitution which their language does not warrant; and secondly, the attempt has to be to harmonize the various provisions Or the Constitution and not to treat any part of it as otiose or superfluous.
Some amount of repetitiveness or overlapping is inevitable in a Constitution like ours which unlike the American Constitution, is drawn elaborately and r runs into minute details.
There is therefore, all the greater reason why, while construing our constitution, care must be taken to see that powers conferred by its different provisions are permitted their full play and any one provision is not, by construction, treated as nullifying the existence and effect of another.
Indeed.
is it be correct that the specific powers conferred by some of the articles in Chapter IV, Part V are exhaustive of matters in which Parliament can confer jurisdiction on the Supreme Court, it was wholly inappropriate and unnecessary to provide by article 138(1) that the Supreme Court shall have such further jurisdiction and powers with respect to any of the matters in the Union List as Parliament: may by law confer.
this article is relied upon heavily as showing that if, even without it, it was competent to the Parliament by virtue of` its power under article 246(1) and (2) to enlarge the Supreme Court 's jurisdiction, no purpose could be served and nothing gained by enacting that article.
The answer to this contention is two fold as indicated above.
Besides, the object of article 138(1) is to further enlarge the Parliament 's power to confer jurisdiction on the Supreme Court even in matters already dealt with specifically in Chapter IV, Part V.
For example article 136(2) provides that nothing in clause (I) shall apply to any judgment, determination sentence or order passed or made by any court or tribunal constituted by or under any law relating to the Armed Forces.
But by virtue of article 138(1) read with entry 2 and entry 93 of List I, it may be competent to the 520 Parliament to remove the fetter on the Supreme Court 's jurisdiction to grant special leave and extend that jurisdiction to the judgment, determination; sentence or order passed or made by any court or tribunal constituted by ar under any law relating to the Armed Forces.
Likewise, acting under article 138 (1), the Parliament may enlarge the n original jurisdiction conferred upon the Supreme Court by article 131.
Even assuming that article 138(1) may not have been intended to achieve any purpose as aforesaid, its object could at least be to empower the Parliament to confer any special kind of jurisdiction and powers on the Supreme Court with respect to a matter in the Union List.
If the argument regarding the exhaustiveness of the provisions, contained in Chapter IV, Part V were correct, by parity of reason not it will be in competent to the Parliament to pass a law in respect of matter, mentioned in entry 72 of List I (Election. to the offices of President and Vice President. ), by reason of the fact that article 71 of the Constitution empowers the Parliament specifically to regulate by law any matter relating to or connected with the election of a President or Vice President, including the grounds on which such election may be questioned.
Article 71, as indeed many other articles, shows that there are overlapping provisions in our Constitution.
The Parliament, therefore, has the competence to pass laws in respect of matters enumerated in Lists I and III notwithstanding, the fact that by such laws, the jurisdiction of the Supreme Court is enlarged in a manner not contemplated by or beyond what is contemplated by the various articles in Chapter IV, Part V. Preventive detention, for example, is the subject matter of entry 3 in List III.
As _contended by Shri Ram Jethmalari, it is competent to the Parliament to legislate upon that topic by virtue of its powers under article 246(2) and also to provide by virtue of its powers under article 246 (1) read with entry 77 of List I that an appeal shall lie to the Supreme Court from an order of detention passed under a law of preventive detention.
What now remains to be seen is whether there is any entry in list I or List III of the Seventh Schedule which covers the subject matter of the jurisdiction of the Supreme Court so that Parliament can have the competence to pass a law with respect to that matter.
This question hardly presents any difficulty.
Entry 77 of List I reads thus: Constitution, organisation, jurisdiction and powers of the Supreme Court (including, contempt of such Court), and the fees taken therein; persons entitled to practise before the Supreme Court.
521 Once the argument regarding the exhaustiveness of the provisions A of Chapter IV of Part V is rejected, Parliament clearly has the competence to provide by clause 10 (1) of the Bill that notwithstanding anything contained in the Code of Criminal Procedure, 1973 an appeal shall lie a, of right from any judgment or order of 2 Special Court to the Supreme Court both on fact and on law.
A law which confers additional powers on the.
Supreme Court by enlarging its jurisdiction is evidently a law with respect to the "jurisdiction and powers" of that court.
Entry 77 of List I presents, as contended by the learned Attorney General, a striking contrast with entry 95 of List I, entry 65 of List II and entry 46 of List III.
The operation of the three last mentioned entries is expressly limited by a qualifying clause, which limits the field of legislation to the matters mentioned in the particular list in which the entry appears.
Entry 95 of List I relates to jurisdiction and powers of all courts, except the Supreme Court with respect to any of the matters in this List".
Entry 65 of List II relates to jurisdiction and powers of all courts, except the Supreme Court, "with respect to any of the matters in this List Entry 46 of List III relates to jurisdiction and powers of all courts, except the Supreme Court, "with respect to any of the matters in this List .
A reference may also be made m passing to article 323B to which Shri Ram Jethmalani drew our attention, which provides that the appropriate Legislature may, by law, provide for the adjudication or trial by tribunals of any disputes, complaints, or offences "with respect to all or any of the matters specified in clause (2) with respect to which such Legislature has power to make laws".
Entry 77 of List I stands out in its uniqueness amongst cognate entries in the legislative Lists by its wide and unqualified language.
The field of legislation covered by it is not circumscribed by the qualification, "with respect to any of the matters in this List", that is, List 5.
This contrast emphasises that the power of the Parliament to legislate with respect to a matter contained in entry 77, which, in the instant case, is "jurisdiction and powers of the Supreme Court" can be exercised without reference to any of the matters contained in List I or in any other List.
There can be no justification, to revert to the argument already disposed of by us f curtailing the amplitude of the Parliament 's power in relation to the subject matter of entry 77 by reason of anything contained in Chapter IV, Part V.
The problem is of a twin variety and has two interlaced facets.
If there is power in the parliament to establish a new court, as undoubtedly there is by virtue of article 246(2) read with entry 11A of List III, 15 9 78SCI/78 522 it would be strange that the Parliament should not possess the whole some power to provide for an appeal to the Supreme Court from the decision of that Court.
Loopholes and lacunae can conceivably exist in any law or Constitution but, as pointed out by us above, our Constitution has not only provided for the power to create new Courts but, it has taken care to confer upon the Parliament the power to provide that an appeal shall lie from the decision of such court directly to the Supreme Court.
In the exercise of its power to establish a new Court, Parliament may by reasons of exigency consider it necessary to create a Court which does not conform to an established pattern in the hierarchy of existing courts.
The status of the newly created Court may by such by reason of its composition or the nature of matters which may come before it that an appeal can justly be provided from its judgment, and orders to the Supreme Court only.
That explains the justification for the amplitude of the legislative field covered by entry 77, List I. It must follow as a logical corollary that Parliament also possesses the legislative competence to provide by clause 6 of the Bill that if at the date of the declaration in respect of any offence, an appeal or revision against any judgment or order in a prosecution in respect of such offence is pending in any court of appeal or revision, the same shall stand transferred to the Supreme Court.
The provision contained in clause 6 falls squarely within the field of legislation delineated by entry 77 of List I. The subject matter of clause 6 is the jurisdiction and powers of the Supreme Court.
Entry 2 of List III, "Criminal procedure, including all matters included in the Code of Criminal Procedure at the commencement of this Constitution" will also take care of clause 6.
Indeed, that entry, giving to it the widest possible meaning, may even support the provision in clause 10(1).
In view of our conclusion that Parliament has the legislative competence to enact clauses 6 and 10(1) of the Bill, it is unnecessary to consider the argument of the learned Solicitor General that, everything else failing.
Parliament would have the competence to legislate upon the jurisdiction and powers of the Supreme Court by virtue of article 248(1) read with entry 97 of List I.
The residuary power of legislation can be resorted to only if any particular matter, on which it is proposed to legislate, is not enumerated in the Concurrent or State List.
To sum up, we are of the opinion that clauses 2, 6 and 10(1) of the Bill are within the legislative competence of the Parliament.
That to say, Parliament has the competence to provide for the creation 523 of Special Courts as clause 2 of the Bill provides, to empower the A supreme Court to dispose of pending appeals and revisions as provided for by clause 6 of; the Bill and to confer jurisdiction on the Supreme Court by providing, as is done by clause 10(1), that an appeal shall lie as of right from any judgment or order of a Special Court to the Supreme Court both on fact and on law.
Though the Parliament 's legislative competence to create Special Courts, for the purpose in the instant case of trying criminal cases, cannot be denied for reasons set out above, it is necessary to advert to an offshoot of the argument to the effect that, in any event, Parliament has no power to create a court outside the hierarchy of Courts recognized by the Constitution.
It was suggested during the course of arguments on the question of legislative competence that the Constitution contains a complete code of judicial system which provides for the Supreme Court at the apex and for the High Courts, the District Courts and subordinate courts next in order of priority.
Article 124 provides that there shall be a Supreme Court of India, article 214 that there shall be a High Court for each State, article 231(1) that Parliament may by law establish a common High Court for two or more States or for two or more States and a union territory while Chapter VI of Part VI of the Constitution provides by articles 233 & 234, for the District Courts and courts subordinate thereto.
To complete the picture, article 236 (a) defines a "district judge" to include the judge of a city civil court, additional district judge, joint district judge, assistant district judge, chief judge of a small cause court, chief presidency magistrate additional chief presidency magistrate.
sessions judge, additional sessions judge and assistant sessions judge.
Finally, article 237 empowers the Governor to apply the provisions of chapter VI and any rules made thereunder to any class or classes of magistrates.
The Constitution having provided so completely and copiously for a hierarchy of Courts.
it is urged that it is impermissible to the Parliament to create a court or a class of courts which does not fall within or fit in that scheme.
An important limb of this argument which requires serious consideration is that the creation of a trial court which is not subject to the control and superintendence of the High Court is detrimental to the Constitutional concept of judicial independence, particularly when the Bill empowers the Central Government by clause 5 to designate the Special Court in which a prosecution shall be instituted or to which a pending prosecution shall be transferred.
We are unable to accept this argument.
What is important in the first place is to inquire whether the Parliament has legislative competence 524 to create Special Courts.
If it has, the next question is whether there is anything in the Constitution which limits that power to the setting up of yet another Court of the same kind and designation provided for in the Constitution 's hierarchical system of courts.
We see nothing in the Constitution which will justify the imposition of such a limitation on the Parliament 's power to create Special Courts.
Indeed, the argument partakes of the same character as the one that no greater or different powers can be conferred on the Supreme Court than are to be found of provided for in chapter IV, part V of the Constitution.
The implications of the Constitution ought not to be stretched so far and wide as to negate the exercise of powers which have been expressly and advisedly conferred on the Parliament.
The words of entry 11A of the Concurrent List which relates to "Administration of Jutice; constitution and organisation of all courts, except the Supreme Court and the High Court" are sufficiently wide in their amplitude to enable the Parliament not merely to set up Courts of the same kind and designation as are referred to in the provisions noticed above but to constitute and organize, that is to say, create new or Special Courts, subject to the limitation mentioned in the entry as regards the Supreme Court and the High Courts.
It is true that the Special Courts created by the Bill will not have the Constitutional status which High Courts have because such courts.
are not High Courts as envisaged by the Constitution.
Indeed, there can but be one High Court only for each State, though two or more States or two or more States and a union territory can have a common High Court.
It is also true to say that the Special Courts are not District Courts within the meaning of article 235, with the result that the control over them will not be vested in any High Court.
But we do not accept that by reason of these considerations, the creation of Special Courts is calculated to damage or destroy the constitutional safeguards of judicial independence.
Our reasons for this view will become clearer after we deal with the questions arising under articles 14 and 21 but suffice it to say at this stage that the provision in clause 10 (1) of the Bill for an appeal to the Supreme Court from every judgment and order of a Special Court and the provision for transfer of a case from one Special Court to another (which the Bill does not contain but without which, as we will show, the Bill will be invalid) are or will be enough to ensure the independence of Special Courts.
Coupled with that will be the consideration, as we will in course of our judgment point out that only sitting judges of the High Courts shall have to be appointed to the Special Courts.
A sitting judge of the High Court, though appointed to the Special 525 Court, will carry with him his constitutional status, rights, privileges and obligations.
There is no reason to apprehend that the mere change of venue will affect his sense of independence or lay him open to the influence of the executive.
One may also not be unmindful of the benign presence of article 226 of the Constitution which may n appropriate cases be invoked to ensure justice.
Equally important as the Parliament 's legislative competence, to enact these provisions and of greater social significance is the question whether the Bill violates the guarantee of equality contained in article 14 of the constitution.
That article provides: The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India.
Several objections, from sublime to not so sublime, have been taken against the provisions of the Bill in the context of article 14.
But, broadly, that challenge is directed against the validity of the classification which the Bill makes and the lack of relationship between the basis of that classification and the object of the Bill.
The Bill, it is further contended, creates administrative tribunals for trying offences which is against the basic tenet of the guarantee of equality.
The Bill leaves it open to the executive to discriminate between persons situated similarly by picking and choosing some of them for being tried by the Special Courts, leaving others to be tried by the regular hierarchy of courts.
The procedure prescribed by the Bill for trial before the Special Courts is alleged to be onerous in comparison with the procedure which ordinary courts generally adopt, subjecting thereby a class of persons, left to be chosen by the executive with an evil eye, to hostile and unfavourable treatment.
The Bill, it is contended, furnishes no guidance for making the declaration under section 4(1) for deciding who and for what reasons should be sent up for trial to the Special Courts and such guidelines as it purports to lay down are vague and indefinite.
These arguments are met by the learned Attorney General, the learned Solicitor General, the various Advocates General and Shri Ram Jethmalani by pointing out that the Bill is not by any manner an instance of class legislation; that it provides for making a classification with reference to the nature of the offences, the public position occupied by the offenders and the extraordinary period during which the offences are alleged to have been committed; that the provisions f the Bill and the recitals of the preamble provide sufficient and 526 definite guidance for making the requisite declaration for deciding who should be sent up for trial to the Special Courts; that, in the context, the Bill does not vest arbitrary or uncanalised power in the Government to pick and choose persons for being tried by Special Courts, that the procedure prescribed by the Bill for trial before the Special Courts.
far from being more onerous than the ordinary procedure, is in certain important respects more beneficial to the accused and since, in any event, the procedure of the Special Courts is not more onerous than the ordinary procedure, the provisions of the Bill involve no discrimination violative of article 14.
A brief resume of the decisions of this court bearing on laws which provided for the creation of special courts will facilitate a clearer perception of the true position and a better appreciation of the points for and against the Bill.
The written brief of the Union Government contains a pithy account of Special Courts, from which it would appear that such courts were set up during the British regime on a number of occasions, moire especially under what may broadly be termed as Security laws like the Rowlatt Act, 1919, the Bengal Provincial Law (Amendment) Act, 1925, the Sholapur Martial Law Ordinance 1930, the Bengal Criminal Law (Amendment) Acts, 1930 and 1932, the Bihar Maintenance of Public Order Act, the Bombay Public Safety Measures Act, 1947, the C.P. and Berar Public Safety Act and the U.P. Maintenance of Public Order Act.
These laws were draconian in nature and were characterised by a denial of the substance of a fair trial to those who had the misfortune to fall within the sweep of the truncated procedure prescribed by them.
They provided a summary procedure for deprivation of the right to life and liberty without affording to the aggrieved person the opportunity to carry an appeal to the High Court for a dispassionate examination of his contentions.
Special Courts were set up under these laws mostly to suppress the freedom movement in India.
They were not set up purportedly to save a democracy in peril.
Therefore, they inevitably acquired a sinister significance and odour.
After the advent of independence and the enactment of our Constitution, Special Courts were set up under various laws to deal with threats to public order and to prevent corruption amongst public servants.
In the years following upon the inauguration of the Constitution in 1950, this Court had to consider the validity of laws under which various State Governments were empowered by the State Legislatures to set up Special Courts for the trial of such offences or classes of offences or cases or classes of cases as the State Governments may by general or special order in writing direct.
The earliest 527 case, after the Constitution came into force, which refers to the setting up of special Tribunals is Janardan Reddy & Others vs State of Hyderabad & Others(1) in which the Military Governor of Hyderabad, by virtue of the powers delegated to him by the Nizam, constituted Special Tribunals which consisted of three members appointed by him for trying offences referred to them by the Governor by a general or special order.
But the decision in that case turned on the question whether the judgment of the Hyderabad High Court which was pronounced before January 26, 1950 and which had acquired a finality could be reopened before the Supreme Court under the provisions of the Constitution.
That question was answered in the negative and no argument arose or was made regarding the violation of article 14.
The contention that the special procedure prescribed for trial before Special Courts violated the guarantee of equality conferred by article 14 was raised specifically and was considered by this Court in The State of West Bengal vs Anwar Ali Sarkar, (2) Kathi Raning Rawat vs The State of Saurashtra,(3) Lachmandas Kewalram Ahuja & Anr.
vs The State of Bombay,(4) Syed Qasim Razvi vs The State of Hyderabad & Ors.,(5) Habeeb Mohamed vs The State of Hyderabad,(6) Rao Shiv Bahadur Singh & Anr.
vs The State of Vindhya Pradesh,(7) Kedar Nath Bajoria vs The State of West Bengal(8) and Asgarali Naizarali Singaporawalla vs The State of Bombay (9). 'the procedure prescribed by the various laws in these cases was, almost without exception, held to be discriminatory, about which no serious dispute could reasonably be raised.
Since the special procedure was more harsh and onerous than the ordinary procedure prescribed for the trial of offences, the further question which this Court was required to consider was whether the classification permissible under the particular laws was valid.
If the classification was valid, persons who were grouped together and who were distinguished from others who were left out of the group on an intelligible differentia could legitimately be tried by a different procedure, even if it was more onerous, provided the differentia had a rational relation to the object sought to be achieved by the statute in question.
(1) ; (2) ; (3) ; (4) ; (5) (6) ; (7) ; (8) ; (9) ; 528 In Anwar Ali Sarkar (supra) it was held by the majority that section 5(1) of the West Bengal Special Courts Act, 1950 was wholly void since it conferred arbitrary powers on the Government to classify offences or cases at its pleasure and the Act did not lay down any policy or guidelines for the exercise by the Government of R its discretion to classify cases or offences.
It may be mentioned that the Act was a verbatim copy of the Ordinance which was framed before the Constitution had come into force and as observed by Fazal Ali J .
(page 308), article 14 could not have been present to the minds of those framed the Ordnance.
As regards the reference in the preamble to the necessity for speedier trial of offences, it was held that even if the words of the preamble were read into section 5(1), the expression "speedier trial" was too vague, uncertain and elusive to afford a basis for rational classification.
Das J. held the section to be partially void in so far as it empowered the Government to direct "cases" as distinguished from "classes of cases" to be tried by a Special Court.
According to the learned Judge, the provision for speedier trial of certain offences was the object of the Act which was a distinct thing from the intelligible differentia which had to be the basis for the classification.
The differentia and the object being different elements, the object by itself could not be the basis for classification of offences or cases.
"Speedier trial" was indeed desirable in the disposal of all cases or classes of offences or classes of cases.
Patanjali Sastri C.J. in his dissenting judgment upheld the validity of the entire section on the view that it was impossible to say that the State Government had acted arbitrarily or with a discriminatory intention in referring the cases to the Special Court since there were special features which marked off the particular group of cases as requiring speedier disposal than was possible under the ordinary procedure.
Kathi Raning Rawat(supra) was decided by the same bench as Anwar Ali Sarkar.
The two cases were heard partly together but the former was adjourned to enable the State Government to file an affidavit explaining the circumstances which led to the passing of the particular Ordinance.
Section 11 of the Saurashtra State Public Safety Measures (Third Amendment) Ordinance, 1949 which was impugned in Kathi Raning Rawat (supra) was similar to section 5(1) of the 'West Bengal Special Courts Act, 1950.
It referred to tour distinct categories, namely, "offences", "classes of offences", "cases" and "classes of cases" and empowered the State Government to direct any one or more of these categories to be tried by the Special Court constituted under the Ordinance.
It was held by the majority 529 that the preamble to the Ordinance which referred to "the need to provide for public safety, maintenance of public order and the preservation of peace and tranquillity in the State of Saurashtra" together with the affidavit filed by the State Government explaining the circumstances under which the impugned order was passed, afforded a basis for distinguishing the case from Anwar Ali Sarkar,(supra) since it was clear that the Government had sufficient guidance for classifying offences, classes of offences or classes of cases for being tried by the Special Procedure.
Therefore, according to the majority, Section 11 of the Ordinance in so far as it authorized the State Government to direct offences, classes of offences or classes of cases to be tried by the Special Court was not violative of article 14 and the notification which was issued under that part of the Ordinance was not invalid or ultra vires Mukherjee J. and Das J, who delivered two out of the four majority judgments pointed out the distinction between the notification issued in Anwar Ali Sarkar(supra) and that issued in Kathi Raning Rawat(supra) (see pages 454 455 and page 470).
Whereas, the former was issued under that part of section 5(1) of the West Bengal Special Courts Act which authorized the State Government to direct particular "cases" to be tried by the Special Court, the latter was issued under that part of section 11 of the Saurashtra Ordinance which authorized the State Government to direct "offences", "classes of offences", or "classes of cases" to be tried by the Special Court.
In Lachmandas Ahuja,(supra) a Bank dacoity case was referred for trial to a Special Judge by the Bombay Government under section 12 of the Bombay Public Safety Measures Act, 1947 which was precisely in the same terms as section 5(1) of the West Bengal Act and section 11 of the Saurashtra Ordinance.
The question was squarely covered by the ratio of the decisions in Anwar Ali Sarkar and Kathi Raning Rawat (supra) by the application of which the majority held that, on a parity of reasoning, section 12 was unconstitutional to the extent to which it authorized the Government to direct particular "cases" to be tried by a Special Judge.
Patanjali Sastri 1 ' C. J. did not differ from the majority on this aspect of the matter.
He held that, granting that the particular part of section 12 was discriminatory in view of the decision in Anwar Ali Sarkar,(supra) the trial which had already started could not be vitiated by the Constitution coming into force subsequently.
Indeed, the learned Attorney General who appeared for the State of Bombay II did not controvert the legal position regarding the invalidity of the relevant part of section 12.
530 IN Syed Qasim Razvi, Habeeb Mohamed and Rao Shiv Bahadur Singh,(supra) the trials had commenced prior to the date when the constitution came into force.
It was held by the majority in the first of these cases and by a unanimous Court in the other two, that article 13 of the Constitution had no retrospective effect, that a pre Constitution law must be held to be valid for all past transactions l and therefore, the Special Tribunal or Special Court had validly taken cognizance of the cases before them.
What remained of the trial after the Constitution came into force was held not to deviate from the normal standard in material respects so as to amount to a denial of the equal protection of laws within the meaning of article 14.
In Kedar Nath Bajoria (supra) the case of the appellant and two others was allotted by the State Government to the Special Court which was constituted by the Government under section 3 of the West Bengal Criminal Law Amendment Act, 1949.
The trial commenced on January 3, 1950 and nine prosecution witnesses were examined in chief before January 26 when the Constitution came into force.
The order of conviction was recorded by the Special Court on August 29, 1950 under sections 120B and 420 of the Penal Code and section 5(2) of the Preventive Corruption Act, 1947.
The appellants ' contention that section 4 of the Act under which the State Government had allotted their case to the Special Court violated article 14 by the application of the ratio in Anwar Ali Sarkar (supra) was rejected by the majority, Bose J. dissenting, on the ground that having regard to the underlying purpose and policy of the Act as disclosed by its title, preamble and its provisions, the classification of the offences for the trial of which the Special Court was set up and a special procedure was laid down could not be said to he unreasonable or arbitrary.
In coming to this conclusion, the Court relied on what was described as "well known" that during the post war period, several undertakings which were established for distribution and control of essential supplies gave special opportunities to unscrupulous persons in public services, who were put in charge of` such undertakings, to enrich themselves by corrupt practices.
Viewed against that background, the Court considered that offences mentioned in the Schedule to the Act were common and widely prevalent during the particular period and it was in order to place an effective check upon these offences that the impugned legislation was thought necessary.
Such a legislation, according to the majority, under which Special Courts were established to deal with special type of cases under a shortened and simplified procedure, was based on a perfectly intelligible principle of classification having a clear and reasonable relation 531 to the object sought to be attained.
It was contended on behalf of A the appellants that the Act conferred an unfettered discretion on the State Government to choose any particular case of an individual accused and send it for trial to the Special Court.
This argument was rejected on the ground that it was competent to the legislature to leave it to an administrative authority to apply a law selectively to persons or things within a defined group by indicating the underlying policy and purpose in accordance with which and in fulfilment of which the administrative authority was expected to select the persons or things to be brought within the operation of the law.
The mere circumstance, according to the majority, that the State Government was not compellable to allot all cases of offences set out in the Schedule to Special Judges but was vested with a discretion m the matter and could choose some cases only for trial before the Special Court did not offend against article 14.
In Asgarali Nazarali Singaporawalla, (Supra) the Criminal Law Amendment Act, 1952 enacted by the Parliament came into force whilst the appellant along with others was being tried before the Presidency Magistrate, Bombay, for offences under section 161 read with section 116, etc.
Of the Penal Code.
The Act provided for the trial of offences of bribery and corruption by the Special Judges and for the transfer of all pending trials to such Judges.
The Presidency Magistrate continued the trial despite the passing of the Act and acquitted the appellants.
It was held by this Court.
unanimously that the Act did not violate article 14 since the offences of bribery and corruption by public servants could appropriately be classified in one group or category.
The classification which was founded on an intelligible differentia was held to bear a rational relationship with the object of the Act which was, to provide for speedier trial of certain offences.
An argument was pressed upon this Court which was based on the observations of Mahajan J. and Mukherjea J. in Anwar Ali Sarkar (Supra) at pages 314 and 328 respectively, that the speedier trial of offences could not afford a reasonable basis for classification.
That argument apparently did not find favour with the Court which said (page 691) that the particular observations ' of the learned Judges in Anwar Ali Sarkar might, standing by themselves, lend support to the argument but the principle underlying those observations was not held to be conclusive by this Court in Kedar Nath Bajoria.
(Supra) This analysis will be incomplete without reference to a recent decision of this Court in Maganlal Chhagganlal (P) Ltd. vs Municipal 532 Corporation of Greater Bombay & Ors.(1) that case two parallel procedures, one under Chapter VA Or the Bombay Municipal Corporation Act, 1888 and the other under the Bombay Government Premises (Eviction) Act, 1955, were available for eviction of persons from public premises.
The constitutional validity of the relevant provisions of the two Acts was challenged on the ground that they contravened article 14, since the procedure prescribed by the two Acts was more drastic and prejudicial than the ordinary procedure of a civil suit and it was left to the arbitrary and unfettered discretion of the authorities to adopt such special procedure against some and the ordinary remedy of civil suit against others.
It was held by this Court that where a statute providing for more drastic procedure different from the ordinary procedure covers the whole field covered by the ordinary procedure without affording any guidelines as to the class of cases in which either procedure is to be resorted to, the statute will be hit by article 14.
However, a provision for appeal could cure the defect and if from the preamble and the surrounding circumstances as well as the provisions of the statutes themselves, explained and amplified by affidavits, necessary guidelines could be spelt out, the statute will not be hit by article 14.
On the merits of the procedure prescribed by the two Acts it was held by the Court that it was not so harsh or unconsionable as to justify the conclusion that a discrimination would result if resort to there is had in some cases and to the ordinary procedure of civil courts in others.
By a separate but concurring judgment two of us, namely, Bhagwati, J. and V. R. Krishna Iyer J. held that it was inevitable that when a special procedure is prescribed for a defined class of persons, such as occupiers of municipal or government premises, discretion which is guided and controlled by the underlying policy and purpose of the legislation has necessarily to be vested in the administrative authority to select occupiers of municipal or government premises for bringing them within the operation of the special procedure.
The learned Judges further observed that minor differences between the special procedure and the ordinary procedure is not sufficient for invoking the inhibition of the equality clause and that it cannot be assumed that merely because one procedure provides the forum of a regular court while the other provides for the forum of an administrative tribunal, the latter, is necessarily more drastic and onerous than the former.
Therefore, said the learned Judges, whenever a special machinery is devised by the legislature entrusting the power of determination of disputes to an authority set up by the legislature in substitution of regular courts of law, one should (1) ; 533 not react adversely against the establishment of such an authority merely because of a certain predilection for the prevailing system of administration of justice by courts of law.
In the context of the need for speedy and expeditious recovery of public premises for utilisation for important public uses, where dilatoriness of the procedure may defeat the very object of recovery, the special procedure prescribed by the two Acts was held not to be really and substantially more drastic and prejudicial than the ordinary procedure of a civil court.
The special procedure prescribed by the two Acts it was observed, was not so substantially and qualitatively disparate as to attract the vice of discrimination, There are numerous cases which deal with different facets of problems arising under article 14 and which set out principles applicable to questions which commonly arise under that article.
Among those may he mentioned the decisions in Budhan Choudhry and Others vs The State of Bihar,(1) Shri Ram Krishna Dalmia vs Shri Justice section R. Tendolkar & Others,(2) Sri C. L. Emden vs The State of U.P.(3) Kangsari Haldar & Another vs The State of West Bengal,(4) Jyoti Persad vs The Administrator for the Union Territory of Delhi(5) and The State of Gujarat and Another vs Shri Ambica Mills Ltd., Ahmedabad, etc.(6) But, as observed by Mathew J. in the last mentioned case, "it would be an idle parade of familiar learning to review the multitudinous cases in which the constitutional assurance of equality before the law has been applied".
We have, therefore.
confined our attention to those cases only in which special tribunals or courts were set up or Special Judges were appointed for trying offences or classes of offences or cases or classes of cases.
The survey which we have made of those cases may be sufficient to give a fair idea of the principles which ought to be followed in determining the validity of classification in such cases and the reasonableness of special procedure prescribed for the trial of offenders alleged to constitute a separate or distinct class.
As long back as in 1960.
it was said by this Court in Kangsari Haldar (Supra) that the prepositions applicable to cases arising under article 14 "have keen repeated so many times during the past few years that they now sound almost platitdinous '.
What was considered to (1) ; (2) ; (3) 11960] (2) S.C.R. 592.
(4) ; (5) ; (6) ; 534 be platitudinous some 18 years ago has, in the natural course of events, become even more platitudinous today, especially in view of the avalanche of cases which have flooded this Court.
Many a learn e i Judge of this Court has said that it is not in the formulation of principles under article 14 but in their application to concrete cases that difficulties generally arise.
But, considering that we are sitting in a larger Bench than some which decided similar cases under article 14, and in view of the peculiar importance of the questions arising in this reference, though the questions themselves are not without a precedent, we propose, though undoubtedly at the cost of some repetition, to state the prepositions which emerge from the judgments of this Court in so far as they are relevant to the decision of the points which arise for our consideration.
Those propositions may be stated thus: 1.
The first part of article 14, which was adopted from the Irish Constitution, is a declaration of equality of the civil rights of all persons within the territories of India.
It enshrines a basic principle of republicanism.
The second part, which is a corollary of the first and is based on the last clause of the first section of the Fourteenth Amendment of the American Constitution, enjoins that equal protection shall be secured to all such persons in the enjoyment of their rights and liberties without discrimination of favourtism.
It is a pledge of the protection of equal laws, that is, laws that operate alike on all persons under like circumstances.
The State, in the exercise of its governmental power, has of necessity to make laws operating differently on different groups or classes of persons within its territory to attain particular ends in giving effect to its policies, and it must possess for that purpose large powers of distinguishing and classifying persons or things to be subjected to such laws.
The Constitutional command to the State to afford equal protection of its laws sets a goal not attainable by the invention and application of a precise formula.
There fore, classification need not be constituted by an exact or scientific exclusion or inclusion of persons or things The Courts should not insist on delusive exactness or apply doctrinaire tests for determining the validity of classification in any given case.
Classification is justified if it is not palpably arbitrary.
535 4.
The principle underlying the guarantee of article 14 is not that the same rules of law should be applicable to all persons within the Indian territory or that the same remedies should be made available to them irrespective of differences of circumstances.
It only means that all persons similarly circumstanced shall be treated alike both in privileges conferred and liabilities imposed.
Equal laws would have to be applied to all in the same situation, and there should be no discrimination between one person and another if as regards the subject matter of the legislation their position is substantially the same.
By the process of classification, the State has the power of determining who should be regarded as a class for purposes of legislation and in relation to a law enacted on a particular subject.
This power, no doubt, in some degree is likely to produce some inequality; but if a law deals with the liberties of a number of well defined classes, it is not open to the charge of denial of equal protection on the ground that it has no application to other persons.
Classification thus means segregation in classes which have a systematic relation, usually found in common properties and characteristics.
It postulates a rational basis and does not mean herding together of certain persons and classes arbitrarily.
The law can make and set apart the classes according to the needs and exigencies of the society and as suggested by experience It can recognise even degree of evil, but the classification should never be arbitrary, artificial or evasive.
The classification must not be arbitrary but must be rational, that is to say, it must not only be based on some qualities or characteristics which are to be found in all the persons grouped together and not in others who are left out but those qualities or characteristics must have a reasonable relation to the object of the legislation.
In order to pass the test, two conditions must be fulfilled, namely, (1) that the classification must be founded on an intelligible differentia which distinguishes those that are grouped together from others and (2) that differentia must have a rational relation to the object sought to be achieved by the Act.
536 8.
The differentia which is the basis of the classification and the object of the Act are distinct things and what is necessary is that there must be a nexus between them.
In short, while Article 14 forbids class discrimination by conferring privileges or imposing liabilities upon persons arbitrarily selected out of a large number of other persons similarly situated in relation to the privileges sought to be conferred or the liabilities proposed to be imposed, it does not forbid classification for the purpose of legislation, provided such classification is not arbitrary in the sense above mentioned.
If the legislative policy is clear and definite and as an effective method of carrying out that policy a discretion is vested by the statute upon a body of administrators or officers to make selective application of the law to certain classes or groups of persons, the statute itself cannot be condemned as a piece of discriminatory legislation.
In such cases, the power given to the executive body would import a duty on it to classify the subject matter of legislation in accordance with the objective indicated in the statute.
If the administrative body proceeds to classify persons or things on a basis which has no rational relation to the objective of the legislature.
its action can be annulled as offending against the equal protection clause.
On the other band, if the statute itself does not disclose a definite policy or objective and it confers authority on another to make selection at its pleasure, the statute would be held on the face of it to be discriminatory, irrespective of the way in which it is applied.
Whether a law conferring discretionary powers on an administrative authority is constitutionally valid or not should not be determined on the assumption that such authority will act in an arbitrary manner in exercising the discretion committed to it.
Abuse of power given by law does occur; but the validity of the law cannot be contested because of such an apprehension.
Discretionary power is not necessarily a discriminatory power.
Classification necessarily implies the making of a distinction or discrimination between persons classified and those who are not members of that class.
It is the essence of a classification that upon the class are cast duties and 537 burdens different from those resting upon the general public.
Indeed, the very idea of classification is that of in equality, so that it goes without saying that the mere fact of inequality in no manner determines the matter of constitutionality.
Whether an enactment providing for special procedure for the trial of certain offences is or is not discriminatory and violative of article 14 must be determined in each case as it arises, for no general rule applicable to all cases can safely be laid down.
A practical assessment of the operation of the law in the particular circumstances is necessary.
A rule of procedure laid down by law comes as much within the purview of article 14 as any rule of substantive law and it is necessary that all litigants, who are similarly situated? are able to avail themselves of the same procedural rights for relief and for defence with like protection and without discrimination.
By the application of these tests, the conclusion is irresistible that the classification provided for by the Special Courts Bill is valid and no objection can be taken against it.
Since the Bill provides for trial before a Special Court of a class of offences and a class of offenders only, the primary question which arises for consideration is whether the Bill postulates a rational basis for classification of whether he classification envisaged by it is arbitrary and artificial.
By clause 5 of the Bill, only those offences can be tried by the Special Courts in respect of which the Central Government has made a declaration under clause 4(1).
That declaration can be made by the Central Government only if it is of the opinion that there is prima facie evidence of the commission of an offence, during the period mentioned in the preamble, by a person who held a high public or political office in India and that, in accordance with the guidelines contained in the preamble to the Bill, the said offence ought to be dealt with under the Act.
The classification which section 4(1) thus makes is both of offences and offenders, the former in relation to the period mentioned in the preamble, that is to say, from February 27, 1975 until the expiry of the proclamation of emergency dated June 25, 1975 and in .
relation to the objective mentioned in the sixth paragraph of the Preamble that it is imperative for the functioning of parliamentary democracy and the institutions created by or under the Constitution Or II India that the commission of such offences should be judicially determined with the utmost dispatch; and the latter in relation to their 16 978 SCI/78 538 status, that is to say, in relation to the high public or political office held by them in India.
It is only if both of these factors co exist that the prosecution in respect of the offences committed by the particular offenders can be instituted in the Special Court.
The promulgation of emergency is not and cannot be a matter of normal occurrence in a nation 's life and indeed a proclamation of emergency cannot but be claimed to have been necessitated by an extra ordinary situation.
Article 352 of the Constitution under which the emergency was declared in June, 1975 occurs in Chapter XVIII called "Emergency Provisions".
That article empowers the President to issue a proclamation if he is satisfied that a "grave emergency" exists wherby, the security of India or of any part of the territory thereof is threatened, whether by war or external aggression or internal disturbance.
Under article 358, while a proclamation of emergency is in operation, the State can make a law or take any executive action even if it violates the provisions of article 19.
That is a consequence which ensues ipso facto on the declaration of an emergency.
The declaration of emergency on June 25, 1975, was followed by an order passed by the President on June 27 under article 359, suspending the enforcement of the right to move any court for the enforcement of fundamental rights conferred by articles 14, 21 and 22 of the Constitution.
During the period of emergency, several laws of far reaching consequence were passed by the Parliament and various notifications and orders were issued by or under the authority of the Central Government, affecting the rights and liberties of the people.
They are: The Defence of Indian (Amendment) Act, 1975; The Conservation of Foreign Exchange and Prevention of Smuggling Activities (Amendment) Act, 1975; The Maintenance of Internal Security (Amendment) Act, 1975; The Election Laws (Amendment) Act, 1975; The Constitution (Thirty eighth and Thirty ninth Amendment) Acts, 1975; The Maintenance of Internal Security (Amendment) Act, 1976; The Maintenance of Internal Security (Second Amendment) Act, 1976; The Press Counsil (Repeal) Act, 1976; The Prevention of Publication of objectionable Matter Act, 1976; Parliamentary Proceedings (Protection of Publication) Repeal Act, 1976; The Constitution (Forty Second Amendment) Act, 1976; The Re presentation of the People (Amendment) Ordinance, 1977; The Disputed Elections (Prime Minister and Speaker) (Ordinance, 1977; and, the Presidential and Vice Presidential Elections (Amendment) ordinance, 1977.
After the declaration of emergency, various regulatory measures were taken with a view to imposing press censorship.
539 The orders and directions in that behalf are dated June 26, July 5, July 6, July 13 and August 5, 1975.
On January 8, 1976, a Presidential Order was issued under article 359(1) suspending the right to move any court for the enforcement of the fundamental rights conferred by article 19 of the Constitution.
These and other measures taken during the period of emergency have been summarised by one of us, Fazal Ali, J. in the State of Rajasthan & Ors.
vs Union of India(1) thus: (1) A grave emergency was clamped in the whole country; (2) Civil liberties were withdrawn to a great extent; (3) Important fundamental rights of the people were suspended; (4) Strict censorship on the press was placed; and (5) The judicial powers were crippled to a large extent.
The third clause of the Preamble to the Bill contains a precise re production of these five factors.
On May 28, 1977, the Government of India, in its Ministry of Home Affairs, issued a Notification under section 3 of the Commission of Inquiry Act, 1952 appointing Shri J. C. Shah, a retired Chief Justice of the Supreme Court, as a Commission of Inquiry for enquiring into "several aspects of allegations of abuse of authority, excesses and malpractices committed and action taken or purported to be taken in the wake of the Emergency proclaimed on the 25th June, 1975 under Article 352 of the Constitution".
The Commission has submitted its report in two parts dated March 11 and April 26, 1978, which contains its findings on what is generally called the 'excesses ' alleged to have been committed during the period of emergency by persons holding high public or political offices in India and by others in association or collaboration with them or with their connivance.
A few other Commissions were also appointed for the same purpose.
The first recital of the preamble to the Bill refers to the reports rendered by these Commissions of Inquiry disclosing the existence of prima facie evidence of offences committed by persons who held high public or political offices in the country and other connected with them during the operation of the emergency dated June 25, 1975 and the preceding period commending on February 27, 1975.
(1) [1978]1 S.C.R. 1,118.
540 We will deal with the relevance of the latter date in due course, but the facts and circumstances which we have narrated above leave no doubt that offences alleged to have been committed during the period of emergency constitute a class by themselves and so do the persons who are alleged to have utilised the high public or political offices held by them as a cover or opportunity for the purpose of committing those offences.
We are not concerned with the truth or otherwise of the allegations, the narrow question before us being whether, in the first instance, the classification is based on some qualities or characteristics which are to be found in all the persons grouped together and not in others who are left out.
The answer to that question can be one and one only, namely that offences alleged to have been committed during the emergency by persons holding high public or political offices in India stand in a class apart.
The cover of emergency, so it is alleged, provided a unique opportunity to the holders of such offices to subvert the rule of law and perpetrate political crimes on the society.
Others left out of that group had neither the means nor the opportunity to do so, since they lacked the authority which comes from official position.
Thus, persons who are singled out by the Bill for trial before Special Courts possess common characteristics and those who fall outside that group do not possess them.
This is not to say that persons who fall outside the group cannot ever commit or might not ever have committed crimes of great magnitude by exploiting their public offices.
But those crimes, if at all, are of a basically different kind and have generally a different motivation.
In the first place, no advantage can be taken of the suppression of human freedoms when the emergency is not in operation.
The suppression of people 's liberties facilitates easy commission of crimes.
Public criticism is a potent deterrent to misbehaviour and when that is suppressed, there is no fear of detection.
Secondly, crimes which are alleged to have been committed during extraordinary periods like the period of emergency are oblique in their design and selective in their object.
They are generally designed to capture and perpetuate political power; and they are broadly directed against political opponents.
The holder of a high public office who, in normal times, takes a bribe has no greater purposes in doing so than to enrich himself.
That, unquestionably, deserves the highest condemnation and there is no reason why such crimes should not also be tried speedily in the interest of public decency and morals.
But those crimes are not woven out of the warp and woof of political motivations.
Equal laws have to be applied to all in the same situation and legislature is free to recognise the degree of harm or evil.
Parliamentary demo 541 cracy will see its halcyon days in India when law will provide for a speedy trial of all offenders who misuse the public offices held by them.
Purity in public life is a desired goal at all times and in all situations, emergency or no emergency.
But, we cannot sit as a super legislature and strike down the instant classification on the ground of under inclusion on the score that those others are left untouched, so long as there is no violation of constitutional restraints.
In this context, it cannot be over emphasized that: "If the law presumably hits the evil where it is most felt, it is not to be overthrown because there, are other instances to which it might have been applied.
There is no doctrinaire requirement that the legislation should be, couched in all embracing terms".
(See West Coast Hotel Company vs Parrish) (1).
The next point which must be considered is whether the classification bears a rational nexus with the object which the Bill seeks to achieve.
The object of the Bill is to ensure a speedy trial of the offences and offenders who, as we have pointed out, constitute a single and special class.
The close relationship between the basis of the classification and the object of the Bill is clear from the very face, of the Bill.
As stated in the 5th paragraph of the Bill 's preamble, ordinary criminal courts, due to congestion of work, cannot reasonably be expected to bring the prosecutions contemplated by the Bill to a speedy termination.
The congestion in Courts, the mounting arrears and the easy and unconcerned dilatoriness which characterise the routine trials in our Courts are well known facts of contemporary life.
They are too glaring to permit of disputation.
Seminars and symposiums are anxiously occupied in finding ways and means to solve what seems to be an intractable and frustrating problem.
The Bill, therefore, justifiably provides for a method whereby prosecutions falling within its scope may be terminated speedily.
It is no answer that speedier trial is a universal requirement of every trial.
The recital of the 6th paragraph of the preamble shows the true nexus between the basis of classification under clause 4(1) and the object of the Bill.
That paragraph says that it is imperative for the functioning of the Parliamentary democracy and the institutions created by or under the Constitution of India that the commission of offences referred to in the preamble should be judicially determined with the utmost dispatch.
If it be true, and we have to assume it to be true, that offences were committed by persons holding high public or political (1)300 U.S. 379, 400 542 offices in India under cover of the declaration of emergency and in the name of democracy, there can be no doubt that the trial of such persons must be concluded with the utmost dispatch in the interest of the functioning of democracy in our country and the institutions created by our Constitution.
Longer these trials will tarry, assuming the charges to be justified, greater will be the impediments in fostering democracy, which is not a plant of easy growth.
If prosecutions which the Bill envisages are allowed to have their normal, leisurely span of anything between 5 to 10 years, no fruitful purpose will be served by launching them.
Speedy termination of prosecutions under the Bill is the heart and soul of the Bill.
Thus, both the tests are fulfilled in the instant case, namely, that (1) the classification is founded on an intelligible differentia which distinguishes those which are grouped together from others who are left out and (2) the said differentia has a rational relation with the object sought to be achieved by the Bill, namely, speedy termination of prosecutions initiated in pursuance of the declaration made under clause 4(1) of the Bill.
If the classification is valid and its basis bears a reasonable relation ship with the object of the Bill, no grievance can be entertained under article 14 that the procedure prescribed by the Bill for the trial of offences which fall within its terms is harsher or more onerous as compared with the procedure which governs ordinary trials.
Classification necessarily entails the subjection of those who fall within it to a different set of rules and procedure, which may conceivably be more disadvantageous than the procedure which generally applies to ordinary trials.
In almost all of the decisions bearing on the question which arise for our consideration and which we have reviewed, the special procedure prescribed by the particular laws was distinctly and indisputably more onerous than the procedure which would have otherwise, governed the trials,.
But once a classification is upheld by the application of the dual test, subjection to harsher treatment or disadvantageous procedure loses its relevance, the reason being that for the purposes of article 14, unequals cannot complain of unequal treatment.
One of the propositions formulated by us in the course of our judgment, namely, proposition No. 11 is to the effect that "Classification necessarily implies discrimination between persons classified and those who are not members of that class.
It is the essence of a classification that upon the class are cast duties and burdens different from those resting upon the general public.
Indeed the very idea of classification is that of inequality, so that it goes with 543 out saying that the mere fact of inequality in no manner determines the matter of constitutionality".
It is, therefore, unnecessary to catalogue, while we are on article 14, the various points of difference between the procedure prescribed by the Bill and the ordinary procedure in order to find whether the former is more disadvantageous than the latter.
We will only add that some of the provisions of the Bill, to which we will presently turn, cast upon the accused arraigned before the Special Court certain disadvantages as compared with the accused who are put up for trial before the ordinary courts, even as son e other provisions give to them certain advantages which are denied to others.
It ought to be mentioned that there is no scope for the argument In the instant case that the Bill leaves it to the arbitrary and uncanalised discretion of the Central Government to pick and choose persons for trial before the Special Courts and leaves the rest to be tried by the ordinary procedure in the regular courts.
Were it so, it would have become necessary to examine, in the context of article 14, whether the procedure prescribed by the Bills is more onerous than the procedure which governs ordinary trials.
But under the Bill, the Government is felt with no choice or alternative in the matter of forum of trial since, if the conditions of clause 4(1) are satisfied, the prosecution has to be instituted in the Special Court.
By that clause, if the Central Government is of the opinion that there is prima facie evidence of the commission of an offence during the period mentioned in the preamble by a person who held public or political office in India and that in accordance with the guidelines contained in the preamble the said offence ought to be dealt with under the Act, the Central Government shall make a declaration to that effect in every case in which it is of the aforesaid opinion.
Thus, formation of the requisite opinion casts on the Government on obligation to make the declaration in every case, without exception, in which the opinion is formed.
Upon the making of the declaration, another consequence follows compulsively under clause 5.
That clause provides that on a declaration being made under clause 4(1), any prosecution in respect of the particular offence shall be instituted only in the Special Court.
Not only is there no scope for initiating prosecutions before an ordinary court in matters which fall within the scope of clause 4 (1), but clause 5 goes a step further and provides that even pending prosecutions in respect of the offences specified in clause 4(1) shall stand transferred to the special Court.
Clause 6, which is an extension of the same concept, provides that if on the date of the declaration in respect of any offence, an appeal or revision against any judgment or order in a prosecution in respect of such offence, whether 544 pending or disposed of, is itself pending in any court of appeal or revision, the same shall stand transferred for disposal to the Supreme Court.
The Bill, in short, excludes the existence of two parallel jurisdictions in the same field and ensures effectively that all offences which fall within its scope shall be tried by the Special Court only and by no other court or tribunal.
That leaves one more point for consideration for the purposes of article 14 which, though last, is not the least in point of importance.
That point pertains to the relevance of the date mentioned in the, preamble, namely, February 27, 1975.
The reasons constituting the justification for the Bill are contained in the eight paragraphs of its preamble out of which paragraph one is relevant for the present purpose.
It says that certain Commissions of Enquiry were appointed under the Commissions of Enquiry Act, 1952 which had rendered reports disclosing the existence of prima facie evidence of offences committed by persons who had held high public or political offices in the country and by others connected with the commission of such offences, during the operation of the Proclamation of Emergency dated 25th June, 1975 "and during the pre ceding period commencing 27th February, 1975 when it became apparent that offenders were being screened by those whose duty it was to bring them to book".
While explaining this recital, it was urged by the learned Solicitor General and Shri Ram Jethmalani that a clear trend to protect excesses and illegalities became apparent on the particular date.
Reliance, was placed in support of that contention on a pair of questions and answers exchanged on the floor of the House between a member of the Lok Sabha and the then Prime Minister.
According to the Lok Sabha Debates (5th Series, Vol. 48, page 258, dated February 27, 1975), this is what transpired between the two: "Shri Janeshwar Mishra (Allahabad): at about Maruti ? Shrimati Indira Gandhi: There is no corruption in Maruti.
Since the hon.
Member has raised it, I can say that every question that has been asked has been replied to; nothing wrong has been done, no special favour should be, or has been, given because it is concerned with the Prime Minister 's son.
What I was saying is that we are just as anxious as any body else to remove corruption.
I do not want lo go into the details.
I have earlier spoken about the stage by stage actions we have taken.
I have said it in public meetings and I have discussed it with leaders.
But today there seems to be a very selective type of campaign or accusation.
Corruption will not 545 go in this way.
If the real intention is, to remove corruption, then it must be an honest way of dealing with it at every level Shri Shyamnandan Mishra: A certificate of honesty should come from you ? Shrimati Indira Gandhi: Not at all".
The claim that the tendency to protect the excess and illegalities became apparent because of these answers or that the particular answers created a new awareness that offenders were being screened by those whose duty it was to bring them to book is too naive for our acceptance.
Even assuming that there is any credible basis for the same, the grouping together of persons who are alleged to have committed offences during the period of emergency with others who are alleged to have engaged themselves.
, in screening certain offenders prior to the declaration of emergency is tantamount to clubbing together, in the same class, persons who do not possess common qualities or characteristics.
It is unquestionably reasonable for the legislature to think that the suppression of human liberties during the period of emergency furnished an opportunity to persons holding high public or political offices to commit crimes of grave magnitude which were calculated to destroy democratic values.
The premise that the suspension, especially, of preferred freedoms engineers callous defiance of laws and the Constitution is easy to understand.
That is why offences alleged to have been committed during the period of emergency can be treated as sui generis.
The same cannot, however, be said of activities, even assuming that they are unlawful, which preceded the declaration of emergency.
Those doings were open to public criticism and were unprotected by the veil of emergency.
It is true that one ought not to insist on abstract symmetry or delusive exactness in the matter of classification.
Therefore, eschewing a doctrinaire approach, one should test the validity of a classification by broad considerations, particularly when the charge is one of under inclusiveness.
The Government, as it is said must be permitted a little free play in the joints since, there is no mathematical formula for determining why those who are left out of a class should not be included within it.
But persons possessing widely differing characteristics, in the context of their situation in relation to the period of their activities, cannot by any reasonable criterion be herded in the same class.
The ante dating of the emergency, as it were, from June 25 to February 27, 1975 is wholly unscientific and proceeds from irrational considerations arising out of a supposed discovery in the matter of screening of offenders.
The inclusion of offences and offenders in relation to the period from February 27 to June 25, 1975 in the same class as those whose alleged unlawful activities covered the period of emergency is too artificial to be sustained.
546 While justifying the extended classification, counsel drew our attention to certain findings of the Shah Commission of Enquiry (Vol.
I, items 8, pages 59 to 64) on the alleged misuse of power by the then Prime Minister prior to the declaration of emergency.
Those findings, according to us, are beside the point for the present purpose The question before us is not whether anyone, high or low committed any excess of power before the declaration of emergency.
The question is whether, those who are alleged to have committed offences prior to the emergency can be put in the same class as persons who are alleged to have committed offences during the period of emergency.
The answer to that question has to be in the negative.
We are accordingly of the view that the classification provided for by clause 4(i) of the Bill is valid to the limited extent to which the Central Government is empowered to make the declaration in respect of offences alleged to have been committed during the period of emerged y, by persons holding high public or political officer.
The classification is invalid in so far as it covers offences committed by such persons between February 27 and June 25, 1975.
No declaration can the fore be made by the Central Government in regard to those offences and offenders under the present classification.
That disposes of the question as regard the validity of the classification provided for by clause 4(1) of the Bill.
Those who are wrong by included in the classification can have nothing more to say because they cannot be tried by the Special Courts.
As regards those who are rightly grouped together, we have already indicated that since the classification is valid, it is unnecessary for the purposes of article 14 to consider whether the procedure prescribed by the Bill is more onerous than the ordinary procedure.
That observation, it shall have been noticed, is expressly limited to the purposes of article 14.
The reason for so limiting it is that the assumption underlying the judgment of the majority ill A. K. Gopalan vs State of Madras(1) that certain articles, of the Constitution exclusively deal with specific matters no longer holds the field A. K. Gopalan (supra) was in that respect expressly over ruled by the majority ill R. Cooper vs Union of India,(2) known generally as the Bank Nationalisation case.
In Shambhu Nath Sarkar vs The State of West Bengal & Ors.
,(3) it was held by a seven Judge Bench that the law of preventive detention has to meet the challenge not only of articles 21 and 22 but also of article 19(1) (d) .
In (l) ; (2) ; , 578.
(3) ; 547 Maneka Gandhi vs Union of India(1) it was observed by one of us, Bhagwati, J. that the law must be now taken to be well settled that article 21 does not exclude article 19 and that even if there is a law prescribing a procedure for depriving a person of personal liberty and there is consequently no infringement of the fundamental right conferred by article 21, such law, in so far as it abridges or takes away any fundamental right under article 19, would have to meet the challenge of that article.
The view, which was accepted by the majority, is that the rights dealt with in different articles contained in Part III of the constitution do not represent separate streams of rights but are parts of an integrated constitutional scheme.
It is thus beyond the pale of controversy now, that the various articles in part III of the Constitution cannot be treated as mutually exclusive.
Upon that view, it is not sufficient to say that since the classification is valid, it is not necessary to consider whether the procedure prescribed by the Bill is more onerous, than the ordinary procedure. 'The onerousness of the special procedure would be irrelevant in considerations arising under article 14, for the reason that the classification is valid (to the extent indicated).
But the Bill has got to meet the challenge cf other provisions of the Constitution also, in so far as any particular provision is attracted.
The theory that articles conferring fundamental rights are mutually exclusive and that any particular article in part III constitutes a self contained code having been discarded, it becomes necessary to examine whether the procedure prescribed by the Bill is violative of any other provision of the Constitution Article 21 is the only other provision of the Constitution which is apposite in this context.
It provides that no person shall be deprived of his life or personal liberty except according to the procedure established by law.
In Maneka Gandhi vs Union of India(1), it was held by the majority that the procedure contemplated by article 21 must be "limit 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".
It is therefore imperative to examine whether the procedure prescribed by the Bill is just and fair or is in any respect arbitrary or oppressive.
An infinite variety of grievances has been made against the provisions of the Bill Some of them are so unsubstantial that we consider it unnecessary to catalogue them.
We will refer to a few of them only as a sample of the many that were made.
It is urged that a person put (1) 11978] 2 S.C.R. 621.
(1) [1978] 2 S.C.R. 621, 674.
548 up for trial before the Special Court is denied the, benefit of section 439 of the Code of Criminal Procedure, under which a High Court or a Court of Sessions may release an accused on bail; that it is permissible to the Government under the provisions of the Bill to choose a situs of trial which is inconvenient to the accused, denying thereby to him the benefit of section 177 of the Code; that the Bill virtually abolishes the court 's supervisory jurisdiction over the investigation conducted by the police; that the accused is denied the right of trial before courts with limited powers of punishment; that the warrant procedure prescribed by the Bill for the trial of offences is, in the circumstances, needlessly cumbersome; that there is no provision for confirming the sentence of death, if any is passed, by the Special Court, that the Bill confers the right of appeal in every case, as much on the State as on the accused and thereby enlarges the rights of the State and imposes uncalled for burden on the accused; that whereas the Code of Criminal Procedure requires the State to obtain the leave of the court before filing an appeal against an order of acquittal, the Bill imposes no such pre condition, and so on and so forth.
We have given our anxious consideration to these and similar other grievances and apprehensions but we see no substance in them, except to the extent to be indicated later.
By clause 9 of the Bill, an accused put up for trial before the Special Court has to be tried by the procedure prescribed by the Code for the trial of warrant cases before a magistrate.
the trial, save as otherwise prescribed has to be governed by the said Code.
In Syed Qasim Razvi (supra) it was held by this Court that the warrant procedure is in no sense prejudicial to the interest of an accused.
As regards bail, 'it is open to the accused to ask for it and in appropriate cases, the Special Court would be justified in enlarging him on bail.
As regards the situs of trial, it is unfair to make an assumption of mala fides and say that an inconvenient forum will be chosen deliberately.
Besides, the provisions of chapter XIII of the Code containing section 177 to 189, which deal with "Jurisdiction of the criminal courts in Inquiries and Trials", are not excluded by the Bill.
Those provisions will govern the question as to the situs of trial.
The grievance regarding absence of provision for the confirmation of death sentence is unreal because under clause 10 (1), every accused has a right of appeal to this Court.
There is no reason to suppose that this right is in any sense narrower than, the right of an accused to ask the High Court to examine the correctness of the death sentence imposed by the Sessions Court.
In so far as the other grievances are concerned they are too trivial to justify the charge that the procedure prescribed by the Bill is unjust or unfair.
In fact most of the other grievances in this category were made on behalf of the accused in Syed Qasim 549 Razi and Habeeb Mohamed (supra) but they were rejected by this Court.
Every variation in procedure is not to be assumed to be unjust and indeed as observed by this Court in Rao Shiv Bahadur Singh(supra) which was followed in Union of India vs Sukumar Pyne,(1) a person accused of the commission of an offence has no vested right to be tried by a particular court or a particular procedure except in so far as there is any constitutional objection by way of discrimination or the violation Or any other fundamental right is involved.
In Sanjay Gandhi vs Union of India,(2), one of us, Krishna Iyer J., said that no party to a criminal trial has a vested right in slow motion justice.
This has to be constantly, kept in mind without, of course, overlooking the Constitutional inhibitions.
Though this is so, the provisions of the Bill appear to us to be unfair and unjust in three important respects.
In the first place, there is no provision in the Bill for the transfer of cases from one Special Court to another.
The manner in which a Judge.
conducts himself may disclose a bias, in which case the interest of justice would require that the trial of the case ought to be withdrawn from him.
There are other cases in which a Judge may not in fact be biased and yet the accused may entertain a reasonable apprehension on account of attendant circumstances that he will not get a fair trial.
It is of the utmost importance that justice must not only be done 'but must be seen to be done.
To compel an accused to submit to the jurisdiction of a Court which, in fact, is biased or is reasonably apprehended to be biased is a violation of the fundamental principles of natural justice and a denial of fair play.
There are yet other cases in which expediency or convenience may require the transfer of a case, even if no bias is involved.
The absence of provision for transfer of trials in appropriate cases may undermine the very confidence of the people in the Special Courts as an institution set up for dispensing justice.
The second infirmity from which the procedural part of the Bill suffers is that by clause 7, Special Courts are to be presided over either by a sitting Judge of a High Court or by a person who has held office as Judge of a High Court to be nominated by the Central Government in consultation with the Chief Justice of India.
The provision for the appointment of a sitting High Court Judge as a Judge, of the Special Court is open to no exception.
In so far as the alternate source (1) ; , 38.
(2) A.T.R. 550 is concerned, we entertain the highest respect for tired Judges of High Courts and we are anxious that nothing said by us in our judgment should be construed as casting any aspersion on them as a class.
Some of them have distinguished themselves as lawyers once again, some as members of administrative tribunal, and many of them are in demand in important walks of life.
Unquestionably they occupy position of honour and respect in society.
But one cannot shut one 's eyes to the constitutional position that whereas by article 217, a sitting Judge of a High Court enjoys security of tenure until he attains a particular age, the retired Judge will hold his office as a Judge of the Special Court during the pleasure of the Government.
The pleasure doctrine is subversive of judicial independence.
A retired Judge presiding over a Special Court, who displays strength and independence may be frowned upon by the Government and there is nothing to prevent it from terminating his appointment as and when it likes.
It is said on behalf of the Government that if the appointment has to be made in consultation with the Chief Justice of India, the termination of the appointment will also require similar consultation.
We are not impressed by that submission.
But, granting that the argument is valid, the process of consultation has its own limitations and they are quite well known.
The obligation to consult may not necessarily act as a check on an executive which is determined to remove an inconvenient incumbent We are, therefore, of the opinion that clause 7 of the Bill violates article 21 of the Constitution to the extent that a person who has held office as a Judge of the High Court can be appointed to preside over a Special Court, merely in consultation with the Chief Justice of India.
Yet another infirmity from which the procedure prescribed by the Bill suffers is that the only obligation which clause 7 imposes on the Central Government while nominating a person to preside over the Special Court is to consult the Chief Justice of India.
This is Dot a proper place and it is to some extent embarrassing to dwell upon the pitfalls of the consultative process though, by hearsay, one may say that as a matter of convention, it is in the rarest of rare cases that the advice tendered by the Chief Justice of India is not accepted by the Government.
But the right of an accused to life and liberty cannot b made to depend upon pious expressions of hope, howsoever past experience may justify them.
The assurance that conventions are seldom broken is a poor consolation to an accused whose life and honour are at stake.
Indeed, one must look at the matter not so much from the point of view of the Chief Justice of India, nor indeed from the point of view of the Government, as from the point of view of the accused 551 and the expectations and sensitivities of the society.
It is of the greatest importance that in the name of fair and unpolluted justice, the procedure for appointing a Judge to the Special Court, who is to be nominated lo try special class of cases, should inspire the confidence not only of the accused but of the entire community.
Administration of justice has a social dimension and the society at large has a stake in impartial and even handed justice.
These, in our opinion, are the three procedural infirmities from which the Bill suffers and which are violative of article 21 of the Constitution, in the sense that they make the procedure prescribed by the Bill unjust and unfair to the accused.
These points were highlighted during the course of the hearing of the reference, whereupon the learned Solicitor General filed a statement in the Court to the following effect: "1.
That in the course of written submissions already filed, it has been contended on behalf of the Union of India that the procedure for trial envisaged in the Bill under Reference is more liberal and ensures a fair trial.
That the last recital in the Preamble to the Bill states that some procedural changes were being made whereby avoidable delay is eliminated without interfering with the right to a fair trial.
That in the course of arguments, certain observations were made by this hon 'ble Court indicating certain changes which might ensure fairer trial and inspire greater confidence about the working of Special Courts.
That in the light of the proceedings in the Court, certain suggestions were communicated by the Solicitor General to the Government.
That after careful consideration, the Government accepts the suggestion that only a sitting Judge of the High Court would be appointed to preside over a Special Court and that the Government also agrees that the appointment will be made with the concurrence of the Chief Justice of India.
That the Government also agrees to the suggestion that the Supreme Court will be specifically empowered to transfer a case from one Special Court to another notwithstanding any other provision in the Bill.
552 7.
That the Government of India have authorised the Solicitor General to make a statement to the Court on the above Sd/ section N. Kacker Solictor General of India 25 9 78 The learned Solicitor General assured us that the Government is committed to making appropriate changes in the bill as mentioned in paragraph 5 and 6 above.
Though we appreciate the response of the Government it has to be remembered that appropriate amendments shall have to be passed by the legislature.
The assurance that such amendments will be proposed by the Government and the prospect that they may be passed by the legislature cannot relieve us from ' discharging, our duty to pronounce upon the Bill as it stands to day.
So long as the Bill contains the three offending provisions which we have pointed out above, the procedure will be violative of article 21, being unjust and unfair.
The other objections are without any substance, particularly in view of the fact that the trial is to be held by no less a person than a Judge of a High Court and there is a right of appeal to this Court.
These two are the outstanding, nay, the saving safeguards of the Bill.
There is one more provision of the Bill to which we must refer while we are on this question.
Sub clause (1) of clause 4 provides for the making of the declaration by the Central Government while sub clause (2) provides that "Such declaration shall not be called in question in any court".
Though the opinion which the Central Government has to form under clause 4(1) is subjective, we have no doubt that despite the provisions of sub clause (2) it will be open to judicial review at least within the limits indicated by this Court in Khudiram Das vs The State of West Bengal & Ors.(1) It was observed in that case by one of us, Bhagwati J., while speaking for the Court, that in a Government of laws "there is nothing like unfettered discretion immune from judicial reviewability".
The opinion has to be formed by the Government, to say the least, rationally and in a bonafide manner.
There was some discussion before us on the question as to whether the opinion rendered by this Court in the exercise of its advisory jurisdiction under article 143(1) of the Constitution is binding as law declared by this Court within the meaning of article 141 of the Constitution.
The question may have to be considered more fully on a future occasion but we do hope that the time which has been (1) ; , 845.
553 spent in determining the questions arising in this reference shall not have been spent in vain.
In the cases of Estate Duty Bill(1), U.P. Legislative Assembly(2), and St. Xaviers College,(3) the view was expressed that advisory opinions do not have the binding force of law.
In Attorney General for Ontario vs Attorney General for Canada(4) it was even said by the Privy Council that the opinions expressed by the Court in its advisory jurisdiction "will have no more effect than the opinions of the law officers".
On the other hand, the High Court of Calcutta in Ram Kishore Sen vs Union of India(5) and the High Court of Gujarat in Chhabildas Mehta vs The Legislative Assembly, Gujarat State(6) have taken the view that the opinion rendered by the Supreme Court under article 143 is law declared by it within the meaning of article 141.
In The Province of Madras vs Messrs Boddu Baidanna (7) the Federal Court discussed the opinion rendered by it in the Central Provinces case(#) in the same manner as one discusses a binding judgment.
We are inclined to the view that though it is always open to this Court to re examine the question already decided by it and to over rule, if necessary the view earlier taken by it insofar as all other courts in the territory of India are concerned they ought to be bound by the view expressed by this court even in the exercise of its advisory jurisdiction under article 143(1) of the Constitution.
We would also like, to draw attention to the observations made by Ray, C.J., in St. Xaviers College (supra) that even if the opinion given in the exercise of advisory jurisdiction may not be binding, it is entitled to great weight.
It would be strange that a decision given by this Court on a question of law in a dispute between two private parties should be binding on all courts in this country but the advisory opinion should bind no one at all even if as in the instant case, it is given after issuing notice to all interested parties, after hearing everyone concerned who desired to be heard, and after a full consideration of the questions raised in the reference.
Almost everything that could possibly be urged in favour of and against the Bill was urged before us and to think that our opinion is an exercise in futility is deeply frustrating.
While saying this, we are not unmindful of the view expressed by an eminent (1) , 320, 332,341.
(2) ; , 446 47.
(3) ; 201 202.
(4) , 589.
(5) A.I.R. 1965 Cal 282.
(6) (1970) II Gujarat Law Reporter 729.
(7) (8) 17 978 SCI/78 554 writer that although the advisory opinion given by the Supreme Court has high persuasive authority, it is not law declared by it within the meaning of article 141.
(See Constitutional Law of India by H.M. Seervai, 2nd Edition, Vol.
II, page 1415, para 25.68).
We have upheld the creation of Special Courts on the touchstone of the Constitution.
We have also expressed the view that appointment of sitting Judges of the High Court to the Special Courts, with the concurrence of the Chief Justice of India, will meet the requirement of article 21.
But we cannot resist the observation which was made during the course of arguments that investing the High Courts with jurisdiction to try cases under the Bill may, in the circumstances, afford the best solution from every point of view.
The Chief Justices of High Courts will, in their discretion, assign and allocate particular cases to Judges of their Courts, as they do in the normal routine of their function.
To avoid delays and to ensure speedier trial no other work may be assigned to the Judge nominated by the Chief Justice to try a case or cases under the Bill.
This will obviate the nomination by the Central Government, of a particular Judge to try a particular case.
Law is not the whole of life and the propriety of an action, though not for the Court to decide, ought to be a matter of paramount consideration for those who desire to govern justly and fairly.
Courts d Justice cannot afford even to risk the charge of bias and no Judge wants it to be said of him that he was specially nominated by the Government to try a particular individual.
The community must retain its confidence in the judiciary, which has to decide not merely constitutional matters but a large variety of other matters in which law touches the life of common men at many points.
As said by Prof Finer in 'The Theory and Practice of Modern Government ' (pp. ,51 152).
"The multitude does not minutely discriminate, and when it mistrusts for one thing it may mistrust for another though the cases are poles asunder".
The deeply thoughtful observations made in this behalf by our learned Brother, Shinghal J, ought to receive the most careful consideration at the hands of the Government.
In conclusion, our answer to the reference is as follows: (1) The Parliament has the legislative competence to create Special Courts and to provide that an appeal shall lie as of right from any judgment or order of a Special Court to make a declaration under Clause 4 (1 ) of the Bill in respect to the Supreme Court.
Clauses 2 and 10(1) of the Bill are, therefore, within the Parliament 's legislative competence; 555 (2) The classification provided for in Clause 4(1) of the Bill is valid to the extent to which the Central Government is empowered to make a declaration in respect of offences alleged to have been committed during the period of Emergency by persons who held high public or political offices in India.
Persons who are alleged to have committed offence prior to the declaration of Emergency cannot n validly be grouped along with those who are alleged to have committed offences during the period of ` Emergency.
It is, therefore, not competent to the Central Government to make a declaration under Clause 4(1) of the Bill in respect of persons who are `alleged to have committed offences between February 27, 1975 and June 25, 1975.
(3) The procedure prescribed by the Bill for the trial of offences in respect of which a declaration can be validly made by the Central Government under Clause 4(1) of the Bill is Juts and fair except in regard to the following matters: (a) the provision in Clause 7 of the Bill.
under which a retired Judge of the High Court can be appointed as a Judge of the Special Court; (b) the provision in Clause 7 under which the appointment of a Judge to the Special Court can be made by the Central Government in consultation with but without the concurrence of the Chief Justice of India; and (c) the absence of a provision for transfer of a case from one Special Court to another.
(4) The Bill is valid and constitutional in all other respects.
KRISHNA IYER, J. Not a note of absonance but a stroke of emphasis is my main intent in appending this separate opinion confined to a few fundamentals.
It is fair to make clear at the outset that all the legal conclusions reached by the learned Chief Justice command my concurrence but, on certain key issues, my ratiocination diverges, sounding harsher and striking harder maybe.
However, the final confluence and considerable consonance cut down my coverage.
The price of unanimity is not taciturnity where individual articulation may make distinctive contribution Right at the beginning, an exordial enunciation of my socio legal perspective which has a constitutional bearing may be set out.
I lend judicious assent to the boarder policy of social justice behind this 556 Bill.
As I read it, this measure is the embryonic expression of a necessitous legislative project, which, if full fledged, will work a relentless break through towards catching, through the compulsive criminal process, the higher inhabitants of Indian public and political decks, who have, in practice, remained 'untouchable ' and 'unapproachable '.
to the rule of law. 'Operation Clean Up ' is a 'consummation devoutly to be wished ', although naive optimism cannot obfuscate the obnoxious experience that laws made in terrorem against those who belong to the top power bloc prove in action to be paper tigers.
The pathology of our public law, with its class slant, is that an unmincing ombudsman or sentinel on the qui vive with power to act against those in power, now or before, and offering Legal access to the informed citizen to complain with immunity does not exist, despite all the bruited umbrage of political performers against peculations and perversions by higher echelons.
Law is what law does, not what law says and the moral gap between word and deed menaces people 's faith in life and law.
And then, the tragedy democracy becomes a casualty.
The greatest trauma of our times, for a developing country of urgent yet tantalising imperatives, is the dismal, yet die hard, poverty of the masses and the democratic, yet graft riven, way of life of power wielders.
Together they blend to produce gross abuse geared to personal aggrandizement, suppression of exposure and a host of other horrendous, yet hidden, crimes by the, summit executives, pro tem, the para political manipulators and the abetting bureaucrats.
And the rule of law hangs limp or barks but never bites.
An anonymous poet sardonically projected the social dimension of this systemic deficiency: "The law locks up both man and woman Who steals the goose from off the common, But lets the greater felon loose Who steals the common from the goose.
" The impact of 'summit ' crimes in the Third World setting is more terrible than the Watergate syndrome as perceptive social scientists have unmasked.
Corruption and repression cousins in such situations hijack developmental processes.
And, in the long run, lagging national progress means ebbing people 's confidence in constitutional means to social justice.
And so, to track down and give short shrift to these heavy weight criminaloids who often mislead the people by public moral weight lifting and multipoint manifestoes is 557 an urgent legislative mission partially undertaken by the Bill under discussion.
To punish such super offenders in top positions, sealing off legalistic escape routes and dilatory strategies and bringing them to justice with high speed and early finality, is a desideratum voiced in vain by Commissions and Committees in the past and is a dimension of the dynamics of the Rule of Law.
This Bill, hopefully but partially, breaks new ground contrary to people 's resigned cynicism that all high powered investigations, reports and recommendations end in legislative and judicative futility, that all these valiant exercises are but sound and fury signifying nothing, that 'business as usual ' is the signature tune of public business, heretofore, here and hereafter.
So this social justice measure has my broad assent in moral principle and in constitutional classification, subject to the serious infirmities from which it suffers as the learned Chief Justice has tersely sketched.
Whether this remedy will effectively cure the malady of criminal summitry is for the future to tell.
All this serves as a backdrop.
Let me unfold in fuller argumentation my thesis that the Bill, good so far as it goes, is bad so far as it does not go saved though by a pragmatic exception I will presently explain.
Where the proposed law excludes the pre and post emergency crime doers in the higher brackets and picks out only 'Emergency ' offenders, its benign purpose perhaps becomes a crypto cover up of like criminals before and after.
An 'ephemeral ' measure to meet a perennial menace is neither a logical step nor national fulfilment.
The classification, if I may anticipate my conclusion.
is on the brink of constitutional break down at that point and becomes almost vulnerable to the attack of article 14 The Court 's advisory opinion is sought, not on social policy but on constitutionality.
Here, however, it is my very endorsement of the basic policy of the Bill, the apparent motive of the mover, the true principle of the measure and the urgent relevancy of the legislation swifts.
sure, yet fair justice to apex offenders in public and political life that compels me to be critical of a few provisions on grounds too basic to be slurred over.
I start with the assumption that an Act of this nature, with the major changes mentioned by the Chief Justice to avert collision with article 21 and with wider coverage to come to terms with article 14, is long overdue and, if passed into law and enforced peremptorily, may partly salvage the sunken credibility of the general community in democracy in action, already demoralised, since Independence, by the perversion of power for oblique purposes as evidenced by periodical parliamentary debates and many Commission Reports still gathering dust.
558 To drive home my point, a little divagation is needed.
Development, in a State which directs the economy, means public expenditure on an unprecedented scale for public weal and this national necessity is sometimes covertly converted into personal opportunity by people in lofty offices vested with authority for decision making.
The realistic rule of law must reckon with the pernicious potential of guided missiles in the hands of misguided men, especially when the victim is a 'soft ' State, and must rise to meet the menace and manacle the delinquent, be he ever so high.
I have said enough to justify the contention that these offenders perfectly fill the constitutional bill as a separate class which deserves speedy prosecution and final punishment by high judicial agencies if restoration of the slumping credence in the constitutional order and democratic development were to be sustained among the masses in Third World countries.
The Pre amble to the Bill is revelatory of this orientation and the mover of the Bill, Shri Ram Jethmalani, appearing in person, indicated as much.
No erudite pedantry can stand in the way of pragmatic grouping of high placed office holders separately, for purposes of high speed criminal action invested with early conclusiveness and inquired into by high level courts.
The differentia of the Bill rings irresistibly sound.
And failure to press forward such clean up undertaking may be a blow to the rule of law and the rule of life and may deepen the crisis of democracy among the millions the men who make our nation who to day are largely disenchanted.
So it is time, if peaceful transformation is the constitutional scheme, to begin by pre emptive steps of quick and conclusive exposure and conviction of criminals in towers of power a special class of economic offenders with abettors from the Bureaucracy and Big Business, as recent Commission Reports trendily portray and portent.
Such is the simple, socio logical substance of the classificatory descrimen which satisfies the egalitarian conscience of article 14.
What better designs engineering can there be than to make a quick example of master criminals and tainted caesars with public office as protective mantle ? The fundamental dynamics of Public Power great trust and sure accountability rank high in a people oriented scheme of the rule of law.
I hold that in this generalised version, there is a reasonable classification implicit in this legislation, but venture further that it is perilously near being under inclusive and, therefore, unequal.
For it is a truncated projection of a manifetsly wider principle that exalted offenders shall be dealt with by the criminal law with emergent speed so that the common man may know that when public power is abused for private profit or personal revenge the rule of law shall rapidly 559 run them down and restore the faith of the people in democratic institutions through speedy justice according to law.
It is in this sense that: very important persons wielding large administrative powers shall, with quick despatch, be tried and punished, if guilty.
Prompt trial and early punishment may be necessary in all criminal cases.
But, raw realism suggests that in a decelerating situation of slow motion justice, with courts chocked by dockets, there is a special case for speedier trial and prompter punishment where the offender sits at the top of the administrative pyramid.
Leizurely justice, year after the long drawn out commission proceedings, hardly carries conviction when man 's memories would have forgotten the grave crimes, if any, committed and men 's confidence in the rule of law would have been wholly demolished by seeing the top brass continuing to hold such offices despite credible charges of gross crimes of misuse.
The common people watch the fortunes of these favoured species when they violate the norms of the criminal law and, if they are not punished forthwith, lose faith in the system itself.
The cynicism about 'equal justice under the law ' sours into 'show me the man and I will show you the law '.
The democratic system must ensure that the business of power public power shall not be doing business.
The social philosophy and philosophy of law in this area emphatically require that offices of public power, especially in a country of poverty, shall not be the workshop of personal gain.
The immediate correctional process is the court, not the once in a few years ballot.
Be you ever so high the law will watch you, catch you, convict you if guilty and that, swiftly but fairly.
The crucial test is 'All power is a trust ', its holders are 'accountable for its exercise ', for 'from the people, and for the people, all springs, and all must exist '.
By this high and only standard the Bill must fail morally if it exempts non Emergency criminals about whom prior Commission Reports now asleep in official pigeon holes, bear witness and future Commission Reports (who knows ?) may, in time, testify.
In this larger perspective, Emergency is not a substantial differentia and the Bill nearly recognises this by ante dating the operation to February G 27, 1975 when there was no 'Emergency '.
Why ante date if the 'emergency ' was the critical criterion ? It is common knowledge that currently in our country criminal courts excel in slow motion.
The procedure is dilatory, the dockets are heavy, even the service of process is delayed and, still more exasperating, II there arc appeals upon appeals and revisions and supervisory jurisdictions" baffling and baulking speedy termination of prosecutions, not to 560 speak of the contribution to delay by the Administration itself by neglect of the basic necessaries of the judicial process.
Parliamentary and pre legislative exercises spread over several years hardly did any thing for radical simplification and streamlining of criminal procedure and virtually re enacted, with minor mutations, the vintage Code making forensic flow too slow and liable to hold ups built into the law.
Courts are less to blame than the Code made by Parliament for dawdling and Governments are guilty of denying or delaying basic amenities for the judiciary to function smoothly.
Justice is a Cinderalla in our scheme.
Even so, leaving V. V. I. P. accused to be dealt with by the routinely procrastinating legal process is to surrender to interminable delays as an inevitable evil.
Therefore, we should not be finical about absolute processual equality and must be creative in innovating procedures compelled by special situations.
But the idiom of article 14 is unmistakeable.
The power status of the alleged criminal, the nature of the alleged crime vis a vis public confidence and the imperative need for speedy litigative finality, are the telling factors Every difference is not a differentia. 'Speedy trials" of offences of a public nature 'committed by persons who have held high public or political offices in the country and others connected with the commission of such offences ' is the heart of the matter Let us take a close look at the 'Emergency ', the vices it bred and the nexus they have to speedier justice, substantial enough to qualify for reasonable sub classification.
Information flowing from the proceedings and reports of a bunch of high powered judicial commissions shows that during that hushed spell, many suffered shocking treatment.
In the words of the Preamble, civil liberties were withdrawn to a great extent, important fundamental rights of the people were suspended, strict censorship on the press was placed and judicial powers were curtailed to a large extent.
Before proceeding further, the Legislative and Judicative frontiers must be, perceived with perspicacity, as set out in Murthy Watch works etc.
vs The Asst.
Collector of Central Excise, etc.(1) "Every differentiation is not a discrimination.
But classification can be sustained only if it is founded on pertinent and real differences as distinguished from irrelevant and artificial ones.
The constitutional standard by which the sufficiency of the differentia which form a valid basis for classification may be measured, has been repeatedly stated by the (1) ; at 130.
561 courts.
If it rests on a difference which bears a fair and just relation to the object for which it is proposed, it is constitutional.
To put it differently, the means must have nexus with the ends.
Even so, a large latitude is allowed to the State for classification upon a reasonable basis and what is reasonable is a question of practical details and a variety of factors which the court will be reluctant and perhaps illequiped to investigate.
In this imperfect world perfection even in grouping is an ambition hardly ever accomplished.
In this context,, we have to remember the relationship between the legislative and judicial departments of Government in the determination of the validity of classification.
A power to classify being extremely broad and based on diverse considerations of executive pragmatism, the judicature cannot rush in where even the legislature warily treads.
" The core question, however, is what reasonable relation Emergency, as the basis of classification, has to the object of the legislation.
This takes us to two telling aspects which deserve careful examination, What are the special factors relied on for classification and what is the legislative goal and then that gut issue what is the correlation between the two ? The integral yoga of means and ends is the essence of valid classification.
An excellent classification may not qualify for exemption from equality unless it is yoked to the statutory goal.
This is the weak link in the, Bill.
The Objects and Reasons are informative material guiding the court about the purpose of a legislation and the nexus of the differentia, if any, to the end in view.
Nothing about Emergency period is adverted to there as a distinguishing mark.
If at all, the clear clue is that all abuse of public authority by exalted public men, whatever the time of commission, shall be punished without the tedious delay which ordinarily defeats justice in the case of top echelons whose crimes affect the credentials of democratic regimes.
The Court in Mohammad Shujat Ali & Ors.
vs Union of India & Ors.
(1) has explained the constitutional facet of classification: "This doctrine recognises that the legislature may classify for the purpose of legislation but requires that the classification must be reasonable.
It should ensure that persons or things similarly situated are all similarly treated.
The measure of reasonableness of a classification is the degree of its success in treating similarly those similarly situated.
(1) ; at 477.
562 But the question is: what does this ambiguous and crucial phrase 'similarly situated ' mean ? Where are we to look for the test of similarity of situation which determines the reason ableness of a classification ? The inescapable answer is that we must look beyond the classification to the purpose of the law.
A reasonable classification is one which includes all persons or things similarly situated with respect to the purpose of the law " After having stated the general proposition the Court struck a note of warning which is the main crux of the present controversy :(1) "The fundamental guarantee is of equal, protection of the laws and the doctrine of classification is; only a subsidiary rule evolved by courts to give a practical content to that guarantee by accommodating it with the practical needs of the society and it should not be allowed to submerge and drown the, precious guarantee of equality.
The doctrine of classification should not be carried to a point where instead of being a useful servant, it becomes a dangerous master, for otherwise, as pointed out by Chandrachud, J. in State of Jammu & Kashmir vs Triolki Nath Khosa(2) "the guarantee of equality will be sub merged in class legislation masquerading as laws meant to govern well marked classes characterised by different and distinct attainments." .
That process would inevitably end in substituting the doctrine of classification for the doctrine of equality the fundamental right to equality be fore the law and equal protection of the laws may be replaced by the overworked methodology of classification.
Our approach to the equal protection clause must, therefore, be guided by the words of caution uttered by Krishna Iyer, J. in State of Jammu & Kashmir vs Triloki Nath Khosa(2) "Mini classifications based on micro distinctions are false to our egalitarian faith and only substantial and straight forward classification plainly promoting relevant goals can have constitutional validity.
To overdo classification is to undo equality. ' (emphasis added) Mathew, J., in Ambica Mills(3) placed the same accent from the angle of under inclusion: (1) Ibid at 478.
(2) [1974]1 S.C.C. 19.
(3) State of Gujarat & Anr.
vs Shri Ambica Mills Ltd. Ahmedabad ; at 782.
563 The equal protection of the laws is a pledge of the protection of equal laws.
But laws may classify. reasonable classification is one which includes all who are similarly situated and none who are not.
The question is what does the phrase 'similarly situated ' mean ? The answer to the question is that we must look beyond the classification to the purpose of the law.
The purpose of a law may be either the elimination of a public mischief or the achievement of some positive public good.
A classification is under inclusive when all who are included if in the class are fainted with the mischief but there are others also tainted whom the classification does not include.
In other words, a classification is bad as under inclusive when a State benefits or burdens persons in a manner that furthers a legitimate purpose but does not confer the same benefit or place the same burden on others who are similarly situated.
A classification is over inclusive when it includes not only those who are similarly situated with respect to the purpose but others who are not so situated as well." (emphasis added) Here, what is the similarly circumstanced class which, according to the mandate of article 14, must be similarly treated ? Is there any substantial differentiation between corrupters of public power before and after February 27, 1975 or before and after Emergency ? Are they not 'birds of a feather ' who must 'flock together ', tried alike and receive the fruits of justice equally ? What genetic distinction justifies a dissection between bribe taking ministers of yesterday, to day and tomorrow so far as and this is the water mark exemplary immediacy and instant finality of judicial processing are concerned ? The prologuic part of the Bill states that the hushed spell of the Emergency ear was haunted by a hundred vampirish villainies which held vital freedoms in thraldom.
Fazal Ali, J. condensed them in State of Rajasthan & Ors, etc.
vs Union of India etc.
( ') and these observations are borrowed in the Preamble to the Bill and stated: "(2) that civil liberties were withdrawn to a great extent; (3) that important fundamental rights of the people were suspended, (4) that strict censorship on the press was placed; and (1) [1978]1 S.C.R. 1 at 118.
564 (5) that the judicial powers were crippled to a large extent" The question is not whether the tragic quadruplex of vices did exist we must, in law, assume they did but what is the substantial linkage between the then prevalent morbid conditions and the unavailability of normal processes of prosecuting corrupt or oppresive administrators in the criminal courts.
Where magistrates and Sessions Judges forbidden from taking cognisance of cases of bribery if the accused happened to be ministers or their collaborators ? Were criminal misuses of power by high functionaries deleted from the court 's jurisdiction ? Were witnesses banned from testifying or the police prohibited from investigating ? No. Top political power wielders had in the past often escaped, even after judicial commissions had found a prima facie case against them.
The pathology of their escape from the coils of the judical process cannot be misdiagnosed as due only to the Emergency virus.
That approach side tracks the solution and serves to continue the sickness.
For instance, secrecy and authority are the armoury of dubious and arrogant power.
The right to know is a fundamental facet of free action and the Official Secrets Act is often a shield of the corrupt.
Fearless investigation is a sine qua non of exposure of delinquent 'greats ' and if the investigative agencies tremble to probe or make public the felonies of high office white collar offenders in the peaks may be unruffled by the law.
An independent investigative agency to be set in motion by any responsible citizen is a desideratum.
These et al, are not to be ignored in the incessant din of 'Emergency Excesses '.
The relevancies relied on in the Preamble bearing on Emergency and its nexus to speedier trial may be analysed.
Civil liberties were suppressed, press censorship was clamped down and judicial powers were curtailed.
Assuming civil liberty was a casualty during the Emergency, as it was, how did it obstruct trials of super political criminals ? If faith in democratic institutions is the victim in case there is undue delay in punishing high public and political offenders" that holds good, regardless of Emergency.
Likewise, if the Press had been suppressed during Emergency what had that to do with political criminals being brought to book by filing complaints before courts ? If judicial powers were crippled by the Proclamation and the follow up notification, they affected the High Courts ' and Supreme Court 's jurisdictions to grant relief against preventive detention or denial of certain freedoms.
What had that to do with prompt prosecution in trial courts of high political criminals that perennial post Independence species ? If substantial relation between the distinguishing criterion and the goal of the law be the only classificatory justification qualifying for exemp 565 tion from equal treatment.
Emergencey does not segregate corrupt ministers and elected caesars into two categories.
They are a common enemy with continuity in space and time and, for social justice to show up, must be tracked down by a permanent statute.
Let us view the problem slightly differently.
Even if liberty had not been curtailed, press not gagged or writ jurisdiction not cut down, criminal trials and appeals and revisions would have taken their own interminable delays.
It is the forensic delay that has to be axed and that has little to do with the vices of the Emergency.
Such crimes were exposed by judicial commissions before, involving Chief Ministers and cabinet ministers at both levels and no criminal action followed except now and that of a select group.
It was lack of will not Emergency that was the villain of the piece in non prosecution of cases revealed by several Commissions like the Commission of Enquiry appointed by the Government of Orissa in 1967 (Mr. Justice Khanna), the Commission of Enquiry appointed by the Government of J&K in 1965 (Mr. justice Rajagopala Ayyangar), the Mudholkar Commission against 14 ex United Front Ministers appointed by the Government of Bihar in 1968 and the T. L. Venkatarama Aiyar Commission of Inquiry appointed by the Government of Bihar, 1970 to mention but some.
We need hardly say that there is no law of limitation for criminal prosecutions.
Somehow, a few manage to be above the law and the many remain below the law.
How ? I hesitate to state.
My point is that high powered public and political offenders are not a peculiar feature of the Emergency but has been a running stream for long and bids fare to flow on, sometimes subterraneously, sometimes gushing through a mountain gorge.
Therefore, a corrupt continuity cannot be cut up without better justification.
Moreover, the 'human ' rights dimensions of article 21 have a fatal effect on legislative truncation of fair procedure.
The contribution of Maneka Gandhi case(1) to humanization of processual justice is substantial.
I do not dilate on this aspect as the leading judgment has dealt with it.
The question, then" is whether there is constitutional rationale for keeping out of the reach of speedy justice non emergency criminals in high public or political offices.
Such a Bill, were it a permanent addition to the corpus juris and available as a jurisdiction for the public to compel government, if a prima facie case were made out even against a minister in office, to launch a prosecution before a sitting High (1) [1978] 1 SCC 248 566 Court Judge, would be a wholesome corrective to the spreading evil of corruption in power pyramids.
It is apt to recall the words of Mr. Justice Khanna, Chairman of the Law Commission.
( ') "Every system of government requires that those wielding power should use it for public good and should not make it an instrument of self seeking.
All power is like a trust.
Those who derive it from the people are accountable to show that it has been exercised for the people.
To repeat what I said recently, abuse of authority by those in power inevitably causes mass disillusionment and results in public frustration.
Nowhere is it more true than in a democratic set up because in democracy it is the people themselves who entrust power to those whom they elect.
Abuse and misuse of authority can take many forms.
It can result in self aggrandisement by the acquisition of more authority by those put in power and the use of that authority for eliminating political and personal opponents.
Such abuse of authority paves way to authoritarianism and dictatorship.
Power can likewise, be abused by making it a source of personal enrichment.
Corruption percolates and if those in power at the top turn corrupt, we would soon find that corruption and graft become ubiquitous in all spheres of administration at lower levels.
Although corruption anywhere is reprehensible, developed countries can somehow afford this vice, despise it how they may, because their economy is already well developed.
In the case of developing countries, corruption arrests and often retards the process of development and the nation pays a heavy price in terms of loss of moral values.
Nothing causes greater public dismay and shakes more the faith of the people in democratic process and undermines their confidence in its working than the sight of these entrusted with power by being elected to office by the people using their authority for self aggrandisement and personal enrichment.
Purity of administration has much greater significance in countries recently freed with economies in the process of development.
" Having stated the case against the Emergency oriented sub classification, I still think that on constitutional principles, sanctified by decisions, it is possible to sustain or salvage this temporary measure which isolates crimes and criminals during a pernicious period from the rest (1) 18th Feroz Gandhi Memorial Lecture.
567 who share the same sinister properties.
When a salvationary alter native is available, the Court should opt for it when the attack is under article 14, provided the assumptions of fact desiderated by the alternatives are plausible, not preposterous.
The anatomy of the Emergency as X rayed in the Preamble, is all dark shadows which, when read imaginatively, leads to situations plausible, even probable and readily presumable.
Imagine, then, the ubiquitous police, acting under the inscrutable yet omnipotent powers of the MISA, seizing humans allergic to Authority and casting them into interminable incarceration in hidden prisons, without any justiciable reasons or for sheer whim ! No court to call illegality to other or halt horrendous torture or challenge high handed unreason If this be a potential peril, naturally a dangerous situation develops, and unaccountable power once unsheathed, the inauguration and escalation of such abuse becomes a compulsive continuum.
Constitutional tyranny is anathema to decent democracy.
In that state of nervous breakdown of the people, sans speech, sans movement, sans security all of which are precariously dependent on a few psychotics in de facto power, the right to go to court and prosecute an absolutist in authority for corruption or misuse of power is illusory.
If you speak up against crimes in high positions, if you complain to court about abuse of power, you may be greeted will prompt detention and secret torture, with judicial relief jettisoned and Press publicity lock jawed.
If these macabre maybes were assumed, there could be a noxious nexus between the Emergency season and the sinister crimes covered by this Bill.
Maybe,, these scary assumptions are exaggerated but the Enquiry Reports produced and Fazal Ali, J 's observations earlier quoted do not permit a Judge to dismiss them as imaginary.
It follows that a nexus between the differentia and the object is not too recondite to be inferred.
To illustrate briefly may concretise clearly.
If an Emergency authoritarian had a criminal 'deal ' cognisable under anti corruption legislation and a knowledgeable citizen did file a complaint in court or a writ petition challenging as mala fide an executive action motivated by graft it was quite on the cards that his way backhome might be diverted into a hospitable lock up or hungry detention camp or horrendous torture cell.
If a man 's building was broken up by a heartless bulldozer steered by a criminal authoritarian with police fanfare how could information of criminal trespass or grave mischief be laid before the same police or case launched before a magistrate if manacles are the consequence ? The rule of law may survive on paper but panicked into hiding where the wages of invocation of the legal process is unquestionable incarceration.
You may go to court but be sure Or tenancy in a penitentiary when you come out.
These perilous possi 568 bilities might have been exaggerations but had some foundation, and fear folds up the book of remedies.
Thus the scary scenario of 'emergency excesses ' had a nexus with non action against persons in high against authority and escalation of corruption and repression when judicial checks on abuse had gone to sleep.
When men realise.
that speech is iron and silence pieces of silver they become deaf and dumb, law books notwithstanding.
Another good reason for upholding the classification is the legality of the State 's power to pick out a hectic phase, a hyper pathological period, a flash flood and treat that spell alone, leaving other like offensive periods well alone because of their lesser trauma.
It is a question of degree and dimension.
This Court in Ambica Mills (1) observed: "Mr. Justice Holmes, in urging tolerance of under inclusive classification, stated that such legislation should not be disturbed by the Court unless it can clearly see that there is no fair reason for the law which would not require with equal force its extension to those whom it leaves untouched.
What, then, are the fair reasons for non extension ? What should a court do when it is faced with a law making an under inclusive classification in areas relating to economic and tax matters.
Should it, by its judgment, force the legislature to choose between inaction or perfection ? The legislature cannot be required to impose upon administrative agencies tasks which cannot be carried out or which must be carried out or a large scale at a single stroke.
"If the law presumably hits the evil where it is most felt, it is not to be overthrown because there are other instances to which it might have been applied.
There is no doctrinnaire requirement that the legislation should be couched in all embracing terms." (See West Coast Hotel Company vs Parrish) (2) The Emergency was witness to criminal abuse of power, so says the Preamble, on a scale unheard of before or after.
Therefore, this ominous period lends itself to legislative segregation and special treatment.
Mr. Justice Mathew has explored the jurisprudence of selective treatment as consistent with the pragmatism of eglitarianism.
The present Bill is a textbook illustration of the.
dictum: (3) (1) ; at 783.
(2) ; , 400.
(3) Gujarat vs Ambica Mills Ltd. ; at 782 783.
569 "The piecemeal approach to a general problem permitted by under inclusive classifications, appears justified when it is considered that legislative dealing with such problems is usually an experimental matter.
It is impossible to tell how successful a particular approach may be, what dislocations might occur, what evasions might develop, what new evils might be generated in the attempt.
Administrative expedients must be forged and tested.
Legislators, recognizing these factors, may wish to proceed cautiously, and courts must allow them to do so (supra).
Administrative convenience in the collection of unpaid accumulations is a factor to be taken into account in adjudging whether the classification is reasonable.
A legislation may take one step at a time addressing itself to the phase of the problem which seems most acute to the legislative mind.
There fore, a legislature might select only one phase of one field for application or a remedy.(1) In may be remembered that article 14 does not require that every regulatory statute apply to all in the same business; where q size is an index to the evil at which the law is directed, discriminations between the large and small are permissible, and is also permissible for reform to take one step at a time, ad dressing itself to the phase of the problem which seems most acute to the legislative mind.
A legislative authority acting within its field is not bound to extend its regulation to all cases which it might possibly reach.
The legislature is free to recognise degrees of harm and it may confine the restrictions to those classes of cases where the need seemed to be clearest (see Mutual Loan Co. vs Martell) (2) In short, the problem of legislative classification is a perennial one, admitting of no doctrinnaire definition.
Evils in the same field may be of different dimensions and proportions requiring different remedies.
Or so the legislature may think (see Tigner vs Texas) (2).
Once an objective is decided to be within legislative competence, however, the working out of classification has been only infrequently impeded by judicial negatives.
(1) Two Guys from Harrison Allentown vs MeGinley, ; , 592.
(2) ; , 180.
(3).310 U.S. 141 .
18 978SCI/78 570 The Courts attitude cannot be that the state either has to regulate all businesses, or even all related businesses and in the same way, or, not at all.
An effort to strike at a particular economic evil could not be hindered by the necessity of carrying in its wake a train of vexatious, trouble some and expensive regulations covering the whole range of connected or similar enterprises." "All or nothing" may lead to unworkable rigidity.
Principled compromises are permissible in law where non negotiable fundamentals are not tampered with.
The Bill in question, viewed in this light, passes the constitutional test.
The fabric of the offences before and during the Emergency is true same, the motivation and the texture of the crime is no different But, in my view, what validates the special legislation is the abnormality of the then conditions, the intensive phase of corrupt operations and the inexpediency of digging up old crimes.
Ambica Mills (supra) is the judicial justification for the classification.
To sum up, the Bill hovers perilously near unconstitutionality (article 14) in certain respects, but is surely saved by application of pragmatic principles rooted in precedents.
Nevertheless, justice to social justice is best done by a permanent statute to deal firmly and promptly with super political offenders, since these 'untouchable ' and 'unapproachable ' powerwielders have become sinister yet constant companions of Development in developing countries.
More remains to be done if the right to know and the right to express and expose are to be real and access to remedies available" absent which the rule of law shines in libraries, not among the people.
A brief reference to Chaganlal Magganlal, presenting it in a light somewhat different from the approach made by the learned Chief Justice, is apposite before I wind up because there was a strand of argument that if both procedures were substantially fair and equal in their onerous process the provision was beyond constitutional cavil on the score of classificatory discrimination. 'this, with great respect, is specious.
It is understandable that given a valid classification, the opportunity for using one or the other alternative procedures is goods a Chaganlal Magganlal.
In that case, speedy recovery of public property was the basis for grouping and, within that group, one of two alternative procedures, more or less similar in burden or facility, was held sound.
(1) Chaganlal Magganlal (P) Ltd V. Municipal Corporation of Greater Bombay & Ors ; 571 Absent the initial classifiability on a rational footing related to the goal of easy ejectment, Changanlal Magganlal (supra) would have run a different course.
A brief excursion into Chaganlal is desirable here.
I do not read Chaganlal in such manner as to make its core redundant.
That case first justified the classification on the ground that public property was a class by itself and that differentia had a rational relation to the goal of speedy recovery.
Another limb of the Chaganlal ratio is that a valid classification is no passport to oppressive or arbitrary procedure.
that is taken care of by holding that the prescribed special procedure is not too onerous.
And thirdly, within the class picked out for special treatment there is no discrimination because both are substantially fair and similar.
To understand that ruling in the sense that once the procedures are substantially equal, no question of discrimination and valid classification can arise is to make much of the discussion redundant.
To hold the whole discussion relevant we have to view its three limbs holistically.
So, basic fairness of procedure is necessary.
A valid classification with an intelligible differentia and intelligent nexus lo the object is needed.
The third part of the triangle is that within the class there should be no possibility of using a more burdensome procedure for one and a substantially different one for another.
Arbitrariness in this area also violates article 14.
Even in our present case, assuming that the facilities under the Bill and under the ordinary Code are equally fair, could the Government have indicted one or the other in the ordinary court or the special court on the basis of drawing lots or the first letter of their names, the colour of their skins or like non sense ? No.
The wisdom of article 14 will not tolerate such whim.
Classify or perish, is the classic test of valid exemption from inflexible equality under the Constitution.
Before I conclude, I must admit the force of the reasoning in Shinghal, J 's powerful plea against nominated judges.
I am persuaded to the view that the sure solution to the tangled web of problems raised by the Reference, consistently with the present object of the Bill, is to make the High Court the custodian of the new jurisdiction. 'this suggestion cropped up even as the argument sailed along but counsel for the Union of India assured the Court that respectful consideration, not more, would be given to the tentative idea expressed from the Bench.
The risk of constitutional litigation defeating the purpose of quick justice may well be the price of ignoring the considered suggestion.
It is for the wisdom of Parliament to trust the High Courts or the hand picked Judges from the High Courts an(l face constitutional adjudication.
I 572 say no more.
There is something to ponder, for those who cherish accountable judicial autonomy, in the apprehension expressed by Shinghal, J. that subtle encroachments on independence of this instrumentally may eventuate in temporising with a fundamental value.
While I am impressed with the reasoning of the learned Judge, I desist from pronouncing on the Point.
I concur with the learned Chief Justice although I give some divergent reasons UNTWALIA J.
I fully concur in the opinion delivered by the learned Chief Justice except in regard to one matter, which in my view, is of a vital and fundamental nature.
I, therefore, proceed to deliver my separate opinion on that question.
During the course of the hearing of the Reference to obviate some technical objections raised on behalf of the interveners and others four suggestions Were given by the Court.
Three were accepted in writing by the Solicitor General appearing for the Government of India which, to all intents and purposes, would mean the President.
Regarding one, we were told that was still under consideration of the Government.
It appears to me that the three suggestions of the Court which were accepted were to obviate, all possible challenges to the constitutional validity of the Bill on one ground or the other.
The fourth one largely concerned the wisdom behind some of the provisions of the. legislation.
My learned Brother Shinghal J., has recorded his separate opinion on a point in connection with which the fourth suggestion was given by the Court just in passing.
I do not agree with his opinion, and I say so with great respect, in that regard.
In my opinion the Bill does not suffer from any invalidity on that account.
I need not deal with this point in any detail as I respectfully agree with all that has been said in the majority opinion in that respect too.
In none of the earlier references answered either by the Federal Court or by this Court a precedent is to be found resembling or identical to what happened in this Special Reference.
I see no harm in adopting the method of giving some suggestions from the Court which may obliterate a possible constitutional attack upon the vires of a Bill.
It may not be necessary or even advisable to adopt such a course in all References under Article 143 of the Constitution.
But if in some it becomes expedient to do so" as in my opinion in the instant one it was so, I think, it saves a lot of public time and money to remove any technical lacuna from the Bill if the Government thinks that it can agree to do so, of course the Bill by itself is not a law.
It would be a law when passed by the Parliament.
But even at the state of the Bill when opinion of this Court is asked for, it seems to me quite appro 573 priate in a given case to make some suggestions and then to answer the Reference on the footing of acceptance by the Government of such of the suggestions as have been accepted.
Otherwise, according to me, it is incongruous for this Court to answer the Reference as it is without taking into account the concessions made on behalf of the Government vis a vis the suggestions of the Court.
It is manifest that all the three infirmities pointed out in the majority opinion in answer No. 3 vanish after the acceptance in writing by the Government that the three suggestions made by the Court vis a vis the alleged three infirmities, namely, 3(a), 3(b) and 3(c) would be removed from the Bill.
I would, however, like to add without elaborately dealing with the point that as regards the merits of the said infirmities I agree that 3(c), namely, that the absence of a provision for transfer of a case from one Special Court to another, makes the procedure unjust or arbitrary.
But as at present advised, I do not agree that the alleged infirmities 3(a) and (b) make the procedure unjust or arbitrary.
I have grave doubts whether it is so on that account.
Any way, in my opinion, there is no question of the procedure being unjust or arbitrary in respect of any of the three infirmities (a), (b) and (F) enumerated in answer 3 in view of the acceptance by the Government of India of the suggestions emanating from the Court during the course of the hearing of the reference.
l see no difficulty in holding that the Reference stands amended in view of those concessions and we are now required to answer the amended Reference which means the Reference as if the Bill as proposed incorporates the three concessions made by the Government.
Thus the procedure prescribed in the Bill, undoubtedly, becomes just and fair and no longer remains arbitrary in any sense.
SHINGHAL J., I had the advantage of going through the judgment of my Lord the Chief Justice and I concur with the conclusion arrived at by him in regard to the maintenance of the reference, the legislative competence of the Parliament and the arguments which were raised with reference to article 14 of the Constitution.
I also agree that the Bill suffers from the three defects mentioned at (a) to (c) of sub paragraph (3) of the concluding paragraph of my Lord 's judgment.
It however appears to me that the question whether the Bill or any of its provisions is otherwise unconstitutional, is equally with the scope of the question under reference and requires consideration in the light of the other arguments which have been advanced before us.
In fact I am of the opinion that, for reasons which follow, clauses 5 and 7 of the Bill are, in any case, constitutionally invalid even if the three offending provisions pointed out by the Chief Justice are amended on the lines stated by learned Solicitor General.
574 A reference to the Statement of Objects and Reasons of the Bill shows that it is meant to create "additional courts" which will "exclusively deal` ' with the class of offences mentioned in it.
While justifying the necessity for the creation of such Special Courts, it has been stated that the "court calendars" are "congested" and "powerful accused" are capable of causing much delay in the disposal of cases and that it was necessary that the true character of the persons who, had held high political or public offices in the Country and had committed offences "must be known to the electorate as early as possible if democratic institutions are to survive and political life is to remain clean.
" The Preamble of the Bill does not refer to the capacity of the "powerful accused" to cause much delay in the disposal of cases, but refers to "congestion of work" and recites that there were "other reasons" for which it could not be reasonably expected that the prosecutions of the persons who had held high public or political offices would be brought to a "speedy termination.
" It is therefore obvious that if the "ordinary criminal courts" were not congested with work, they would have been allowed to try the cases with "some procedural changes" referred to in the eighth recital of the Preamble.
There is no reference to "procedural changes" in the Statement of Objects and Reasons, and they did not form the basis of that Statement.
In any case the reason for excluding the ordinary criminal courts from trying the class of offences referred to in the Bill within their respective jurisdiction, in accordance with the provisions of section 177 of the Code of Criminal Procedure, 1973, is congestion of work and not their inferior status or incapacity to deal with those cases.
The object of the Bill would therefore have been served by the creation of additional courts of the same category as the "ordinary criminal courts" and the making of any procedural changes which may have been considered necessary in that context to exclude avoidable delay in the trials.
There would have been nothing unusual if such additional courts had been created to save the ordinary congested criminal courts from the burden of more work and to bring the contemplated prosecutions to speedy termination.
That was permissible under the existing law and it would not have been necessary to introduce the present Bill in Parliament.
And even if some "procedural changes" were considered necessary, they could have been worked out within that frame work and incorporated in a different Bill for that limited purpose.
But that has not been considered satisfactory, and the Bill provides for the creation of "Special Courts.
" Clauses 2 and 7 which bear on the point under consideration, read as follows. 575 "2.
The Central Government shall by notification create adequate number of courts to be called Special Courts.
A Special Court shall be presided over by a sitting judge of a High Court in India or a person who has held office as a judge of a High Court in India and nominated by the Central Government in consultation with the Chief Justice of India." The Special Courts envisaged in the Bill are therefore courts the like of which has not been provided in the Code of Criminal Procedure or any other law, and are in fact unknown to the criminal law of the Country.
The question is whether our Constitution envisages the creation of such Courts.
Part V of the Constitution deals with "The Union", while Chapter I thereof deals with "The Executive", Chapter II deals with "Parliament" and Chapter IV deals with "The Union judiciary".
Article ]24(1) provides that there "shall be a Supreme Court of India", which shall have original, appellate and other jurisdiction and powers provided in the subsequent articles, in addition to the power to issue directions or orders or writs mentioned in article 32.
Article 141 specifically provides that the law declared by the Supreme Court shall be binding on all courts within the Country, and article 144 makes it clear that all authorities, civil and judicial shall act in aid of the Supreme Court.
That Court is therefore the supreme "Union Judiciary" under the Scheme of the Constitution, and Chapter IV of Part V of the Constitution provides all that is necessary for that purpose.
Part Vl deals with the States.
Chapter II thereof deals with "The Executive", Chapter III with "The State Legislature" and Chapter V with "The High Courts in the States.
" Article 214 provides that there shall be "a High Court for each State", so that it is not permissible to have two or more High Courts in any state although it is permissible to establish a common High Court for two or more States (article 231 ) .
The High Court of a State has thus been assured an unparalleled position in the State or States for which it has been established.
Article 225 provides for the jurisdiction of, the law administered in any existing High Court and the respective powers of the Judges thereof in relation to the administration of justice in the Court.
Article 226 deals with the power of the High Court "throughout the territories in relation to which it exercises jurisdiction, to issue to any person or authority, including in appropriate cases, any government, within those territories directions, orders or writs for the purposes mentioned in clause (1).
Article 227 vests the power of superintendence in every High Court 576 over all courts subject to its appellate jurisdiction.
Power of withdrawing cases to itself has also been given to the High Court in the circumstances mentioned in article 228.
The High Court has thus been vested with all the necessary jurisdiction and powers to stand out as the repository of all judicial authority within the State, and it is not contemplated by the Constitution that any civil or criminal court in the State should be outside its control.
Then comes Chapter VI which deals with "Subordinate Courts" in the States.
Article 233 provides for the appointment of district judges and article 234 for the recruitment of persons other than district judges to the State Judicial Service.
Article 235 vests the control over all district courts and courts subordinate thereto, in the High Court. 'The Constitution thus contemplates that all civil and criminal courts in a State, other than, the High Court, shall be no other than the subordinate courts over which the High Court shall exercise the fullest superintendence and control, and that the presiding officers of those courts (other than the magistrates referred to in article 237) shall be under the control of the High Court and of no other authority.
That is in fact necessary to ensure the independence of every court dealing with civil and criminal matters.
It may be permissible to create or establish civil and criminal courts in a State with designations other than those expressed in article 236, namely, those covered by the expression "district judge", or by any existing designation in the Codes of Civil and Criminal Procedure, but that is far from saying that it is permissible to establish a hierarchy of courts other than that envisaged in the Constitution.
The Constitution has thus made ample and effective provision for the establishment of a strong, independent and impartial judicial administration in the Country, with the necessary complement of civil and criminal courts.
It is not permissible for Parliament or a State Legislature to ignore or bypass that Scheme of the Constitution by providing for the establishment of a civil or criminal court parallel to a High Court in a State, or by way of an additional or extra or a second High Court, or a court other than a court subordinate to the High Court.
Any such attempt would be unconstitutional and will strike at the independence of the judiciary which has so nobly been enshrined in the Constitution and so carefully nursed over the years.
There is another reason for this view.
Articles 233 and 235 provide for the appointment of district judges and other judicial officers in the States.
The provisions of these articles have been interpreted by this Court in a number of cases including The State of West Bengal 577 vs Nripendra Nath Bagchi,(1) Chandra Mohan and others vs State of Uttar Pradesh and others, (2) state if Assam etc.
vs Rangu Mahammad and others,(3) The State of Orissa vs Sudhansu Sekhar Misra and others, (4) State of Assam and another vs section N. Sen and another, (5) Shamsher Singh and another vs State of Punjab,(6) High Court of Punjab and Haryana vs State of Haryana and others etc.
,(7) State of Bihar vs Madan Mohan Prasad and others,(8) State of Haryana vs Inder Prakash Anand(9) and Chief Justice of Andhra Pradesh and others vs L. V. A Dixitulu and others.(ix).
It has been declared in these decisions that it is the High Court which is the sole custodian of the control over the State Judiciary. 'that is in fact the life blood of an independent judicial administration, and the very foundation of any real judicial edifice.
For if it were permissible to appoint officers other than those under the control or subordination of the High Court to be presiding officers of civil and criminal courts, or in other words, if it were permissible to appoint as judges or magistrates persons outside the control of the High Court, and answerable to the State Executive, that will amount to serious encroachment on a sphere exclusively reserved for the High Court under the constitutional scheme, for the laudable and cherished goal of providing an independent judiciary.
It may be ` that Executive Magistrates and District Magistrates do not belong to the judicial service of a State, but their courts are "inferior", and are amenable to the appellate or revisional jurisdiction of the Courts of Session and the High Court.
Even as it is, the existence of such courts of Executive Magistrates has not been viewed with favour in the Constitution, and article 50 specifically directs that the State shall take steps to separate the judiciary from the executive in the public services of the State.
Then there is article 237 which provides that the Governor may by public notification direct that the "foregoing" provisions of Chapter VI (which deal with the subordinate courts) and any rules made thereunder shall apply in relation to any class or classes of magistrates (i.e. Executive Magistrates) in a State as they apply in relation to persons appointed to the judicial service of the State.
It is therefore quite clear that the Constitution has not considered the exis (1) ; (2) (3) ; (4) ; (5) ; (6) ; (7) ; (8) ; (9) ; (10) 578 tence or continuance of those magistrates who are outside the control of the High Court to be desirable, and their continuance cannot be said to be a matter of credit for those concerned.
It is beyond any doubt or controversy that the Constitution does not permit the establishment of a criminal court, of the status of a court presided over by a "district judge" as defined in article 235, which is not subordinate to the High Court, and, as has been shown, it does not permit the establishment of a court similar to the High Court or a court parallel to the High Court.
It has been argued that section 6 of the Code of Criminal Procedure permits the constitution of criminal courts other than the High Courts and courts of the classes mentioned in the section.
Attention has also been invited to section 6 of the Criminal Law Amendment Act, 1952, for showing that Special Judges can be appointed as and when necessary.
But both these provisions do not justify the argument that Special Courts of the nature contemplated in the Bill can be created under the Scheme of the Constitution.
What section of the Code of Criminal Procedure states is that besides the High Court and "the courts constituted under any law, other than this Code", there shall be, in every State, the classes of criminal courts mentioned in it, namely, the Courts of Session, Judicial Magistrates first class and, in any Metropolitan area, Metropolitan Magistrates, Judicial Magistrates of the second class, and Executive Magistrates.
So all that the section states is that the five classes of criminal courts stated in it shall be in addition to High Courts ' and courts that may be constituted under any other law, and it cannot be said with any justification that it provides for the constitution of courts parallel to or on the same footing as the High Courts, or of criminal courts which are not subordinate to the High Courts.
On the other hand sub section (1) of section 4 of the Code provides that all offences under the Indian Penal Code shall be investigated, inquired into, tried, and otherwise dealt with according to the provisions contained in it.
And sub section (2) provides that all offences under any other law shall be investigated, inquired into, tried and otherwise dealt with according to the "same provisions", subject only to any enactment for the time being in force regulating the manner or place of investigating, inquiring into, trying or otherwise dealing with such offences.
But that is correlated to clause (4) of section 2 which defines "offence" to mean any act or omission made punishable by any law for the time being in force including any act in respect of which a complaint may be made under section 20 of the Cattle trespass Act.
Section of the Code does not therefore justify the creation of Special Courts of the nature con 579 templated in the Bill, and the argument to the contrary is quite untenable.
A reference to section 6 of the Criminal Law Amendment Act, 1952, is equally futile.
While that section provides for the appointment of special Judges for the trial of some offences, section 9 specifically provides that the High Court may exercise, so far as they may 1 be applicable, all the powers conferred by Chapters XXXI and XXXlI of the Code of Criminal Procedure, 1898, on a High Court "as if the court of the special Judge were a Court of Session trying cases without a jury within the local limits of the jurisdiction of the High Court.
" The special Judges appointed under section 6 are therefore subordinate to the High Court and fit in the scheme of the independence of judicial courts and officers contained in the Constitution.
An attempt has also been made to justify the provision in the Bill for the creation of Special Courts by a reference to Part XIV A Or the Constitution which provides for the establishment of Administrative Tribunals.
But such tribunals are not meant for the trial of offences referred to in the Indian Penal Code, and may well be said to be quasi judicial.
It will thus appear that the Special Courts contemplated by clause 2 of the Bill will not be on the same footing as the High Courts, and will, to say the least, be lesser or inferior courts.
Clause 7 of the Bill however provides that a Special Court shall be presided over by a "sitting judge" of a High Court" and in examining it I have presumed that the Bill will be so amended as to exclude the nomination of "a person who has held office as a judge of a High Court" as the presiding judge of a Special Court.
It will not, however, be permissible or proper to appoint a "sitting" Judge of a High Court to preside over a Special Court which is lesser or inferior to the High Court.
In all probability, "sitting" judges of High Courts will refuse to serve as presiding judges of the Special Courts, and there is no provision in the Constitution under which they can be compelled, or ordered against their will, to serve there.
That eventuality will make the provisions of the Bill unworkable even is it were assumed for the sake of argument that they are otherwise valid and constitutional.
At any rate, the possibility that the "sitting" High Court judges may not agree to serve as presiding Judges of the Special Courts is real, and their very refusal will embarass the judicial administration and lower the prestige of the judiciary for clause 7 of the Bill provides for the nomination of the presiding judge of a Special 580 Court in consultation with (or with the concurrence of ?) the Chief Justice of India.
This is also a factor which should caution those concerned with the Bill and its enactment, that it is not only unconstitutional but is not likely to work well and may not serve the avowed purpose of discharging their "commitment to the Rule of Law" to which reference has been made in the Statement of Objects and Reasons of the Bill.
There is another reason for this view.
Equality before the law, or, speaking in terms of the present controversy, equality in criminal justice, is the universal goal of all democratic forms of government, for no one can ever deny that all persons charged with crime must, in law, stand on the same footing at the Bar of justice.
Such an equality should be assured not only between one accused and another but also between the prosecution and the accused.
This is not a mere "rights explosion" but, as will appear, it is what our Constitution has carefully, assuredly and fully provided for every citizen of the Country.
Article 21 of the Constitution is, by itself, enough to bring this out.
The article provides that no person shall be deprived of his life or personal liberty except according to procedure established by law.
I am here avoiding any reference to article 14 of the Constitution be cause that is not necessary when the scope and the meaning of article 21 have been defined by this Court in a number of decisions including Maneka Gandhi vs Union of India.(1) It will be enough for me to refer to the following opinion of Chandrachud J., as he then was, "But the mere prescription of some kind of procedure cannot ever meet the mandate of article 21.
The procedure prescribed by law has to be fair, just and reasonable, not fanciful, oppressive or arbitrary.
The question whether the procedure prescribed by law which curtails or takes away the personal liberty guaranteed by article 21 is reasonable or not has to be considered not in the abstract or on hypothetical considerations like the provision for a full dressed hearing as in a Court room trial, but in the context, primarily, of the purpose which the Act is intended to achieve and of urgent situations which those who are charged with the duty of administering the Act may be called upon to deal with. ' Bhagwati J., undertook a detailed examination of the meaning and content of "personal liberty" in article 21.
He has taken the view (1) [1978] 2 S.C.R. 621.
581 that the expression is of the "widest amplitude and it covers a variety A of rights which go to constitute the personal liberty of man.
" While examining the procedure prescribed by the , he has expressed his views and the views of the other Judges as follows, "Is the prescription of some sort of procedure enough or must the procedure comply with any particular requirements Obviously, procedure cannot be arbitrary, unfair or unreasonable.
This indeed was conceded by the learned Attorney General who with his usual candour frankly stated that it was not possible for him to contend that any procedure howsoever arbitrary, oppressive or unjust may be prescribed by the law.
There was some discussion in A. K. Gopalan 's case in regard to the nature of the procedure required to be prescribed under Article 21 and at least three of the learned Judges out of five expressed themselves strongly in favour of the view that the procedure cannot he any arbitrary, fantastic or oppressive procedure.
Fazal Ali, J., who was in a minority, went to the farthest limit ill saying that the procedure must include the four essentials set out in Prof. Willis ' book on Constitutional Law, namely, notice, opportunity to be heard, impartial tribunal and ordinary course of procedure.
Patanjali Sastri, J., did not go as far as that but he did say that "certain basic principles emerged as the constant factors known to all those procedures and they formed the core of the procedure established by law.
" Mahajan, J., also observed that Article 21 requires that "there should be some form of proceeding before a person can be condemned either in respect of his life or his liberty" and "it negatives the idea of fantastic, arbitrary and oppressive forms of proceedings.
" But apart altogether from these observations in A. K. Gopalan 's case, which have great weight, we find that even on principle the concept of reason ableness must be projected in the procedure contemplated by Article 21, having regard to the impact of Article 14 on Article 21." In order to fulfil the guarantee of article 21, the procedure prescribed by law for the trial of a criminal case has therefore to be fair, just and reasonable, and not fanciful oppressive or arbitrary.
Clauses 5, 7 and 8 of the Bill, however, provide as follows, "5.
On such declaration being made any prosecution in respect of such offence shall be instituted only in a Special 582 Court designated by the Central Government and any pro section in respect of such offence pending in any court in India shall stand transferred to a Special Court designated by the Central Government.
A Special Court shall be presided over by a sitting judge of a High Court in India or a person who has held office as a judge of a High Court in India and nominated by the Central Government in consultation with the Chief Justice of India.
A Special Court shall have jurisdiction to try any per son concerned in the offence in respect of which a declaration is made under section 4 either as principal, conspirator or abettor and all other offences and accused persons as can be jointly tried therewith at one trial in accordance with the Code of Criminal Procedure, 1973.
" Taken together, the clauses provide for the trial of the accused only by Special Courts to be presided over by a judge nominated by the Central Government and clauses 4, 5 and 7 vest the power of designating the Special Court in which an accused is to be tried exclusively in that government.
Speaking in practical terms, the Bill thus enables the Central Government to decide which of its nominated judges shall try which accused or, in other words, which of the accused will be tried by which of its nominated judges.
It has in fact been stated at the Bar by Mr. Jethamalani that most of the Special Courts envisaged in the Bill will be located in Delhi.
So if several courts arc created by the Central Government in Delhi, and they are all presided over by judges nominated by the Central Government, the power of nominating the judge for any particular case triable in Delhi shall vest in the Central Government.
As will appear, such a procedure can not be said to be fair, just and reasonable within the meaning of article 21 and amounts to serious transgression on the independence of the Judiciary.
Reference has already been made to the scheme provided in the Constitution for the creation of the civil and criminal judicial courts and the independence of the judges and the magistrates presiding over those courts.
So far as the Supreme Court and the High Courts are concerned, the question of the Central or the State Governments nominating the judge who shall deal with a particular case does not and cannot arise.
As regards the subordinate courts, section 9(2) of the Code of Criminal Procedure provides that every Court of Session shall be presided over by a Judge to be appointed by the High Court, and section 11(2) makes a similar provision regarding 583 Judicial Magistrates.
The same care has been taken in regard to the A appointment of Chief Judicial Magistrates, Additional Chief Judicial Magistrates and Sub divisional Judicial Magistrates, and the conferring of powers on Special Judicial Magistrates.
It is not therefore permissible for the Executive to appoint a particular judge or magistrate to preside at the trial of a particular accused under the Code of Criminal Procedure.
That is fair, just and reasonable and relieves the accused of any possible oppression.
It has to be appreciated that the problem is of much greater significance in the case of trials before the Special Courts envisaged in the Bill.
As is obvious, a trial by the fiat of a successor government, however justified, is noticed with an amount of scepticism.
If one may be permitted to say so, a "successor trial," broadly speaking, seeks to hit the adversary a second time after his initial discomfiture and displacement from power or authority and in the case of an accused who has held a high political status, it may have the effect of destroying his political future.
It is, by the very nature of things, difficult to disabuse the mind of such an accused of the lurking suspicion that the trial is motivated by political considerations and will not be just and fair, or to convince him that it will ultimately lead to justice.
It should therefore be the effort of those ordering the trial to do nothing that may, even remotely, justify such a suspicion.
They should in fact do all they can to convince every one concerned including the accused, that they had the best of intentions in ordering the trial and had provided a fair and straight forward procedure, and the cleanest of judges, for the trial, in an open and fearless manner.
that will not only foreclose avoidable criticism but uphold the majesty of the Rule of Law in its true sense Moreover, if the result of the trial has to carry conviction with the people as a whole, and is meant to acquaint them with the "true character" of the persons who have committed the offences for the survival of the democratic institutions and cleanliness of the political life, as professed in the Statement of objects and Reasons of the Bill, i: is in the interest of those making the declaration referred to in clause 4 of the Bill to convince everyone, including the accused.
that the trial is not spectacular in purpose and does not expose those facing it to a risk greater than that taken by any other accused at an ordinary trial, under the ordinary law.
That kind of assurance, that there is no prearranged result, and that the accused have nothing to fear from the presiding judge of the Court, is the basic requirement of a "successor trial".
Human dignity is a concept enshrined in the Preamble of our Constitution and runs through all that it provides.
It 584 is therefore necessary that this treasure should be the priceless posses s on and the solid hope of all our fellow citizens including those who have to face trials for the offences charged against them.
But the clauses of the Bill referred to above are in derogation of the majesty of the judicial edifice so gloriously and assuredly built up by the Constitution, and is a serious inroad on the independence of the judiciary.
Reference in this connection may be made to Liyanage and others vs Regina(1).
In that case, the appellants were not tried by a judge and jury in accordance with the normal procedure, but by three judges of the Supreme Court of Ceylon nominated by the Minister of Justice.
A preliminary objection was taken that the nomination and the section under which it was made were ultra vires the Constitution.
The three judges of the Supreme Court unanimously upheld the objection on the ground that the power of nomination conferred on the Minister was an interference with the exercise by the judges of the Supreme Court of the strict judicial power of the State vested in them by virtue of their appointment or was in derogation thereof, and was a power which had till then been "invariably exercised by the judicature as being part of the exercise of the judicial power of the state, and could not be reposed in any one outside the judicature.
" The law was amended thereafter, and it was made permissible for the Chief Justice to nominate the three judges.
But the Privy Council, on appeal against conviction after the amended provision had taken effect, upheld the conclusion of the Supreme Court in principle, and held that the power of the judicature could not be "usurped or infringed" by the executive or the legislature.
The Privy Council examined the other objectionable provisions of the amended Act and held that they were invalid.
Those provisions are not relevant for purposes of the present case, but I cannot help extracting the following note of caution struck by their Lordships, "What is done once, if it be allowed, may be done again and in a lesser crisis and less serious circumstances; and thus judicial power may be eroded.
" An attempt like the one made in the present Bill to usurp an important judicial power and vest it in the executive, is a serious inroad on the independence of the judiciary and is fraught with serious consequences.
It has therefore necessarily to be put down at the very inception for it may otherwise give rise to a prospect too gruesome to (1) ; 585 envisage and too dangerous to be allowed to have the sanction of law.
My answer to the question referred by the President will therefore be that apart from the three defects pointed out by my Lord the Chief Justice, clauses S and 7 of the Bill are constitutionally invalid, and I would report my opinion accordingly.
| IN-Abs | The draft Special Courts Bill 1978 introduced in the Parliament by a private member seeks to create adequate number of courts to be called specialcourts.
The Bill provides that a special court shall take cognizance of or try such cases as are instituted before it or transferred to it in the manner provided therein.
If the Central Government is of opinion that there is prima facie evidence of the commission of an offense alleged to have been committed during the period of Emergency by a person who held high public or political office in India and that the said offense ought to be debit with under the Act, it shall make a declaration to that effect in every case in which it is of that opinion.
A declaration made by the Central Government cannot be called in question in ;my court.
Clause (7) of the Bill provides that a special count shall be presided over by a sitting Judge of a High Court in India or a person who has held the office as a Judge of a High Court in India and nominated by the Central Government in consultation with the Chief Justice of India.
Clause 10(1) provides that notwithstanding anything contained in the Code of Criminal Procedure, an appeal shall lie as of right from any judgment or order of a special court to the Supreme Court of India both on fact and on law The President made a reference to the Supreme Court under article 143(1) of the Constitution for consideration of the question whether the Special Courts Bill 1978 or any of its provisions, if enacted would be constitutionally invalid.
Preliminary objections as to the maintainability of the reference were raised on the ground that (i) the reference was of a hypothetical and speculative character and was vague, general and omnibus; (ii) since the Parliament was seized of the Bill it is it6 exclusive function to decide upon the constitutionality of the Bill and if the court withdrew that question for its consideration and report, it would be encroaching upon the functions and privileges of the Parliament.
(iii ) if the reference were entertained it would supplant the salutary provision of article 32 of the Constitution, (iv) irrespective of the view expressed by this Court it would be open to the Parliament to discuss the Bill and pass or not to pass it with or without amendment, and (v) the reference raised purely political questions which the court should refrain from answering.
^ HELD: [per majority Y. V. Chandrachud, C.J., P. N. Bhagwati, R. section Sarkaria and section Murtaza Fazal Ali, JJ.] 1.
(a) It is not necessary that the question on which the opinion of this Court is sought under article 143(1) must have arisen actually: it is competent for the President to make the reference if he is satisfied that the question has 477 arisen or is likely to arise.
The plain duty and function of the Court under article 143(1) is to consider the question on which the reference i6 made and report to the President its opinion, provided the question is capable of being pronounced upon and falls within the powers of the Court to decide.
If, for any reason the Court considers it not proper or possible to answer the questions it would be entitled to return the reference by pointing out the impediments in answering it.
The right of this Court to decline to answer a reference does not flow merely out of the different phraseology used viz., "may" in clause (1) and "shall" in clause (2).
Even in matters arising under clause (2), the Court may be justified in returning the reference unanswered, if it finds for a valid reason that the question is incapable of being answered.
[502C F] (b) It cannot be said that the reference is of a hypothetical or speculative character on the ground that the Bill has yet to become an Act.
The assumption of every reference under article 143 has to be the continued existence of a context or conditions on the basis of which the question of law or fact arises or is likely to arise.
But the possibility of a change, even of a fundamental change, cannot make the exercise of the Presidential jurisdiction under article 143 speculative or hypothetical.
In the press It case there is no speculation about the existence of the Bill and there is nothing hypothetical about its contests as they stand today.
The Bill may undergo changes in future but so may the Constitution itself, including article 143, under which the President has made the reference to this Court.
The former possibility cannot make the reference speculative or hypothetical any more than the latter possibility can make it so.
The Special Courts Bill is there in flesh and blood for anyone to see and examine.
That sustains the reference, which is founded upon the satisfaction of the President that a question as regards the constitutional validity of the Bill is likely to arise and that the question i5 of such a nature and of such public importance that it is expedient to obtain the opinion of this Court upon it.
(503B E l (c) A reference which does not specify with particularity the ground or grounds on which the Bill or any of its provisions may be open to attack under the Constitution is difficult to answer because it gives no indication of the specific point or points on which the opinion of the Court is sought.
It is not proper or desirable that this Court should be called upon to embark upon a roving enquiry into the constitutionality of a Bill or an Act.
Such a course virtually necessitates the adoption of a process of elimination with regard you all reasonably conceivable challenges under the Constitution.
It is not expected of this Court, while answering a reference under article 143, to sit up and discover, article by article, which provision of the Constitution is most lawlessly to be invoked for assailing the validity of the Bill if it becomes a law.
Speculative opinions or hypothetical questions are worthless and it is contrary to principle, inconvenient and inexpedient that opinions should be given Up.l such questions at all.
Whenever a reference is made to this Court under Art 143 of the Constitution, care should be taken to frame specific questions for the opinion of the Court.
In the instant reference it is possible to consider specific questions as being comprehended within the terms of the reference but the risk that a vague and general reference ma.
,y be returned unanswered is real and ought to engage the attention of those whose duty it is to frame the reference.
505 F G, 507B] (d) The contention that since the Parliament is seized of the Bill, it is its exclusive function to decide upon the constitutionality of the provisions of the 478 Bill betrays a tctal lack of awareness of the scheme of.division of powers under the Constitution.
The Court is concerned, not with fanciful theories based on personal predilections, but with the scheme of the Constitution and the philosophy underlying it.
The principle is firmly and wisely embedded in the Constitution that the policy of law and the expediency of passing it are matters for the legislature to decide while, interpretation of laws and questions regarding their validity fall within the exclusive advisory or adjudicatory functions of Courts [507D E] (e) There is equally no force in the contention that if the Court withdrew the question of validity of the Bill for its consideration while the Bill was pending consideration before the Parliament, the Court would be encroaching upon the functions and privileges of Parliament.
The President has made a reference under article 143(1) and the Court is under a constitutional obligation to consider the reference and report to the President.
It cannot be said that any particular function or privilege of the Parliament is encroached upon by this Court.
The question whether the provisions of the Bill suffer from any constitutional invalidity falls within the legitimate domain of this Court.
Parliament can discuss and debate the Bill but the ultimate decision on the validity of a law has to be that of the Court, and not of the Parliament.
In the absence of any text or authority showing what the privileges of the British Parliament are in regard to the kind of matter before the Court it is impossible to say that there is a violation of the Parliament 's privileges.
The a,argument that it would be futile to consider the constitutional validity of the Bill because whatever view the Court might take it would still be open to the Parliament to discuss the Bill and to pass or not to pass it, proceeds on an unrealistic basis.
Although the opinion of this Court can neither deter the Parliament from proceeding with the Bill nor from dropping it, it cannot be said that even if the Court holds the Bill as unconstitutional the Parliament would proceed to pass it without removing the defects from which it is shown to suffer.
[508 F H; 510 B] (f) The argument that.
the reference raises a purely political question is without force.
The policy of the Bill and the motive of the mover may be to ensure a speedy trial of persons holding high public or political office who are alleged to have committed certain crimes relating to the period of emergency.
The President, however, has not asked the Court to advise him as to the desirability of passing the Bill or the soundness of the policy underlying it.
The question whether the Bill or any of its provisions are constitutionally invalid is not a question of political nature which the Court should restrain itself from answering The question referred by the President for the opinion of this Court raises purely legal and constitutional issues which is the right and function of this Court to decide.
[510 D F] Clauses 2, 6 and 10(1) of the Bill are within the legislative competence of the Parliament.
(522H ] 2.
(a) The challenge to the legislative competence of Provide to provde for the creation of Special Courts is devoid of substance.
By virtue of article 246(2) read with Entry 1 1A of the Concurrent List, Parliament has clearly the power to make laws with respect to the Constitution and organisation, that is to say, the creation and setting up of Special Courts.
Clause ' of the Bill, ;S therefore, within the competence of the Parliament to enact.
By cl.
10(1) of the Bill Parliament clearly has the competence to provide that notwith standing anything contained in the Code of Criminal Procedure, 1973 an appeal 479 shall lie as of right from any judgment or order of a Special Court to the A Supreme Court both on fact and on law.
A law which confers additional powers on the Supreme Court by enlarging its jurisdiction is evidently a law with respect to the "Jurisdiction and powers" of that Court.
[517 C D; 521 A B] (b) The argument that the constitution having provided copiously for an hierarchy of courts.
it is impermissible to the Parliament to create a court or a class of courts which do not fall within or fit in that scheme has no force.
There is nothing in the Constitution which will justify the imposition of such a limitation on the Parliament 's power to create special courts.
The words to Entry 11A are sufficiently wide to enable the Parliament not merely to set up courts of the same kind and designation as are referred to in the relevant provisions but to constitute and organize, that is to say, create new or special courts subject to the limitation mentioned in the entry as regards the Supreme Court and the High Courts.
[524 A&D] (c) It is not correct to say that by reason of the fact that the Special Courts will not have the constitutional status of High Courts nor are they District Courts within the meaning of article 235, the creation of Special Courts is calculated to damage or destroy the constitutional safeguards of judicial independence.
[524F] 3.
(a) The classification provided for by the Special Courts Bill is valid and no objection can be taken against it.
[537E] (b) The promulgation of emergency is not and cannot be a matter of normal occurrence in a, nation 's life.
Offenses alleged to have been committed during the period of emergency constitute a class by themselves and so do the persons who are alleged to have utilized the high public or political offices held by them as a cover for committing those offenses.
This Court is not concerned with the truth or otherwise of the allegations, the narrow question before it being whether, in the first instance, the classification is based on some qualities or characteristics which are to be found in all the persons grouped together and not in others who are left out.
The answer to that question can be one and one only, namely, that offenses alleged to have been committed during the emergency by persons holding high public or political offices in India stand in a class apart.
The cover of emergency provided a unique opportunity to the holders of such offices to subvert the rule of law and perpetrate political crimes on the society.
Others left out of that group had neither the means nor the opportunity to do so, since they lacked the authority which comes from official position.
Thus persons who are singled out by the Bill for trial before Special Courts possess common characteristics and those who fall outside that Group do not possess them.
[538 B; 540 A D] (c) Crimes falling outside the group are of a basically different kind and have generally a different motivation.
No advantage can be taken of the suppression of human freedom when the emergency is not in operation.
The suppression of people 's liberties facilitates easy commission of crimes when public criticism is suppressed, there is no fear of detection.
Crimes which are alleged to have been committed during emergency are oblique in their design and selective in their object.
They are generally designed to capture and perpetuate political power; and they are broadly directed against political opponents.
The holder of a high public office who takes a bribe does it to enrich himself.
Though, that deserves the highest condemnation, such crimes are not woven out of the warp and woof of political motivation.
Equal laws have to be 480 applied to all in the same situation and the legislature is free to recognize the degree of harm or evil.
Purity in public life is a desired goal at all times and in all situations.
But, this Court cannot sit as a super legislature and 6trike down the classification on the ground of under inclusion on the score that those others are left untouched, so long as there is no violation of constitutional restraints.
[540 E H) (d) If the classification is valid and its basis bears a reasonable relationship with the object of the Bill, no grievance can be entertained under article 14.
Classification necessarily entails the subjection of those who fall within it to a different set of rules and procedure, which may conceivably be more onerous than the procedure which generally applies to ordinary trials.
In almost all of the decisions bearing, on the questions which arise for consideration the especial procedure prescribed by the particular laws was distinctly more onerous than the procedure which governs ordinary trials.
But once a classify cation is upheld by the application of the dual test, subjection to harsher treatment or disadvantageous procedure loses its relevance, the reason being that for the purposes of article 14, unequals cannot complain of unequal treatment.
Classification necessarily implies discrimination between persons classified and those who are not members of that class.
It is the essence of a classification that upon the class are cast duties and burdens different from those resting upon the general public.
The very idea of classification is that of inequality, so that it goes without saying that the mere fact of inequality in no manner determines the matter of constitutionality.
Some of the provisions of the Bill, cast upon the accused before the Special Court, certain disadvantages as compared with the accused who a.re put up for trial before the ordinary courts, even as some other provisions give to them certain advantages which are denied to others.
[542 E H] The State of West Bengal vs Anywhere Ali Sarkar, ; ; Kathy Raning Rawat vs The State of Saurashtra, ; ; Lachmandas Kewalram Ahuja & Anr.
vs the Slate of Bombay, (1952] SCR 710; Syed Qasim Razvi vs The State of Hyderabad & Ors., ; Habeeb Mohamed vs The State of Hyderabad, [1953) SCR 661; Rao Shiv Bahadur Singh & Anr.
vs The State of Vindhya Pradesh, ; ; Kedar Nath Bajoria vs The State of West Bengal; , ; Asgarali Nazarali Singaporawalia vs The State of Bombay, ; ; referred to.
(e) The grouping1g together of persons who are alleged to have committed offences during the period of emergency with others who are alleged to have engaged themselves in screening certain offenders prior to the declaration of emergency is tantamount to clubbing together, in the same class, persons who do not possess common qualities or characteristics.
It is unquestionably reasonable for the legislature to thinly that the suppression of human liberties during the period of emergency furnished an opportunity to persons holding high public or political offices to commit crimes of grave magnitude which were calculated to destroy democratic values.
Offences alleged to have been committed during the period of emergency can be treated as sui generis.
The same cannot, however, be said of activities, which preceded the declaration of emergency.
Those doings were open to public criticism and were unprotected by the veil of emergency.
The validity of a classification should be tested by broad considerations, particularly when the charge is one of under inclusiveness.
But 481 persons possessing widely differing characteristics, in the context of their situation 1 in relation to the period of their activities, cannot by any reasonable criterion be herded in the same class.
The ante dating of the emergency, as it were, from June 25 to February 27, 1975 is wholly unscientific and proceeds from irrational considerations arising out of a supposed discovery in the matter of screening of offenders.
The inclusion of offences and offenders in relation to the period from February 27 to June 25, 1975 in the same class as those whose alleged unlawful activities covered the period of emergency is too artificial to be sustained.
[545 C H] (f) The answer to the question whether, those who are alleged lo have committed offences prior to the emergency can be put in the same class as persons who are alleged to have committed offences during the period of emergency, has to be in the negative.
[546 c] (g) The classification provided for by cl.
4(1) of the Bill is valid to the limited extent to which the Central Government is empowered to make the declaration in respect of offences alleged to have been committed during the period of emergency, by persons holding high public or political offices.
The classification is invalid in so far as it covers offences committed by such persons between February 27 and June 25, 1975.
No declaration can therefore be made by the Central Government in regard to those offences and offenders under the present classification.
[546 D] (h ) As regards those who are rightly grouped together, since the classification is valid, it is unnecessary for the purposes of article 14 to consider whether the procedure prescribed by the Bill is more onerous then the ordinary procedure.
The onerousness of the special procedure would be irrelevant in considerations arising under article 14, for the reason that the classification is valid (to the extent indicated).
But the Bill has got to meet the challenge of other provisions of the Constitution also, in so far as any particular provision is attracted.
(a) There is no provision in the Bill for the transfer of cases from one Special Court to another.
Absence of such a provision may undermine the confidence of the people in the Special Courts.
The manner in which a Judge conducts himself may disclose a bias; or a Judge may not in fact be biased and yet the accused may entertain a reasonable apprehension on account of attendant circumstances that he will not get a fair trial.
To compel an accused to submit to the jurisdiction of a court which, in fact, is biased or is reasonably apprehended to be biased is a violation of the fundamental principles of natural justice and a denial of fair play.
In yet another case expediency or convenience may require the transfer of a case, even if no bias is involved.
[549D E] (b) The provision for the appointment of a, sitting High Court Judge as Judge of the Special Court is open to no exception.
Though unquestionably retired Judges of High Courts occupy a position of honour and respect in society, one cannot shut one 's eyes to the constitutional position that whereas by article 217 a sitting Judge of a High Court enjoys security of tenure until he attains a particular age, the retired Judge will hold his office as a Judge of the Special Court during the pleasure of the Government.
The pleasure doctrine is subversive of judicial independence.
A retired Judge presiding over a Special Court, who display strength and independence may be frowned upon by the 482 Government and there is nothing to prevent it from terminating his appointment as and when it likes.
There is no force in the submission that if the appointment has to be made in consultation with the Chief Justice of India, the termination of the appointment will also require similar consultation.
The obligation to consult may not necessarily act as a check on an executive which is determined to remote an inconvenient incumbent.
,549 H; 550 B E] (c) Clause 7 of the Bill violates article 21 of the Constitution to the extent that a person who has held office as a Judge of the High Court can be appointed to preside over a. Special Court, merely in consultation with the Chief Justice of India.
[550 E] (d) Yet another infirmity from which the procedure prescribed by the Bill suffers is that the only obligation which cl. 7 imposes on the Central Government while nominating a person to preside over the Special Court is to consul the Chief Justice of India.
One must look at the matter not so much from the point of view of the Chief Justice of India, nor indeed from the point of view of the Government as from the point of view of the accused and the expectation and sensitivities of the society.
It is of the greatest importance that in the name of fair and unpolluted justice, the procedure for appointing a Judge to the Special Court, should inspire the confidence not only of the accused but of the entire community.
Administration of justice has a social dimension and the society at large has a stake in impartial and even handed justice.
[550 H: 551 A B] 5.
The fact that the trial is to be held by no less a person than a Judge of a High Court and there is a right of appeal to this Court are salient safeguards of the Bill.
[552 H] 6.
The question as to whether the opinion rendered by this Court in the exercise of its advisory jurisdiction under article 143(1) of the Constitution is binding as law declared by this Court within the meaning of article 141 of the Constitution, may have to be considered more fully on a future occasion but it is to be hoped that the time which has been spent in determining the questions arising in this reference shall not have been spent in vain.
Though it is always open to this Court to re examine the question as already decided by it and to over rule, if necessary the view earlier taken by it, insofar as all other courts in the territory of India are concerned, they ought to be bound by the view expressed by this Court even in the exercise of its advisory jurisdiction under article 143(1) of the Constitution.
In St. Xaviers College it was pointed (jut that even if the opinion given in the exercise of advisory jurisdiction may not he binding, it is entitled to great weight.
It would be strange that a decision given by this Court on a question of law in a dispute between two private parties should be binding on all courts in this country but the advisory opinion Should bind no one at all, even if, as in the instant case, it is given after issuing notice to all interested parties, after hearing everyone concerned who desired to be heard, and after a full consideration of the questions raised in the reference.
Almost everything that could possibly be urged in favour of and against the Bill was urged before this Court and to think that its opinion is an exercise in futility is deeply frustrating.
[553 D G] Estate Duty Bill, , 320, 332, 341; U.P. Legislative Assembly; , , 446 47; St. Xaviers College, [19751 1 SCR 173, 201 202; Attorney General for Ontario vs Attorney General 483 for Canada, , 589; Ram Kishore Sen vs Union of India, AIR 1965 Cal. 282; Chhabildas Mehta vs The Legislative Assembly Gujarat State, 1970 II Gujarat Law Reporter 729; The Province of Madras vs Messrs Boddu Paidanna, ; Central Provinces case, ; Constitutional Law of India by H. M. Seervai, 2nd Edn.
II, page 1415, para 25.68, referred to.
Investing the High Courts with jurisdiction to try cases under the Bill may, B: in the circumstances afford the best solution from every point of view.
The Chief Justices of High Courts will, in their discretion, assign and allocate particular cases to Judges of their courts.
To avoid delays and to ensure speedier trial, no other work may be assigned to the High Court Judge nominated by the Chief Justice to try a case or cases under the Bill.
This will obviate the nomination, by the Central Government, of a particular Judge to try a particular case.
[554 C D] Answers to the reference are as follows: (1) Parliament has the legislative competence to create Special Courts and to provide that an appeal shall lie as of right from any judgment or order of a Special Court to the Supreme Court.
Clauses 2 and 10(1) of the Bill are, therefore, within the Parliament 's legislative competence; [554G H] (2) The classification provided for in cl.
4(1) of the Bill is valid to the extent to which the Central Government is empowered to make a declaration in respect of offences alleged to have been committed during the period of Emergency by persons who held high public or political offices in India.
Persons who are alleged to have committed offences prior to the declaration of Emergency cannot validly be grouped along with those who are alleged to have committed offences during the period of Emergency.
It is, therefore not competent to the Central Government to make a declaration under cl. 4(l) of the Bill in respect of persons who are alleged to have committed offences between February 27, 1975 and June 25, 1975.
[555 A C] (3) The procedure prescribed by the Bill for the trial of offences in respect of which a declaration can be validly made by the Central Government under cl.
4(1) of the Bill is just and fair except in regard to the following matters: (a) the provision in cl. 7 of the Bill, under which a retired Judge of the High Court can be appointed as a Judge of the Special Court; (b) the provision in cl. 7, under which the appointment of a Judge lo the Special Court can be made by the Central Government in consultation with but without the concurrence of the Chief Justice of India; and (c) the absence of a provision for transfer of a case from one Special Court to another.
(d) The Bill is valid and constitutional in all other respects.
[555 D E] KRISHNA IYER.
J. (Concurring) 1.
Corruption and repression hijack development processes, and, in the long run, lagging national progress means ebbing people 's constitutional in constitutional means to social justice.
And so, to track down and 484 give short shrift to these heavy weight criminaloids who often mislead the people by public moral weight lifting and multipoint manifestoes is an urgent legislative mission partially undertaken by the Bill under discussion.
To punish such super offenders in top positions, sealing off legalistic escape routes and dilatory strategies and bringing them to justice with high speed and early finality, is a. desideratum voiced in vain by Commissions and Committees in the past and is a dimension of the dynamics of the Rule of Law.
This Bill, breaks new ground contrary to people 's resigned cynicism that all high powered investigations, reports and recommendations end in legislative and judicative futility, that all these valient exercises are but sound and fury signifying nothing.
[557 A B] 2.
(a) An Act of this nature, with the major changes mentioned by the Chief Justice to avert collision with Al t.
21 and with wider coverage to come to terms with article 14, is long overdue.
[577 G H] (b) These offenders perfectly fill the constitutional bill as a separate class which deserves speedy prosecution and final punishment by high judicial agencies if restoration of the slumping credence in the constitutional order and democratic development were to be sustained among the masses in Third World countries.
The Preamble to the Bill is revelatory of this orientation.
[558 C`l (c) There is a reasonable classification implicit in this legislation, but it is perilously near being under inclusive and.
therefore, unequal.
For it is a truncated projection of a manifestly wider principle that exalted offenders shall be dealt with by the criminal law with emergent speed so that the common man may knew that when public power is abused for private profit or personal revenge the rule of law shall rapidly run them down and restore the faith of the people in democratic institutions through speedy justice according to law.
It is in this sense that very important persons wielding large administrative powers shall, with quick despatch be tried an(l punished, if guilty.
Prompt trial and early punishment may be necessary in all criminal cases.
But, raw realism suggests that in a decelerating situation of slow motion justice there is a special case for speedier trial and.
prompter punishment where the offender sits at the top Or the administrative pyramid.
[558 H; 559 A C] (d) The Bill must fail morally if it exempts non Emergency criminals about whom prior Commission Reports, bear witness.
In this larger perspective, `emergency ' is not a substantial differential and the Bill nearly recognises this by ante dating the operation to February, 27, 1975 when there was no 'emergency '.
[559 G] 3.
The procedure of criminal courts is dilatory, there are appeals upon appeals and revisions and supervisory jurisdiction, baffling and baulking speedy termination of prosecutions, not to speak of the contribution to delay by the Administration itself by neglect of the basic necessaries of the judicial process.
Leaving V.V.I.P. accused to be dealt with by the routinely procrastinating legal process is to surrender to interminable delays as an inevitable evil.
Therefore, the Court should not be finical about absolute processual equality and must be creative in innovating procedures compelled by special situations.
[559H] 4.
(a) The idiom of article 14 is unmistakeable.
The power status of the alleged criminal the nature of the alleged crime vis a vis public confidence and the imperative need for speedy litigative finality, are the telling factors.
Every difference is not a difference. 'Speedy trial ' of offences of a public nature committed by persons who have held high public or political offices in the 485 country and others connected with the commission of such offences ' is the heart of the matter.
[560 D] (b) During that hushed spell, many suffered shocking treatment.
In the words of the Preamble of the Bill, civil liberties were withdrawn to a great extent, important fundamental rights of the people were suspended, strict censorship on the press was placed and judicial powers were curtailed to a large extent.
[560 F] Murthy Match Works etc etc.
vs The Asstt.
Collector of Central Excise, etc.
; , at 130, referred to.
(c) The objects and reasons are informative material guiding the court about the purpose of a legislation and the nexus of the differentia, if any, to the end in view.
Nothing about Emergency period is adverted to there as a distinguishing mark.
The clear clue is that all abuse of public authority by exalted public men, shall be punished without the tedious delay in the case of top echeolns.
[561 F] Mohammad Shujat Ali & Ors.
vs Union of India & Ors.
, ; at 477; State of Gujarat & Anr.
vs Shri Ambica Mills Ltd., Ahmedabad, [19741 3 SCR 760 at 782: referred to (d) Civil liberties were suppressed.
press censorship was clamped down and judicial powers were curtailed.
Even if liberty had not been curtailed, press not gagged or writ jurisdiction not cut down.
criminal trials and appeals and revisions would have taken their own interminable delays.
It is the forensic delay that has to be axed and that has little to do with the vices of the Emergency.
There is no law of limitation for criminal prosecutions.
B] (e) High powered public and political offenders are not a peculiar feature of the Emergency but has been a running stream for long and bids fair to flow on, therefore, a corrupt continuity cannot be cut up without better justification.
[565 E F] (f) The question, then is whether there is constitutional rationale for keeping out of the reach of speedy justice non emergency criminals in high public or political offices.
Such a Bill, were it a permanent addition to the corpus juris and available as a jurisdiction for the public to compel government, if a prima facie case were made out even against a minister in office, to launch a prosecution before a sitting High Court Judge, would be a wholesome corrective to the spreading evil of corruption in power pyramids.
[565 G H] (g) On constitutional principles, it is possible to sustain this temporary measure which isolates crimes and criminals during a pernicious period from the rest who share the same sinister properties.
When a salvationary alternative is available, the Court should opt for it when the attack is under article 14, provided the assumptions of fact desiderated by the alternatives are plausible, not preposterous.
The anatomy of the Emergency as X rayed in the Preamble, hi all dark shadows.
No court to call illegality to order or halt horrendous torture or challenge high handed unreason.
If this be a potential peril naturally a dangerous situation develops, and unaccountable power once unsheathed, the inauguration and escalation of such abuse becomes a compulsive continuum.
Constitutional tyranny is anathema to decent democracy.
In that state of nervous breakdown of the people, the right to go to court and prosecute an absolutist in authority for corruption dr misuse of power is illusory.
If 486 you speak up against crimes in high positions, if you complain to court about abuse of power, you may be greeted with prompt detention and secret torture, with judicial relief jettisoned and Press publicity loc jawed If these macabre maybes were assumed, there could be a noxious nexus between the Emergency season and the sinister crimes covered by this Bill.
It follows that a rexus between the differentia and the object is not too recondite to be inferred.
[567 A B] (h) The scary scenario of emergency excesses ' had a nexus with non action against persons in high against authority and escalation of corruption and repression then judicial checks on abuse had gone to sleep.
[563 A B] (i) The fabric of the offences before and during the Emergency is the same.
What validates the special legislation is the abnormality of the then conditions, the intensive phase of corrupt operations and the inexpediency of digging up old crimes.
Ambica Mills (supra) is the judicial justification for the classification.
[570C] 5.
(a) The Bill hovers periliously near unconstitutionality (article 14) in a certain respects, but is surely saved by application of pragmatic principles rooted in precedents.
Nevertheless, justice to social justice is best done by a permanent statute to deal firmly and promptly with super political offenders, since these 'untouchable ' and 'unapproachable ' power wielders have become sinister yet constant companions of Development in developing countries.
[570 E] Chaganlal Maganlal (P) Ltd. vs Municipal Corporation of Greater Bombay & Ors., [1975] I SCR 1, referred to.
(b) Basic fairness of procedure is necessary.
A valid classification with an intelligible differentia and intelligent nexus to the object is needed.
Within the class there should be no possibility of using a more burdensome procedure for one and a substantially different one for another.
Arbitrariness in this area also violates article 14.
[571 D] (c) Assuming that the facilities under the Bill and under the ordinary Code are equally fair, could the Government have indicated one or the other in the ordinary court or the special court on the basis of drawing lots or the first letter of their names, the colour of their skins or like non sense ? No.
The wisdom of article 14 will not tolerate such whim.
Classify or perish, is the classic test of valid exemption from inflexible equality under the Constitution.
[571 E F] (d) The sure solution to the problems raised by the Reference, consistently with the present object of the Bill, is to make the High Court the custodian of the new jurisdiction.
[571G] UNTWALIA, J. (concurring with the majority) 1.
In none of the earlier references answered either by the Federal Court or by this Court a, precedent is to be found resembling or identical to what happened in this Special Reference.
There is no harm in adopting the method of giving some suggestions from the Court which may obliterate a possible constitutional attack upon the vires of a Bill.
It may not be necessary or even advisable to adopt such a course in all References under article 143 of the Constitution.
But if in some it becomes expedient to do so, as in the instant one it was so, it saves a lot of public time and money to remove any technical lacuna from the Bill if the Government thinks that it can agree to do so.
The Bill by itself is not a law.
It would be a law would passed by the Parliament.
487 But even at the stag of the Bill when opinion of this Court is asked for, it A seems quite appropriate in a given case to make some suggestions and then to answer the Reference on the footing of acceptance by the Government of such of the suggestions as have been accepted.
Otherwise is incongruous for this Court to answer the Reference as it is without taking into account the concessions made on behalf of the Government vis a vis the suggestions of the Court.
It is manifest that all the three infirmities pointed out in the majority opinion m answer No. 3 vanish after the acceptance in writing by the Government that the three suggestions made by the Court vis a vis the alleged three infirmities, namely, 3(b), and 3(c) would be removed from the Bill.
[572 D A] 2.
The absence of a provision for transfer of a case from one Special Court to another, makes the procedure unjust or arbitrary.
But the alleged infirmities, 3(a) and (b), do not make the procedure unjust or arbitrary.
There is no question of the procedure being unjust or arbitrary in respect of any of the three infirmities (a), (b) and (c) enumerated in answer 3 in view of the acceptance by the Government of India of the suggestions emanating from the Court during the course of the hearing of the Reference.
The Reference, therefore, stands amended in view of those concessions and the court is now required to answer the amended Reference which means the Reference as if the Bill as proposed incorporates the three concessions made by the Government.
Thus the procedure prescribed in the Bill, undoubtedly, becomes just and fair and no longer remains arbitrary in any sense.
[573 C D] SHlNGHAL, J. (Dissenting) Clauses 5 and 7 of the Bill ale unconstitutional and invalid.
[573H] 1.
(a) The reason given in the Statement of Objects and Reasons of the Bill for excluding the ordinary criminal courts from trying the class of offences referred to therein is congestion of work and not their inferior status or in capacity to deal with those cases.
That object of the Bill would have been served by the creation of additional courts of the same category as the ordinary criminal courts and the making of any procedural changes which may have been considered necessary in that context to exclude avoidable delay in the trial.
1574 F] (b) There would have been nothing unusual if such additional courts had been created to save the ordinary criminal courts, from the burden of more work and to bring the contemplated prosecutions to speedy termination.
That was permissible under the existing law.
Even if some procedural changes were considered necessary, they could have been worked out within the framework of the law.
The special courts envisaged in the Bill are, however, courts, the like of which has It been provided in the Code of Criminal Procedure or any other law and are in fact unknown to the Criminal law of the country.
[574 G] (c) The Constitution contemplates that all civil and criminal courts in State, other than the High Court, shall be no other than the Subordinate Courts over which the High Court shall exercise the fullest superintendence and control and that the presiding officers of those courts shall be under the control of the High Court and of no other authority.
That is necessary to ensure the independence of every court dealing with civil and criminal matters.
[576 D] (d) It may be permissible to create or establish civil and criminal courts in a state with designations other than those expressed in article 236, or any existing designation in the Codes of Civil and Criminal Procedure.
but that is far 488 from saying that it is permissible to establish a hierarchy of courts other than that envisaged in the Constitution.
[576 E] 2.
(a) The Constitution has made ample and effective provision for the establishment of a strong, independent and impartial judicial administration in the country with the necessary complement of civil and criminal courts.
it is not permissible for Parliament or a state Legislature to ignore or bypass that scheme of the Constitution by providing for the establishment of a civil or criminal court parallel to a High Court in a state or by way of an additional or extra or a second High Court or a court other than a court subordinate to the High Court.
Any such attempt would be unconstitutional and would strike at the independence of the judiciary which he so nobly been enshrined in the Constitution and so carefully nursed over the years.
[576 G] (b) The Constitution provides for the appointment of district judges and other judicial officers in the States.
In a large number of cases this Court had declared that it is the High Court which is the sole custodian of the control over the State Judiciary which in fact is the life blood of in independent judicial administration and the very foundation of any real judicial edifice The Constitution has not considered even the existence or continuation of Magistrates who are outside the control of the High Court to be desirable.
It is beyond doubt that the Constitution does not permit the establishment of a criminal court of the status of a court presided over by a District Judge which is not subordinate to the High Court and does not permit the establishment of a court similar to the High Court or a court parallel to the High Court.
[577 C; 578 A B] The State of West Bengal vs Nripendra Math Bagchi, ; , Chandra Mohan and others, vs State of U.P. & Ors., ; State of Assam etc.
vs Ranga Mohammad & Ors., [1967] J SCR 454; The State of Orissa vs Sudhansu Sekhar Misra & Ors., [968] 2 SCR 154; State of Assam & Anr.
N. Sen & Anr., ; ; Shamsher Singh & Anr.
vs State of Punjab ; ; High Court of Punjab & Haryana vs State of Haryana & Ors.
etc., [1975]) SCR 365; State, of Haryana vs Inder Prakash Anand, ; ; Chief Justice of Andhra Pradesh & Ors.
vs L. V. A. Dixitulu & Ors. referred to.
(c) Neither section 6 of the Code of Criminal Procedure 1973 nor section 6 of the Criminal Law Amendment Act, 1952 justifies the argument that special courts of the nature contemplated in the Bill would be created under the scheme of the Constitution.
Although section 6 of the Code of Criminal Procedure states that the five classes of criminal courts stated in it shall be in addition to the High Court and courts that may be constituted under any law, it cannot be said that it pro ides tor the constitution of courts parallel to or on the same footing as the High Court or of criminal courts which are not subordinate to the High Courts Similarly, special judges appointed under section 6 of the Criminal Law Amendment Act are subordinate to the High Court and fit in the scheme of the independence of the judiciary envisaged by the Constitution.
[578 E Fl (d) The attempt to justify the creation of special courts by reference to Part XIVA of the Constitution which provides for establishment of administrative Tribunals cannot be sustained because such Tribunal are not meant for the trial of offences referred to in the Indian Penal Code.
They may well be said to be quasi judicial Tribunals, [579 D] 489 (e) The Special Courts contemplated by clause 2 of the Bill will not be on the same.
footing as the High Courts and will, to say the least, be lesser or inferior courts.
1579 E] (f) Clause 7 of the Bill provides that a special court shall be presided over by a "sitting judge" of a High Court, but it will not be permissible or proper to do so as that court is lesser and inferior to a High Court.
In all probability, sitting judges of High Courts will refuse to serve as presiding judges of special Courts, and there is no provision in the Constitution under which they can be compelled, or ordered against their will, to serve there.
That eventuality will make the provisions of the Bill unworkable.
At any rate, the possibility that the sitting High Court Judges may not agree to serve as presiding judges of Special Courts is real, and their very refusal will embarrass the judicial administration and lower the prestige of the judiciary for clause 7 of the Bill provides for their nomination in consultation with the Chief Justice of India.
[579 F H] 3.
(a) Equality before the law, or speaking in terms of the present controversy, equality in criminal justice, is the universal goal of all democratic forms of government, for no one can ever deny that all persons charged with crime must, in law, stand on the same footing at the Bar of justice.
That equality should be assured not only between one accused and another, but between the prosecution and the accused.
That is what the Constitution has carefully, assuredly and fully provided for every citizen.
Article 21 is, by itself, enough to bring that out.
[580 C D] (b) In order to fulfil the guarantee of article 21 the procedure prescribed by law for the trial of criminal cases has to be fair, just and reasonable, and not fanciful, oppressive or arbitrary.
Taken together, clauses S, 7 and 8 of the of Bill provide for the trial of the accused only by special courts to be presided over by a judge nominated by the Central Government and clauses 4, 5 and 7 vest the power of designating the special court in which an accused is to be tried exclusively in that Government.
The Bill enables the Central Government to decide which of the accused will be tried by which of its nominated judges.
Thus if several special courts are created by the Central Government in Delhi and they are all presided over by judges nominated by the Central Government, the power of nominating the judge for any particular case treble in Delhi shall vest in the Central Government.
Such a procedure cannot be said to be fair, just and reasonable within the meaning of article 21 and amounts to serious transgression on the independence of the judiciary.
[581 G; 587 D F] (c) The question of the Central Government or the State Government nominating a judge of the Supreme Court or of the High Court for dealing with a particular case does not and cannot arise.
So too in regard to the judges and magistrates of the subordinate courts, sufficient safeguards have been provided, in the relevant laws for their appointment by the High Court.
It is not permissible for the executive to appoint a particular judge or magistrate to preside over the trial of a particular accused under the Code of Criminal Procedure.
That is fair, just and reasonable and relieves the accused of any possible oppress on.
1583 A Bl (d) Moreover in the case of trials before special courts, the trial by the fiat of a successor government, however, justified, is noticed with scepticism The suspicion that the trial is motivated by political considerations, that it would not be just and fair or that it would lead to injustice, would be lurking 13 978SCI/78 490 in the mind of the accused.
It is therefore necessary that everyone concerned, including the accused, should be convinced that the executive had the best of intentions in ordering the trial and had provided for a fair and straight forward procedure, and the cleanest of judges, for the trial in an open and fearless manner.
[583 C&E] (e) If the result of the trial has to carry conviction with the people as a whole, and is meant to acquaint them with the true character of the persons who have committed the offences for the survival of the democratic institutions and cleanliness of the political life as professed in the statement Of Objects and Reasons of the Bill, it is in the interest of those making the declaration under clause 4 to convince everyone, including the accused, that the trial is not spectacular in purpose and does not expose those facing it to a risk greater the that taken by any other accused at an ordinary trial, under the ordinary law.
Human dignity is a concept enshrined in the Constitution and this treasure should be the priceless possession and solid hope of all our fellow citizens.
including those who have to face trials for offences charged against them.
[583 F H] (f) An attempt, like the one made in the present Bill to usurp an important judicial power and vest it in the executive is a serious inroad of the Independence of the judiciary and is fraught with serious consequences.
It has, there fore, to be put down at the very inception for it may otherwise give rise to a prospect too gruesome to envisage and too dangerous to be allowed to have the sanction of law.
[584 H] Liyanage & Ors.
vs Regina ; referred to.
|
Appeals Nos. 21 and 22 of 1954.
Appeals under Article 133(1) (c) of the Constitution of India from the judgment and order dated the 18th September 1953 of the Travancore Cochin High Court at Ernakulam in O. P. No. 41 of 1952.
M.K. Nambiar, (N. Palpu, Sri Narain Andley and Rajinder Narain) for the appellant in C. A. No. 21 of 1954 and respondent in C. A. No. 22 of 1954.
M.C. Setalvad, Attorney General of India (G. N. Joshi), R. Ganapathy Iyer, Porus A. Mehta and R. H. Dhebar), for the respondents in C. A. No. 21 of 1954 and appellants in C. A. No. 22 of 1954.
December 20.
The Judgment of the Court was delivered by BHAGWATI J.
These two appeals with certificates under article 133 of the Constitution are directed against a judgment of the High Court of TravancoreCochin in a writ petition filed by one A. Thangal Kunju Musaliar, hereinafter called the petitioner.
The petitioner is a native of Quilon within the Travancore State which was originally under the sovereignty of the Maharaja of Travancore.
He is the Managing Director of Messrs A. Thangal Kunju.
Musaliar & Sons Ltd., Quilon, and bad been assessed to income tax for the years 1942 and 1943 and the final orders in his assessment for the said years were 1200 passed by the Chief Revenue Authority of Travancore on the 6th December 1946 and 30th November 1946 respectively.
On the 7th March 1949, the Travancore Legislature passed Act XIV of 1124 (M.E.) modelled on our Act XXX of 1947, styled the Travancore Taxation on Income (Investigation Commission) Act, 1124, to provide for an investigation into matters relating to taxation on income.
Section 1(3) of the Act provided that it was to come into force on such date as the Travancore Government may by notification in the Government Gazette appoint. 'Under section 3, a Commission to be called the Income tax Investigation Commission was to be constituted inter alia to investigate in accordance with the provisions of the Act cases referred to it under section 5 and report thereon to the Government.
The Commission was to be appointed to act in the first instance up to the last day of Karkadakom 1125 (16 8 1950) but the Government was empowered to extend its appointment to any period up to the last day of Karkadakom 1126 (16 8 1951).
Section 5(1) enacted that the Government might, at any time before the last day of Makaram 1125 (15 2 1950) refer to the Commission for investigation and report any case or points in a case in which the Government had prima facie reasons for belief that a person had to a substantial extent evaded payment of tax on income together with such material as might be available in support of such belief.
Section 6 prescribed the powers of the Commission and inter alia provided for the appointment by the Commission of an authorised official to examine accounts or documents, interrogate persons or obtain statements from persons.
On the 1st July; 1949, the Travancore State and the Cochin State integrated with each other and there was brought into existence the United State of Travancore and Cochin.
By virtue of Ordinance I of 1124 promulgated on the same day, called the United State of Travancore and Cochin Administra tion and Application of Laws Ordinance, 1124 (Ordinance I was enacted later as Act VT of 1125), 1201 all existing laws of Travancore were to continue in force till altered, amended or repealed by competent authority.
The existing law of Travancore was defined to mean any law in force in the State of Travancore immediately prior to the 1st July 1949.
On the 26th July 1949, a notification was published in the Travancore Cochin Government Gazette whereby, in exercise of the powers conferred by section 1(3) of the Travancore Taxation oN Income Investigation Commission) Act XIV of 1124 as continued in force By the United State of Travancore and Cochin Administration & Application of Laws (Ordinance, 1124 (I of 1124), the Government appointed the 7th Karkadakom 1124 (22 7 1949) to be the date on which the said Act was To have come into force.
On the 26th November 1949 the Government of the United State of Travancore and Cochin issued orders under section 5(1) of the Travancore Act XIV of 1124 referring the cases of the petitioner for the years 1942 and 1943 for investigation by the Travancore Income tax Investigation Commission.
These orders had specific reference to the years 1942 and 1943 and the investigation to be made by the Commission was with reference to the alleged evasion of tax by the petitioner for those respective years.
The cases were registered as Evasion Cases I and 2 of 1125.
On the 10th December 1949 the petitioner received from the Secretary of the Commission a notice in regard to the said cases.
The relevant portion of the said notice stated: "Whereas the Income tax Investigation Commission having been informed that a substantial portion of your income for 1942 and 1943 has escaped assessment, has ordered investigation into the matter, you are hereby required to produce the following on or before 21 12 1949 before the Commission.
The account books (day books and ledgers) for the years 1942 and 1943.
2. . . . 3. . . 4. . . . 1202 5. . . . 6.
Pursuant to this notice the petitioner produced the relevant books and the Commission duly completed its investigation under the terms of the Travancore Act XIV of 1124.
Before the Commission could, however, make its report, the Constitution of India came into force on the 26th January 1950 and the United State of Travancore and Cochin became a part of the territory of India,, forming, a Part 'B ' State.
Under article 372(1) of the Constitution, the Travancore Taxation on Income (Investigation Commission) Act, 1124 (Travancore Act XIV of 1124) was continued in force "until altered, amended or replaced by a competent authority" An Indian States Finance Enquiry Committee had been appointed in 1948 49 and it had made its recommendations regarding the agreements to be entered into between the President of the Union and the Rajpramukhs in regard to financial arrangements.
In accordance with the recommendations of the Committee, an agreement was entered into on the 25th February 1950 between the President of the Union and the Rajpramukh of Travancore Cochin in regard to these matters and on the 31st March 1950 the Finance Act, 1950 (Act XXV of 1950) came into force and the Indian Income tax Act, 1922 (XI of 1922) was extended to Travancore Cochin.
On the 18th April 1950, the , being Act XXXIII of 1950, was passed by Parliament extending to Travancore Cochin the Taxation on Income (Investigation commission) Act, 1947 (XXX of 1947) and section 3 of that Act provided that the law of Travancore corresponding to the Taxation on Income (Investigation Commission) Act, 1947 (XXX of 1947) shall continue to remain in force with the following modifications, viz., (a) that all cases referred to or pending before the State Commission (by whatever name called) in respect of matters relating to taxation on income 1203 other than agricultural income shall stand transferred to the Central Commission for disposal; and (b) that the State law shall, so far as may be, apply to determine the procedure that may be followed and powers that may be exercised by the Central Commission in the disposal of cases transferred under clause (a).
The Travancore Commission bad been appointed in the first instance to act up to the last day of Karkadakom 1125 116 8 1950).
Neither the Travancore Commission nor the Indian Commission to which the pending cases before the Travancore Commission were transferred as aforesaid made any report on these cases of the petitioner before the expiry of this period nor was any extension of the term of appointment of the Travancore Commission made up to the last day of Karkadakom 11 26 (16 8 1951) as originally contemplated.
On the 25th August 1951, therefore, the Opium and Revenue Laws (Extension of Application) Amendment Act, 1951, being Act XLIV of 1951, was passed amending Act XXXIII of 1950 whereby it was provided that in the place of clause (b) of section 3 of Act XXXIII of 1960, the following clause shall be substituted and shall be deemed always to have been substituted, viz., "in the disposal of cases transferred to the Central Commission, the Commission shall have and exercise the same powers as it has and exercises in the investigation of cases referred to it under the Taxation on Income (Investigation Commission) Act, 1947 (XXX of 1947) and shall be entitled to act for same term as under sub section (3) of section 4 of that Act" and it was further provided that any decision given by the Chief Revenue Authority of Travancore or of Travancore Cochin shall be deemed a decision of the Income tax Authority for the purposes of sub section (2) of section 8 of the Travancore Act XIV of 1124.
On the 18th October 1951, a notification was issued by the Indian Income tax Investigation Commission appointing M. Venkitachalam Potty, Income tax Officer on Special Duty, Trivandrum, as an 152 1204 authorised official under section 6 of the Travancore Taxation on Income (Investigation Commission) Act, 1124 read with Act XXXIII of 1950.
The authorised official, hereinafter referred to as respondent 1, forwarded to the petitioner on the 21st November 1951 for his information a copy of that notification, investing him with the powers of an authorised official and intimated that the investigation proposed to be conducted will not be confined to the years 1942 and 1943, the two years originally covered by Evasion Cases Nos. 1 and 2 of 1125 but that it would be necessary for him to investigate the petitioner 's income for the period from 1940 to the last completed assessment year notwithstanding the fact that the erstwhile State Commission had not specifically intimated to him that they proposed to cover the full period.
The petitioner, by his registered letter dated the 23rd February 1952 pointed out to respondent 1 the illegality of the steps proposed to be taken by him to which, however, the latter replied by his letter dated the 13th March 1952 stating that he proposed to consider income for the full investigation period, viz., from 1940 to the last completed assessment year.
The petitioner thereupon filed on the 6th May 1952 a writ petition in the High Court of Travancore Cochin, being 0.
P. 41 of 1952 against respondent 1 as also the Indian Income tax Investigation Commission, hereinafter called respondent 2, for a writ of prohibition or any other appropriate writ or direction prohibiting the respondents from holding any enquiry into the cases registered as Evasion Cases Nos.
I and 2 of 1125 on the file of Income tax Investigation Commission of Travancore or from holding any investigation into the income of the petitioner from 1940 to the last completed assessment year or for any other period.
Respondent 1 filed a counter affidavit in which it was inter alia submitted: "that the Commission by these proceedings is not trying to clutch at non existent jurisdiction.
They are fully prepared to shape their proceedings in accordance with the directions of this Hon 'ble Court".
1205 This affidavit was stated to have been filed as the answer of both the counter petitioners, viz., respondents I and 2 and respondent I stated that he had been fully authorised to do so.
The writ petition was heard by a Bench of three Judges of the High Court consisting of K. T. Koshi, C. J. and P. K. Subramonia Iyer and M. section Menon, JJ.
The learned Judges held that respondent 2 bad all the powers that the Travancore Commission had under the Travancore Act XIV of 1124 and no mote and accordingly issued a writ prohibiting respondent I from conducting an investigation into years other than 1942 and 1943 observing that any attempt to enlarge the scope of the enquiry was without legislative warrant.
The petitioner appealed in so far as the order of the High Court was against him permitting the enquiry for the years 1942 and 1943, his appeal being Civil Appeal No. 21 of 1954.
Respondents I and 2 appealed against the order of the High Court in so far as it prohibited respondent 1 from conducting investigation for the years which were not covered by the Evasion Cases Nos.
I and 2 of 1125, their appeal being Civil Appeal No. 22 of 1954.
Both these appeals came for hearing and final disposal before us on the 20th September 1955.
After the arguments had proceeded for some time Shri Nambiyar, for the petitioner, asked for leave to urge additional grounds, viz., (a) that section 5(1) of Travancore Act XIV of 1124 was ultra vires under articles 14 and 19, of the Constitution, and (b) that in particular,the said section 5(1) infringed article 14 of the Constitution inasmuch as it was not based on any rational classification whatsoever, and the word "substantial" therein could not possibly be deemed to be any form of classification.
On, our giving him such leave the learned Attorney General, appearing for respondents I and 2 asked for time to put in an affidavit showing the background against which Travaneore Act XIV of 1124 bad been passed by the, Travancore Legislature.
An affidavit was accordingly filed before us by Gauri Shanker, Secretary of 1206 respondent 2 setting out facts and events as and by way of answer to these new contentions of the petitioner.
A preliminary objection to the jurisdiction of the High Court to entertain the writ petition may be dealt with first.
This objection was not taken in the counter affidavit filed by the respondents, they having expressed their readiness to shape their proceeding,s in accordance with the directions of the Court.
The learned Advocate General of Travancore Cochin, however, urged before the High Court that the Court was not competent to entertain the petition in view of the fact that respondent 2 was not amenable to i s jurisdiction and the argument was that as respondent 2 functioned outside the State of Travancore Cochin and respondent I was a mere subordinate of respondent 2 it was beyond the competence of the High Court to grant the prayer embodied in the petition.
The High Court overruled the objection observing that respondent I was resident within the State of Travancore Cochin, his office was situated at Trivandrum, all his communications to the petitioner had emanated from within the State and the activities complained about were activities confined to the State.
It was of the opinion that the prayer in the petition was, in essence, a prayer to paralyse the hands of respondent I and thus prevent the mischief and that, by his residence and the location of his office within the State, respondent 1 was clearly amenable to the jurisdiction of the Court under article 226 of the Constitution.
It was further of opinion that the writ against respondent 1, if issued, was sufficient for stopping the mischief complained about and therefore it was unnecessary for it to decide whether or not a writ could be issued so far as respondent 2 was concerned.
It, therefore, issued the necessary writ of prohibition against respondent 1.
The learned Attorney General pressed this preliminary objection at the outset while arguing Civil Appeal No. 22 of 1954.
He pointed out that respondent 2 had its office in New Delhi and was permanently located there and the mere fact of its having appointed res 1207 pondent 1 to function and carry on the investigation within the State.
of Travancore under its direction did not make it amenable to the jurisdiction of the High ' Court.
He, therefore, contended that the High Court had no jurisdiction to entertain the writ petition against respondent 2.
He further contended that the High Court could not do indirectly what it was not able to do directly and that it could not issue any writ of prohibition against respondent 1 either even though he had his office at Trivandrum and had a permanent location within the jurisdiction of the High Court inasmuch as he was merely an arm of respondent 2 and any writ issued against him would have the indirect effect of prohibiting respondent 2 from exercising its legitimate functions within the ambit of its powers under the Travancore Act XIV of 11 24 read with Act XXX of 1950 and Act XLIV of 1951.
Reliance was placed by him on the decision of this Court in Election Commission, India vs Saka Venkata Rao(1).
The respondent in that case bad applied to the High Court of Madras under article 226 for a writ restraining the Election Commission, a statutory authority constituted by the President and having its office permanently located at New Delhi, from enquiring into his alleged disqualification for membership of the Assembly, and a single Judge of the High Court had issued a writ of prohibition restraining the Election Commission from doing so.
The Election Commission filed an appeal to this Court and agitated the question of the jurisdiction of the High Court under article 226 to issue the writ against it.
While discussing this question, Patanjali Sastri, C.J., who delivered the judgment of the Court, observed as under: "But wide as were the powers thus conferred, a two fold limitation was placed upon their exercise.
In the first place, the power is to be exercised "throughout the, territories in relation to which it exercises jurisdiction", that is to say, the writs issued by the Court cannot run beyond the territories subject to its jurisdiction.
Secondly, the person or authority to (1) ; 1208 whom the High Court is empowered to issue such writs must be "within those territories", Which clearly implies that they must be am enable to its jurisdiction either by residence or location within those territories".
The learned Chief Justice then traced the origin and development.
of the power to issue prerogative writs as a special remedy in England and observed at page 1151: "These writs were thus specifically directed to the persons or authorities against whom redress was sought and were made returnable in the Court issuing them and, in case of disobedience, were enforceable by attachment for contempt.
These characteristics of the special form of remedy rendered it necessary for its effective use that the persons or authorities to whom the Court was asked to issue these writs should be within the limits of its territorial jurisdiction".
The mere functioning, of the tribunal or authority permanently located and normally carrying on its activities elsewhere, within the territorial limits was not considered sufficient to invest the High Court with jurisdiction under article 226 nor was the accrual of the cause of action within the territories considered sufficient for the purpose.
The residence or location within the territories of the person or authority was considered a condition of the High Court being empowered to issue such writs with the result that the Election Commission having its office permanently located at New Delhi was held not amenable to the jurisdiction of the High Court for the issue of a writ under article 226.
This decision in Saka Venkata Rao 's case was followed by this Court in K. section Rashid & Son vs The Income tax Investigation Commission, etc.(1).
In that case, the assesses who were within the state of U.P. and whose original assessments were made by the income tax authorities of that State had filed writ petitions in the Punjab High Court for the issue of writs tinder article 226 to the Income tax Investigation Commission located in Delhi and investigating (1) ; 1209 their cases under section 5 of the Taxation on Income (Investigation Commission) Act, 1947.
The Punjab High Court had sustained the objection urged on behalf of the respondents to the effect that the assesses having belonged to the State of U.P. their assessment was to be made by the Income tax Commissioner of that State and the mere fact that the location of the Investigation Commission was in Delhi would not confer jurisdiction on the Punjab High Court to issue writs under article 226 and had dismissed the petitions.
This Court, on appeal, distinguished the decision in Parlakimidi 's case which was sought to be relied upon by the respondents before it and followed the position in law as it bad been enunciated in Saka Venkata Rao 's case, supra, and held that the Punjab High Court had jurisdiction to issue a writ under article 226 to the Investigation Commission which was located in Delhi in spite of the fact that the assesses were within the State of U.P. and their original assessments were made by the income tax authorities of that State.
The principle of these decisions would, it was urged by the learned Attorney General, eliminate respondent 2 and the High Court of Travancore Cochin would have no jurisdiction to entertain the writ petition against it.
It was, however, urged on behalf of the petitioner that, in the affidavit filed by the respondents, both the respondents had submitted that they were fully prepared to shape their proceedings in accordance with the directions of the Court.
This, it was submitted, was a voluntary submission to the jurisdiction of the High Court investing the High Court with jurisdiction to issue the appropriate, writ against respondent 2.
We need not, however, express any opinion on this point because no writ was in fact issued by the High Court against respondent 2 nor was any appeal filed by the petitioner against that part of the decision of the High Court.
The real question, however, is whether a writ could issue against respondent 1 who is, it was submitted, a mere arm of respondent 2 and a writ against whom 1210 would be equivalent to a writ issued by the High Court against respondent 2 which it had no jurisdiction to do.
An authorised official derives his appointment from the Commission under section 6 of the Travancore Act XIV of 1124.
Section 6(4) of the Act provides that if in the course of any investigation conducted by the Commission it appears to the Commission to be necessary to examine any accounts or documents or to interrogate any person or to obtain any statement from any person the Commission may authorise any income tax authority not below the rank of an income tax officer (called the "authorised official") in that behalf subject to such directions as may be issued by the Commission from time to time and the authorised official shall examine the accounts or documents, interrogate the persons and obtain the statements from the persons.
The authorised official is invested, under section 6, sub section (5), subject to the direction of the Commission, with the same powers as the Commission under sub sections (1), (2) and (3) which empower the Commission to require any person or banking or other company to prepare and furnish written statements of accounts and affairs giving information on such points or matters as in the opinion of the Commission may directly or indirectly be useful or relevant to any case referred to it; to administer oaths and exercise all powers of a Civil Court under the Code of Civil Procedure for the purpose of taking evidence on oath, enforcing attendance of witnesses and of persons whose cases are being investigated, compelling the production of docu ments and issuing commissions for the examination of witnesses and to impound and retain in its custody for such period as it thinks fit any documents produced before it.
The authorised official is, under section 6, sub section (10), to have full and free access to all documents, books and other papers which in his opinion are relevant to the proceedings in any case or cases under the Act and if specially authorised in this behalf by the Commission to any buildings and places where he may have reason to believe that such books, 1211 documents or papers may be found and also to have power to place identification marks on such books, documents or papers and to make extracts or copies therefrom or if he considers it necessary to take possession of or seize such books, documents or papers.
Under section 6, sub section (11), the authorised official is deemed to be a public servant within the meaning of section 16 of the Travancore Penal Code (I of 1074).
It is clear from the above provisions that the authorised official has considerable powers conferred upon him in the conduct of the investigation and even though he could be called a mere arm of the Commission or an authorised agent of the Commission, he has important functions to discharge and is not merely a mouth piece of the Commission or a con duit pipe transmitting the orders or the directions of the Commission.
He is no doubt under the general control and supervision of the Commission but he performs the various functions assigned to him on his own initiative and in the exercise of his discretion.
If, therefore, he does anything in the discharge of his functions as authorised official which is not authorised by law or is violative of the fundamental rights of the petitioner, he would be amenable to the jurisdiction of the High Court under article 226.
Even though this is the prima facie position, it was urged that he is acting under the directions of the Commission as its authorised agent and as such no writ can issue against him, because the principal who directs the activities and not the agent would be liable for the same.
This contention is unsound.
There can be no agency in the matter of the commission of a wrong.
The wrong doer would certainly be liable to be dealt with as the party directly responsible for his wrongful action.
The relationship between principal and agent would only be relevant for the purpose of determining whether the principal also is vicariously liable for the wrong perpetrated by his agent.
On the analogy of criminal liability, the 153 1212 offender could certainly not be heard to say that he was committing the offence under the behest or directions of his principal.
On the analogy of a civil wrong, the tortfeasor could certainly not protect himself against liability on the ground of having committed the tort under the directions of his principal.
The agent could in no event exculpate himself from liability for the wrongful act done by him and if he is thus amenable to the jurisdiction of the High Court the High Court could certainly issue an appropriate writ against him under article 226.
The jurisdiction under article 226 is exercised by the High Court in order to protect and safeguard the rights of the citizens and wherever the High Court finds that any person within its territories is guilty of doing an act which is not authorised by law or is violative of the fundamental rights of the citizen, it exercises that jurisdiction in order to vindicate his rights and redress his grievances and the only conditions of its exercise of that jurisdiction are those laid down in the passage from Patanjali Sastri, C.J. 's judgment cited above.
The argument that by issuing a writ against the agent under those circumstances the High Court would be putting him in a position whereby he would be compelled to disobey the directions of his principal is also of no avail for the simple reason that an agent is bound to obey all lawful directions of his principal and not directions which the High Court holds to be unlawful or not justified in law.
The agent could certainly be prohibited from obeying the un lawful directions of his principal and even if the principal cannot be reached by reason of his being outside the territories, the arm of the law could certainly reach the agent who is guilty of having committed the wrong and the High Court could certainly issue a writ against him under article 226.
It was further contended that by issuing such a writ against the authorised official the High Court would be indirectly prohibiting the Commission from conducting the investigation within the territories even though it could not directly prohibit the Com 1213 mission from doing so.
If the Commission was doing something within the territories through its authorised official which was not justified in law, it would not lie in the mouth of the Commission to urge that the High Court could not issue a writ of prohibition against its agent, the authorised official, who had his residence or permanent location within the territories merely because it would be indirectly prohibited from perpetrating a wrong within the territories.
The principal could, in no event, urge that his agent should be allowed to function for him within the territories in a manner which was not warranted by law or had no justification in law.
It is expected that once this Court has declared the law the Investigation Commission would comply with it and not place its agent in the wrong by directing him to act contrary to the law so declared.
Our attention was drawn by the learned Attorney General in this connection to three recent decisions of the High Courts of Allahabad, Nagpur and Pepsu which, according to him, supported his contention, viz., Azmat Ullah vs Custodian, Evacuee Property, U.P., Lucknow(1), Burhanpur National Textile Workers Union, Burhanpur vs Labour Appellate Tribunal of India at Bombay and others(2) and Joginder Singh Waryam Singh vs Director, Rural Rehabilitation, Pepsu, Patiala and others(2).
These decisions, however, are clearly not in point for, in each of them, the order passed by the authority within the territories and accordingly within the jurisdiction of the High Court concerned had merged in the order of the superior authority which was located outside the territories and was, therefore, beyond the jurisdiction of that High Court.
In that situation, a writ against the inferior authority within the territories could be of no avail to the petitioner concerned and could give him no relief for the order of the superior authority outside the territories would remain outstanding and operative against him.
As, therefore, no writ could be issued against that outside authority and as the (1) A.I.R. 1955 All. 435.
(2) A.I.R. 1955 Nag. 148.
(3) A.I.R. 1955 Pepsu 91.
1214 orders against the authority within the territories would, in view of the orders of the superior authority, have been infructuous, the High Court concerned had, of necessity, to dismiss the petition.
Such, however, was not the position in the present petition before the High Court of Travancore Cochin.
There was here no question of merger of any judicial order of respondent I into the judicial order of respondent 2.
In this case respondent 1 was actually claiming to exercise powers conferred upon him by certain sections of the Travancore Act XIV of 1124 which, it was submitted, were contrary to law or discriminatory and consequently ultra vires the Constitution.
The fact that respondent 1 was the agent of respondent 2, which being beyond its jurisdiction could not be reached by the High Court, could not make his acts any the less objectionable or discriminatory and ultra vires.
It is sufficient to say that if his action was contrary to law or if the provisions of law under which he was claiming to act became, after the commencement of the Constitution, void under article 13(1) as being repugnant to article 14 and the doer of the illegal act was within the reach of the High Court, the High Court had jurisdiction under article 226 to issue a writ against respondent I and thereby prevent further infringement of the petitioner 's fundamental rights.
The preliminary objection urged by the learned Attorney General against the jurisdic tion of the High Court, therefore, fails.
The next question canvassed in Civil Appeal No. 22 of 1954 was that respondent 2 was entitled to investigate the alleged evasion of tax by the petitioner not only for the years 1942 and 1943 but also the other years from 1940 to the last completed assessment year.
The decision of this question turns on a construction of the terms, of the references made by the Government of the United State of Travancore and Cochin under section 5(1) of the Travancore Act XIV of 1124.
A report dated the 17th November 1949 had been made by the Board of Revenue in regard to the income tax assessment of the petitioner for the years 11 19 and 1120(M.E.) and two orders were passed 1215 on the 26th November 1949 by the Government on the strength of that report.
The first of these orders related to taxation on the petitioner 's income for 1119 and the second related to the taxation on his income for 1120.
The return of income for the year ending the 31st December 1942 was the subject matter of the first order and after setting out the materials in the order the Government stated that they had prima facie reasons for believing that the petitioner had to a substantial extent evaded payment of tax on his income for 1119 and they considered that this was a fit case for reference to the Income tax Investigation 'Commission under section 5(1) of the Act.
The second order referred to the petitioner 's return of income for the year ending the 31st December 1943 and after ,setting out the materials, wound up similarly by stating that the Government had Prima facie reasons for believing that the petitioner bad to a substantial extent evaded payment of tax on his income for 1120 and they considered that this was a fit case for ref erence to the Income tax Investigation Commission under section 5(1) of the Act.
A cursory perusal of the Travancore Act XIV of 1124 will show that the Commission had no authority to investigate any case suo motu.
It could only investigate cases referred to it by the Government.
Thus under section 5(1), Government might refer to it for investigation and report any case or points in a case in which the Government had prima facie reasons for believing that a person had to a substantial extent evaded payment of taxation on income.
Such reference, however, could be made at anytime before the 16th February 1950 but not later.
Again, under sub section (4) of the same section, if in the course of investigation into any case or points in a case referred to it under sub section (1) the Commission bad reason to believe that some other person had evaded payment of taxation on income or some other points required investigation, it might make a report to the Government and the Government would forthwith refer to the Commission for investigation the case of such other person or such additional points as might 1216 be indicated in that report.
All that was done in the present case was that by two separate orders made under section 5(1) of the Act the Government referred two cases of the petitioner for the two years 1942 and 1943 to the Commission and they were registered as Evasion Cases Nos. 1 and 2 of 1125.
There was no other order under section 5(1) at any time before the 16th February 1950 and none could be made under that sub section after that date.
It was not suggested that there was any report by the Commission or any reference of any case or additional points in a case under section 5(4).
It was, therefore, contended for the petitioner that the Commission had no jurisdiction to enquire into any alleged evasion in any year prior or subsequent to the years 1942 and 1943.
The learned Attorney General, on the other hand, contended that the Government could, under section 5(1) of the Act, only refer the case of the petitioner who was reasonably suspected to have evaded the tax and, therefore, the whole case of the petitioner for all the years referred to in section 8(2) of the Act was the subject matter of the investigation which bad been entrusted to the Commission.
We are unable to accept this contention.
Under section 5(1) the Government could refer any case or points in a case.
There is nothing in that sub section which requires that a "case" referred thereunder must cover the entire period mentioned in section 8(2).
Indeed, the Government might have reason to believe that an assessee evaded the tax only in, say, two years and not in others and in such a case the Government could only refer the case for investigation of evasion during those two years only but could not refer any case for other years as to which they had no reasonable belief Therefore, in such a situation the reference must be limited to the particular years in which the evasion was believed to have taken place.
It makes no difference whether one calls the matter referred a "case" or "points in a case".
It follows, therefore, that, in order to ascertain whether, in a given case, the reference covers the entire period or only a shorter period, one has only to look at the order 1217 of reference.
The operative parts of the two orders of reference dated the 26th November 1949 in the present case clearly record the fact that the Government had prima facie reasons for believing that the petitioner had to a substantial extent evaded payment of taxation on his income for 1119 and 1120 (M.E.) and that they considered that "this was a fit case for reference to the Income tax Investigation Commission under section 5(1) of Act XIV of 1124".
What was a fit case for reference was described as "this" which clearly referred back to the evasion of payment on taxation on income for the two specific years in the two orders.
It is, therefore, clear that neither respondent 2 nor respondent I who was appointed an authorised official by respondent 2 had jurisdiction to cover any period beyond those specific years 1942 and 1943 and the notice which was issued by respondent I on the 21st November 1951 was, therefore, not warranted by law.
Respondent I had no warrant or authority whatever for issuing the said notice and we are of the opinion that the High Court was right in the conclusion to which it came that the action of respondent 1 was clearly illegal, without jurisdiction and unsupported by law.
The writ of prohibition issued against respondent I was, therefore, in order and Civil Appeal No. 22 of 1954 must stand dismissed with costs.
As regards Civil Appeal No. 21 of 1954, the petitioner contended that respondent 2 had no power or authority to conduct an investigation in regard to the alleged evasion of tax by the petitioner for the years 1942 and 1943 also.
Shri Nambiyar urged that: (1)The Travancore Act XIV of 1124 was not a law in force prior to the integration and was not an "existing law" continued in force by Ordinance I of 1124; (2)The notification dated the 26th July 1949 which purported to bring the Travancore Act XIV of 1124 into force as from the 22nd July 1949 was in effective and invalid; (3) Even if the Travancore Act XIV of 11 24 was 1218 in force, it could not apply to or override the assessment orders concluded by the Chief Revenue Authority, Travancore; (4) The Rajpramukh 's agreement read with article 245 of the Constitution precluded any investigation except in accordance with the Travancore Act XIV of 1124 and Act XXXIII of 1950 amended by Act XLIV of 1951 was invalid to the extent that it authorised investigation otherwise than in accordance with the Travancore Law; (5) Assuming all the foregoing points were held against the petitioner, section 5(1) of the Travancore Act XIV of 1124 was in any event unconstitutional and void as being inconsistent with article 14 of the Constitution.
(1): The Travancore Act XIV of 1124 was passed by the Travancore Legislature on the 7th March 1949.
It was, however, under section 1(3) to come into force on such date as the Travancore Government might by notification in the Government Gazette appoint.
No such notification was issued by the Travancore Government UP to the 1st July 1949 when the Travancore State and the Cochin State integrated into the United State of Travancore and Cochin.
On the 1st July 1949, the United State of Travancore and Cochin promulgated Ordinance I of 1124 whereby all existing laws of Travancore were continued in force till altered, amended or repealed by competent authority and the "existing law of Travancore" was therein defined to mean any law in force in the State of Travancore immediately prior to the 1st July 1949.
It was only on the 26th July 1949 that a notification was issued under section 1(3) by the United State of Travancore and Cochin bringing Act XIV of 1124 into force retrospectively from 22nd July, 1949.
The contention put forward on behalf of the petitioner was that as no notification under section 1(3) of Act XIV of 1124 had been issued up to the 1st July 1949, that Act had not been brought into force and was not in force on that date and, therefore, was not then an "existing law" which alone was given conti 1219 nuity by Ordinance I of 1124 which was promulgated on that very day.
The contention further was that, in the circumstances the Act was not continued by Ordinance I of 1124 but had lapsed and, therefore, the subsequent notification issued on the 26th July 1949 was wholly ineffective and consequently the reference of the cases of the petitioner to the Commission for investigation under section 5(1), the appointment of respondent I as the authorised official and the notices issued by him were unauthorised and wholly devoid of any authority of law.
The question for our consideration is whether Act XIV of 1124 or any part of it was, on the 1st July 1949, an existing law.
The general rule of English law, as to the date of the commencement of a statute, since 1797, has been and is that when no other date is fixed by it for its coming into operation it is in force from the date when it receives the royal assent (33 Geo.
3. c. 13).
The same rule has been adopted in section 5 of our .
We have not been referred to any Travancore Law which provides otherwise.
If, therefore, the same principle prevailed in that State, Travancore Act XIV of 1124 would have come into force on the 7th March 1949 when it was passed by the Travancore Legislature.
What prevented that result? The answer obviously points to section 1(3) which authorises the Government to bring the Act into force on a later date by issuing a notificated.
How could section 1(3) operate to postpone the commencement of the Act unless that section itself was in force? One must, therefore, concede that section 1(3) came into operation immediately the Act was passed, for otherwise it could not postpone the coming into operation of the Act.
To put the same argument in another way, if the entire Act including section 1(3) was not in operation at the date of its passing, how could the Government issue any notification under that very section? There must be some law authorising the Government to bring the Act into force.
Where is that law to be found unless it were in section 1(3)? In answer, Shri Nambiyar referred 154 1220 is to the principle embodied in section 37 of the English Interpretation Act which corresponds to section 22 of our .
That section does not help the petitioner at all.
All that it does is to authorise the making of rules or bye laws and the issuing of orders between the passing and the commencement of the enactment but the last sentence of the section clearly says that "rules, bye laws or orders so made or issued shall not take effect till the commencement of the Act or Regulation".
Suppose Shri Nambiyar is right in saying that the Government could issue a notification under section 1(3) by virtue of the principle embodied in section 22 of the , it will not take his argument an inch forward, for that notification, by reason of the last sentence of section 22 quoted above, will not take effect till the commencement of the Act.
It will bring about a stalemate.
It is, therefore, clear that a notification bringing an Act into force is not contemplated by section 22 of the .
Seeing, therefore, that it is section 1 (3) which operates to prevent the commencement of the Act until a notification is issued thereunder by the Government and that it is section 1(3) which operates to authorise the Government to issue a notification thereunder, it must be conceded that section 1(3) came into force immediately on the passing of the Act.
There is, therefore, no getting away from the fact that the Act was an "existing law" from the date of its passing right up to the 1st July 1949 and was, consequently, continued by Ordinance I of 1124.
This being the position, the validity of the notification issued on the 26th July 1949 under section 1(3), the reference of the case of the petitioner, the appointment of respondent 1 as the authorised official and all proceedings under the Travancore Act XIV of 1124 cannot be questioned on the ground that the Act lapsed and was not continued by Ordinance I of 1124.
(2): It is urged that the notification issued on the 26th July 1949 was bad in that it purported to bring the Act into operation as from the 22nd July 1949.
The reason relied upon is that the Govern 1221 meat could not, in the absence of express provision, authorising it in that behalf, fix the commencement of the Act retrospectively.
The reason for which the Court disfavours retroactive operation of laws is that it may prejudicially affect vested rights.
No such, reason is involved in this case.
Section 1(3) authorises the Government to bring the Act into force on such date as it may, by notification, appoint.
In exercise of the power conferred by this section the Government surely had the power to issue the notification bringing the Act into force on any date subsequent to the passing of the Act.
There can, therefore, be no objection to the notification fixing the commencement of the Act on the 22nd July 1949 which was a date subsequent to the passing of the Act.
So the Act has not been given retrospective operation, that is to say, it has not been made to commence from a date prior to the date of its passing.
It is true that the date of commencement as fixed by the notification is anterior to the date of the notification but that circumstance does not attract the principle disfavouring the retroactive operation of a statute.
Here there is no question of affecting vested rights.
The operation of the notification itself is not retrospective.
It only brings the Act into operation on and from an earlier date.
In any case it was in terms authorised to issue the notification bringing the Act into force on any date subsequent to the passing of the Act and that is all that the Government did.
In this view of the matter, the further argument advanced by the learned Attorney General and which found favour with the Court below, namely, that the notification was at any rate good to bring the Act into operation as on and from the date of its issue need not be considered.
There is no substance in this contention also.
(3): It was urged that, even if the Travancore Act XIV of 1124 was in force on the 1st July 1949 and was validly brought into operation from the 22nd July 1949, the terms of section 8(2) of the Act could not apply to or override the assessment orders of the petitioner for the years 1942 and 1943 which 1222 were concluded by the Chief Revenue Authority of Travancore.
Section 8(2) of the Act provided that, after considering the report of the Commission, the Government shall, by an order in writing, direct that such proceedings as they think fit under the various Income tax Acts of Travancore therein mentioned or any other law shall be taken against the person to whose case the report relates in respect of the income of any period commencing after the last day of Karkadakom 1115 (16 8 1939) and upon such a direction being given such proceedings may be taken and completed under the appropriate law notwithstanding any decision to a different effect given in the case by any income tax authority or Income tax Appellate Tribunal.
It was contended that the Chief Revenue Authority was not included in the description of "any income tax authority" and, therefore, even if the report of respondent 2 was adverse to the petitioner the assessment orders which were concluded by the Chief Revenue Authority could not be affected by the provisions of section 8(2) and could not be reopened.
This argument is based on a misconception of the true position of the Chief Revenue Authority.
The Chief Revenue Authority was an income tax authority mentioned in the hierarchy under the Travancore Act VIII of 1096.
When the Travancore Act XXIII of 1121 came to be passed, the income tax authorities enumerated therein included the Board of Revenue at the apex., substituting the Board of Revenue for the Chief Revenue Authority which occupied a similar position in the old Act.
By section 10 of the Travancore Act XIV of 1124, the Travancore Act VIII of 1096 was deemed to be in force for the purpose of the Act and to the extent necessary, with the result that in construing the provisions of section 8(2) of the Act, the words "any income tax auth ority" would include the Chief Revenue Authority which was an income tax authority under the Travancore Act VIII of 1096.
It may also be noted that section 4 of the Travancore Act XVII of 1122 continued all proceedings and petitions pending before the 1223 Chief Revenue Authority and provided that the same may be disposed of by the said authority or by such authority as may be appointed by the Government for the purpose as if the 'Said Travancore Act VIII of 1096 bad not been repealed.
It, therefore, follows that the Chief Revenue Authority was included within the expression "any income tax authority" in section 8(2) of the Act and the assessment orders of the petitioner for the years 1942 and 1943 which were concluded by the Chief Revenue Authority could be affected or overridden by any order which might be passed by the Government under section 8(2) of the Act.
This contention of the petitioner also, there fore, does not avail him.
(4): The Indian States Finance Enquiry Committee 1948 49 made two interim reports.
It recommended in the first interim report that subject to certain limitations indicated therein which were designed to secure legal "continuity" of pending proceedings and "finality and validity" of completed proceedings under the pre existing State legislation, the whole body of State legislation relating to "federal" subjects should be repealed and the corresponding body of Central legislation extended proprio vigore to the States with effect from the prescribed date or as and when the administration of particular "federal" subjects was assumed by the Centre.
All matters and proceedings pending under or arising out of preexisting States Acts should be disposed of under those Acts by, so far as may be, the "corresponding authorities" under the corresponding Indian Acts.
The income, profits and gains accruing and arising in States of all periods which were 'previous years ' of the States assessment years 1949 50 or earlier should be assessed wholly and in accordance with the States ' laws and at the States ' rates respectively, appropriate to the assessment years concerned.
Except in Travancore, there was no Income tax Investigation Commission in any State.
Should the Travancore Commission still be functioning at the time of the federal financial integration, all cases pending before it should be taken over by 1224 the Indian Commission.
The disposal of those cases should, however, (as in the case of pending assessments) be in accordance with the pre existing Travancore Law.
It recommended in the Second Interim Report that the Travancore Commission should be wound up and the cases referred to it should be transferred to the corresponding Commission in India.
These recommendations of the Committee in so far as they applied to Travancore Cochin were accepted by and incorporated into the agreement entered into between the President of India and the Rajpramukh of Travancore Cochin on the 25th February 1950 subject to certain modifications which are not relevant for the purpose of the present enquiry.
The result of the agreement was the enactment of Act XXXIII of 1950 which extended to Travancore Cochin the Act XXX of 1947 and section 3 of that Act provided that the law of Travancore corresponding to Act XXX of 1947 shall continue to remain in force with the modification that all cases referred to or pending before the Travancore Commission shall stand transferred to the Central Commission for disposal and that the State law shall determine the procedure to be followed and the powers to be exercised by the Central Commission in the disposal of those cases.
Evasion Cases Nos. 1 and 2 of 1125 which were pending before the Travancore Commission thus became transferred to res pondent 2 and were to be disposed of in accordance with the procedure laid down and the powers conferred on the Travancore Commission by the Travancore Act XIV of 1124.
Two questions, however, arose in the matter of this investigation by respondent 2, viz., (1) whether the life of the Travancore Commission, not having been extended beyond 16 8 1950, respondent 2 had the power and authority to continue the investigation of the cases of the petitioner after 16 8 1950, and, (2) whether any orders passed by the Government on the report made by respondent 2 would have the effect of overriding the assessment orders concluded by the Chief Revenue Authority, Travancore, in cases of the petitioner for the years 1942 and 1943.
1225 In regard to the first question, it was urged by Shri Nambiyar that the life of the Travancore Commission having come to an end on the 16th August 1950, respondent 2 also, which was its successor and to which the pending cases of the petitioner were transferred, could not function beyond 16 8 1950.
Parliament, however, passed, on the 26th August 1951, Act XLIV of 1951 amending Act XXXIII of 1950 whereby it provided with retrospective effect that, in the disposal of cases transferred to respondent 2, it shall have and exercise the same powers as it has and exercises in the investigation of cases transferred to it under Act XXX of 1947 and shall be entitled to act for the same term as under sub section (3) of section 4 of that Act thus extending the life of respondent 2 beyond 16 8 1950.
This) it was submitted, Parliament was not competent to do by reason of the terms of the agreement dated the 25th February, 1950, the effect of the enactment of Act XLIV of 1951 being to amend the law of the Travancore State which was to govern the investigation of pending cases by respondent 2.
The agreement was one which was contemplated under article 295 of the Constitution and, being provided by the Constitution itself, was a bar to the legislative competence of the Central Legislature under article 245.
The Central Legislature, it was submitted, was, therefore, not competent to pass Act XLIV of 1951 extending the life of respondent 2 beyond 16 8 1950 and respondent 2 was, therefore, not entitled to carry on any further investigation in the Evasion Cases Nos. 1 and 2 of 1125.
Considerable argument was addressed to us on the effect of the agreement on the legislative competence of the Central Legislature under article 245.
We do not, however, consider it necessary to decide this question as, in our opinion, the life of respondent 2 was not a part of the law of Travancore State which was to govern the procedure followed or the powers exercised by it in the investigation of the cases of the petitioner.
Respondent 2 to which the pending cases of the petitioner were transferred, was a body with a longer lease of life and the fact that the Travancore 1226 Commission had a shorter lease could not have the effect of curtailing the life of respondent 2.
The life of respondent 2 depended upon the law which established it and it was extended from time to time by subsequent legislation up to December, 1955, and that accident which gave to respondent 2 a longer lease of life did not contravene any provision of the Travancore law which determined the procedure to be followed and the powers to be exercised by the Travancore Commission.
The transfer to respondent 2 of the cases pending before the Travancore Commission, of necessity involved that those cases would be dealt with by respondent 2 which had a longer lease of life and respondent 2 could conduct the investigation of these cases and complete the same within the span of life which had been allotted to it by the relevant provisions of the Indian Law, the only limitations imposed upon the conduct of such investigation being that the procedure to be followed as also the powers to be exercised by it would be those obtaining in the Travancore Law.
Act XLIV of 1951 merely accepted this position and there was nothing in that Act which ran counter to the agreement.
As regards the second question also, the Chief Revenue Authority, as observed before, was an income tax authority within the meaning of the term as used in section 8(2) of the Travancore Act XIV of 1124 read with section 10 of that Act which continued in force the provisions of the Travancore Act VIII of 1096 so far as it was necessary for the purpose of the Act.
There also Act XLIV of 1951 did not make any changes in the existing Travancore Law which was to govern the investigation of the pending cases by respondent 2.
This contention of the petitioner, therefore, is equally untenable.
(5): This contention urged by Shri Nambiyar questions the vires of section 5(1) of the Travancore Act XIV of 1124.
This section provides: "Section5(1):Our Government may at any time before the last day of Makaram 1125 refer to the Commission for investigation and report any case or 1227 points in a case in which our Government have prima facie reasons for believing that a person has to a substantial extent evaded payment of taxation on income, together with such material as may be available in support of such belief, and may at any time before the last day of Meenam 1125 apply to the Commission for the withdrawal of any case or points in a case thus referred, and if the Commission approves of the withdrawal, no further proceedings shall thereafter be taken by or before the Commission in respect of the case or points so withdrawn".
It corresponds to section 5(1) of the Taxation on Income (Investigation Commission) Act, 1947 (XXX of 1947) which reads as under: "Section 5 (1): The Central Government may at any time before the last day of September 1948 refer to the Commission for investigation and report any case or points in a case in which the Central Government has prima facie reasons for believing that a person has to a substantial extent evaded payment of taxation on income, together with such material as may be available in support of such belief, and may at any time before the first day of September 1948 apply to the Commission for the withdrawal of any case or points in a case thus referred, and if the Commission approves of the withdrawal, no further proceedings shall thereafter be taken by or before the Commission in respect of the case or points so withdrawn".
We may also at this stage refer to the provisions of section 47 of the Travancore Act XXIII of 1121 which relates to income escaping assessment: "Section 47(1): If in consequence of definite information which has come into his possession the Income tax Officer discovers that income, profits or gains chargeable to income tax have escaped assessment in any year, or have been under assessed, or have been assessed at too low a rate, or have been the subject of excessive relief under this Act the Income tax Officer may, in any case in which he has reason to believe that the assessed has concealed the particulars of his income or deliberately furnished inaccu 155 1228 rate particulars thereof, at any time within eight years, and in any other case at any time within four years of the end of that year, serve on the person liable to pay tax on such income, profits or gains, or, in the case of a company, on the principal officer thereof, a notice containing all or any of the requirements which may be included in a notice under subsection (2) of section 29, and may proceed to assess or re assess such income, profits or gains and the provisions of this Act shall, so far as may be, apply accordingly as if the notice were a notice issued under that sub section: . . . . " The corresponding provision of the Indian Income tax Act was contained in section 34 which provided: "Section 34(1): If in consequence of definite information which has come into his possession the Income tax Officer discovers that income, profits or gains chargeable to income tax have escaped assessment in any year, or have been under assessed, or have been assesses at too low a rate, or have been the subject of excessive relief under this Act the Income tax Officer may, in any case in which be has reason to believe that the assessed has concealed the particulars of his income or deliberately furnished inaccurate particulars thereof, at any time within eight years, and in any other case at any time within four years of the end of that year, serve on the person liable to pay tax on such income, profits or gains, or, in the case of a company, on the principal officer thereof, a notice containing all or any of the requirements which may be included in a notice under subsection (2) of section 22, and may proceed to assess or re assess such income, profits or gains, and the provisions of this Act shall, so far as may be, apply accordingly as if the notice were a notice issued under that sub section: . . . ." Section 34 of the Indian Income tax Act was amended by Act XLVIII of 1948 which received the assent of the Governor General on the 8th September 1948.
It was further amended by the Indian Income tax Act, 1954 (XXXIII of 1954) which was assented to by the President on the 25th September 1229 1954 and introduced sub sections (1 A) to (1 D) therein.
It may, however, be noted that no amendment was made in section 47 of the Travancore Act XXIII of 1121 at any subsequent period and the question as to whether the provisions of section 5(1) of the Travancore Act XIV of 1124 became discriminatory and violative of the fundamental right guaranteed under article 14 of the Constitution will have to be determined with reference to the provisions of that sec tion set out above.
The true nature, scope and effect of article 14 of the Constitution have been explained by this Court in a series of cases beginning with Chiranjit Lal Chowdhuri vs The Union of India(1) and ending with Budhan Chowdhury and others vs The State of Bihar(2).
It is, therefore, not necessary to refer to the earlier cases and it will suffice to quote the principle as summarised in the decision of the Full Court in the last mentioned case at page 1049 in the following terms: "It is now well established that while article 14 forbids class legislation, it does not forbid reasonable classification for the purposes of legislation.
In order, however, to pass the test of permissible classification two conditions must be fulfilled, namely, (i) that the classification must be founded on an intelligible differentia which distinguishes persons or things that are grouped together from others left out of the group, and (ii) that differentia must have a rational relation to the object sought to be achieved by the statute in question.
The classification may be founded on different bases, namely, geographical, or according to objects or occupations or the like.
What is necessary is that there must be a nexus bet ween the basis of classification and the object of the Act under consideration.
It is also well establisbed by the decisions of this Court that article 14 condemns discrimination not only by a substantive law but also by a law of procedure".
The principles underlying article 14 of the Constitution are well settled.
The only difficulty which (1) ; (2) ; 1230 arises is in regard to the application of those principles to the facts of a particular case and the Court has to consider the terms of the impugned legislation having regard to the background and the surrounding circumstances so far as it may be necessary to do so in order to arrive at a conclusion whether it infringes the fundamental right in question.
Section 5(1) of Act XXX of 1947 (which is in pari materia with section 5(1) of the Travancore Act XIV of 1124) was impugned in the case of Suraj Mall Mohta & Co. vs A. V. Visvanatha Sastri and another(1).
The references for investigation in that case had been made in pursuance of a report made by the Commission to the Central Government under the provisions of section 5(4) of the Act requesting that the 'Case of the petitioner along with other cases may be referred to the Commission for investigation.
The contention urged on behalf of the petitioner was that the provisions of sections 5(1), 5(4), 6, 7 and 8 of Act XXX of 1947 had become void being discriminatory in character after the coming into force of the Constitution.
The attack made against the provisions of section 5(1) of the Act was two fold: "(1) That the section was not based on any valid classification; the word "substantial" being vague and uncertain and having no fixed meaning, could furnish no basis for any classification at all; (2) That the Central Government was entitled by the provisions of the section to discriminate between one person and another in the same class and it was authorised to pick and choose the cases of persons who fell within the group of those who bad substantially evaded taxation.
It could, if it chose, send the case of one person to the Commission and show favouritism to another person by not sending his case to the Commission though both of these persons be within the group of those who had evaded the payment of tax to a substantial extent".
As regards section 5(4), it was urged that it bad no independent existence and was bound to fall with section 5(1) if his contention regarding its invalidity (1) ; 1231 prevailed.
In the alternative, it was urged that assuming that section 5(1) was valid, even then section 5(4) had to be declared void because it gave arbitrary power to the Commission to pick and choose and secondly because the clause was highly discriminatory in character inasmuch as an evasion, whether substantial or insubstantial, came within its ambit as well as within the ambit of section 34(1) of the Indian Income tax Act.
This Court considered it sufficient for the decision of that case to examine the contentions urged against the validity of section 5(4) of the Act because the case of the petitioner was referred to the Commission under those provisions of the Act and not under section 5(1) and decided that case on the assumption that section 5(1) of the Act was based on a valid classification and dealt with a group of persons who came within the class of war profiteers which required special treatment, that the classification was rational and that reasonable grounds existed for making a distinction between those who fell within that class and others who did not come within it, but without in any way deciding or even expressing any opinion on that question.
This Court compared the provisions of section 5(4) of the Act with those of section 34(1) of the Indian Income tax Act and came to the conclusion that section 5(4) dealt with the same class of persons who fell within the ambit of section 34(1) of the Indian Income tax Act and were dealt with in sub section (1) of that section and whose income could be caught by a proceeding under that section.
It held that there was nothing uncommon either in properties or in characteristics between persons who had been discovered as evaders of income tax during an investigation conducted under section 5(1) of the Act and those who had been discovered by the Income tax Officer to have evaded payment of income tax.
Both those kinds of persons had common properties and had common characteristics and therefore required equal treatment.
The Court thus held that both section 34(1) of the Indian Income tax Act and sub sec 1232 tion (4) of section 5 of the impugned Act dealt with persons who had similar characteristics and similar properties, the common characteristics being that they were persons who had not truly disclosed their income and had evaded payment of taxation on income.
The court then considered whether the procedure prescribed by Act XXX of 1947 for discovering the concealed profits of those who bad evaded payment of taxation on their income was substantially different and prejudicial to the assesses than the procedure prescribed in the Indian Income tax Act.
After comparing the provisions of section 8 of Act XXX of 1947 and those of sections 31, 32 and 33 of the Indian Income tax Act, this court came to the conclusion that there was material and substantial difference between the two procedures and there was no doubt that the procedure prescribed by the impugned Act deprived a person who was dealt with under that Act of those rights of appeal, second appeal and revision to challenge questions of fact decided by the judge of first instance.
The procedure prescribed by the impugned Act in sections 6 and 7 was also compared with the procedure prescribed in sections 37 and 38 in the Indian Income tax Act and this Court held that the procedure prescribed by the impugned Act was substantially more prejudicial to the assessee than the procedure prescribed under the Indian Income tax Act.
It was thus clear that persons dealt with under Act XXX of 1947 were submitted to a procedure which was more drastic and prejudicial than the procedure which was available to those who were dealt with under section 34 of the Indian Income tax Act.
This Court, therefore, was of the opinion that section 5(4) and the procedure prescribed by the impugned Act in so far as it affected the persons proceeded against thereunder being a piece of discriminatory legislation offended against the provisions of article 14 of the Constitution and were thus void and unenforceable.
It was after this decision of this Court in Suraj 1233 Mall Mohta 's case supra that Parliament enacted the Indian Income tax Amendment Act, 1954 (XXXIII of 1954) introducing sub sections (1 A) to (1 D) in section 34 of the Indian Income tax Act.
Though Act XXXIII of 1954 received the assent of the President on the 5th September 1954 it was to come into effect from the 17th July 1954.
Section 34(1 A) purported to meet two criticisms which had been, in the main, offered against the constitutionality of section 5(1) of the Act in Suraj Mall Mohtas case.
One criticism was that the classification made in section 5(1) of the Act was bad because the word 'substantial ' used therein was a word which had no fixed meaning and was an unsatisfactory medium for carrying the idea of some ascertainable proportion of the whole, and thus the classification being vague and uncertain, did not save the enactment from the mischief of article 14 of the Constitu tion.
That alleged defect was cured in section 34 (1 A) inasmuch as the Legislature clearly indicated there what it meant when it said that the said object of Act XXX of 1947 was to catch persons who, to a substantial extent, had evaded payment of tax, in other words, what was seemingly indefinite within the meaning of the word 'substantial ' bad been made definite and clear by enacting that no evasion below a sum of one lakh was within the meaning of that expression.
The other criticism was that section 5(1) did not necessarily deal with the persons, who, during the war, had made huge profits and evaded payment of tax on them.
Section 34(1 A) remedied this defect also.
It clearly stated that it would operate on income made between the 1st September 1939 and 31st March 1946 tax on which had been evaded.
Section 5(1) was again attacked in the case of Shree Meenakshi Mills Ltd. vs Sri A. V. Visvanatha Sastri and Another(1).
This was a petition under article 32 of the Constitution filed on the 16th July 1954 after the decision in Suraj Mall Mohta 's case, supra, had been pronounced.
Section 5(1) of the Act was attacked on the very same grounds which were mentioned in (1) 1234 the judgment in Suraj Mall Mohta 's case, supra, but had not been dealt with by this Court it being considered sufficient to strike down section 5(4) of the Act without expressing any opinion on the vires of section 5(1).
Even in this case, section 5(1) was not struck down as void on a comparison of its provisions with those of section 34(1) of the Indian Incometax Act as was done in the case of section 5(4) in Suraj Mall Mohta 's case, supra.
By the time this petition came to be heard by this Court, the Parliament had enacted Act XXXIII of 1954 which, as stated above, introduced section 34(1 A) in section 34 of the Indian Income tax Act and this Court came to the conclusion on a comparison of the provisions of section 5(1) of the Act with section 34(1 A) of the Indian Income tax Act that the new sub section inserted in section 34 by Act XXXIII of 1954 was intended to deal with the class of persons who were said to have been classified for special treatment by section 5(1) of Act XXX of 1947.
This Court reiterated the conclusions to which it had come in Suraj Mall Mohta 's case, supra, that the procedure prescribed by the Act for making the investigation under its provisions was of a summary and drastic nature and it constituted a departure from the ordinary law of procedure and in certain important aspects was detrimental to the persons subjected to it and as such was discriminatory.
It did not again express an opinion on the validity of section 5(1) as being based on a valid classification and being thus saved from the mischief of article 14 of the Constitution, but, on a comparison of the provisions of section 5(1) of the Act with those of section 34(1 A) of the Indian Income tax Act which came into effect from the 17th July 1954, came to the conclusion that this defence of the provisions of section 5(1) being saved from the mischief of article 14 of the Constitution on the basis of a valid classification was no longer available in support of it after the introduction of the new subsection in section 34 of the Indian Income tax Act which sub section dealt with the same class of persons dealt with by section 5(1) of the impugned 1235 Act.
The result was that proceedings could no longer be continued under the procedure prescribed by the impugned Act and section 5 (1) was thus struck down as unconstitutional and void after the coming into operation of section 34(1 A) of the Indian Income tax Act.
These two cases, viz., Suraj Mall Mohta 's case supra and Shree Meenakshi Mills ' case, supra, did not directly pronounce upon the vires of section 5(1) of the Act in comparison with section 34(1) of the Indian Income tax Act though the vires were the subject matter of a direct challenge therein.
The ratio of these decisions is, however, helpful in the determination of the question that arises directly before us, viz., whether section 5(1) of the Act is discriminatory in its character and thus violative of the fundamental right guaranteed under article 14 of the Constitution.
In both these cases, this Court was of the opinion that the procedure for investigation prescribed by Act XXX of 1947 (corresponding with the Travancore Act XIV of 1124) was of a summary and drastic nature and constituted a departure from the ordinary law of procedure and in certain aspects was detrimental to persons subjected to it as compared with the procedure prescribed by the corresponding provisions of the Indian Income tax Act (corresponding to the Travancore Act XXIII of 1121) and was as such discriminatory.
The provisions of sections 5 (4) and 5 (1) of the Act were compared respectively with the provisions of section 34(1) and section 34(1 A) of the Indian Income tax Act and, on a comparison of these provi sions, this Court came to the conclusion that the classes of persons who were said to have been classified for special treatment by those respective sections of the Act were intended to be and could be dealt with under section 34(1) and section 34(1 A) of the Indian Income tax Act and there could, therefore, be no basis of a valid classification for special treatment under the provisions of Act XXX of 1947 (corresponding with the Travancore Act XIV of 1124).
The procedure prescribed by the Travancore Act XIV of 1124 being thus discriminatory as compared 156 1236 with the procedure prescribed in the Travancore Act XXIII of 1121, the questions that arise for our consideration are, (1) whether there is a rational basis of classification to be found in the enactment of section 5(1) of the Act, and (2) whether the same class of persons were intended to be and could be dealt with under the provisions of section 47 of the Travancore Act XXIII of 1121.
In order to ascertain the scope and purpose of the impugned section reference must first be made to the Act itself.
The preamble of a statute has been said to be a good means of finding out its meaning and as it were a key to the understanding of it.
The preamble to the Travancore Act XIV of 1124, like that of Act XXX of 1947, runs thus: "Whereas it is expedient for the purpose of ascertaining whether the actual incidence of taxation on income is and has been in recent years in accordance with the provisions of law and the extent to which the existing law and pro cedure for the assessment and recovery of such taxation is adequate to prevent the evasion thereof, to make provision for an investigation to be made into such matters.
It is hereby enacted as follows".
It does not unfortunately give any assistance in the solution of the problem before us.
Section 5(1) itself, however, gives some indication as to the real object of it.
The condition on which the action of the Government under that section is made dependent is that the Government must have prima facie reasons for believing that a person has to a substantial extent evaded payment of taxation on his income.
The powers conferred on the Commis sion by section 6 and the procedure prescribed for the Commission by section 7 are clearly very drastic and harsh.
This unmistakably shows that the legislative authority took the view that these stringent measures were necessary for unearthing the tax evasions which had gone unnoticed before when the usual procedure under the Income tax law was applied.
Then comes section 8(2) which authorises the Government after perusal of the report of the Commission to direct proceedings to, be taken against the person to whose 1237 case the report relates in respect of the income of any period commencing after the 16th August 1939.
This provision clearly evinces that the intention of the legislative authority is to catch the income evaded from after the 16th August 1939.
Section 5(1) also provides that the reference thereunder of a case must be made at any time before the 16th February 1950.
From these sections it will appear that the object of this law was to uncover the evasion of tax on income made after the 16th August 1939 and before the 16th February 1950 about the existence of which evasion the Government had prima facie reason to believe.
The question at once arises as to why it was that the legislative authority took the view that there were possible cases of tax evasion.
It has been said that although the statement of 'the objects and reasons appended to a bill is not admissible as an aid to the construction of the Act as passed (see Aswini Kumar Ghose case(1)), yet it may be referred to only for the limited purpose of ascertaining the conditions prevailing at the time which necessitated the making of the law (see Subodh Gopal Bose 's case(2)).
Similar observations were made by Fazl Ali, J. with ref erence to legislative proceedings being relevant for the proper understanding of the circumstances under which an Act was passed and the reasons which necessitated it in Chiranjit Lal Chowdhuri vs The Union of India(3).
Indeed, in the case of Kathi Raning Rawat vs The State of Saurashtra(4), this Court permitted the State to file an affidavit stating in detail the circumstances which prevailed at the time when the law there under consideration bad been passed and which necessitated the passing of that law.
In the present case also, an affidavit has been filed by Gauri Shanker, Secretary of respondent 2, stating the reasons why it was thought necessary to enact the impugned Act including section 5(1).
This affidavit clearly brings out the serious problem that faced the revenue authorities.
A war of unprecedented magnitude had raged from September 1939 to 1946.
The (1) ; (2) ; , 628.
(3) ; , 879.
(4) ; 1238 war conditions brought in their train a sudden rise in the demand of all kinds of goods, both consumer and industrial, which, naturally pushed up the prices to abnormal heights affording a great opportunity to the producers, manufacturers and merchants to reap huge profits.
There was good reason to believe that these abnormal profits were not being brought into regular accounts but were being concealed.
Faced with this situation, means bad to be devised to enquire into the tax evasions and to realise the legitimate dues of the State.
If regard be had to this background it is obvious that section 5(1) had reference to a class of substantial evaders of income tax who required to be specially treated under the drastic procedure provided by Act XXX of 1947.
It was, however, urged that the words "substantial extent" were of such vague import that they did not afford any reasonable basis of classification.
Reference was made to Stroud 's Judicial Dictionary, 3rd ed., Vol. 4, page 2901, where the word "substantial" has been described to be: "A word of no fixed meaning, it is an unsatisfactory medium for carrying the idea of some ascertainable proportion of the whole (Terry 's Motors, Ltd. vs
Binder; , The word "substantial" has been used in various legislative enactments and even though it is said to be a word of no fixed meaning, Viscount Simon in Palser vs Grinling(1) observed: "One of the primary meanings of the word is equivalent to considerable, solid, or big.
It is in this sense that we speak of a substantial fortune, a substantial meal., a substantial man, a substantial argument or ground of defence.
Applying the word in this sense, it must be left to the discretion of the judge of fact to decide as best he can according to the circumstances in each case. ." and it has been described at page 2902 of Stroud 's Judicial Dictionary to be "equivalent to considerable,solid or big".
Even though the word "substantial" by itself might (1) , 817.
1239 not afford a definite measure or yard stick for including particular individuals within the classification, the background and the circumstances mentioned in the aforesaid affidavit of Gauri Shanker indicate with reasonable certainty the class of persons who are intended to be subjected to this drastic procedure.
It does not require much effort to pick out persons who would fall within this group or category of substantial evaders of income tax and even though a definite amount be not specified in section 5(1) of the Act as constituting a substantial evasion of income tax the Government, to whom the process of selection for the purposes of reference of the cases for investigation to the Commission is entrusted, would not have any difficulty in finding out the persons coming within this group or category.
To use the language of Viscount Simon, the income tax which has been evaded would have to be considerable, solid or big, and once that conclusion was reached by the Government, the cases of such persons would indeed be referred by them for investigation by the Commission under section 5(1) of the Act.
It was, however, urged that it would be open to the Government within the terms of section 5(1) of the Act itself to discriminate between persons and persons who fell within the very group or category; the Government might refer the case of A to the Commission leaving the case of B to be dealt with by the ordinary procedure laid down in the Travancore Act XXIII of 1121.
The possibility of such discriminatory treatment of persons falling within the same group or category, however, cannot necessarily invalidate this piece of legislation.
It is to be presumed, unless the contrary were shown, that the administration of a particular law would be done "not with an evil eye and unequal band" and the selection made by the Government of the cases of persons to be referred for investigation by the Commission would not be discriminatory.
This question was considered by this Court in two cases, viz. , Kathi Raning Rawat vs The State of Sau 1240 rashtra(1) and Kedar Nath Bajoria vs The State of West Bengal(2).
Mr. Justice Mukherjea, as he then was, dealt with the argument in Kathi Raning Rawat vs The State of Saurashtra(1) as under: "It is a doctrine of the American courts which seems to be well founded on principle that the equal protection clause can be invoked not merely where discrimination appears on the express terms of the statute itself, but also when it is the result of improper or prejudiced execution of the law.
(Vide Weaver on Constitutional Law, p. 404).
But a statute will not necessarily be condemned as discriminatory, because it does not make the classification itself but, as an effective way of carrying out its policy, vests the authority to do it in certain officers or administrative bodies. . . .
In my opinion, if the legislative policy is clear and definite and as an effective method of carrying out that policy a discretion is vested by the statute upon a body of administrators or officers to make selective application of the law to certain classes or groups of persons, the statute itself cannot be condemned as a piece of discriminatory legislation.
After all "the law does all that is needed when it does all that it can, indicates a policy . and seeks to bring within the lines all similarly situated so far as its means allow" (Vide Buck vs Bell, ; , 208).
In such cases, the power given to the executive body would import a duty on it to classify the subject matter of legislation in accordance with the objective indicated in the statute.
The discretion that is conferred on official agencies in such circumstances is not an unguided discretion; it has to be exercised in conformity with the policy to effectuate which the direction is given and it is in relation to that objective that the propriety of the classification would have to be tested.
If the ad ministrative body proceeds to classify persons or things on a basis which has no rational relation to the objective of the legislature, its action can certainly be annulled as offending against the equal protection clause.
On the other hand, if the statute (1) ; , 459.
(2) ; , 41, 1241 itself does not disclose a definite policy or objective and it confers authority on another to make selection at its pleasure, the statute would be held on the face of it to be discriminatory irrespective of the way in which it is applied. . . " The same line of demarcation was also emphasized by Patanjali Sastri, C. J., delivering the judgment of the Court in Kedar Nath Bajoria vs The State of West Bengal(2).
It, therefore.
, follows that the mere fact that the Government is entrusted with the power to select cases of persons falling within the group or category of substantial evaders of income tax for reference to the Commission would not render section 5(1) discriminatory and void.
The object sought to be achieved by the impugned piece of legislation is quite definite and that is to catch substantial evaders of income tax out of those who have made huge profits during the war period.
They form a class by themselves and have to be specially treated under the procedure laid down in the Act.
Being a class by themselves, the procedure to which they are subjected during the course of investigation of their cases by the Commission is not at all discriminatory because such drastic procedure has reasonable nexus with the object sought to be achieved by the Act and therefore such a classification is within the constitutional limitations.
The selection of the cases of persons falling within that category by the Government cannot be challenged as discriminatory for the simple reason that it is not left to the unguided or the uncontrolled discretion of the Government.
The selection is guided by the very objective which is set out in the terms of section 5 (1) itself and the attainment of that object controls the discretion which is vested in the Government and guides the Government in making the necessary selection of cases of persons to be referred for investigation by the Commission.
It cannot, therefore, be disputed that there is a valid basis of classification to be found in section 5(1) of the Act.
(1) ; , 41.
1242 The validity of the classification was further attacked on the ground that the limitation of the period within which the cases of the substantial evaders of income tax falling within this group or category may be referred for investigation by the Government to the Commission, viz., 16th February 1950 imports a discrimination in so far as those persons whose cases are referred before that date would be treated under the procedure laid down in the Travancore Act XIV of 1124 whereas those whose cases have not been referred by that date would not be subjected to the same treatment even though they fell within the same category.
This would bring about a discrimination between the same class of persons some of whom would be subjected to that special treatment and others who would escape the same.
Section 5(4) of the Act also would not cure this defect because the cases contemplated therein are either the cases which have been already referred for investigation to the Commission under section 5(1) of the Act or cases of other persons about whose alleged 'evasion of income tax the Commission has gathered information during the course of their investigations.
Even if these other persons be thus subjected to the special procedure prescribed in the Act there would remain, outside the jurisdiction of the Commission, numbers .of persons whose cases are not covered by sections 5(1) or 5(4) but who nonetheless are comprised within the class of substantial evaders of income tax.
They would have to be dealt with under the ordinary law and presumably under section 47 of the Travancore Act XXIII of 1121 if they could be dealt with thereunder.
If they could not be so dealt with, the only result would be that they would escape the surveillance of the Government and the escapement of income tax in their cases would be without any remedy.
This, it was urged, was discriminatory and was enough to strike down section 5(1) of the Act.
It would be impossible in the normal course to reach all substantial evaders of income tax.
Those persons falling within that category in respect of whom the 1243 Government had received the requisite information and in whose cases the Government had prima facie reasons for believing that they had to a substantial extent evaded payment of taxation on income would have their cases referred by the Government for investigation by the Commission.
Those persons in respect of whom no such information was available to the Government would certainly escape detection but that is the position with regard to each and every law which may be passed in order to detect evasion of payment of income tax.
Even under the provisions of section 47 of the Travancore Act XXIII of 1121 (corresponding to section 34 of the Indian Income tax Act as it stood before the amendment in 1948), those persons in respect of whom the Incometax Officer had gathered definite information and consequently discovered that income, profits or gains chargeable to income tax had escaped assessment in any year could be dealt with under the relevant provisions of that Act.
Those persons in respect of whom no such information had been received by the Income tax Officer could not be reached at all.
The fact that some persons falling within a particular category may escape detection altogether is not necessarily destructive of the efficacy of the particular legislation.
The only thing required is that, as between persons who fall within the same category and who can be dealt with under the same procedure, there should be no discrimination, some being treated in one way and others being treated in another.
It was also urged that discrimination was inherent in the terms of section 5(1) itself by reason of its operation being limited only to those persons whose cases were referred to the Commission on or before the 16th February 1950.
It thus arbitrarily left out persons who evaded payment of taxation on income made during the war period but whose cases were not discovered or referred to the Commission on or before that date although they were otherwise similarly situated.
Reliance was placed in support of this position on the following passage from the judgment of Mahajan, C. J. in Shree Meenakshi Mills ' case, 157 1244 supra, at pages 795 796: "Assuming that evasion of tax to a substantial amount could form a basis of classification at all for imposing a drastic procedure on that class, the inclusion of only such of them whose cases had been referred before 1st September, 1948, into a class for being dealt with by the drastic procedure, leaving other tax evaders to be dealt with under the ordinary law will be a clear discrimination for the reference of the case within a particular time has no special or rational nexus with the necessity for drastic procedure. . " These observations were made to repel the first argument of the learned Attorney General that the class of substantial evaders who fall within section 5(1) were only those whose cases had been referred within the date fixed.
It was pointed out that if the class was so circumscribed then that by itself would make the classification discriminatory by leaving out those substantial evaders whose cases had not been referred by that date.
By that passage, however, this Court did not hold that in fact section 5(1) was confined to such a limited class.
We are of the opinion that the fixation of the date for references for investigation by the Government to the Commission, viz., the 16th February 1950 was not an attribute of the class of substantial evaders of income tax which were intended to be specifically treated under the drastic procedure prescribed in the Travancore Act XIV of 1124 but was a mere accident and a measure of administrative convenience.
The date of such references could, without touching the nature and purpose of the classification, be extended by the Travancore Legislature by a necessary amendment of the Travancore Act, XIV of 1124, and if such an amendment had been grafted on the Act as originally passed, no one belonging to the particular class or category of substantial evaders of income tax could have complained against the same.
The next question to consider is whether the same class of persons dealt with under section 5(1) of the Travancore Act XIV of 1124 were intended to and 1245 could be dealt with under the provisions of section 47 of the Travancore Act XXIII of 1121.
Because, if that was the position at any particular period of time, section 5(1) of the Travancore Act XIV of 1124 would certainly be discriminatory in so far as there will be two distinct provisions simultaneously existing in the statute book, one of which could be applied to some persons within the same class or category and the other could be applied to others also falling within the same class or category, thus discriminating between the two groups.
Section 47 of the Travancore Act XXIII of 1121, as already observed, was in the same terms as section 34(1) of the Indian Income tax Act as it stood before its amendment in 1948.
Each of the following conditions had to be fulfilled before the Income tax Officer could take action under this section, viz.: (i)that definite information bad come into the possession of the Income tax Officer that income, etc.
had escaped; (ii)that inconsequence of such definite information the Income tax Officer discovered that income, etc.
(a) had escaped assessment, or (b) had been under assessed, or (c) had been assessed at too low a rate, or (d) had been the subject of excessive relief; (iii) that the Income tax Officer had reason to belive that (a) the assessee had concealed the particulars of his income, or (b) deliberately furnished inaccurate particulars thereof It is, therefore, abundantly clear that section 47(1) of the Travancore Act XXIII of 1121 was directed only against those persons concerning whom definite information came into the possession of the Incometax Officer and in consequence of which the Incometax Officer discovered that the income of those persons bad escaped or been under assessed or assessed at too low a rate or had been the subject of excessive relief.
The class of persons envisaged by 1246 section 47(1) was a definite class about which there was definite information leading to discovery within 8 years or 4 years as the case may be of definite item or items of income which had escaped assessment.
The Travancore Act XIII of 11 21 was passed on the 9th July 1946.
The action to be taken under it was not confined to escapement from assessment of income made during the war period (September 1939 to 1946).
Action could be taken in respect of income which escaped assessment even before the war and also more than 8 years after the end of the war.
Turning now to section 5(1) it will be noticed that the class of persons sought to be reached comprises only persons about whom there was no definite information and no discovery of any definite item or items of income which escaped taxation but about whom the Government had only prima facie reason to believe that they evaded payment of tax to a substantial amount.
The class of persons who might fall within section 5(1) of the Travancore Act XIV of 1124 was, therefore, not the same class of persons who may come under section 47(1) of the Travancore Act XXIII of 1121.
Further, action under section 5(1) read with section 8(2) of the 'Travancore Act XIV of 1124 is definitely limited to the evasion of payment of taxation on income made during the war period.
It cannot, therefore, be urged that section 5(1) of the Travancore Act XIV of 1124 was discriminatory in comparison with section 47(1) of the Travancore Act XXIII of 1121, for the persons who came under section 5(1) were not similarly situated as persons who came under section 47(1), Section 5(1) of Act XXX of 1947 was struck down in Shree Meenakshi Mills ' case, supra, as it comprised the same class of persons who were brought in the amended section 34(1 A) of the Indian Income tax Act, 1922 but the same cannot be said about section 5(1) as compared to section 47(1).
These two sections do not overlap and do not cover the same class of persons.
The result, therefore, is that section 5(1) of the Travancore Act XIV of 1124 which has to be read for 1247 this purpose in juxtaposition with section 47 of the Travancore Act XXIII of 1121 cannot be held to be discriminatory and violative of the fundamental right guaranteed under article 14 of the Constitution.
The proceedings which took place in the course of investigation by the Commission up to the 26th January 1950 were valid and so also were the proceedings during the course of investigation which took place after the inauguration of the Constitution on the 26th January 1950 under which the petitioner, as a citizen of our Sovereign Democratic Republic acquired inter alia guarantee of the fundamental right under article 14 of the Constitution.
The result, therefore, is that all the contentions urged on behalf of the petitioner fail and Civil Appeal No. 21 of 1954 must be dismissed with costs.
Civil Appeals Nos. 21 and 22 of 1954 will accordingly be dismissed with costs.
There will be a set off for costs.
| IN-Abs | The petitioners native of Quilon within the Travancore State had been assessed to income tax for the years 1942 and 1943, the final orders in his assessment having been passed by the Chief Revenue authority of Travancore in December 1946 and November 1946 respectively.
Travancore Taxation on Income (Investigation Commission) Act, 1124 (Act XIV of 1124) modelled on the Indian Act XXX of 1947 was passed by the Travancore Legislature, to provide for an investigation into matters relating to taxation on income.
In July 1949 , the United State of Travancore and Cochin was brought into existence as a result of integration between the two States.
All existing laws of Travancore were to continue in force by virtue of Ordinance I of 1124 which was later enacted as Act VI of 1125.
In November 1949 the Government of the 'United State of Travancore 1197 Cochin issued orders under section 5(1) of the Travancore Act XIV of 1 124 referring the cases of the petitioner for the years 1942 and 1943 (called Evasion Cases Nos. 1 & 2 of 1125) for investigation by the Travancore Income Tax Investigation Commission.
Before the Commission could make its report the Constitution of India came into force and the United State of Travancore Cochin became a part of India (Part B State) and the Travancore Act XIV of 1124 was continued in force until altered, amended or repealed by a competent authority.
In April 1950 Parliament passed Act XXXIII of 1950 whereby Taxation on Income (Investigation Commission) Act, (Act XXX of 1947) was extended to Travancore Cochin and the law of Travancore corresponding to Act XXX of 1947 was to continue in force with certain modifications.
In October 1951, a notification issued by the Indian Investigation Commission appointed Respondent No. 1 as an authorised official under section 6 of Travancore Act XIV of 1124 read with Act XXXIII of 1950.
Respondent No. I sent a copy of that notification to the petitioner on 21st November, 1951 for his information and further intimated to him that the investigation proposed to be conducted will not be confined to the years 1942 and 1943 but that it would be necessary for him to investigate the petitioner 's income for the period from 1940 to the last completed assessment year.
The petitioner filed a writ petition in the Travancore High Court against Respondent No. I and Respondent No. 2 (Indian Income Tax Investigation Commission) for a writ of prohibition or any other writ prohibiting the Respondents from holding an enquiry into the cases registered as Evasion Cases Nos. 1 & 2 of 1126 or from holding an investigation into the income of the petitioner from the year 1940 to the last completed assessment year.
The Travancore High Court held that the Respondent No. 2 had all the powers that the Travancore Commission had under Travancore Act XIV of 1124 and no more and granted the writ prohibiting respondents from conducting an enquiry into years other than 1942 and 1943.
Both the parties appealed to the Supreme Court against the order of the High Court.
A preliminary objection to the jurisdiction of the High Court to entertain the writ petition was repeated in the Supreme Court by the Attorney General.
Held, that the High Court bad jurisdiction under article 226 of the Constitution to issue a writ against Respondent No. 1 because under the provisions of section 6 of the Travancore Act XIV of 1124 the authorised official (Respondent No. 1) had considerable powers conferred upon him in the conduct of the investigation, and if he did anything as authorised official which was not authorised by law or was violative of the fundamental rights of the petitioner as in the present case be would be amenable to the jurisdiction of the High Court under article 226 of the Constitution.
Held, further that under the provisions of the Travancore Act XIV of 1124 the Commission had no authority 'to investigate any case suo motu.
It could only investigate cases referred to it by 1198 Government.
All that was done in the present case was that by two separate orders made under section 5(1) of the Act the Government referred two cases of the petitioner for the two years 1942 and 1943 to the Commission.
There was no other order under section 5(1) at any time before 16th February 1950 and none could be made under that sub section after that date.
Therefore neither Respondent No. 2 nor Respondent No. 1 who had been appointed as authorised Official by Respondent No. 2 had jurisdiction to cover any period beyond the two specific years 1942 and 1943 and the notice dated 21st November 1951 issued by Respondent No. 1 to investigate the petitioner 's income for the period from 1940 to the last completed assessment year was clearly illegal and without jurisdiction.
Held, also that section 5(1) of the Travancore Act XIV of 1124 which is to be read in juxta position with section 47 of the Travancore Inc6me Tax Act, 1121 (XXIII of 1121) is not discriminatory and violative of the fundamental right guaranteed under article 14 of the Constitution.
Section 47(1) of the Travancore Act XXIII of 1121 was directed only against those persons concerning whom definite information came into the possession of the, Income tax Officer and in consequence of which the Income tax Officer discovered that the income of those persons had escaped or been under assessed or assessed at too low a rate or had been the subject of excessive relief.
The class of persons envisaged by section 47(1) was a definite class about which there was definite information leading to discovery within 8 years or 4 years as the case may be of definite item or items of income which had escaped assessment.
The action to be taken under Travancore Act XXIII of 1121 was not confined to escapement from assessment of income made during the war period (September 1939 to 1946).
Action could be taken in respect of income which escaped assessment even before the war and also more than 8 years after the end of the war.
On the other hand under section 5(1) of the Travancore Act XIV of 1124 the class of persons sought to be reached comprised only these persons about whom there was no definite information and no discovery of any definite item or items of income which escaped taxation but about whom the Government had only prima facie reason to believe that they had evaded payment of tax to a substantial amount.
Further, action under section 5(1) read with section 8(2) of the Travancore Act XIV of 1124 was definitely limited to the evasion of payment of taxation on income made during the war period and therefore section 5(1) of the Travancore Act XIV of 1124 was not discriminatory in comparison with section 47(1) of the Travancore Act XXIII of 1121.
Election Commission, India vs Saka Venkata Rao ([1953] S.C.R. 1144), K. section Rashid & Son vs The Income tax Investigation Commission, etc.
([1954] S.C.R. 738), Azmat Ullah vs Custodian, Evacuee Property, U.P., Lucknow (A.I.R. 1955 All, 435), Burhanpur 1199 National Textile Workers Union, Burhanpur vs Labour Appellate Tribunal of India at Bombay and others (A.I.R. 1955 Rag. 148), Joginder Singh Waryam Singh vs Director, Rural Rehabilitation, Pepsu, Patiala and others (A.I.R. 1955 Pepsu 91), Chiranjit Lal Chowdhuri vs The Union of India ([1950] S.C.R. 869), Budhan Chowdhury and others vs The State of Bihar ([1955] 1 S.C.R. 1045), Suraj Mall Mohta & Co. vs A. V. Visvanatha Sastri and another ([1955] 1 S.C.R. 448), Shree Meenakshi Mills Ltd. vs Sri A. V. Visvanatha Sastri and Another ([1955] 1 S.C.R. 787), Aswini Kumar Ghose 's case ([1953] S.C.R. 1), Subodh Gopal Bose 's case ([1954] S.C.R. 587, 628), Kathi Baning Bawat vs The State of Saurashtra ([1952] S.C.R. 435), Palser vs Grinling ([1948] A.C. 291) and Kedar Nath Bajoria vs The State of West Bengal ([1954] S.C.R. 30), referred to.
|
: Criminal Appeal No. 45 of 1972.
Appeal by Special Leave from the Judgment and Order dated 18 8 71 of the Calcutta High Court in Crl.
Revision No. 1006 of 1970.
Sukumar Ghosh for the Appellant.
M. M. Kshatriya and G. section Chatterjee for the Respondent.
Jaswant Singh, J. concurred with the Opinion of Koshal, J. Kailasam, J. gave a dissenting Opinion.
JASWANT SINGH, J.
I have had the advantage of going through the judgments prepared by my esteemed Brothers Kailasam and Koshal.
While I find myself unable to agree with the view expressed by my learned Brother Kailasam, I am inclined to agree with the opinion of and the conclusion arrived at by my learned brother Koshal.
KAILASAM, J.
This appeal is filed by special leave by Kamlapati Trivedi against the judgment of the Calcutta High Court in Criminal Revision No. 1006 of 1970 by which it refused to quash the proceedings which were taken cognizance of by the Magistrate, on a complaint given by one Satya Narayan Pathak.
Satya Narayan Pathak is the Secretary of Bhartiya Primary School in Howrah.
The appellant before us, Kamlapati Trivedi, was a Head Teacher of the Bhartiya Primary School.
On 18th April, 1970 Satya Narayan Pathak served a Notice on the appellant calling upon him to show cause why he should not be found guilty of negligence of duty.
On receipt of the Notice, the appellant attempted to remove certain records from the school but he was prevented.
On the same day, that is, on 18th April, 1970 the appellant complained in writing to the Officer In charge of Bally Police Station, Howrah at 21.40 hours that Satya Narayan Pathak and others criminally trespassed, assaulted and abused him in filthy language and committed theft of money and valuable documents of the school.
The Police treating the complaint of the appellant as First Information Report took cognizance of an offence under Sections 147, 448 and 722 379 I.P.C. and registered it.
A warrant of arrest was issued against Satya Narayan Pathak and others.
Satya Narayan Pathak attended the Court on 21 5 1970 and 21 7 1970 the dates fixed for submission of the Police report.
The Police Officer who investigated the case on finding no evidence against Satya Narayan Pathak and others, named as accused, submitted a final report and the magistrate agreeing with the report discharged all the accused.
As Satya Narayan Pathak felt that the appellant instituted criminal proceedings with intent to cause injury to him and others, for offences under Sections 147, 448 and 379 knowing that there was no just or lawful ground and had caused pecuniary loss and agony to him, he preferred a complaint against the appellant for offences under Sections 211 and 182 of the I.P.C. on 20th October, 1970.
The learned Magistrate took cognizance of the case and summoned the appellant under Section 211 of the Indian Penal Code.
fixing 10th December, 1970 for appearance of the appellant.
On 16th November, 1970 the appellant appeared in court and was released on bail.
The appellant moved the High Court of Calcutta for quashing the proceeding of the Magistrate on the ground that the cognizance taken by the Magistrate was bad and without jurisdiction for non compliance of the provisions of Section 195(1) (b) of Criminal Procedure Code.
The learned Judge refused to quash the proceedings and discharge the accused, by judgment dated 18th August, 1971.
Against the order of the Single Judge of the High Court, the present appeal to this Court has been filed.
The main ground of attack in this appeal is that the High Court failed to appreciate the meaning of the words "in relation to any proceedings in any court" in Section 195 (1) (b) of the Code of Criminal Procedure.
It is submitted that when a final report was submitted by the Police under Section 173 of Criminal Procedure Code and the Magistrate passed an order it would be a judicial order and the bar under Section 195 (1) (b) would be attracted.
The question that arises for consideration is whether on the facts of the case the bar against taking cognizance in Section 195(1)(b) is attracted.
Section 195(1)(b) so far as it is relevant for the purpose of this case may be extracted: "195(1) No court shall take cognizance (a) . . . (b) of any offence punishable under any of the following sections of the same Code, namely, sections 723 193, 194, 196, 195, 199, 200, 205, 206, 207, 208, 209, 210, 211 and 228, when such offence is alleged to have been committed in, or in relation to, any proceeding in any Court, except on the complaint in writing of such Court or of some other Court to which such Court is subordinate; or (c) . . . (2) In clauses (b) and (c) of sub section (1), the term "Court" (includes) Civil, Revenue or Criminal Court, but does not include a Registrar or Sub Registrar under the Indian Registration Act, 1877.
While Section 190 of the Criminal Procedure Code enumerates the conditions requisite for initiation of proceedings, Section 195 bars taking cognizance of certain offences except on complaint by authorities specified in the Section.
Section 195(1) (a) requires that the complaint should be by a public servant if the offences complained of are under Sections 172 to 188 of the Indian Penal Code.
Sub section (1)(b) refers to offences under Sections 193, 194, 195, 196, 199, 200, 205, 206, 207, 208, 209, 210, 211 and 228 and requires the complaint in writing of the Court before whom the offence is alleged to have been committed in or in relation to any proceeding in any Court.
Sub section (c) relates to offences under Sections 463, 471, 475 or 476 when the offence is committed by a party to any proceeding in any Court in respect of a document produced or given in evidence in such proceeding a complaint in writing by the court is required.
Sections 172 to 190 of the Indian Penal Code deal with offences constituting contempt of lawful authority of public servants.
The bar to taking cognizance of offences under Sections 172 to 188 except on a complaint by the public servant is laid down in Section 195(1) (a) of the Code of Criminal Procedure.
Chapter XI, of the Indian Penal Code relates to false evidence and offences against public justice.
The cases of offence such as under Section 463, 471, 475 or 476 alleged to have been committed by a party in a proceeding in any court in respect of a document produced or given in evidence in such proceeding, the complaint in writing of such court is required.
The policy behind the bar for institution of criminal proceedings by a private party is that when offences are committed against lawful authority or false evidence is given or offence committed against public justice, it should be the concerned authority that should prefer a complaint and no one else.
724 In this appeal we are concerned with the question whether the offence under Section 211 I.P.C. is "committed in or in relation to any proceeding in any court".
Before I deal with the question whether the offence is committed in or in relation to any proceeding in any court, I have determined the meaning of the word 'court ' for the purpose of this Section.
Sub section (2) to Section 195 states that in clauses (b) and (c) of sub section (1), the term "Court includes a Civil, Revenue or Criminal Court, but does not include a Registrar or Sub Registrar under the Indian Registration Act, 1877.
It may be noted that the word 'includes ' was introduced by an amendment to sub clause (b) Act 18 of 1923 instead of the word "means".
In the Criminal Procedure Code 1974 the word 'means ' has been introduced in the place of 'includes '.
To some extent the use of the word 'includes ' may widen the scope of the definition.
In Halsbury 's Laws of England, third edition, volume 9 at page 342, the meaning of court is given.
At page 343 it is stated: "many bodies are not courts, although they have to decide questions, and in so doing have to act judicially in the sense that the proceedings must be conducted with fairness and impartiality".
Lord Sankley in Shell Co. of Australia Ltd. vs Federal Commissioner of Taxation has enumerated some negative propositions as to when a Tribunal is not a court.
The learned Judge observed "The authorities are clear to show that there are Tribunals with many of the trappings of a court which nevertheless are not courts in the strict sense of exercising judicial power".
In enumerating the propositions Lord Sankey observed: "In that connection it may be useful to enumerate some negative propositions on this subject: (1) A tribunal is not necessarily a Court in this strict sense because it gives a final decision.
(2) Nor because it hears witnesses on oath.
(3) Nor because two or more contending parties appear before it between whom it has to decide.
(4) Nor because it gives decisions which affect the rights of subjects.
(5) Nor because there is an appeal to a Court.
(6) Nor because it is a body to which a matter is referred by another body".
In enumerating the negative propositions the learned Judge relied on the decision in Rex.
vs Electricity Commissioners.
In Shri Virinder Kumar Satyawadi vs The State of Punjab.
Venkatarama Ayyar, J. speaking for this Court quoted with approval the decision in Shell Co. of Australia (supra) and observed that the dis 725 tinction between Courts and tribunals exercising quasi judicial functions is well established, though whether an authority constituted by a particular enactment falls within one category or the other may, on the provisions of that enactment, be open to argument.
After referring to the various decisions, the learned Judge observed "it may be stated broadly that what distinguishes a Court from a quasi judicial tribunal is that it is charged with a duty to decide disputes in a judicial manner and declare the rights of parties in a definitive judgment.
To decide in a judicial manner involves that the parties are entitled as a matter of right to be heard in support of their claim and to adduce evidence in proof of it.
It also imparts an obligation on the part of the authority to decide the matter on a consideration of the evidence adduced and in accordance with law.
This view was accepted by the Supreme Court in Smt.
Ujjam Bai vs State of Uttar Pradesh where Justice Hidayatullah observed that though the taxing authorities follow a pattern of action which is considered judicial, they are not converted into courts of civil judicature and they still remain instrumentalities of the State and are within the definition of the State.
The answer to the question as to what is 'court ' in the Criminal Procedure Code is not free from difficulty for in many places the word Magistrate as well as court is used in identical situations.
Section 6 of the Criminal Procedure Code states that besides the High Courts and the Courts constituted under any law other than this Code for the time being in force there should be five classes of Criminal Courts in India, namely: (i) Courts of Sessions; (ii) Presidency Magistrate, (iii) Magistrates of the first class (iv) Magistrates of the second class, (v) Magistrates of the third class.
Criminal courts according to this section therefore, consist of courts specified besides the High Court and courts that are constituted under any other law other than Criminal Procedure Code.
The Code of Criminal Procedure provides not merely judicial enquiry into or trial of alleged offences but also for prior investigation thereof.
Section 5 of the Code provides that all offences under Indian Penal Code shall be investigated, inquired into and tried and otherwise dealt with in accordance with the provisions hereinafter contained.
For the purposes of investigation offences are divided into two categories 'cognizable ' and non cognizable.
When information of the commission of a cognizable offence is received or such commission is suspected, the appropriate police officer has the authority to enter on investigation.
726 In case of non cognizable offence the officer shall not investigate without the order of a competent Magistrate.
According to scheme of the Code investigation is preliminary to a case being put up for trial for a cognizable offence.
Investigation starts on an information relating to commission of an offence given to an officer in charge of Police Station and recorded under Section 154 of the Code.
Investigation consists generally of various steps, namely proceeding to the spot ascertainment of facts and circumstances of the case, discovery and arrest of suspected offender, collection of evidence relating to the commission of the offence which may consist of examination of various persons including the accused, and the reduction of the statement into writing such as places and seizure of things and formation of opinion as to whether on material collected there is a case to place the accused before the Magistrate for trial and filing of the charge sheet under Section 173 of the Criminal Procedure Code.
After the investigation is completed and a chargesheet is filed under Section 173 of the Criminal Procedure Code the question of taking cognizance arises.
Section 190 of the Criminal Procedure Code lays down conditions necessary for initiation of proceedings.
It provides for that any Presidency Magistrate, District Magistrate or Sub Divisional Magistrate or any other Magistrate specially empowered in this behalf may take cognizance of any offence.
(a) upon receiving a complaint of facts which constitute such offence; (b) upon a report in writing of such facts made by any police officer; and (c) upon information received from any person other than a police officer or upon his own knowledge or suspicion, that such offence has been committed.
One mode of taking cognizance by the Magistrate is upon a report in writing of such facts made by any police officer.
This stage is reached when the police officer submits a report under Section 173.
When the Police Officer upon investigation forms an opinion that there is sufficient evidence or reasonable ground he shall forward the case to the Magistrate empowered to take cognizance of the offence upon a Police report.
Under Section 190 of the Criminal Procedure Code, if the Magistrate to whom the report is sent by the Police Officer, agrees with the opinion of the police officer, he proceeds to take cognizance, and issues process under Section 204.
The judicial opinion is unanimous that when once Magistrate taking cognizance of an offence finds that there is sufficient ground for proceeding and issues 727 summons or a warrant as the case may be, he takes cognizance, and the trial begins, and further proceedings will be undoubtedly before a criminal court.
In Jamuna Singh and others vs Bhadai Sah, Das Gupta, J. observed "The Code does not contain any definition of the words 'institution of a case '.
It is clear, however, and indeed not disputed, that a case can be said to be instituted in a court only when the court takes cognizance of the offence alleged therein.
" When once this stage is reached the requirement of Section 211 of the Indian Penal Code "institutes or causes to be instituted any criminal proceeding" is satisfied.
The second part of Section 211 I.P.C. refers to falsely charging a person with having committed an offence.
A person falsely charging another of a cognizable offence before a police officer will come within the mischief of the second part of the Section.
The crucial question that arises in this case is whether it can be said that when a person falsely charges another person of a cognizable offence before a Police Officer and when the Police Officer upon investigation finds that there is no sufficient evidence or reasonable ground for suspicion to justify the forwarding of the accused to the Magistrate under Section 169 and the Magistrate agrees with him, an offence under Section 211 is committed in or in relation of any proceeding in any court '.
It is settled law that when a Magistrate applies his mind under Chapter XVI that is on complaints, he must be held to have taken cognizance of the offence mentioned in the complaint but when he applies his mind not for such purpose but for purpose of ordering investigation under Section 156 (3) or issues a search warrant for the purpose of investigation, he cannot be said to have taken cognizance of any offence vide R. R. Chari vs State of U.P. and in Gopal Das vs State of Assam.
When the Magistrate receives a report under Section 169 of the Criminal Procedure Code that there is not sufficient evidence or reasonable ground for suspicion and agrees with it, he may be doing so in exercise of his judicial function but the question is whether he is acting as a court.
In Abhinandan Jha & Ors.
vs Dinesh Mishra this Court has pointed out the difference between the report by the police filed under Section 170 of the Criminal Procedure Code which is referred to as a charge sheet and a report sent under Section 169 which is termed variously in different States as either 'referred charge ', 'final report ' or 728 summary.
This court observed that when the police submitted a report that no case has been made out for sending up accused for trial it is not open to the Magistrate to direct the police officer to file a chargesheet.
In such circumstances the Magistrate is not powerless as it is open to him to take cognizance of an offence on the report submitted by the Police under Section 190(1)(c) of the Criminal Procedure Code.
Dealing with the position of the Magistrate when a report is submitted by the police that no case is made out for sending a case for trial the court observed that it is open to the magistrate to agree with the report and close the proceedings.
Equally it will be open to the Magistrate if he takes a different view to give directions to the police under Section 163(1) to make further investigations.
After receiving a report from the police on further investigation if the Magistrate forms an opinion on the fact that it constitutes an offence he may take cognizance of an offence under Section 190(1) (c) notwithstanding the opinion of the police expressed in final report.
This court held in conclusion that there is no power expressly or impliedly conferred on the Magistrate under the Code to call upon the police to submit a charge sheet when they have sent a report under Section 169 of the Code that there is no case made out for sending the case for trial.
The same view is expressed in the decision in Kamla Prasad Singh vs Hari Nath Singh and another.
In R. N. Chatterji vs Havildar Kuer Singh, A. N. Ray J. as he then was, followed the decision in Abhinandan Jha & Ors.
vs Dinesh Mishra (supra) and held that the provisions of the Criminal Procedure Code do not empower the Magistrate to direct the police officer to submit a charge sheet but if he is of the opinion that the repot submitted by the police requires further investigation, the Magistrate may order investigation, under Section 163 of the Criminal Procedure Code.
It was held that directing further enquiry is entirely different from asking police to submit a charge sheet.
The only source open for the Magistrate if he is not satisfied with the police report under Section 169 is to take cognizance of an offence under Section 190(1) (c) of the Criminal Procedure Code.
It may be noted that in M. L. Sethi vs R. P. Kapur & Anr., it was held that if the Magistrate disagrees with the opinion of the police he may proceed to take cognizance on the facts stated in the police under Section 190(1) (b).
It is clear that when a Magistrate applies his mind to the contents of a complaint before him for the purpose of proceeding under Section 729 200 and the other provisions of the Code following it, he is taking cognizance of an offence as held by five judges Bench decision of this Court in Mowu vs The Superintendent, Special Jail, Nowgong, Assam and Others.
The position regarding the case in which Magistrate accepts a report under Section 169 Criminal Procedure Code is different.
On an analysis of the various sections, it appears that a report under Section 169 of the Cr. P. C. and the magistrate agreeing with it, are proceedings under Chapter XIV which relates to information to the police and their power to investigate.
The Chapter provides for supervision by the Magistrates of the investigation by the police.
It has been laid down that Magistrate has no option except to agree with the report of the Police Officer unless he proceeds to take cognizance of the offence under Section 190(1) (c).
Though the Magistrate in deciding whether to accept the report or not may be exercising his judicial mind, it cannot be said that he is acting as a court.
The Magistrate acting at this stage cannot be said to fulfil the positive requirements enumerated by Venkatarama Ayyar, J. in Shri Virinder Kumar Satvawadi vs The State of Punjab (supra).
To be classified as court it must be charged with a duty to decide disputes in a judicial manner and declare the rights of parties in a definitive judgment and to decide in a judicial manner.
It involves that the parties are entitled as a matter of right to be heard in support of their claim and to adduce evidence in proof of it and an obligation on the part of the authority to decide the matter on a consideration of the evidence adduced and in accordance with law.
As pointed out by Lord Sankey in Shell Co. case (supra) though there may be some of the trappings of the court the magistrate at this stage cannot be termed as a court within the provisions of Section 195(2) Cr.
The magistrate may decide the question finally which may affect parties but that is not enough.
Even when a tribunal bears witnesses on oath and decides rights of parties and a right of appeal is provided, it may not, as observed by Lord Sankey, become a court.
Most of requirements of a court are lacking when the Magistrate agrees with the report of the police officer under Section 169.
At this stage the rights of the parties are not finally decided as the complainant is entitled to file a complaint directly to the Magistrate.
The persons accused are not before the Magistrate and neither the complainant nor the accused are entitled to be heard or to adduce evidence before the Magistrate at this stage.
It cannot be said that the Magistrate has a duty to decide the matter on a consideration of the evidence adduced before him.
730 Taking into account the scheme of the Criminal Procedure Code, the function of the Magistrate in agreeing with a report under Section 169 can only be said to be in the course of investigation by the police.
In Chapter XIV which relates to information to the police and their powers to investigate, the Magistrate having jurisdiction over the area and empowered to take cognizance is given certain supervisory powers.
Thus the Police Officer incharge of Police Station is required to refer the informant to the Magistrate when information as to a non cognizable offence is received by him.
The Police Officer shall not investigate a non cognizable case without the orders of the Magistrate though the Police Officer is entitled to investigate a cognizable offence without the order of the Magistrate.
The Magistrate under Section 190 is entitled to order an investigation into a cognizable offence.
Section 157 Cr.
P.C. requires the officer incharge of the Police Station to send a report to the Magistrate empowered to take cognizance of the offence of which he has received information.
Under Section 159 Crl.
P.C. the Magistrate receiving a report under Section 157 may proceed or depute any magistrate subordinate to him to proceed to hold a preliminary inquiry into the case.
Section 164 empowers Presidency Magistrate or any Magistrate of first class or any Magistrate of second class specially empowered by the State Government to record a statement or confession made to him in the course of an investigation under this Chapter.
When a search is conducted by a Police Officer, he is required to send copies of the record to the nearest Magistrate empowered to take cognizance.
Section 167 of the Crl.
P.C. requires that when investigation cannot be completed within 24 hours and when there are grounds of believing that the accusation or information is well founded, the Officer incharge of the Police Station shall transmit to the nearest Magistrate the copy of the entries in the diary relating to the case and forward the accused to such Magistrate.
The Magistrate to whom the accused is forwarded is empowered to authorise the detention of the accused in such custody as he thinks fit for a term not exceeding 15 days.
If the period is to exceed 15 days he is required to forward the accused to the Magistrate having jurisdiction.
When an investigation is completed and when the Police Officer is of the opinion that there is sufficient evidence, he shall forward the accused to the Magistrate along with his report.
The final report of the Police Officer is to be submitted under Section 173.
It may be noticed that Section 169 does not require the Police Officer to send a report as he is required under Section 170 when he is of the opinion that there is no sufficient evidence or reasonable ground of suspicion to justify the forwarding of the accused to the Magistrate.
The only precaution he has to take is to take steps to ensure the appearance of 731 the accused in the event of the Magistrate empowered to take cognizance wants his presence.
A perusal of the various Sections under Chapter XIV shows that the Magistrate is associated with the investigation by the Police in a supervisory capacity.
It has been laid down that when the Magistrate applies his mind for ordering an investigation under Section 156(3) of the Cr.
P.C. or for issue of a search warrant for the purpose of investigation, he cannot be said to have taken cognizance of the offence.
The Magistrate during this stage functions as a Magistrate during investigation.
As the trial has yet to commence it cannot be said that he is acting as a court.
Before leaving this aspect of the case I would refer to some of the decisions which were cited before us on this point.
Strong reliance was placed by the learned counsel for the appellant on a decision in J. D. Boywalla vs Sorab Rustomji Engineer.
Boywalla, the appellant in the case, lodged a complaint with the police against the respondent Sorab Rustomji Engineer for cheating in respect of three rupees.
The police after investigation submitted a report stating that no offence has been disclosed against him with a request that he may be discharged and his bail bond cancelled.
On receipt of the report the Magistrate discharged the accused and cancelled the bail bond.
Sorab Rustomji Engineer, against whom the complaint was filed, filed a case under Section 211 of the I.P.C. alleging that the appellant Boywalla instituted criminal proceedings against him knowing that there is no just or lawful ground for such proceedings.
The appellant contended that it is the Magistrate that can lodge a complaint under Section 195 (b) of the Cr.
P.C. and that no court shall take cognizance of the offence punishable under Section 211 of the I.P.C. when such offence is alleged to have been committed in or in relation to any proceeding to a court except on a complaint in writing of such court.
John Beaumont Chief Justice held that in doing what he had done the Magistrate had taken cognizance of the case and therefore under Section 195(b) Cr.
P.C. it was the Magistrate alone who could lodge a complaint.
Two reasons were given by the Chief Justice.
The second ground with which we are concerned at the moment deals as to the capacity in which Magistrate acted when he accepted the police report under Section 169 and discharged the accused.
The Chief Justice expressed that after considering the report if the Magistrate thinks that there is no sufficient ground of proceeding he may discharge the accused and though the Code does not expressly provide there can be no doubt that when the Magistrate can act upon the report of the 732 police officer and discharge an accused person without further inquiry only by acting in his judicial capacity which should be open to review by the High Court.
The learned Chief Justice proceeded on the basis that before a magistrate passed orders on the report of the police under Section 169 he should take cognizance of the offence.
The Chief Justice thus took the view that (1) the Magistrate before discharging the accused in pursuance of a police report under Section 169 takes cognizance and (2) acts in his judicial capacity.
While there could be no doubt that the magistrate is acting judicially, I am unable to hold that before a magistrate discharges an accused agreeing with the report of the police under Section 169 Cr.
P.C., he takes cognizance.
This Court has held that the stage of laking cognizance arises only when he acts under Section 190(1) (b).
Further this Court has taken the view that if the magistrate does not agree with a police report under Section 169 Cr.
P.C., he can only proceed under Section 190(1)(c).
The facts of the case were the accused was arrested and later after the order of discharge the bail bond was cancelled.
The circumstances of the arrest of the accused his being released on bail during investigation and his discharge after the police report were the reasons for the learned Chief Justice coming to the conclusion that the Magistrate was acting in a judicial capacity.
The learned Judge observed "indeed it is a novelty to me to hear it suggested that there is any authority which can make an administrative order discharging the arrested person from judicial capacity".
But as he has pointed out acting in a judicial capacity alone is not enough.
The Supreme Court in M. L. Sethi 's case (supra) expressed its dissent from the view taken in Ghulam Rasul vs Emperor where the learned Judge held that a complaint by criminal court is necessary when a false report is made in an investigation by the police.
The facts of the case are that Ghulam Rasul made a report to the police that a certain person stole his watch from his car.
On investigation the police came to the conclusion that the report was false and that the watch had been removed by the petitioner himself.
The case was reported to the Magistrate for cancellation.
A complaint was given against Ghulam Rasul for offence under Sections 193 and 211 I.P.C. and the Magistrate took cognizance and recorded the evidence of the prosecution witnesses and framed charge against him.
Accepting the contention on behalf of Ghulam Rasul the High Court held that in view of section 195(1) (b), Criminal Procedure Code, the Magistrate 's taking cognizance of the offence was illegal.
The Court observed: "I am clear that the words in this sub section 'in relation to any proceeding in any court ' apply to this case of a false report or a false 733 statement made in an investigation by the police with the intention that there shall in consequence of this, be a trial in the Criminal Court".
The facts of the case show that a report under Section 169, Criminal Procedure Code was submitted by the police for cancellation and the Magistrate dropped further proceedings.
The Supreme Court referring to the view of the High Court observed: "He appears to have held the view that the Magistrate having passed an order of cancellation, it was necessary that the complaint should be filed by the Magistrate, because section 195(1)(b) had become inapplicable.
If the learned Judge intended to say that without any proceeding being taken by the Magistrate in the case which was investigated by the police it was still essential that a complaint should be filed by the Magistrate simply because a subsequent proceeding following the police investigation was contemplated we consider that his decision cannot be accepted as correct".
This decision makes it clear that even though the Magistrate passed an order of cancellation on the report by the police under section 169 if the Magistrate has not taken any proceeding, a complaint by the Magistrate is not necessary.
The decision of the Supreme Court covers the facts of the present case so far as the discharge of the accused on a police report under section 169, Criminal Procedure Code, is concerned.
Referring to the Bombay decision, the Supreme Court observed that "the decision of the Bombay High Court in J. D. Roywalla vs Sorab Rustomji Engineer (supra) is also inapplicable because in that case also orders were passed by a Magistrate on the final report made by the police after investigation of the facts in the report, in respect of which complaint under section 211 I.P.C. was filed".
In Sethi 's case (supra) at the stage when the complaint was filed by the respondent under Section 211 I.P.C., the police were enquiring into the appellant 's report.
When there is no proceeding pending before any court at the time when the applicability of section 195(1) (b) is to be determined, a complaint by the court is not necessary.
The decision in Bombay case is therefore not applicable to the facts in Sethi 's case as in the Bombay case orders were passed by the magistrate on the final report of the police.
There is a conflict between various High Courts as to whether a complaint is necessary when on a police report under Section 169 the Magistrate does not take any further action.
The Bombay, Saurashtra and Andhra Pradesh High Courts in 1946 Bombay 7(11), 1952 Saurashtra 67(68) and (287) have held that a Magistrate passing an order on a final report of police under Section 173 referring the case as false should be deemed to be a Court passing a judicial order disposing of the information to the police, and 734 that in such a case, the complaint of the Magistrate is necessary for the prosecution of the informant under Section 211 of the I.P.C. The Madras, Calcutta and Allahabad High Courts in A.I.R. 1934 Madras 175, A.I.R. 1948 Allahabad 184 Full Bench and A.I.R. 1916 Calcutta 593 following 1921 Patna 302 and 1917 Calcutta 593 have held the other view.
For the reasons already stated I hold that when no further proceedings are taken by the Magistrate on receipt of a police report under Section 169 there is no proceeding in or in relation to any court and, therefore, no complaint by the court is necessary.
The next question which arises in this case is that whether a complaint by the court is necessary because of the arrest and release on bail of the accused Satya Narayan Pathak in consequence of the complaint given by the appellant.
The police after taking cognizance of the complaint by Kamlapati Trivedi, the appellant in this case, took cognizance under Sections 147, 448 and 379 I.P.C., registered a case and issued a warrant of arrest against Satya Narayan Pathak and five others.
They all surrendered in court on 6 5 1970 and were released on bail on a bond of Rs. 200/ each.
They attended court on 21 5 1970 and 21 7 1970 when the police report was expected to be filed.
The High Court found that there was a police investigation and during investigation Satya Narayan Pathak surrendered before the Magistrate who released him on bail and police submitted a final report and the Magistrate discharged him from his bail bond.
On this evidence the High Court came to the conclusion that the proceedings before the court become a criminal proceeding only when the court takes cognizance and not before.
On these facts the question arises whether the proceedings when the accused were released on bail and later after the receipt of the report from the police they were discharged, would be in or in relation to a court.
It was submitted that when in pursuance of a complaint the accused was arrested and remand and bail proceedings were subsequently taken before a Magistrate in connection with the report to the police, they were proceedings in court and a complaint by the court was necessary.
In support of the proposition a decision in Badri vs State was relied upon.
In that case the Allahabad High Court held that an offence under section 211, Indian Penal Code, alleged to have been committed by the appellant by making a false report against the complainant and others to the police, was an offence in relation to the remand proceedings and the bail proceedings because those proceedings were a direct consequence of the making of the report and the subsequent arrest and, therefore, the case is governed by section 195(1)(b) of Code of 735 Criminal Procedure.
The Supreme Court in Sethi 's case (supra) at page 538 did not consider it necessary to express any opinion whether remand and bail proceedings before the Magistrate can be held to be proceedings in a court nor did they consider the question whether the charge of making a false report could be rightly held to be in relation to these proceedings.
The position, therefore, is the question whether remand and bail proceedings before the Magistrate in pursuance of information given to the police of a cognizable offence are proceedings in or in relation to a court is left open.
To determine whether the remand or bail proceedings are proceedings in a court it is useful to refer again to Chapter XIV of the Criminal Procedure Code.
On a complaint by an informant relating to a commission of a cognizable offence the investigation starts.
The information may not be against any person.
When an investigation cannot be completed in 24 hours after the arrest of the accused and when the officer is of the view that there are grounds for believing that the accusation or information is well founded the officer is required to transmit to the nearest Magistrate a copy of the entries in the diary and to forward the accused to the Magistrate.
When the accused is produced the Magistrate is required to act under Section 167(2) of the Criminal Procedure Code.
The Magistrate to whom the accused is produced can from time to time authorise detention of accused in such custody as such Magistrate thinks fit for a term not exceeding 15 days in whole.
If he has not the jurisdiction to try the case or commit it for trial but considers further detention is necessary, he may order the accused to be forwarded to a Magistrate having jurisdiction.
We have seen that in investigation by the police the Magistrate is associated in a supervisory capacity.
The action taken by the Magistrate cannot be taken to be that of a court for the Magistrate who has no jurisdiction to try the case has a limited power.
Even the Magistrate who has jurisdiction to try the accused when acting under the Section is not acting as a court for the words used are the Magistrate having jurisdiction.
The trial commences only after the offence has been taken cognizance of.
The proceedings under Section 167, is during investigation.
But it has to be noted that when the bail and remand proceedings are before the Magistrate, he has to act judicially.
If the accused applies for bail the Magistrate has to act judicially and take into account the facts of the case before he decides to release the accused on bail or refuse bail.
Chapter XXXIII Cr.
P. C. deals with bail.
Section 496 provides as to when bail may be taken of non bailable offences.
The provisions of Sections 496 and 497 speak of an accused person in custody charged with a non bailable offence 736 being produced before court at any stage of the proceedings.
The Section deals with the exercise of the power of a court at any stage of proceedings when the accused is brought before a court while in the custody of the police officer.
According to the wording of Section, the bail proceedings would be before a court even though the accused is produced while in custody of a police officer.
Even though the word 'court ' is used in Sections 496 and 497, we have to consider whether proceedings can be said to be taken before a court as defined in Section 195(2) of Cr. P. C.
In deciding the question we have to bear in mind the restricted meaning given to the word in the observations of Lord Sankey in Shell Company 's case reported in Shell Co. of Australia Ltd. vs Federal Commissioner of Taxation (supra) and the tests laid down by Venkatarama Ayyar, J. in Shri Virinder Kumar Satyawadi vs The State of Punjab and Hidayatullah, J. in Smt.
Ujjam Bai vs State of Uttar Pradesh (supra).
Though there may be some trappings of a court and the section itself mentions the word 'court ', I feel that the requirements for being a court for the purpose of Section 195(2) have not been satisfied.
The intention of the legislature in prescribing a bar when an offence under Chapter XI of I.P.C. is committed, that is, when false evidence is given or offence against public justice is committed is that the court should decide whether a complaint should be given for an offence committed before it and if satisfied should prefer the complaint itself.
Before a court gives a complaint, it will have to satisfy itself that a prima facie case is made out and that it is in the interest of justice that a complaint should be lodged.
The purpose, therefore, is that a private party should not be permitted to make a complaint regarding offences committed in or in relation to court proceedings.
In an investigation by the police the complainant is only in the background.
He might not have mentioned the name of any person as being involved in the crime.
Taking all the circumstances into account, I am, in the absence of the complainant, unable to hold that remand and bail proceedings before cognizance of the offence is taken could be held to be proceedings before a court bearing in mind the restricted meaning given to the word 'court '.
The second question is whether the charge of making of the false report could be rightly held to be in relation to proceedings in court.
When an information is given of a commission of a cognizable offence, the police register a case and start investigation.
For facilitating the investigation provision for remand is provided for.
If the investigation is not completed within 24 hours the police may ask for further remand and the court may grant according to provisions of section 167 of 737 Criminal Procedure Code.
At this stage though the remand and bail proceedings arise as a consequence of complaint given, it cannot be said that it is the direct result of a false report to a court for no one might have been mentioned in the complaint as a suspect.
Further, it will be seen that the complainant is not entitled to appear in court and oppose grant of bail.
The court dealing with the remand or bail proceedings cannot be said to fulfil the conditions laid down by Venkatarama Ayyar as the parties are not entitled as a matter of right to be heard in support of their claim and adduce evidence in proof of it.
The Magistrate dealing with remand proceedings or a bail petition does not hear the complainant.
He acts on the material that is placed before him by the police during investigation.
The complainant has no opportunity of substantiating or presenting his case before the Magistrate at this stage.
If the action of the Magistrate in agreeing with the report under section 169 Cr. P.C. and the proceedings taken during investigation by way of remand or bail are understood to be proceedings in or in relation to court a complaint may be preferred by the Magistrate without giving an opportunity to the complainant to satisfy the Magistrate about the truth of his case.
In this connection, it is useful to refer to section 476 of the Cr. P. C.
The section provides that when any Civil, Revenue or Criminal Court is, whether on application made to it in this behalf or otherwise, of opinion that it is expedient in the interests of justice that an inquiry should be made into any offence referred to in section 195, sub section (1), clause (b) or clause (c), which appears to have been committed in or in relation to a proceeding in that Court, such Court may, after such preliminary inquiry, if any, as it thinks necessary, record a finding to that effect and make a complaint thereof in writing signed by the presiding officer of the Court, and shall forward the same to a Magistrate of the first class having jurisdiction.
Before making a complaint a preliminary inquiry is contemplated.
Normally, it would mean that the person against whom a complaint is preferred has an opportunity to show why a complaint should not be preferred against him.
These stages are not reached in a case when the Magistrate has still to take cognizance of an offence.
The restricted meaning given to the Code in section 195(2) Cr.
P.C. read along with the conditions to be specified before a complaint is preferred by the court, inclines me to hold that the proceedings before a Magistrate in which he agrees with the report by the police under section 169, Criminal Procedure Code, and the proceedings in remand or bail applications during investigation will not amount to proceedings in or in relation to court.
738 In the result I agree with the High Court that there was no proceeding in or in relation to a court, and, therefore, section 195(1)(b) of Criminal Procedure Code is not attracted.
The appeal is dismissed.
KOSHAL, J. I have had the advantage of going through the judgment prepared by my learned brother, Kailasam, J. Having given it my best consideration, I regret that I have to differ with him.
The facts giving rise to this appeal lie in a narrow compass and may be stated in brief.
The appellant before us is one Kamlapati Trivedi (hereinafter called Trivedi) on whose complaint a case was registered under sections 147, 448 and 379 of the Indian Penal Code at the Bally Police Station on the 18th April, 1970 against six persons including one Satyanarayan Pathak (called Pathak hereinafter).
Warrants were issued for the arrest of the accused, all of whom surrendered on the 6th of May, 1970 in the Court of the Sub Divisional Judicial Magistrate, Howrah (referred to later herein as SDJM) who who was the magistrate having jurisdiction and who passed an order releasing them on bail.
The police held an investigation culminating in a report dated the 25th of July, 1970 which was submitted to the SDJM under section 173 of the Code of Criminal Procedure, 1898 (the Code, for short).
The contents of the report made out the complaint to be false and included a prayer that the accused "may be released from the charge".
On the 31st of July, 1970 the SDJM, agreeing with the report, passed an order discharging the accused.
On the 20th of October, 1970 Pathak filed a complaint before the SDJM accusing Trivedi of the commission of offences under sections 211 and 182 of the Indian Penal Code by reason of the latter having lodged with the police the false complaint dated the 18th of April, 1970.
Trivedi appeared in the Court of the SDJM on the 16th of November, 1970 in response to a summons issued by the latter only in respect of an offence under section 211 of the Indian Penal Code and was allowed a fortnight to furnish security while the case itself was adjourned to the 10th of December, 1970.
It was then that Trivedi presented a petition dated the 23rd December, 1970 to the High Court at Calcutta praying that the proceedings pending against him before the SDJM be quashed inasmuch as the latter was debarred from taking cognizance of the offence under section 211 of the Indian Penal Code in the absence of a complaint in writing of the SDJM himself in view of the provisions of clause (b) of sub section (1) of section 195 of the Code.
Sub sections (1) and (2) of that section may be reproduced here for ready reference: 739 195.
(1) No Court shall take cognizance (a) of any offence punishable under sections 172 to 188 of the Indian Penal Code, except on the complaint in writing of the public servant concerned, or of some other public servant to whom he is subordinate; (b) of any offence punishable under any of the following sections of the same Code, namely, sections 193, 194, 195, 196, 199, 200, 205, 206, 207, 208, 209, 210, 211 and 228, when such offence is alleged to have been committed in, or in relation to, any proceeding in any Court, except on the complaint in writing of such Court or of some other Court to which such Court is sub ordinate; or (c) of any offence described in section 463 or punishable under section 471, section 475 or section 476 of the same Code, when such offence is alleged to have been committed by a party to any proceeding in any Court in respect of a document produced or given in evidence in such proceeding, except on the complaint in writing of such Court, or of some other Court to which such Court is subordinate.
(2) In clauses (b) and (c) of sub section (1), the term "Court" includes a Civil, Revenue, or Criminal Court, but does not include a Registrar or sub Registrar under the Indian Registration Act, 1977.
" It was argued before the High Court that part of the proceedings which started with the registration of the case by the police on the 18th of April, 1970 at the instance of Trivedi and culminated in the order dated the 31st of July, 1970 discharging Pathak and his five co accused constituted proceedings before a Court, that the offence under section 211 of the Indian Penal Code attributed to Trivedi was committed in or, in any case, in relation to such part and therefore the case against Trivedi fell within the ambit of clause (b) above extracted.
The argument did not find favour with the High Court and the learned Single Judge before whom it was made rejected it with the following observations: "The police submitted a final report and so the Magistrate discharged him from his bail bond but there was no criminal proceeding before the Court against Satyanarayan.
The proceeding before the Court becomes a criminal proceeding only when a Court takes cognizance and not before.
Whatever the view of the other High Courts 740 may be, the consistent view of this High Court is that so long as cognizance is not taken it cannot be said that there was a proceeding pending in the Court in respect of that offence and since no proceeding was pending before the Court section 195 (1)(b) of the Code is not attracted.
" It is against the order of the High Court (which is dated the 18th of August, 1971) that Trivedi has instituted this appeal by special leave.
Before us the argument which was put forward on behalf of Trivedi for the consideration of the High Court has been repeated and it has been urged strenuously by his learned counsel that in so far as the SDJM passed an order on the 6th of May, 1970 releasing him on bail and then another on the 31st of July, 1970 discharging him, the SDJM acted judicially and therefore as a Court, that it cannot but be held that these orders were passed in proceedings in relation to which the offence under section 211 of the Indian Penal Code was alleged to have been committed and that consequently the SDJM had no jurisdiction to take cognizance of that offence.
The points requiring determination therefore are: (a) Whether the SDJM acted as a Court when he passed the orders dated the 6th of May, 1970 and the 31st of July, 1970 or any of them? (b) If the answer to question (a) is in the affirmative, whether the offence under section 211 of the Indian Penal Code attributed to Trivedi could be regarded as having been committed in relation to the proceedings culminating in either or both of the said orders? 5.
In finding an answer to question (a) I attach quite some importance to the provision of sections 6, 496 and 497 of the Code.
These sections are extracted below: "6.
Besides the High Court and the Courts constituted under any law other than this Code for the time being in force, there shall be five classes of Criminal Courts in India, namely: I. Courts of Session: II.
Presidency Magistrates: III.
Magistrates of the first class: IV.
Magistrates of the second class: V. Magistrates of the third class." 741 "496.
When any person other than a person accused of a 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, and is prepared at any time while in the custody of such officer or at any stage of the proceedings before such Court to give bail, such person shall be released on bail: Provided that such officer or Court, if he or it thinks fit, may, instead of taking bail from such person, discharge him on his executing a bond without sureties for his appearance as hereinafter provided : "Provided, further, that nothing in this section shall be deemed to affect the provisions of section 107, sub section (4), or section 117, sub section (3)." "497. (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, he may be released on bail, but he 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: "Provided that the Court may direct that any person under the age of sixteen years or any woman or any sick or infirm person accused of such an offence be released on bail.
(2) If it appears to such officer or Court at any stage of the investigation, inquiry or trial, as the case may be, that there are not reasonable grounds for believing that the accused has committed non bailable offence, but that there are sufficient grounds for further inquiry into his guilt, the accused shall, pending such inquiry, be released on bail, or, at the discretion of such officer or Court, on the execution by him of a bond without sureties for his appearance as hereinafter provided.
"(3) An officer or a Court releasing any person on bail under sub section (1) or sub section (2) shall record in writing his or its reason for so doing.
"(3A) If, in any case triable by a Magistrate, the trial of a person accused of any non bailable offence is not concluded within a period of sixty days from the first date fixed 742 for taking evidence in the case, such person shall, if he is in custody during the whole of the said period, be released on bail to the satisfaction of the Magistrate, unless for reasons to be recorded in writing, the Magistrate otherwise directs. "(4) If, at any time, after the conclusion of the trial of a person accused of a non bailable offence and before judgment is delivered the Court is of opinion that there are reasonable grounds for believing that the accused is not guilty of any such offence, it shall release the accused, if he is in custody, on the execution by him of a bond without sureties for his appearance to hear judgment delivered. "(5) A High Court or Court of Sessions and, in the case of a person released by itself any other Court may cause any person who has been released under this section to be arrested and may commit him to custody.
" Magistrates are specifically labelled as Courts by the statutory provisions of section 6 and therefore have to be regarded as such.
It is no doubt true that the Code assigns to a Magistrate various functions which do not fall within the sphere of judicial duties and are, on the other hand, functions of an executive nature such as the exercise of supervisory jurisdiction in relation to investigation carried out by the police or work done on the administrative side; and it may plausibly be argued that in the discharge of such functions a Magistrate does not act as a Court.
But then in my opinion a Magistrate cannot but be regarded as a Court when he acts judicially.
This follows from the provisions of section 6 itself.
The Code does not contain any provision to the effect that no functions performed by a Magistrate in relation to criminal proceedings whether handled by him or dealt with by the police would be regarded as functions performed by a Court unless they are posterior in point of time to the stage when he acts under section 190 of the Code.
On the contrary, sections 496 and 497 which embrace bail matters specifically describe a Magistrate while dealing therewith as a Court and these sections operate fully at all stages of a case including that when the investigation has just started.
There is nothing in the context in which the word `Court ' is used in these two sections and section 195 which would provide an indication that it has been used in two different senses therein, and in such a situation the legislature must be deemed to have used it in one and the same sense wherever it occurs in the Code.
While deciding the question of bail, therefore, a Magistrate must be held to be 743 acting as a Court and not in any other capacity, irrespective of the stage which the case has reached by then, that is, whether it is still under investigation by the police or has progressed to the stage of an inquiry or trial by the Magistrate.
It at once follows that the taking of cognizance of any offence by a Magistrate under section 190 of the Code is not a condition precedent for him to be regarded as a Court.
Nor do I feel that the opinions expressed by Halsbury and Lord Sankey lay down any different principle.
Those opinions appear to me to cover only cases of tribunals which perform quasi judicial functions but are not statutorily recognised as `Court '.
At page 342 of Volume 9 of Halsbury 's Laws of England (third edition) appears the following passage in Para 809 : "Originally the term "court" meant, among other meanings, the Sovereign 's palace; it has acquired the meaning of the place where justice is administered and, further, has come to mean the persons who exercise judicial functions under authority derived either immediately or mediately from the Sovereign.
All tribunals, however, are not courts, in the sense in which the term is here employed, namely, to denote such tribunals as exercise jurisdiction over persons by reason of the sanction of the law, and not merely by reason of voluntary submission to their jurisdiction.
Thus, arbitrators, committees of clubs, and the like, although they may be tribunals exercising judicial functions, are not "courts" in this sense of that term.
On the other hand, a tribunal may be a court in the strict sense of the term although the chief part of its duties is not judicial.
Parliament is a court, its duties are mainly deliberative and legislative : the judicial duties are only part of its functions.
A coroner 's court is a true court although its essential function is investigation.
" In para 810 the learned author proceeds to lay down the criteria which determine when a tribunal would be regarded as a Court.
In his opinion, the elements to be considered are : (1) the requirement for a public hearing, subject to a power to exclude the public in a proper case, and (2) a provision that a member of the tribunal shall not take part in any decision in which he is personally interested, or unless he has been present throughout the proceedings.
744 The learned author then quotes Lord Sankey 's observations in Shell Co. of Australia Ltd. vs Federal Commissioner of Taxation and then gives numerous examples of tribunals which are not regarded as Courts.
One common feature of such tribunals is that they are not described as Courts by statute and are charged with the performance of administrative or executive functions as distinguished from judicial functions.
Paragraph 812 on page 344 of the same Volume deals with the subject of creation of Courts and lays down : "Courts are created by the authority of the Sovereign as the fountain of justice.
This authority is exercised either by statute, charter, letters patent, or Order in Council.
In some cases, a court is held by prescription, as having existed from time immemorial, with the implication that there was at some time a grant of the Court by the Sovereign, which has been lost.
"An Act of Parliament is necessary to create a court which does not proceed according to the common law.
" Reference may usefully be made to Section 6 of the same Chapter in which the above paragraphs occur.
That Section is headed "Magistrates ' Courts".
The relevant part of paragraph 1041 with which the Section begins is to the following effect: "A magistrate 's court consists of a justice or justices of the peace acting under any enactment or by virtue of his or their commission or under common law (otherwise than as a court or committee of quarter sessions or a purely administrative tribunal), or of a stipendiary magistrate." The combined effect of the various paragraphs forming part of the treatise and noticed above would be that a Court may be created by a statute and that when such a Court performs judicial functions, it will be deemed to act as a Court and further, that Magistrates ' Courts are regarded as such unless performing executive or administrative functions.
That is how the position stands in England and there is nothing in the case of Shell Company of Australia Ltd. vs Federal Commissioner of Taxation (supra) which runs to the contrary.
It may be noted that in that case the question for decision was as to whether the Board of Review which had been constituted under the Australian Income Tax Assessment Act to review the decisions of the Commissioner of Taxation was or was not a Court and it was in that context that Lord Sankey expressed his opinion.
Obviously he was 745 not dealing with the functions of a tribunal which had been statutorily labelled as a Court.
What I have said of Lord Sankey 's opinion is true of the decisions of this Court in Virinder Kumar Satyawadi vs The State of Punjab and Smt.
Ujjam Bai vs State of Uttar Pradesh.
In the former the question for decision was as to whether a returning officer discharging functions under the Representation of the People Act, 1951 was a Court and in answering the same the Court referred to the case of Shell Company of Australia (supra) and other English and Australian authorities and then observed : "It is unnecessary to traverse the same ground once again.
It may be stated broadly that distinguishes a court from a quasi judicial tribunal is that it is charged with a duty to decide disputes in a judicial manner and declare the rights of parties in a definitive judgment.
To decide in a judicial manner involves that the parties are entitled as a matter of right to be heard in support of their claim and to adduce evidence in proof of it.
And it also imports an obligation on the part of the authority to decide the matter on a consideration of the evidence adduced and in accordance with law.
When a question therefore arises as to whether an authority created by an Act is a Court as distinguished from a quasi judicial tribunal, what has to be decided is whether having regard to the provisions of the Act it possesses all the attributes of a Court.
" In Ujjam Bai 's case (supra) this Court was resolving a question as to whether an officer of the income tax department was a Court and replied in the negative, broadly for the reason that even though taxing authorities follow a pattern of action which is considered judicial, they are not converted into Courts of civil judicature and that their actions are executive in nature.
Neither of these cases deals with an authority on which the status of a Court is conferred by statute, nor with one forming part of the judiciary, such as a Magistrate in whose case the opinion of this Court would surely have been different as is apparent from the judgment of Hidayatullah, J., in Ujjam Bai 's case (supra) which quotes the following passage from Gullapalli Nageswara vs State of Andhra Pradesh 746 "The concept of a quasi judicial act implies that the act is not wholly judicial, it describes only a duty cast on the executive body or authority to conform to norms of judicial procedure in performing some acts in exercise of its executive power." and then proceeds : "The taxing departments are instrumentalities of the State.
They are not a part of the Legislature; nor are they a part of the judiciary.
Their functions are the assessment and collection of taxes, and in the process of assessing taxes they have to follow a pattern of action, which is considered judicial.
They are not thereby converted into Courts of civil judicature.
They still remain the instrumentalities of the State and are within the definition of `State ' in article 12.
In this view of the matter, their actions must be regarded, in the ultimate analysis, as executive in nature, since their determinations result in the demand of tax which neither the legislature nor the judiciary can collect.
Thus, the actions of these quasi judicial bodies may be open to challenge on the ground of breach of fundamental rights.
" It is thus clear that the source of power exercised by the authority, that is, whether it is an executive power or judicial power would make all the difference in the determination of the question as to whether the authority acts as a Court or merely as a quasi judicial tribunal not functioning as a Court.
In this connection a reference may also be made to section 19 of the Indian Penal Code coupled with illustration (b) appended thereto and section 20 thereof : Section 19 : "The word "Judge" denotes not only every person who is officially designated as a Judge, but also every person.
"Who is empowered by law to give, in any legal proceeding, civil or criminal, a definitive judgment, or a judgment which, if not appealed against, would be definitive, or a judgment which if confirmed by some other authority, would be definitive, or "who is one of a body of persons, which body of persons is empowered by law to give such a judgment." 747 Illustration (b) : "A Magistrate exercising jurisdiction in respect of a charge on which he has power to sentence to fine or imprisonment, with or without appeal, is a Judge.
" Section 20 : "The words "Court of Justice" denote a Judge who is empowered by law to act judicially alone, or a body of Judges which is empowered by law to act judicially as a body, when such Judge or body of Judges is acting judicially.
" Although we are not here concerned with the terms "Judge" and "Court of Justice" properly so called, the provisions above extracted do give a definite indication of the attributes of a Court as used in criminal law generally.
It may be noted that the Code and the Indian Penal Code are the main statutes operating in India in relation to the dispensation of criminal justice and may in a sense be regarded as supplementary to each other, the Code forming the procedural link of the same chain of which the Indian Penal Code constitutes the link of substantive law.
This relation between the two enactments is further strengthened by the provisions contained in sub section (2) of section 4 (the definition clause) of the Code which runs thus : "4 (2) : Words which refer to acts done, extend also to illegal omissions; and "all words and expressions used herein and defined in the Indian Penal Code, and not hereinabove defined, shall be deemed to have the meanings respectively attributed to them by the Code.
" It is no doubt true that the expression "Court of Justice" does not appear to have been used in the Code (although the expression "Judge" does find a place in section 197 thereof), but then there is no escape from the conclusion that when a "Judge" (including a Magistrate) who is empowered to act judicially and does so act constitutes not merely a Court but a Court of Justice.
Now I proceed to examine the relevant provisions contained in Chapter XIV of the Code which carries the caption "INFORMATION TO THE POLICE AND THEIR POWERS TO INVESTIGATE".
It may be stated at once that although the Chapter is headed as stated, it is not confined to matters which are strictly concerned with the investigation stage but also deals with situations which arise after the investigation has been finalized.
Reference may be made in this behalf to subsection (2) of section 172 of the Code reads thus : 748 "Any Criminal Court may send for the police diaries of a case under inquiry or trial in such Court, and may use such diaries, not as evidence in the case, but to aid it in such inquiry or trial.
Neither the accused nor his agents shall be entitled to call for such diaries, nor shall he or they be entitled to see them merely because they are referred to by the Court, but, if they are used by the police officer who made them, to refresh his memory, or if the Court uses them for the purpose of contradicting such police officer, the provisions of the , section 161 or section 145, as the case may be, shall apply.
" The sub section clearly deals with the use of police diaries at an inquiry or trial which a Magistrate holds not in his administrative or executive capacity but undoubtedly as a Court.
The caption of the Chapter therefore is not decisive of the question as to whether a particular provision contained therein is limited to the supervisory jurisdiction of the Magistrate in relation to the investigation being conducted by the police or deals with his judicial functions as a Court.
The contents of sections 169, 170 and 173 of the Code may now be scrutinised.
They are re produced below : "169.
If, upon an investigation under this Chapter, it appears to the officer in charge of the police station or to the police officer making the investigation that there is not sufficient evidence or reasonable ground of suspicion to justify the forwarding of the accused to a Magistrate, such officer shall, if such person is in custody, release him on his executing a bond, with or without sureties, as such officer may direct, to appear, if and when so required, before a Magistrate empowered to take cognizance of the offence on a police report and to try the accused or commit him for trial." "170.
(1) If, upon an investigation under this Chapter, it appears to the officer in charge of the police station that there is sufficient evidence or reasonable ground as aforesaid, such officer shall forward the accused under custody to a Magistrate empowered to take cognizance of the offence upon a police report and to try the accused or commit him for trial or, if the offence is bailable and the accused is able to give security, shall take security from him for his appearance before such Magistrate on a day fixed and for his attendance from day to day before such Magistrate until otherwise directed." 749 "(2) When the officer in charge of a police station forwards an accused person to a Magistrate or take security for his appearance before such Magistrate under this section, he shall send to such Magistrate any weapon or other article, which it may be necessary to produce before him, and shall require the complainant (if any) and so many of the persons who appear to such officer to be acquainted with the circumstances of the case as he may think necessary, to execute a bond to appear before the Magistrate as thereby directed and prosecute or give evidence (as the case may be) in the matter of the charge against the accused. "(3) If the Court of the District Magistrate or Sub divisional Magistrate is mentioned in the bond, such Court shall be held to include any Court to which such Magistrate may refer the case for inquiry or trial, provided reasonable notice of such reference is given to such complainant or persons." "173.
(1) : Every investigation under this Chapter shall be completed without unnecessary delay, and, as soon as it is completed, the officer in charge of the police station shall "(a) forward to a Magistrate empowered to take cognizance of the offence on a police report a report, in the form prescribed by the State Government, setting forth the names of the parties, the nature of the information and the names of the persons who appear to be acquainted with the circumstances of the case, and stating whether the accused (if arrested) has been forwarded in custody, or has been released on his bond and, if so, whether with or without sureties, and "(b) communicate, in such manner as may be prescribed by the State Government, the action taken by him to the person, if any, by whom the information relating to the commission of the offence was first given. "(2) Where a superior officer of police has been appointed under section 158, the report shall, in any case in which the State Government by general or special order so directs, be submitted through that officer, and he may, pending the orders of the Magistrate, direct the officer in charge of the police station to make further investigation. "(3) Whenever it appears from a report forwarded under this section that the accused has been released on his bond, 750 the Magistrate shall make such order for the discharge of such bond or otherwise as he thinks fit. "(4) After forwarding a report under this section the officer in charge of the police station shall, before the commencement of the inquiry or trial, furnish or cause to be furnished to the accused, free of cost, a copy of the report forwarded under sub section (1) and of the first information report recorded under section 154 and all other documents or relevant extracts thereof, on which the prosecution proposes to rely, including the statements and confessions, if any recorded under section 164 and the statements recorded under sub section (3) of section 161 of all the persons whom the prosecution proposes to examine as its witnesses.
"(5) Notwithstanding anything contained in sub section (4), if the police officer is of opinion that any part of any statement recorded under sub section (3) of section 161 is not relevant to the subject matter of the inquiry or trial or that its disclosure to the accused is not essential in the interests of justice and is inexpedient in the public interests, he shall exclude such part from the copy of the statement furnished to the accused and in such a case, he shall make a report to the Magistrate stating his reasons for excluding such part : "Provided, that at the commencement of the inquiry or trial, the Magistrate shall, after perusing the part so excluded and considering the report of the police officer, pass such orders as he thinks fit and if he so directs, a copy of the part so excluded or such portion thereof, as he thinks proper, shall be furnished to the accused.
" Section 169 and 170 do not talk of the submission of any report by the police to the Magistrate, although they do state what the police has to do short of such submission when it finds at the conclusion of the investigation (1) that there is not sufficient evidence or reasonable ground of suspicion to justify the forwarding of the accused to a Magistrate (section 169) (2) that there is sufficient evidence or reasonable ground as aforesaid (section 170).
In either case the final report of the police is to be submitted to the Magistrate under sub section (1) of section 173.
Sub section (3) of that section further provides that in the case of a report by the police that the accused has been released on his bond (which is the situation envisaged by section 169), the 751 Magistrate shall make "such order for the discharge of such bond or otherwise as he thinks fit".
Now what are the courses open to the Magistrate in such a situation? He may, as held by this Court in Abhinandan Jha & Others vs Dinesh Mishra.
(1) agree with the report of the police and file the proceedings, or (2) not agree with the police report and (a) order further investigation, or (b) hold that the evidence is sufficient to justify the forwarding of the accused to the Magistrate and take cognizance of the offence complained of.
The appropriate course has to be decided upon after a consideration of the report and the application of the mind of the Magistrate to the contents thereof.
But then the problem to be solved is whether the order passed by the Magistrate pertains to his executive or judicial capacity.
In my opinion, the only order which can be regarded as having been passed by the Magistrate in his capacity as the supervisory authority in relation to the investigation carried out by the police is the one covered by the course 2 (a).
The order passed by the Magistrate in each of the other two courses, that is, (1) and 2(b), follows a conclusion of the investigation and is a judicial order determining the rights of the parties (the State on the one hand and the accused on the other) after the application of his mind.
And if that be so, the order passed by the Magistrate in the proceeding before us must be characterised as a judicial act and therefore as one performed in his capacity as a Court.
The reasons which have weighed with me in coming to the conclusion arrived at in the last paragraph are equally applicable to the consideration of the question whether an order of bail passed by a Magistrate calls for the performance by him of his judicial functions.
Such an order also decides the rights of the State and the accused and is made by the Magistrate after the application of his mind and therefore in the discharge of his judicial duties, which factor constitutes it an act of a Court.
For a tribunal to be acting as a Court, it is not necessary that the parties must have a right of hearing or adducing evidence at every stage of the proceedings before it.
This is specially true of Courts constituted as such by the legislature.
Reference may here be made to interlocutory orders issuing temporary injunctions or staying 752 proceedings in a subordinate Court or dispossession of a party by Civil Courts at the instance of a plaintiff or appellant and in the absence of the opposite party which comes into the picture later on after it is served with a notice.
And even subsequent to the appearance of the party adversely affected, the existence of a prima facie case would till the scales against it so that the order earlier passed in favour of the other party is confirmed till the conclusion of the case on merits, even though the case may finally be decided otherwise and the interlocutory order found to be unjust and then vacated.
And yet it can hardly be argued that the presiding officer of the Court does not act as a Court when passing such an order.
Really, the right to adduce evidence and be heard is to be taken into consideration as being available at one stage of the proceedings or the other.
Thus in the case of an order passed by a Magistrate under sub section (3) of section 173 of the Code in agreement with the police report does not call for any hearing or the production of any evidence on the part of the accused, as it goes in his favour.
If the Magistrate, on the other hand, disagrees with the report submitted by the police and takes cognizance of the offence, the accused comes into the picture and thereafter shall have the right to be heard and to adduce evidence in support of his innocence.
Viewed in this context, all orders passed by a Magistrate acting judicially (such as orders of bail and those passed under subsection (3) of section 173 of the Code discharging an accused or orders taking cognizance of the offence complained of) are parts of an integral whole which may end with a definitive judgment after an inquiry or a trial, or earlier according to the exigencies of the situation obtaining at a particular stage, and which involves, if need be, the adducing of evidence and the decision of the Magistrate on an appreciation thereof.
They cannot be viewed in isolation and given a character different from the entire judicial process of which they are intended to form a part.
In the view that I have taken of the matter, I do not consider it necessary to go into the details of the conflict of opinion amongst the High Courts in India in relation there to but I would touch briefly thereupon.
In J. D. Boywalla vs Sorab Rustomji Engineer Beaumont, C. J. speaking for himself and Macklin, J., emphatically held that a Magistrate while passing a order releasing an accused person on bail or discharging him in pursuance of a report submitted by the police to the effect that the evidence was insufficient to sustain the charge, acts judicially and therefore as a Court within the meaning of that term as used in clause (b) of sub section (1) of section 195 of the Code.
That decision was followed by a Division Bench consis 753 ting of Shah, C. J., and Baxi, J., in State vs Vipra Khimji Gangaram in so far as an order discharging an accused person as aforesaid is concerned.
Beaumont, C. J. 's view in regard to orders of bail was accepted as correct by M. C. Desai, C.J., and Mishra, J., in Badri vs State.
These three decisions, in my opinion, lay down the correct law on the point and the view expressed to the country by the Madras, Calcutta and Patna High Court as also by a Full Bench of the Allahabad High Court in Hanwant vs Emperor and by a Full Bench of the Lahore High Court in Emperor vs Hyat Fateh Din merits rejection for the reasons stated above.
In so far as this Court is concerned, the point debated before us has not been the subject matter of any decision and was expressly left open in M. L. Sethi vs R. P. Kapur & Anr.
In that case the appellant had lodged a report with the police charging the respondents with certain cognizable offences.
While the police were investigating into the report, the respondent filed a complaint in the Magistrate 's Court alleging that the appellant had committed an offence under section 211 of the Indian Penal Code by falsely charging the respondent with having committed an offence.
The Magistrate took cognizance of the respondent 's complaint under section 190 of the Code.
At that stage there were no proceedings in any Court nor any order by any Magistrate for arrest, remand or bail of the respondent in connection with the appellant 's report to the police.
Later, however, the police arrested the respondent in connection with the appellant 's report and filed a charge sheet against him, but the case ended in an order of discharge.
Thereafter, the appellant raised an objection in the Court of the Magistrate to the effect that cognizance of the offence under section 211 of the Indian Penal Code could not be taken in view of the provisions of clause (b) of sub section (1) of section 195 of the Code.
The Magistrate rejected the contention and the order was confirmed by the Sessions Court and the High Court.
While dismissing the appeal, this Court held that the complaint filed by the respondent was competent and that clause (b) aforesaid did not stand in the way of the Magistrate taking cognizance, in as much as, there had been no proceedings of any kind whatsoever before the Magistrate in relation to the report lodged by the appellant with the police till the complaint was 754 filed by the respondent.
Reliance was placed on behalf of the appellant in that case on Badri vs State (supra) and J. D. Boywalla vs Sorab Rustomji Engineer (supra) but the points decided in those cases were held not to arise in the case then before the Court which made the following observations in relation thereto : "In the case of Badri vs State, where an offence under section 211, I.P.C., was alleged to have been committed by the person making a false report against the complainant and others to the police, it was held that it was an offence in relation to the remand proceedings and the bail proceedings which were subsequently taken before a Magistrate in connection with that report to the police, and, therefore, the case was governed by section 195 (1) (b), Cr. P. C., and no cognizance of the offence could be taken except on a complaint by the Magistrate who held the remand and bail proceedings.
We do not consider it necessary to express any opinion whether the remand and bail proceedings before Magistrate could be held to be proceedings in a Court, nor need we consider the question whether the charge of making of the false report could be rightly held to be in relation to those proceedings.
That aspect need not detain us, because, in the case before us, the facts are different.
The complaint for the offence under section 211, I.P.C. was taken cognizance of by the Judicial Magistrate at Chandigarh at a stage when there had been no proceedings for arrest, remand or bail of the respondent and the case was still entirely in the hands of the police.
There was, in fact, no order by any Magistrate in the proceedings being taken by the police on the report lodged by the appellant up to the stage when the question of applying the provisions of section 195 (1)(b), Cr.
P.C. arose.
These two cases are also, therefore, of no assistance to the appellant.
On the same ground, the decision of the Bombay High Court, in J. D. Boywalla vs Sorab Rustomhi Engineer is also inapplicable, because in that case also orders were passed by a Magistrate on the final report made by the police after investigation of the facts in the report in respect of which the complaint under section 211, I.P.C. was sought to be filed." 13.
In another part of the judgment deciding M. L. Sethi vs R. P. Kapur (supra) this Court disagreed with the view expressed in Ghulam 755 Rasul vs Emperor wherein Blacker, J., made the following observation : "I am clear that the words in this sub section "in relation to any proceedings in any Court" apply to the case of a false report or a false statement made an investigation by the police with the intention that there shall in consequence of this be a trial in the criminal Court, and I find support for this view in the case reported as 1929 Sind 132 (1)".
This view of Blacker, J., was repelled by this Court thus : "The decision in the words in which the learned Judge expressed himself appears to support the argument of learned counsel for the appellant in the present case but we think that very likely in that case, the learned Judge was influenced by the circumstances that the case had been reported by the police to the Magistrate for cancellation.
He appears to have held the view that the Magistrate having passed an order of cancellation, it was necessary that the complaint should be filed by the Magistrate, because section 195 (1) (b) had become applicable.
If the learned Judge intended to say that without any proceeding being taken by the Magistrate in the case which was investigated by the police, it was still essential that a complaint should be filed by the Magistrate simply because a subsequent proceeding following the police investigation was contemplated, we consider that his decision cannot be accepted as correct.
" These observations cannot be held to mean that if an order of cancellation of a case has actually been passed by a Magistrate in agreement with the report of the police to the effect that no sufficient evidence was available against the accused, such order could not be regarded as a judicial proceeding and the Magistrate passing it could not be given the status of a Court.
This is apparent from the last sentence of the passage just above extracted which indicates that all that was meant was that if Blacker, J., meant to say that even though no proceeding at all had been taken by the Magistrate, clause (b) of sub section (1) of section 195 of the Code would be attracted merely for the reason that the police had held an investigation which would at a later point of time result in any proceedings before the Magistrate this Court could not agree with him.
Another fact which may be noted in this connection is that judgment in Ghulam Rasul vs Emperor (supra) does not state in unmistakable terms that any order 756 of cancellation of the case was passed by the concerned Magistrate and all that is mentioned is that the police had reported the case for "cancellation", which may well mean that really no order of cancellation had in fact been made by the Magistrate.
As the order releasing Trivedi on bail and the one ultimately discharging him of the offence complained of amount to proceedings before a Court, all that remains to be seen is whether the offence under section 211 of the Indian Penal Code which is the subject matter of the complaint against Trivedi can be said to have been committed "in relation to" those proceedings.
Both the orders resulted directly from the information lodged by Trivedi with the police against Pathak and in this situation there is no getting out of the conclusion that the said offence must be regarded as one committed in relation to those proceedings.
This requirement of clause (b) aforementioned is also therefore fully satisfied.
For the reasons stated, I hold that the complaint against Trivedi is in respect of an offence alleged to have been committed in relation to a proceeding in Court and that in taking cognizance of it the SDJM acted in contravention of the bar contained in the said clause (b), as there was no complaint in writing either of the SDJM or of a superior Court.
In the result, therefore, I accept the appeal and, setting aside the order of the High Court, quash the proceedings taken by the SDJM against Trivedi.
ORDER In accordance with the opinion of the majority, the appeal is allowed, the order of the High Court is set aside and the proceedings taken by the Sub Divisional Judicial Magistrate against the appellant, Kamlapati Trivedi, are quashed.
N.V.K. Appeal allowed.
| IN-Abs | Section 195(1)(b) of the Code of Criminal Procedure provides that no court shall take cognizance of any offence punishable under any of the sections enumerated therein (one of which is section 211) if such offence is alleged to have been committed in or in relation to any proceedings in any court.
The appellant filed a complaint with the police that the accused criminally trespassed, assaulted and abused him in filthy language and committed theft of money and valuable documents of the school of which he was the secretary.
After investigation the police found that there was no evidence against the accused and therefore, the Magistrate discharged all the accused.
One of the accused thereupon preferred a complaint under section 211 IPC alleging that the appellant had instituted criminal proceedings with the intent to cause injury to him and others knowing that there was no just or lawful ground and thereby caused pecuniary loss and agony to him.
The appellant moved the High Court for quashing the proceedings before the Magistrate because in the absence of a complaint in writing of the Magistrate himself, the Magistrate had no jurisdiction to take cognizance of the offence under s.211 IPC in view of the provisions of section 195 (1)(b) of the Cr.
The High Court refused to quash the proceedings.
On further appeal it was contended that an order passed by a Magistrate on a report submitted by the police under section 173 Cr. P. C. being a judicial order the bar of section 195(1)(b) would be attracted.
Allowing the appeal, ^ HELD: Per Koshal, J. (with whom Jaswant Singh, J. agreed) 1.
The complaint against the appellant was in respect of an offence alleged to have been committed in relation to a proceeding in court.
In taking cognizance of it the Magistrate acted in contravention of the bar contained in section 195(1)(b) because there was no complaint in writing either of the Magistrate or of a superior court.
[756 D] 2.
Taking cognizance of any offence by a Magistrate under section 190 is not a condition precedent for him to be regarded as a court.
Magistrates are specifically labelled as courts by section 6 of the Code of Criminal Procedure and, therefore, have to be regarded as such.
It is true that a Magistrate also performs functions which are of an executive nature and do not fall within 718 the sphere of judicial duties and it may plausibly be argued that in the discharge of those functions he does not act as a court.
But then he cannot but be regarded as a court when he acts judicially.
Sections 496 and 497 which make provision for bail matters describe a Magistrate while dealing with those matters as a court and these sections operate at all stages of a case including that when the investigation has just started.
Neither in these sections nor in section 195 is there anything to show that the word "court" has been used in two different senses and therefore the legislature must be deemed to have used it in one sense wherever it occurs in the Code.
[743 B, 742 D H] 3.
The well accepted position is that a court created by a statute, when it performs judicial functions, would be deemed to act as a court; and Magistrates ' courts are regarded as such unless they are performing executive or administrative functions.
[744 F G].
Shell Co. of Australia Ltd. vs Federal Commissioner of Taxation, PC and Halsbury 's Laws of England (3rd Edn.) Vol.
9 p. 342; Virinder Kumar Satyawadi vs The State of Punjab, ; Smt.
Ujjam Bai vs State of U.P., [1963] 1 SCR 778; referred to.
The source of power exercised by the authority, i.e. whether it is executive or judicial power, would make all the difference in the determination of the question whether the authority acts as a court or merely as a quasi judicial tribunal.
[746 F].
Section 4(2) of the Code of Criminal Procedure provides that "all words and expressions used herein and defined in the IPC and not hereinabove defined shall be deemed to have the meanings respectively attributed to them by the Code.
" In the matter of dispensation of criminal justice the Indian Penal Code (which contains the substantive law) and the Criminal Procedure Code (which deals with procedure) may be regarded as supplementary to each other.
The term "Judge" and "Court of justice" used in sections 19 and 20 of the Indian Penal Code give an indication of the attributes of a court as used in criminal law generally.
Although the term "court of justice" has not been used in the Cr.
P.C. the expression "Judge" is used in section 197 and, therefore, when a judge (including a Magistrate) who is empowered to act judicially and does so act, constitutes not merely a Court but a Court of Justice.
[747 E, D, C, F G].
The caption of Chapter XIV is not decisive of the question whether a particular provision contained in it is limited to the supervisory jurisdiction of the Magistrate in relation to the investigation being conducted by the police or deals with his judicial functions as a court.
Although Chapter XIV is headed "Information to the police and their powers to Investigate", it is not confined to matters which are strictly concerned with the investigation stage but also deals with situations arising after the investigation has been finalised.
For example, section 172(2) clearly deals with the use of police diaries at an inquiry or trial which a Magistrate holds not in his administrative or executive capacity but as a court.
Similarly sections 169 and 170 are another instance in point in which an order passed by a Magistrate is a judicial order determining the rights of the parties after application of his mind.
If that 719 be so the order passed by the Magistrate in the instant case must be characterised as a judicial act and therefore as one performed in his capacity as a court.
[748 D, 747 G 748 C, 750 G, 751 E] 7.
For a tribunal to be acting as a court, it is not necessary that the parties must have a right of hearing of adducing evidence at every stage of the proceedings before it.
While passing interlocutory orders, issuing temporary injunctions etc.
, the presiding officer of a court does act as a court.
[751 H 752 B].
All orders passed by a Magistrate acting judicially (such as orders of bail and those passed under sub section
(3) of section 173 of the Code discharging the accused or orders taking cognizance of an offence complained of) are parts of an integral whole which may end with a definitive judgment after an inquiry or a trial or earlier, according to the exigencies of the situation obtaining at a particular stage and which involves, if the need be, the adducing of evidence and the decision of the Magistrate on an appreciation thereof.
They cannot be viewed in isolation and given a character different from the entire judicial process of which they are intended to form a part.
[752 E F].
Abhinandan Jha & Ors.
vs Dinesh Mishra, ; ; M. L. Sethi vs R. P. Kapur & Anr., ; ; referred to.
Kailasam, J. (dissenting) The restricted meaning given to "Court" in section 195(2) Cr.
P.C. read along with the conditions to be specified before a complaint is preferred by the court, indicate that the proceedings before a Magistrate in which he agrees with the report by the police under section 169 Cr.
P.C. and the proceedings in remand or bail applications during investigations will not amount to proceedings 'in or in relation to court. ' [737 H].
The policy behind the bar against institution of criminal proceedings by a private party is that when offences are committed against lawful authority or false evidence is given or offence is committed against public justice, it should be the concerned authority that should prefer a complaint and no one else.
[723 H].
A court is charged with a duty to decide disputes in a judicial manner and declare the rights of parties in a definitive judgment.
To decide in a judicial manner involves that the parties are entitled as a matter of right to be heard in support of their claim and to adduce evidence in proof of it.
It also imparts an obligation on the part of the authority to decide the matter on a consideration of the evidence adduced and in accordance with law [725 B C].
It is settled law that when a Magistrate applies his mind on complaints, he must be held to have taken cognizance of the offence mentioned in the complaint but when he applies his mind not for such purpose but for the purpose of ordering investigation under section 156(3) Cr. P.C. or issues a search warrant for the purpose of investigation, he cannot be said to have taken cognizance of any offence.
[727 E] 4.
When the Magistrate receives a report under section 169 of the Cr.
P.C. that there is not sufficient evidence or reasonable ground for suspicion and agrees 720 with it, he may be doing so in exercise of his judicial function but the question is whether he is acting as a court.
Most of the requirement of a court are lacking at this stage.
To be classified as a court, an authority must be charged with a duty to decide disputes in a judicial manner and declare the rights of parties in a definitive judgment.
This involves that the parties are entitled as a matter of right to be heard in support of their claim and to adduce evidence in proof of it and an obligation on the part of the authority to decide the matter on a consideration of the evidence adduced and in accordance with law.
[729 D E].
Though the Magistrate in deciding whether or not to accept the report of a police officer under section 169 Cr.
P.C. may be exercising his judicial mind and though there may be some of the trappings of the court, at this stage he cannot be termed as a court within the provisions of section 195(2) Cr.
At this stage the rights of the parties are not finally decided as the complainant is entitled to file a complaint directly to the Magistrate.
The persons accused are not before the Magistrate and neither the complainant nor the accused are entitled to be heard or to adduce evidence before the Magistrate at this stage.
It cannot, therefore, be said that the Magistrate has a duty to decide the matter on a consideration of the evidence adduced before him.
[729 B, F H] 7.
The proceeding under section 167 Cr.
P.C. is during investigation.
The Magistrate to whom the accused is produced can from time to time authorise detention of accused in such custody as such Magistrate thinks fit for a term not exceeding 15 days in whole.
If he has not the jurisdiction to try the case or commit it for trial but considers further detention is necessary, he may order the accused to be forwarded to a Magistrate having jurisdiction.
In investigation by the police the Magistrate is associated in a supervisory capacity.
The action taken by the Magistrate cannot be taken to be that of a court for the Magistrate who has no jurisdiction to try the case has a limited power.
The trial commences only after the offence has been taken cognizance of.
[735 E F] 8.
Section 496 provides as to when bail may be taken in non bailable offences.
The provisions of section 496 and section 497 speak of an accused person in custody charged with a non bailable offence being produced before court at any stage of the proceedings.
The section deals with the exercise of the power of a court at any stage of proceedings when the accused is brought before a Court while in the custody of the police officer.
Though there may be some trappings of a court and the section itself mentions the word 'court ', the requirements for being a court for the purpose of section 195(2) have not been satisfied.
[735 H 736 D] 9(i) There is a conflict between various High Courts as to whether a complaint is necessary when on a police report under section 169 the Magistrate does not take any further action.
The Bombay, Saurashtra and Andhra Pradesh High Courts in , 1952 Saurashtra 67(68) and (287) have held that a Magistrate passing an order on a final report of police under section 173 referring the case as false should be deemed to be a court passing a judicial order disposing of the information to the police, and that in such a case, the complaint of the Magistrate is necessary for the prosecution of the informant under section 211 IPC.
The Madras, Calcutta and 721 Allahabad High Court in AIR 1934 Mad. 175, AIR 1948 All.
184 FB and AIR 1916 Cal.
593 have held the other view.
(ii) When no further proceedings are taken by the Magistrate or receipt of a police report under section 169 there is no proceeding in or in relation to any court and therefore, no complaint by the court is necessary.
[733 G 734 B].
|
Civil Appeal No. 1597 of 1972.
Appeal from the Judgment and Order dated 25th January, 1972of the Allahabad High Court in Civil Misc.
Writ No. 3788/70.
S.T. Desai, Shri Narain, J. B. Dadachanji, Ravinder Narain, S Swarup and Talat Ansari for the Appellant.
G. N. Dikshit, M. V. Goswami and O. P. Rana for RR 1 3 and 5.
Girish Chandra for Respondent No. 4.
651 A. B. Dewan, Ravinder Narain, section Swarup and A. N. Haksar for the Intervener (M/s. Modi Rubber Ltd.).
The Judgment of the Court was delivered by BHAGWATI, J.
, This appeal by certificate raises a question of considerable importance in the field of public law.
How far and to what extent is the State bound by the doctrine of promissory estoppel ? It is a doctrine of comparatively recent origin but it is potentially so fruitful and pregnant with such vast possibilities for growth that traditional lawyers are alarmed lest it might upset existing doctrines which are looked upon almost reverentially and which have held the field for a long number of years.
The law in regard to promissory estoppel is not yet well settled though it has been the subject of considerable debate in England as well as the United States of America and it has also received consideration in some recent decisions in India and we, therefore, propose to discuss it in some detail with a view to defining its contours and demarcating its parameters.
We will first state briefly the facts giving rise to this appeal.
This is necessary because it is only where certain fact situations exist that promissory estoppel can be invoked and applied.
The appellant is a limited company which is primarily engaged in the business of manufacture and sale of sugar and it has also a cold storage plant and a steel foundry.
On 10th October, 1968 a news item appeared in the National Herald in which it was stated that the State of Uttar Pradesh had decided to give exemption from sales tax for a period of three years under section 4A of the U.P. Sales Tax Act to all new industrial units in the State with a view to enabling them "to come on firm footing in developing stage".
This news item was based upon a statement made by Shri M. P. Chatterjee the then Secretary in the Industries Department of the Government.
The appellant, on the basis of this announcement, addressed a letter dated 11th October, 1968 to the Director of Industries stating that in view of the sales tax holiday announced by the Government, the appellant intended to set up a Hydro genation Plant for manufacture of Vanaspati and sought for confirmation that this industrial unit, which it proposed to set up would be entitled to sales tax holiday for a period of three years from the date it commenced production.
The Director of Industries replied by his letter dated 14th October, 1968 confirming that "there will be no sales tax for three years on the finished product of your proposed Vanaspati factory from the date it gets power connection for commencing production." The appellant thereupon started taking steps to contact various financiers for financing the project and also initiated negotiations with manufacturers for purchase of machinery for setting 652 up the Vanaspati factory.
On 12th December, 1968 the appellant 's representative met the 4th respondent who was at that time the Chief Secretary to the Government as also Advisor to the Governor and intimated to him that the appellant was setting up the Vanaspati factory solely on the basis of the assurance given on behalf of the Government that the appellant would be entitled to exemption from sales tax for a period of three years from the date of commencement of commercial production at the factory and the 4th respondent reiterated the assurance that the appellant would be entitled to sales tax holiday in case the Vanaspati factory was put up by it.
The appellant by its letter dated 13th December, 1968 placed on record what had transpired at the meeting on the previous day and requested the 4th respondent "to please confirm that we shall be allowed sales tax holiday for a period of three years on the sale of Vanaspati from the date we start production." On the same day the appellant entered into an agreement with M/s. De Smith (India) Pvt. Ltd., Bombay for supply of plant and machinery for the Vanaspati factory, providing clearly that the appellant would have the option to terminate the agreement, if within 10 weeks exemption from sales tax was not granted by the State Government.
The 4th respondent replied on 22nd December, 1968 confirming that "the State Government will be willing to consider your request for grant of exemption from U.P. Sales Tax for a period of three years from the date of production" and asked the appellant to obtain the requisite application form and submit a formal application to the Secretary to the Government in the Industries Department and in the meanwhile to "go ahead with the arrangements for setting up the factory".
The appellant had in the meantime submitted an application dated 21st December, 1968 for a formal order granting exemption from sales tax under section 4A of the Act.
It appears that the letter of the 4th respondent dated 22nd December, 1968 was not regarded as sufficient by the financial institutions which were approached by the appellant for financing the project since it merely stated that the State Government would be willing to consider the request for grant of exemption and did not convey any decision of the State Government that the exemption would be granted.
The appellant, therefore, addressed a letter dated 22nd January, 1969 to the 4th respondent pointing out that the financial institutions were of the view that the letter of the 4th respondent dated 22nd December, 1968 "did not purport to commit the Government for the concession mentioned" and it was, therefore, necessary to obtain a formal order of exemption in terms of the application submitted by it.
The 4th respondent, however, stated categorically in his letter in reply dated 23rd January, 1969 that the proposed Vanaspati Factory of the appellant "will be 653 entitled to exemption from U.P. Sales Tax for a period of three years from the date of going into production and that this will apply to all Vanaspati sold during that period in Uttar Pradesh itself" and expressed his surprise that "a letter from the Chief Secretary to the State Government stating this fact in clear and unambiguous words should not carry conviction with the financial institutions.
" In view of this unequivocal assurance given by the 4th respondent, who not only occupied the post of Chief Secretary to the Government but was also Advisor to the Governor functioning under the President 's rule, the appellant went ahead with the setting up of the Vanaspati Factory.
The appellant by its letter dated 25th April, 1969 advised the 4th respondent that the U.P. Finance Corporation, being convinced by the clear and categorical assurance given by the 4th respondent that the Vanaspati Factory of the appellant would be entitled to exemption from sales tax for a period of three years from the date of commencement of production, had sanctioned financial assistance to the appellant and the appellant was going ahead with the project in full speed to enable it to start production at the earliest.
The appellant made considerable progress in the setting up of the Vanaspati Factory but it seems that by the middle of May 1969 the State Government started having second thoughts on the question of exemption and a letter dated 16 May, 1969 was addressed by the 5th respondent who was Deputy Secretary to the Government in the Industries Department, intimating that a meeting has been called by the Chief Minister on 23rd May, 1969 "to discuss the question of giving concession in Sales Tax on Vanaspati products" and requesting the appellant to attend the meeting.
The appellant immediately by its letter dated 19th May, 1969 pointed out to the 5th respondent that so far as the appellant was concerned, the State Government had already granted exemption from Sales Tax by the letter of the Chief Secretary dated 23rd January, 1969 but still, the appellant would be glad to send its representative to attend the meeting as desired by the 5th respondent.
The proposed meeting was, however, postponed and the appellant was intimated by the 5th respondent by its letter dated 23rd May, 1969 that the meeting would now be held on 3rd June, 1969.
The appellant 's representative attended the meeting on that day and reiterated that so far as the appellant was concerned, it had already been granted exemption from Sales Tax and the State Government stood committed to it.
The appellant thereafter proceeded with the work of setting up the Vanaspati plant on the basis that in accordance with the assurance given by the 4th respondent on behalf of the State Government, the appellant would be exempt from payment of Sales Tax for a period of three years from the date of commencement of production.
654 The State Government however went back upon this assurance and a letter dated 20th January, 1970 was addressed by the 5th respondent intimating that the Government had taken a policy decision that new Vanaspati Units in the State which go into commercial production by 30th September, 1970 would be given partial concession in Sales Tax at the following rates for a period of three years: First year of production 31/2% Second year of production 3% Third year of production 21/2% The appellant by its letter dated 25th June, 1970 pointed out to the Secretary to the Government that the appellant proposed to start commercial production of Vanaspati with effect from 1st July, 1970, and stated that, as notified in the letter dated 20th January, 1970, the appellant would be availing of the exemption granted by the State Government and would be charging sales tax at the rate of 31/2% instead of 7% on the sales of Vanaspati manufactured by it for a period of one year commencing from 1st July, 1970.
The factory of the appellant thereafter went into production from 2nd July, 1970 and the appellant informed the Secretary to the Government about the same by its letter dated 3rd July, 1970.
The State Government however once again changed its decision and on 12th August, 1970 a news item appeared in the Northern India Patricia stating that the Government had decided to rescind the earlier decision i.e. the decision set out in the letter dated 20th January, 1970, to allow concession in the rates of Sales Tax to new Vanaspati Units.
The appellant thereupon filed a writ petition in the High Court of Allahabad asking for a writ directing the State Government to exempt the sales of Vanaspati manufactured by the appellant from sales tax for a period of three years commencing from 2nd July, 1970 by issuing a notification under section 4A and not to collect or charge sales tax from the appellant for the said period of three years.
It appears that in the writ petition as originally filed, there was no plea of promissory estoppel taken against the State Government and the writ petition was, therefore, amended by obtaining leave of the High Court with a view to introducing the plea of promissory estoppel.
The appellant urged in the amended writ petition that the 4th respondent acting on behalf of the State Government had given an unequivocal assurance to the appellant that the appellant would be entitled to exemption from payment of sales tax for a period of three years from the date of commencement of the production and this assurance was given by the 4th respondent intending or knowing that it would be acted on by the appellant and in fact 655 the appellant, acting in reliance on it, established the Vanaspati factory by investing a large amount and the State Government was, therefore, bound to honour the assurance and exempt the Vanaspati manufactured and sold by the appellant from payment of sales tax for a period of three years from 2nd July, 1970.
This plea based on the doctrine of promissory estoppel was, however rejected by the Division Bench of the High Court principally on the ground that the appellant had waived the exemption, if any, by accepting the concessional rates set out in the letter of the Deputy Secretary dated 20th January, 1970.
The appellant thereupon preferred the present appeal after obtaining a certificate of fitness from the High Court.
The principal argument advanced on behalf of the appellant in support of the appeal was that the 4th respondent had given a categorical assurance on behalf of the State Government that the appellant would be exempt from payment of sales tax for a period of three years from the date of commencement of production and such assurance was given intending or knowing that it would be acted on by the appellant and in fact the appellant, acting in reliance on it, altered its position and the State Government was, therefore, bound, on the principle of promissory estoppel, to honour the assurance and exempt the appellant from sales tax for a period of three years from 2nd July, 1970, being the date on which the factory of the appellant commenced production.
The appellant assailed the view taken by the High Court that this claim of the appellant for exemption based on the doctrine of promissory estoppel was barred by waiver, because the appellant had by its letter dated 25th June, 1970 accepted that it would avail of the exemption granted under the letter of the 5th respondent dated 20th January, 1970 and charged sales tax at the concessional rate of 31/2% instead of 7% during the first year of its production.
The appellant urged that waiver was a question of fact which was required to be pleaded and since no plea of waiver was raised in the affidavit filed on behalf of the State Government in opposition to the writ petition, it was not competent to the State Government to rely on the plea of waiver for the first time at the hearing of the writ petition.
Even if the plea of waiver were allowed to be raised, notwithstanding that it did not find place in the pleadings, no waiver was made out, said the appellant, since there was nothing to show that were the circumstances in which the appellant had addressed the letter dated 25th June, 1970 stating that it would avail of the exemption granted under the letter dated 20th January, 1970 and it was not possible to say that the appellant, with full knowledge of its right to claim total exemption from payment of sales tax, waived that right and agreed to accept the concessional rates set out in the letter dated 20th January, 1970.
The 656 State Government on the other hand strongly pressed the plea of waiver and submitted that the appellant had clearly waived its right to complete exemption from payment of Sales Tax by addressing the letter dated 25th June, 1970.
The State Government also contended that, in any event, even if there was no waiver, the appellant was not entitled to enforce the assurance given by the 4th respondent, since such assurance was not binding on the State Government and more over, in the absence of notification under section 4A, the State Government could not be prevented from enforcing the liability to sales tax imposed on the appellant under the provisions of the Act.
It was urged on behalf of the State Government that there could be no promissory estoppel against the State Government so as to inhibit it from formulating and implementing its policies in public interest.
These were broadly the rival contentions urged on behalf of the parties and we shall now proceed to consider them.
We shall first deal with the question of waiver since that can be disposed of in a few words.
The High Court held that even if there was an assurance given by the 4th respondent on behalf of the State Government and such assurance was binding on the State Government on the principle of promissory estoppel, the appellant had waived its right under it by accepting the concessional rates of sales tax set out in the letter of the 5th respondent dated 20th January, 1970.
We do not think this view taken by the High Court can be sustained.
In the first place, it is elementary that waiver is a question of fact and it must be properly pleaded and proved.
No plea of waiver can be allowed to be raised unless it is pleaded and the factual foundation for it is laid in the pleadings.
Here it was common ground that the plea of waiver was not taken by the State Government in the affidavit filed on its behalf in reply to the writ petition, nor was it indicated even vaguely in such affidavit.
It was raised for the first time at the hearing of the writ petition.
That was clearly impermissible without an amendment of the affidavit in reply or a supplementary affidavit raising such plea.
If waiver were properly pleaded in the affidavit in reply, the appellant would have had an opportunity of placing on record facts showing why and in what circumstances the appellant came to address the letter dated 25th June, 1970 and establishing that on these facts there was no waiver by the appellant of its right to exemption under the assurance given by the 4th respondent.
But in the absence of such pleading in the affidavit in reply, this opportunity was denied to the appellant.
It was, therefore, not right for the High Court to have allowed the plea of waiver to be raised against the appellant and that plea should have been rejected in limine.
657 Secondly, it is difficult to see how, on the facts, the plea of waiver could be said to have been made out by the State Government.
Waiver means abandonment of a right and it may be either express or implied from conduct, but its basic requirement is that it must be "an intentional act with knowledge".
Per Lord Chelmsford, L.C. in Earl of Darnley vs London, Chatham and Dover Rly.
Co. There can be no waiver unless the person who is said to have waived is fully informed as to his right and with full knowledge of such right, he intentionally abandons it.
It is pointed out in Halsbury 's Laws of England (4 d) Volume 16 in paragraph 1472 at page 994 that for a "waiver to be effectual it is essential that the person granting it should be fully informed as to his rights" and Isaacs, J, delivering the judgment of the High Court of Australia in Craine vs Colonial Mutual Fire Insurance Co. Ltd. has also emphasised that waiver "must be with knowledge, an essential supported by many authorities".
Now in the present case there is nothing to show that at the date when the appellant addressed the letter dated 25th June, 1970, it had full knowledge of its right to exemption under the assurance given by the 4th respondent and that it intentionally abandoned such right.
It is difficult to speculate what was the reason why the appellant addressed the letter dated 25th June, 1970 stating that it would avail of the concessional rates of sales tax granted under the letter dated 20th January, 1970.
It is possible that the appellant might have thought that since no notification exempting the appellant from sales tax had been issued by the State Government under section 4A, the appellant was legally not entitled to exemption and that is why the appellant might have chosen to accept whatever concession was being granted by the State Government.
The claim of the appellant to exemption could be sustained only on the doctrine of promissory estoppel and this doctrine could not be said to be so well defined in its scope and ambit and so free from uncertainty in its application that we should be compelled to hold that the appellant must have had knowledge of its right to exemption on the basis of promissory estoppel at the time when it addressed the letter dated 25th June, 1970.
In fact, in the petition as originally filed, the right to claim total exemption from sales tax was not based on the plea of promissory estoppel which was introduced only by way of amendment.
Moreover, it must be remembered that there is no presumption that every person knows the law.
It is often said that every one is presumed to know the law, but that is not a correct statement: there is no such maxim known to the law.
Over a hundred and thirty years ago, Maule, J., pointed out in Martindala vs Faulkner(3): "There is no presumption in this country 658 that every person knows the law: it would be contrary to common sense and reason if it were so".
Scrutton, also once said: "It is impossible to know all the statutory law, and not very possible to know all the common law." But it was Lord Atkin who, as in so many other spheres, put the point in its proper context when he said in Evans vs Bartlem(1)"_____the fact is that there is not and never has been a presumption that every one knows the law.
There is the rule that ignorance of the law does not excuse, a maxim of very different scope and application.
" It is, therefore, not possible to presume, in the absence of any material placed before the Court, that the appellant had full knowledge of its right to exemption so as to warrant an inference that the appellant waived such right by addressing the letter dated 25th June, 1970.
We accordingly reject the plea of waiver raised on behalf of the State Government.
That takes us to the question whether the assurance given by the 4th respondent on behalf of the State Government that the appellant would be exempt from sales tax for a period of three years from the date of commencement of production could be enforced against the State Government by invoking the doctrine of promissory estoppel.
Though the origin of the doctrine of promissory estoppel may be found in Hughes vs Metropolitan Railway Co.(2) and Birmingham & District Land Co. vs London & North Western Rail Co.(3) authorities of old standing decided about a century ago by the House of Lords, it was only recently in 1947 that it was rediscovered by Mr. Justice Denning, as he then was, in his celebrated judgment in Central London Property Trust Ltd. vs High Trees House Ltd.(4) This doctrine has been variously called 'promissory estoppel ', 'equitable estoppel ', 'quasi estoppel ' and 'new estoppel '.
It is a principle evolved by equity to avoid injustice and though commonly named 'promissory estoppel, it is, as we shall presently point out, neither in the realm of contract nor in the realm of estoppel.
It is interesting to trace the evolution of this doctrine in England and to refer to some of the English decisions in order to appreciate the true scope and ambit of the doctrine particularly because it has been the subject of considerable recent development and is steadily expanding.
The basis of this doctrine is the inter position of equity.
Equity has always, true to form, stepped into mitigate the rigours of strict law.
The early cases did not speak of this doctrine as estoppel.
They spoke of it as 'raising an equity '.
Lord Cairns stated 659 the doctrine in its earliest form it has undergone considerable development since then in the following words in Hughes vs Metropolitan Railway Company (supra): "It is the first principle upon which all Courts of Equity proceed, that if parties who have entered into definite and distinct terms involving certain legal results. afterwards by their own act or with their own consent enter upon a course of negotiation which has the effect of leading one of the parties to suppose that the strict rights arising under the contract will not be enforced, or will be kept in suspense, or held in abeyance, the person who otherwise might have enforced those rights will not be allowed to enforce them where it would be inequitable having regard to the dealings which have thus taken place between the parties.
" This principle of equity laid down by Lord Cairns made sporadic appearances in stray cases now and then but it was only in 1947 that it was disinterred and restated as a recognised doctrine by Mr. Justice Denning, as he then was, in the High Trees ' case (supra).
The facts in that case were as follows: The plaintiffs leased to the defendents, a subsidiary of the plaintiffs, in 1937 a block of flats for 99 years at a rent of & 2500/ a year.
Early in 1940 and because of the war, the defendants were unable to find sub tenants for the flats and unable in consequence to pay the rent.
The plaintiffs agreed at the request of the defendants to reduce the rent to &.
1250/ from the beginning of the term.
By the beginning of 1945 the conditions had improved and tenants had been found for all the flats and the plaintiffs, therefore, claimed the full rent of the premises from the middle of that year.
The claim was allowed because the court took the view that the period for which the full rent was claimed fell out side the representation, but Mr. Justice Denning, as he then was, considered Obiter whether the plaintiffs could have recovered the covenanted rent for the whole period of the lease and observed that in equity the plaintiffs could not have been allowed to act inconsistently with their promise on which the defendants had acted.
It was pressed upon the Court that according to the well settled law as laid down in Jorden y. Money(1), no estoppel could be raised against plaintiffs since the doctrine of estoppel by representation is applicable only to representations as to some state of facts alleged to be at the time actually in existence and not to promises de futuro which, if binding at all, must be binding only as contracts and here there was no representa 660 tion of an existing state of facts by the plaintiffs but it was merely a promise or representation of intention to act in a particular manner in the future.
Mr. Justice Denning, however, pointed out: "The law has not been standing still since Jorden vs Money.
There has been a series of decisions over the last fifty years which, although they are said to be cases of estoppel are not really such.
They are cases in which a promise was made which was intended to create legal relations and which, to the knowledge of the person making the promise, was going to be acted on by the person to whom it was made, and which was in fact so acted on.
In such cases the courts have said that the promise must be honoured.
" The principle formulated by Mr. Justice Denning was, to quote his own words, "that a promise intended to be binding, intended to be acted on and in fact acted on, is binding so far as its terms properly apply".
Now Hughes vs Metropolitan Railway Co. (supra) and Birmingham and District Land Co. vs London & North Western Rail Co. (supra), the two decisions from which Mr. Justice Denning drew inspiration for evolving this new equitable principle, were clearly cases where the principle was applied as between parties who were already bound contractually one to the other.
In Hughes vs Metropolitan Railway Co. (supra) the plaintiff and the defendant were already bound in contract and the general principle stated by Lord Cairns, L.C. was: "If parties who have entered into definite and distinct terms involving certain legal results afterwards enter upon a course of negotiations".
Ten years later Bowen, L. J. also used the same terminology in Birmingham and District Land Co. vs London and North Western Rail Co. (supra) that: "If persons who have contractual rights against others induce by their conduct those against whom they have such rights to believe ".
These two decisions might, therefore, seem to suggest that the doctrine of promissory estoppel is limited in its operation to cases where the parties are already contractually bound and one of the parties induces the other to believe that the strict rights under the contract would not be enforced.
But we do not think any such limitation can justifiably be introduced to curtail the width and amplitude of this doctrine.
We fail 661 to see why it should be necessary to the applicability of this doctrine that there should be some contractual relationship between the parties.
In fact Donaldson, J. pointed out in Durham Fancy Goods Ltd. vs Michael Jackson (Fancy Goods) Ltd. (1) : "Lord Cairns in his enunciation of the principle assumed a pre existing contractual relationship between the parties, but this does not seem to me to be essential, provided that there is a pre existing legal relationship which could in certain circumstances give rise to liabilities and penalties." But even this limitation suggested by Donaldson, J. that there should be a pre existing legal relationship which could in certain circumstances give rise to liabilities and penalties is not warranted and it is significant that the statement of the doctrine by Mr. Justice Denning in the High Trees ' case does not contain any such limitation.
The learned Judge has consistently refused to introduce any such limitation in the doctrine and while sitting in the Court of Appeal, he said in so many terms, in Evenden vs Guildford City Association Football Club Ltd.(2) "Counsel for the appellant referred us, however, to the second edition of Spencer Bower 's book on Estoppel by Representation[(1966) pp.
340 342] by Sir Alexander Turner, a judge of the New Zealand Court of Appeal.
He suggests the promissory estoppel is limited to cases where parties are already bound contractually one to the other.
I do not think it is so limited : see Durham Fancy Goods Ltd. vs Michael Jackson (Fancy Goods) Ltd. It applies whenever a representation is made, whether of fact or law, present or future, which is intended to be binding, intended to induce a person to act on it and he does act on it.
" This observation of Lord Denning clearly suggest that the parties need not be in any kind of legal relationship before the transaction from which the promissory estoppel takes its origin.
The doctrine would seem to apply even where there is no pre existing legal relationship between the parties, but the promise is intended to create legal relations or affect a legal relationship which will arise in future.
Vide Halsbury 's Laws of England, 4th ed.
16 p. 1018, Note 2 para 1514.
Of course it must be pointed out in fairness to Lord Denning that he made it clear 662 in the High Trees ' case that the doctrine of promissory estoppel cannot found a cause of action in itself, since it can never do away with the necessity of consideration in the formation of a contract, but he totally repudiated in Evenden 's case the necessity of a pre existing relationship between the parties and pointed out in Crabb vs Arun District Council(1) that equity will in a given case where justice and fairness demand, prevent a person from insisting on strict legal rights even where they arise, not under any contract, but on his own title deeds or under statue.
The true principle of promissory estoppel, therefore seems to be that where one party has by his words or conduct made to the other a clear and unequivocal promise which is intended to create legal relations or affect a legal relationship to arise in the future, knowing or intending that it would be acted upon by the other party to whom the promise is made and it is in fact so acted upon by the other party, the promise would be binding on the party making it and he would not be entitled to go back upon it, if it would be inequitable to allow him to do so having regard to the dealings which have taken place between the parties, and this would be so irrespective whether there is any preexisting relationship between the parties or not.
It may be pointed out that in England the law has been well settled for a long time, though there is some indication of a contrary trend to be found in recent juristic thinking in that country, that promissory estoppel cannot itself be the basis of an action.
It cannot found a cause of action : it can only be a shield and not a sword.
This narrow approach to a doctrine which is otherwise full of great potentialities is largely the result of an assumption, encouraged by it rather misleading nomenclature, that the doctrine is a branch of the law of estoppel.
Since estoppel has always been traditionally a principle invoked by way of defence, the doctrine of promissory estoppel has also come to be identified as a measure of defence.
The ghost of traditional estoppel continues to haunt this new doctrine and that is why we find that while boldly formulating and applying this new equity in the High Trees ' case, Lord Denning added a qualification that though in the circumstances set out, the promise would undoubtedly be held by the courts to be binding on the party making it, notwithstanding that under the old common law it might be difficult to find any consideration for it. "the courts have not gone so far as to give a cause of action in damages for the breach of such a promise, but they have refused to allow the party making it to act inconsistently with it".
Lord Denning also pointed out in Combe vs 663 Combe(2) that "Much as I am inclined to favour the principles stated in the High Trees ' case, it is important that it should not be stretched too far, lest it should be endangered.
That principle does not create new causes of action where none existed before.
It only prevents a party from insisting upon his strict legal rights, when it would be unjust to allow him to enforce them, having regard to the dealings which have taken place between the parties. " So also said Buckley, J., in the more recent case of Beesly vs Hallwood Estates Ltd.(1) "The doctrine may afford a defence against the enforcement or otherwise of enforceable rights : it cannot create a cause of action.
" It is, however, necessary to make it clear that though this doctrine has been called in various judgments and text books as promissory estoppel and it has been variously described as `equitable estoppel ', `quasi estoppel ' and `new estoppel ', it is not really based on the principle of estoppel, but it is a doctrine evolved by equity in order to prevent injustice where a promise is made by a person knowing that it would be acted on by the person to whom it is made and in fact it is so acted on and it is inequitable to allow the party making the promise to go back upon it.
Lord Denning himself observed in the High Trees ' case, expressly making a distinction between ordinary estoppel and promissory estoppel that cases like the one before him were" not cases of estoppel in the strict sense.
They are really promises, promises intended to be binding, intended to be acted upon and in fact acted upon".
Jenkins, C.J. also pointed out in Municipal Corporation of Bombay vs Secretary of State (2) that the "doctrine is often treated as one of estoppel but I doubt whether this is correct, though it may be a convenient name to apply".
The doctrine of promissory estoppel need not, therefore, be inhibited by the same limitation as estoppel in the strict sense of the term.
It is an equitable principle evolved by the courts for doing justice and there is no reason why it should be given only a limited application by way of defence.
It may be noted that even Lord Denning recognised in Crabb vs Arun Distric Council (supra) that "there are estoppels and estoppels.
Some do give rise to a cause of action.
Some don 't" and added that "in the species of estoppel called `proprietary estoppel ', it does give rise to a cause of action" The learned Law Lord, after quoting what he had said in Moorgate Mercantile Co. Ltd. vs Twitchings,(3) namely that the effect of estoppel on the true owner may be that : 664 "his own title to the property, be it land or goods, has been held to be limited or extinguished, and new rights and interests have been created therein.
And this operates by reason of his conduct what he has led the other to believe even though he never intended it.
" Proceeded to observe that "the new rights and interests, so created by estoppel, in or over land, will be protected by the courts and in this way give rise to a cause of action".
The Court of Appeal in this case allowed Crabb a declaration of "a right of access at point over the verge on to Mill Park Road and a right of way along that road to Hook Lane" on the basis of an equity arising out of the conduct of the Arun District Council.
Of course, Spencer Bower and Turner, in their Treatise on `The Law Relating to Estoppel by Representation ' have explained this decision on the basis that it is an instance of the application of the doctrine of estoppel by encouragement or acquiescence or what has now come to be known as proprietary estoppel which, according to the learned authors, forms an exception to the rule that estoppel cannot found a cause of action.
But if we look at the judgments of Lord Denning and Scarman, L.J., it is apparent that they did not base their decision on any distinctive feature of proprietary estoppel but proceeded on the assumption that there was no distinction between promissory and proprietary estoppel so far as the problem before them was concerned.
Both the learned Law Lord and the learned Lord Justice applied the principle of promissory estoppel in giving relief to Crabb.
Lord Denning, referring to what Lord Cairns had said in Hughes vs Metropolitan Railway Co.,(1) a decision from which inspiration was drawn by him for evolving the doctrine of promissory estoppel in the High Tree 's case, observed that " it is the first principle on which all courts of equity proceed. that it will prevent person from insisting on his strict legal rights whether arising under a contract, or on his title deeds, or by statute when it would be inequitable for him to do so having regard to the dealings which have taken place between the parties".
The decision in the High Trees ' case was also referred to the learned Law Lord and so also other cases supporting the doctrine of promissory estoppel.
Scarman, L.J. also observed that in pursuing the inquiry as to whether there was an equity in favour of Crabb, he did not find helpful "the distinction between promissory and proprietary estoppel".
He added that this "distinction may indeed be valuable to those who have to teach or expound the law, but I do not think that, in solving the particular problem raised by a particular case, putting the law into categories is of the slightest assistance".
It does appear to us that this was a case deci 665 ded on the principle of promissory estoppel.
The representative of the Arun District Council clearly gave assurance to Crabb that they would give him access to the new road at point B to serve the southern portion of his land and the Arun District Council in fact constructed a gate at point B, and in the belief induced by this representation that he would have right of access to the new road at point B, Crabb agreed to sell the northern portion of his land without reserving for himself as owner of the southern portion any right of way over the northern portion for the purpose of access to the new road.
This was the reason why the Court raised an equity in favour of Crabb and held that the equity would be satisfied by giving Crabb "the right of access at point B free of charge without paying anything for it".
Arun District Council was held bound by its promise to provide Crabb access to the new road at point B and this promise was enforced against Arun District Council at the instance of Crabb.
The case was one which fell within the category of promissory estoppel and it may be regarded as supporting the view that promissory estoppel can be the basis of a cause of action.
It is possible that the case also came within the rule of proprietary estoppel enunciated by Lord Kingsdown in Ramsden vs Dyson(1) : "The rule of law applicable to the case appears to me to be this : If a man, under a verbal agreement with a landlord for a certain interest in land, or what amounts to the same thing, under an expectation, created or encouraged by the landlord that he shall have a certain interest, takes possession of such land, with the consent of the landlord, and upon the faith of such promise or expectation, with the knowledge of the land lord, and without objection by him, lays out money upon the land, a Court of equity will compel the landlord to give effect to such promise or expectation." and Spencer Bower and Turner may be right in observing that that was perhaps the reason why it was held that the promise made by Arun District Council gave rise to a cause of action in favour of Crabb.
But, on what principle, one may ask, is the distinction to be sustained between promissory estoppel and proprietary estoppel in the matter of enforcement by action.
If proprietary estoppel can furnish a cause of action, why should promissory estoppel not ? There is no qualitative difference between the two.
Both are the off springs of equity and if equity is flexible enough to permit proprietary estoppel to be used as a cause of action, there is no reason in logic or principle why promissory estoppel should also not be available as a cause of action, if necessary to satisfy the equity.
666 But perhaps the main reason why the English Courts have been reluctant to allow promissory estoppel to found a cause of action seems to be the apprehension that the doctrine of consideration would other wise be completely displaced.
There can be no doubt that the decision of Lord Denning in the High Trees ' case represented a bold attempt to escape from the limitation imposed by the House of Lords in Jorden vs Money (supra) and it rediscovered an equity which was long embedded beneath the crust of the old decisions in Hughes vs Metropolitan Railway Co. (supra) and Birmingham and District Land Co. vs London and North Western Rail Co. (supra), and brought about a remarkable development in the law with a view to ensuring its approximation with justice, an ideal for which the law has been constantly striving.
But it is interesting to note the Lord Denning was not prepared to go further, as he thought that having regard to the doctrine of consideration which was so deeply entrenched in the jurisprudence of the country, it might be unwise to extend promissory estoppel so as to found a cause of action and that is why he uttered a word of caution in Combe vs Combe (supra) that the principle of promissory estoppel "should not be stretched too far, lest it should be endangered".
The learned Law Lord proceeded to add "seeing that the principle never stands alone as giving a cause of action in itself, it can never do away with the necessity of consideration when that is an essential part of the cause of action.
The doctrine of consideration is too firmly fixed to be overthrown by a side wind.
" Spencer Bower and Turner also point out at page 384 of their Treatise (3rd ed) that it is difficult to see how in a case of promissory estoppel a promise can be used to found a cause of action without according to it operative contractual force and it is for this reason that "a contention that a promissory estoppel may be used to found a cause of action must be regarded as an attack on the doctrine of consideration." The learned authors have also observed at page 387 that "to give a plaintiff a cause of action on a promissory estoppel must be little less than to allow an action in contract where consideration is not shown" and that cannot be done because consideration "still remains a cardinal necessity of the formation of a contract.
" It can hardly be disputed that over the last three or four centuries the doctrine of consideration has come to occupy such a predominant position in the law of contract that under the English law it is impossible to think of a contract without consideration and, therefore, it is understandable that the English courts should have hesitated to push the doctrine of promissory estoppel to its logical conclusion and stopped short at allowing it to be used merely as a weapon of defence, though, as we shall point out, there are, quite a few cases where this doctrine has been used 667 not as founding a cause of action in itself but as a part of a cause of a action.
The modern attitude towards the doctrine of consideration is, however, changing fast and there is considerable body of juristic thought which believes that this doctrine is "something of an anchronism".
Prof. Holdsworth pointed out long ago in his History of English Law that "the requirements of consideration in its present shape prevent the enforcement of many contracts, which ought to be enforced, if the law really wishes to give effect to the lawful intentions of the parties to them; and it would prevent the enforcement of many others, if the judges had not used their ingenuity to invest considerations.
But the invention of considerations, by reasoning which is both devious and technical, adds to the difficulties of the doctrine".
Lord Wright remarked in an article published in that the doctrine of consideration in its present form serves no practical purpose and ought to be abolished.
Sir Federick Pollock also said in his well known work of `Ganius of Common Law ', p. 91 that the application of the doctrine of consideration" to various unusual but not unknown cases has been made subtle and obscured by excessive dialectic refinement".
Equally strong is the condemnation of this doctrine in judicial pronouncements.
Lord Duned observed in the well known case of Dunlop Pneumatic Tyre Co. vs Selfridge and Co. Ltd.(1) "I confess that this case is to my mind apt to nip any budding affection which one might have had for the doctrine of consideration.
For the effect of that doctrine in the present case is to make it possible for a person to snap his fingers at a bargain deliberately made, a bargain not in itself unfair, and which the person seeking to enforce it has a legitimate interest to enforce.
" The doctrine of consideration has also received severe criticism at the hands of Dean Roscoe Pound in the United States.
The reason is that promise as a social and economic institution becomes of the first importance in a commercial and industrial society and it is an expression of the moral sentiment of a civilised society that a man 's word should be `as good as his bond ' and his fellow men should be able to rely on the one equally with the other.
That is why the Law Revision Committee in England in its Sixth Report made as far back as 1937 accepted Prof. Holdsworth 's view and advocated that a contract should exist if it was intended to create or affect legal relations and either consideration was present or the contract was reduced to writing.
This recommendation, however, did not fructify into law with the result that the present position remains what it was.
But having regard to the general opprobrium to which the doctrine of consideration has been subjected 668 by eminent jurists, we need not be unduly anxious to project this doctrine against assault or erosion nor allow it to dwarf or stultify the full development of the equity of promissory estoppel or inhibit or curtail its operational efficacy as a justice device for preventing injustice.
It may be pointed out that the Law Commission of India in its 13th Report adopted the same approach and recommended that, by way of exception to section 25 of the Indian Contract Act, 1925, a promise, express or implied, which the promisor knows or reasonably should know, will be relied upon by the promisee, should be enforceable, if the promisee has altered his position to his detriment in reliance on the promise.
We do not see any valid reason why promissory estoppel should not be allowed to found a cause of action where, in order to satisfy the equity, it is necessary to do so.
We may point out that even in England where the judges apprehending that if a cause of action is allowed to be founded on promissory estoppel it would considerably erode, if not completely overthrow, the doctrine of consideration, have been fearful to allow promissory estoppel to be used as a weapon of offence, it is interesting to find that promissory estoppel has not been confined to a purely defensive role.
Lord Denning himself said in Combe vs Combe (supra) that promissory estoppel "may be a part of a cause of action", though "not a cause of action itself".
In fact there have been several cases where promissory estoppel has been successfully invoked by a party to support his cause of action, without actually founding his cause of action exclusively upon it.
Two such cases are : Robertson vs Minister of Pensions(1) and Evenden vs Guildford City Association Football Club Ltd.(2) The English courts have thus gone a step forward from the original position when promissory estoppel was regarded merely as a passive equity and allowed it to be used as a weapon of offence to a limited extent as a part of the cause of action, but still the doctrine of consideration continues to inhibit the judicial mind and that has thwarted the full development of this new equitable principle and the realisation of its vast potential as a juristic technique for doing justice.
It is true that to allow promissory estoppel to found a cause of action would seriously dilute the principle which requires consideration to support a contractual obligation, but that is no reason why this new principle, which is a child of equity brought into the world with a view to promoting honesty and good faith and bringing law closer to justice should be held in fetters and not allowed to operate in all the activist magnitude, so that it may fulfil the purpose for which it was conceived and born.
It must be remembered that law is not a mausoleum.
It is not an antique to be taken 669 down, dusted, admired and put back on the shelf.
It is rather like an old vigorous tree, having its roots in history, yet continuously taking new grafts and putting out new sprouts and occasionally dropping dead wood.
It is essentially a social process, the end product of which is justice and hence it must keep on growing and developing with changing social concepts and values.
Otherwise, there will be estrangement between law and justice and law will cease to have legitimacy.
It is true as pointed out by Mr. Justice Holmes, that continuity with the past is a historical necessity but it must also be remembered at the same time, as pointed out by Mr. Justice Cardozo that "conformity is not to be turned into a "fetish".
We would do well to recall the famous words uttered by Mr. Justice Cardozo while closing his first lecture on "Paradoxes of Legal Science"; "The disparity between precedent and ethos may so lengthen with the years that only covin and chicenery would be disappointed if the separation were to end.
There are many intermediate stages, mores, if inadequate to obliterate the past, may fix direction for the future.
The evil precedent may live, but so sterilized and truncated as to have small capacity for harm.
It will be prudently ignored when invoked as an apposite analogy in novel situations, though the novel element be small.
There will be brought forward other analogies, less precise, it may be, but more apposite to the needs of morals.
The weights are constantly shifted to restore the equilibrium between precedent and justice.
" Was it not Lord Denning who exhorted judges not to be timorous sours but to be bold spirits, ready to allow a new cause of action if justice so required.
(Candler vs Crane Christmas & Co.(1) We may profitably consider at this stage what the American law on the subject is because in the United States the law has always shown a greater capacity for adjustment and growth than elsewhere.
The doctrine of promissory estoppel has displayed remarkable vigour and vitality in the hands of American Judges and it is still rapidly developing and expanding in the United States.
It may be pointed out that this development does not derive its origin in any way from the decision of Lord Denning in the High Trees ' case but ante dates this decision by a number of years; perhaps it is possible that it may have helped to inspire that decision.
It was long before the decision in the High Trees 'case that the American Law Institute 's Restatement of the Law of Contract 's came out with the following proposition in Article 90 : 670 "A promise which the promisor should reasonably expect to induce action or forbearance of a definite and substantial character on the part of the promisee, and which does induce such action or forbearance, is binding if injustice can be avoided only by enforcement of the promise.
" This proposition was explained and elucidated by several illustrations given in the article and one of such illustrations was as follows : "A promises B to pay him an annuity during B 's life.
B thereupon resigns a profitable employment, as A expected that he might.
B receives the annuity for some years, in the meantime becoming disqualified from again obtaining good employment.
A 's promise is binding.
" It is true that the Restatement has not the same weight, as a source of law, as actual decisions of courts of high standing, yet the principle set out in Article 90 has in fact formed the basis of a number of decisions in various states and it is now becoming increasingly clear that a promise may in the United States derive contractual enforceability if it has been made by the promisor intending that it would be acted on and the promisee has altered his position in reliance on it, notwithstanding that there is no consideration in the sense in which that word is used in English and Commonwealth jurisprudence.
Of course the basic requirement for invoking this principle must be present namely, that the fact situation should be such that "injustice can be avoided only by enforcement of the promise".
There are numerous examples of the application of this principle to be found in recent American decisions.
There is, for instance, the long line of cases in which a promise to give a charitable subscription has been consistently held to be enforceable at the suit of the charity.
Though attempts have been made to justify these decisions by reasoning that the charity by commencing or continuing its charitable work after receiving promise has given good consideration for it, we do not think that, on closer scrutiny, the enforceability of the promise in these cases can be supported by spelling out the presence of some form of consideration and the true principle on which they are really based is the principle of promissory estoppel.
This is also the view expressed in the following statement at page 657 of vol.
19 of American Jurisprudence : "A number of courts have upheld the validity of charitable subscriptions on the theory of promissory estoppel holding that while a mere promise to contribute is unenforceable for want of consideration, if money has been expended or liabilities have been incurred in reliance on the promise so 671 that non fulfillment will cause injury to the payee, the donor is estopped to assert the lack of consideration, and the promise will be enforced." Chief Justice Cardozo, presiding over the Court of Appeals of the State of New York, explained the ratio of these decisions in the same terms in Alleghany College vs National Chauteuque County Bank(1): "The half truths of one generation tend at times to perpetuate themselves in the law as the whole truths of another, when constant repetition brings it about that qualifications, taken once for granted, are disregarded or forgotten.
The doctrine of consideration has not escaped the common lot.
As far back as 1881, Judge Holmes in his lectures on the Common Law (p. 292) separated the detriment which is merely a consequence of the promise from the detriment, which is in truth the motive or inducement, and yet added that the courts 'have gone far in obliterating this distinction '.
The tendency toward effacement has not lessened with the years.
On the contrary there has grown up of recent days a doctrine that a substitute for consideration or an exception to its ordinary requirements can be found in what is styled a 'promissory estoppel '.
Williston, Contract, Ss. 139, 116.
Whether the exception has made its way in this State to such an extent as to permit us to say that the general law of consideration has been modified accordingly, we do not now attempt to say.
Cases such as and be signposts on the road.
Certain at least it is that we have adopted the doctrine of promissory estoppel as the equivalent of consideration in connection with our law of charitable subscriptions.
So long as those decisions stand, the question is not merely whether the enforcement of a charitable subscription can be squared with the doctrine of consideration in all its ancient rigor.
The question may also be whether it can be squared with the doctrine of consideration as qualified by the doctrine of promissory estoppel".
We have said that the cases in this State have recognized this exception, if exception it is thought to be.
Thus, in the subscription was made without request, express or implied that the church do anything on the faith of it.
Later, the church did incur expense to the knowledge of the promisor, and in the reasonable belief that the promise would be kept.
We held the promise binding, though 672 consideration there was none except upon the theory of a promissory estoppel.
In a situation substantially the same became the basis for a like ruling.
So in 103 N.Y. 600 and the moulds of consideration as fixed by the old doctrine were subject to a like expansion.
Very likely, conceptions of public policy have shaped, more or less subconsciously, the rulings thus made.
Judges have been affected by the thought that 'defences of that character ' are 'breaches of faith towards the public, and especially towards those engaged in the same enterprise, and an unwarrantable disappointment of the reasonable expectations of those interested '.
W. F. Allen J. in 12 N.Y. 18 and of and cases there cited.
The result speaks for itself irrespective of the motive.
Decisions which have stood so long, and which are supported by so many considerations of public policy and reason, will not be over ruled to save the symmetry of a concept which itself came into our law, not so much from any reasoned conviction of its justice, as from historical accidents of practice and procedure.
(8 Holdsworth, History of English Law, 7 et.
The concept survives as one of the distinctive features of our legal system.
We have no thought to suggest that it is obsolete or on the way to be abandoned.
As in the case of other concepts, however, the pressure of exceptions has led to irregularities of form.
" It is also interesting to note that the doctrine of promissory estoppel has been widely used in the United States in diverse other situations as founding a cause of action.
The most notable instances are to be found in what may be called the "sub contractor bid cases" in which a contractor about to tender for a contract, invites a sub contractor to submit a bid for a sub contract and after receiving his bid the contractor submits a tender.
In such cases, the sub contractor has been held unable to retract his bid and be liable in damages if he does so.
It is not possible to say that any detriment which the contractor may be able to show in these cases would amount to consideration in its strict sense and these decisions have plainly been reached on an application of the doctrine of promissory estoppel.
One of such cases was Drennan vs Star Paving Company(1) where Traynor, J. explicitly adopted as good law the text of Article 90 of the Restatement of the law of Contracts quoted above and stated in so many words that "the absence of consideration is not fatal to the enforcement of such a promise".
There are also numerous cases where the doctrine of promissory estoppel has been applied against the Government where 673 the interest of justice, morality and common fairness clearly dictated such a course.
We shall refer to these cases when we discuss the applicability of the doctrine of equitable estoppel against the Government.
Suffice it to state for the present that the doctrine of promissory estoppel has been taken much further in the United States than in English and Commonwealth jurisdictions and in some States at least, it has been used to reduce, if not to destroy, the prestige of consideration as an essential of valid contract.
Vide Spencer Bower and Turner 's Estoppel by Representation (2d) page 358.
We now go on to consider whether and if so to what extent is the doctrine of promissory estoppel applicable against the Government.
So far as the law in English is concerned, the position cannot be said to be very clear.
Rowlett J., in an early decision in Rederiaktiebolaget Amphitrite vs The King(1) held that an undertaking given by the British Government to certain neutral ship owners during the First World War that if the shipowners sent a particular ship to the United Kingdom with a specified cargo, she shall not be detained, was not enforceable against the British Government in a court of law and observed that his main reason for taking this view was that: " it is not competent for the Government to fetter its future executive action, which must necessarily be determined by the needs of the community when the question arises.
It cannot by contract hamper its freedom of action in matters which concern the welfare of the State.
" This observation has however not been regarded by jurists as laying down the correct law on the subject since it is "very wide and it is difficult to determine its proper scope".
Anson 's English Law of Contract, 22d.
The doctrine of executive necessity propounded by Rowlatt, J., was in fact disapproved by Denning, J., as he then was, in Roberston vs Minister of Pensions (supra) where the learned Judge said: The Crown cannot escape by saying that estoppels do not bind the Crown for that doctrine has long been exploded.
Nor can the Crown escape by praying in aid the doctrine of executive necessity, that is, the doctrine that the Crown cannot bind itself so as to fetter its future executive action.
That doctrine was propounded by Rowlatt, J., in Rederiak tiebolaget Amphitrite vs The King but it was unnecessary for the decision because the statement there was not a promise which was intended to be binding but only an expression of intention.
Rowlatt, J., seems to have been influenced by 674 the cases on the right of the Crown to dismiss its servants at pleasure, but those cases must now all be read in the light of the judgment of Lord Atkin in Reily vs The King (1954) A.C. 176, 176).
In my opinion the defence of executive necessity is of limited scope.
It only avails the Crown where there is an implied term to that effect or that is the true meaning of the contract.
" It is true that the decision of Denning J., in this case was overruled by the House of Lords in Howell vs Falmouth Boat Construction Co. Ltd. (1) but that was on the ground that the doctrine of promissory estoppel cannot be invoked to "bar the Crown from enforcing a statutory prohibition or entitle the subject to maintain that there has been no breach of it".
The decision of the House of Lords did not express any disapproval of the applicability of the doctrine of promissory estoppel against the Crown nor did it overrule the view taken by Denning J., that the Crown cannot escape its obligation under the doctrine of promissory estoppel by "praying in aid the doctrine of executive necessity.
" The statement of the law by Denning, J., may, therefore, still be regarded as holding the field and it may be taken to be a judicially favoured view that the Crown is not immune from liability under the doctrine of promissory estoppel.
The courts in America for a long time took the view that the doctrine of promissory estoppel does not apply to the Government but more recently the courts have started retreating from that position to a sounder one, namely, that the doctrine of promissory estoppel may apply to the Government when justice so requires.
The second edition of American Jurisprudence brought out in 1966 in paragraph 123 points out that "equitable estoppel will be invoked against the State when justified by the facts", though it does warn that this doctrine "should not be lightly invoked against the State.
" Later in the same paragraph it is stated that "as a general rule, the doctrine of estoppel will not be applied against the State in its governmental, public or sovereign capacity", but a qualification is introduced that promissory estoppel may be applied against the State even in its governmental, public or sovereign capacity if "its application is necessary to prevent fraud or manifest injustice".
Since 1966 there is an increasing trend towards applying the doctrine of promissory estoppel against the State and the old law that promissory estoppel does not apply against the government is definitely declining.
There have been numerous cases in the State courts where it has been held that promissory estoppel may be applied even against the Govern 675 ment in its governmental capacity where the accommodation of the needs of justice to the needs of effective government so requires.
The protagonists of the view that promissory estoppel cannot apply against the Government or a public authority seek to draw inspiration from the majority decision of the United States Supreme Court in Federal Crop Insurance Corporation vs Merrill.(1) But we do not think that decision can be read as laying down the proposition that the doctrine of promissory estoppel can never be invoked against the Government.
There the County Committee acting as the agent of the Federal Crop Insurance Corporation which was a wholly Government owned corporation constituted under the Federal Crop Insurance Act, advised the respondents that their entire 460 acres of spring wheat crop which included spring wheat reseeded.
On winter wheat acreage was insurable and acting upon it, the respondents made an application for insurance which was forwarded by the County Committee to the Denver office of the Corporation with a recommendation for acceptance.
The application did not mention that any part of the insured crop was reseeded and it was accepted by the Denver office of the Corporation.
There were at this time wheat crop insurance regulations framed by the Corporation and published in the Federal Register which prohibited insurance of spring wheat reseeded on winter wheat acreage but neither the respondents nor the County Committees which was acting as the agent of the Corporation was aware of them.
A few months later, most of the respondent 's crop was destroyed by drought and on a claim being made by the respondents under the policy of insurance, the Corporation refused to pay the loss on the ground that the wheat crop insurance regulations expressly prohibited insurance of reseeded wheat.
The refusal was upheld by the Supreme Court by a majority of five to four.
The majority observed: "It is too late in the day to urge that the Government is just another private litigant, for purposes of charging it with liability, whenever it takes over a business theretofore conducted by private enterprises or engages in competitions with private ventures.
Whatever the form in which the Government functions, anyone entering into an arrangement with the Government takes the risk of having accurately ascertained that be who purports to act for the Government stays within the bounds of his authority And this is so even though as here, the agent himself may have been unaware of the limitations upon his autho 676 rity. "Man must turn square corners when they deal with the Government", does not reflect a callous outlook.
It merely expresses the duty of all courts to observe the conditions defined by Congress for charging the public treasury.
" It will be seen that the Corporation was held entitled to repudiate its liability because the wheat crop insurance regulations prohibited insurance of reseeded wheat and the assurance given by the County Committee as the agent of the Corporation that the reseeded wheat was insurable being contrary to the wheat crop insurance regulations, could not be held binding on the Corporation.
It was not within the authority of the County Committee to give such assurance contrary to the wheat crop insurance regulations and hence no promissory estoppel against the Corporation could be founded upon it.
This decision did not say that even if an assurance given by an agent is within the scope of his authority and is not prohibited by law, it could still not create promissory estoppel against the Government.
But, it may be pointed out, even this limited holding has come in for considerable criticism at the hands of jurists in the United States.
See Davis on Administrative Law (3rd d.) pages 344 345.
Referring to the observation of the majority that "Men must turn square corners when they deal with the Government", Maguire and Zimet have poetically responded by saying: "It is hard to see why the Government should not be held to a like standard of rectangular rectitude when dealing with its citizens." (Maguire and Zimet, Hobson 's Choice and Similar Practices in Federal Taxation, 48 Harv.
L. Rev. 1287 at 1299).
There has so far not been any decision of the Supreme Court of the United States taking the view that the doctrine of promissory estoppel cannot be invoked against the Government.
The trend in the State courts, of late, has been strongly in favour of the application of the doctrine of promissory estoppel against the Government and public bodies "where interests of justice, morality and common fairness clearly dictate that course.
" It is being increasingly felt that "that the Government ought to set a high standard in its dealings and relationships with citizens and the word of a duly authorised Government agent, acting within the scope of his authority ought to be as good as a Government bond".
Of course, as pointed out by the United States Court of Appeals, Third Circuit in Valsonavich vs United States, (1) the Government would not be estopped "by the acts of its officers and agents who without authority enter into 677 agreements to do what the law does not sanction or permit" and "those dealing with an agent of the Government must be held to have notice of limitations of his authority" as held in Merrill 's case.
This is precisely what the House of Lords also held in England in Howell vs Falmouth Boat Construction Co. Ltd. (supra) where Lord Simonds stated the law to be: "The illegality of an act is the same whether or not the actor has been misled by an assumption of authority on the part of a Government officer however high or low in the hierachy.
The question is whether the character of an act done in face of a statutory prohibition is affected by the fact that it has been induced by a misleading assumption of authority.
In my opinion the answer is clearly No." But if the acts or omissions of the officers of the Government are within the scope of their authority and are not otherwise impermissible under the law, they "will work estoppel against the Government.
" When we turn to the Indian law on the subject it is heartening to find that in India not only has the doctrine of promissory estoppel been adopted in its fullness but it has been recognized as affording a cause of action to the person to whom the promise is made.
The requirement of consideration has not been allowed to stand in the way of enforcement of such promise.
The doctrine of promissory estoppel has also been applied against the Government and the defence based on executive necessity has been categorically negatived.
It is remarkable that as far back as 1880, long before the doctrine of promissory estoppel was formulated by Denning, J., in England, A Division Bench of two English Judges in the Calcutta High Court applied the doctrine of promissory estoppel and recognised a cause of action founded upon it in the Ganges Manufacturing Co. vs Surajmuli and other(1).
The doctrine of promissory estoppel was also applied against the Government in a case subsequently decided by the Bombay High Court in Municipal Corporation of Bombay vs The Secretary of State.(2) The facts of this last mentioned case in Municipal Corporation of Bombay vs The Secretary of State (supra) are a little interesting and it would be profitable to refer to them.
The Government of Bombay, with a view to constructing an arterial road, requested the Municipal Commissioner to remove certain fish and vegetable 678 markets which obstructed the construction of the proposed road.
The Municipal Commissioner replied that the markets were vested in the Corporation of Justices but that he was willing to vacate certain municipal stables which occupied a portion of the proposed site if the Government would rent other land mentioned in his letter, to the Municipality at a nominal rent, the Municipality undertaking to bear the expenses of levelling the same and permit the Municipality to erect on such land "stables of wood and iron with nobble foundation to be removed at six months ' notice on other suitable ground being provided by Government".
The Government accepted the suggestion of the Municipal Commissioner and sanctioned the application of the Municipal Commissioner for a site for stabling on the terms set out above and the Municipal Commissioner thereafter entered into possession of the land and constructed stables, workshops and chawls on the same at considerable expense.
Twenty four years later the Government served a notice on the Municipal Commissioner determining the tenancy and requesting the Municipal Commissioner to deliver possession of the land within six months and in the mean time to pay rent at the rate of Rs.12,000/ per month.
The Municipal Corporation declined to hand over possession of the land or to pay the higher rent and the Secretary of State for India thereupon filed a suit against the Municipal Corporation for a declaration that the tenancy of the Municipality stood determined and for an order directing the municipality to pay rent at the rate of Rs. 12,000/ per month.
The suit was resisted by the Municipal Corporation on the ground then the events which had transpired had created an equity in favour of the Municipality which afforded an answer to the claim of the Government to eject the Municipality.
This defence was upheld by a Division Bench of the High Court and Jenkins C.J., speaking on behalf of the Division Bench, pointed out that, in view of the following facts, namely: " the Municipality gave up the old stables, levelled the ground, and erected the moveable staibles in 1866 in the belief that they had against the Government an absolute right not to be turned out until not only the expiration of six months notice, but also other suitable ground was furnished: that this belief is referable to an expectation created by the Government that their enjoyment of the land would be in accordance with this belief: and that the Government knew that the Municipality were acting in this belief so created:" 679 an equity was created in favour of the Municipality which entitled it "to appeal to the Court for its aid in assisting them to resist the Secretary of State 's claim that they shall be ejected from the ground".
The learned Chief Justice pointed out that the doctrine which he was applying took its origin "from the jurisdiction assumed by Courts of Equity to intervene in the case of or to prevent fraud" and after referring to Ramsden vs Dyson(1) observed that the Crown also came within the range of this equity.
This decision of the Bombay High Court is a clear authority for the proposition that it is open to a party who has acted on a representation made by the Government to claim that the Government shall be bound to carry out the promise made by it, even though the promise is not recorded in the form of a formal contract as required by the Constitution.
That is how this decision has in fact been interpreted by this court in Union of India vs Indo Afghan Agencies:(2) We don 't find any decision of importance thereafter on the subject of promissory estoppel until we come to the decision of this Court in Collector of Bombay vs Municipal Corporation of the City of Bombay & Ors.(3).
The facts giving rise to this case were that in 1865 the Government of Bombay called upon the predecessor in title of the Municipal Corporation of Bombay to remove old markets from a certain site and vacate it and on the application of the Municipal Commissioner, the Government passed a resolution approving and authorizing the grant of another site to the Municipality.
The resolution stated further that "the Government do not consider that any rent should be charged to the Municipality as the markets will be like other public buildings, for the benefit of the whole community".
The Municipal Corporation gave up the site on which the old markets were situated and spent a sum of Rs. 17 lakhs in erecting and maintaining markets on the new site.
In 1940 the Collector of Bombay assessed the new site to land revenue and the Municipal Corporation there upon filed a suit for a declaration that the order of assessment was ultra vires and it was entitled to hold the land for ever without payment of any assessment.
The High Court of Bombay held that the Government had lost its right to assess the land in question by reason of the equity arising on the facts of the case in favour of the Municipal Corporation and there was thus a limitation on the right of the Government to assess under section 8 of the Bom 680 bay City Land Revenue Act.
On appeal by the Collector to this Court, the majority Judges held that the Government was not, under the circumstances of the case, entitled to assess land revenue on the land in question because the Municipal Corporation had taken possession of the land in terms of the Government resolution and had continued in such possession openly, uninterruptedly and of right for over seventy years and thereby acquired the limited title it had been prescribing for during the period, that is to say, the right to hold the land in perpetuity free of rent.
Chandrasekhra Aiyar, J., agreed with the conclusion reached by the majority but rested his decision on the doctrine of promissory estoppel.
He pointed out that the Government could not be allowed to go back on the representation made by it and stressed the point in the form of an interrogation by asking: "if we do so, would it not amount to our countenancing the perpetration of what can be compendiously described as legal fraud which a court of equity must prevent being committed?" He observed that even if the resolution of the Government amounted merely to "the holding out of a promise that no rent will be charged in the future, the Government must be deemed in the circumstances of this case to have bound themselves to fulfil it.
Whether it is the equity recognised in Ramsden 's case (supra) or it is some other form of equity, is not of much importance.
Courts must do justice by the promotion of honesty and good faith, as far as it lies in their power.
" This was of course the solitary view of Chandrasekhara Aiyer, J., but it was approved by this Court in no uncertain terms in Indo Afghan Agencies case (supra).
Then we come to the celebrated decision of this Court in the Indo Afghan Agencies case (supra).
It was in this case that the doctrine of promissory estoppel found its most eloquent exposition.
We may briefly state the facts in order to appreciate the ratio of the decision.
Indo Afghan Agencies Ltd. who were the respondents before the Court, acting in reliance on the Export Promotion Scheme issued by the Central Government, exported woollen goods to Afghanistan and on the basis of their exports claimed to be entitled to obtain from the Textile Commissioner import entitlement certificate for the full F.O.B. value of the goods exported as provided in the scheme.
The Scheme was not a statutory Scheme having the force of law but it provided that an export of woollen goods would be entitled to import raw material of the total amount equal to 100% of the F.O.B. value of his exports.
The respondents contended that, relying on the promise contained in the Scheme, they had exported woollen goods to Afghanistan and were,.
therefore, entitled to enforce the promise against the Government and to obtain import entitlement 681 certificate for the full F.O.B. value of the goods exported on the principle of promissory estoppel.
This contention was sought to be answered on behalf of the Government by pleading the doctrine of executive necessity and the argument of the Government based on this doctrine was that it is not competent for the Government to fetter its future executive action which must necessarily be determined by the needs of the community when the question arises and no promise or undertaking can be held to be binding on the Government so as to hamper its freedom of executive action.
Certain observations of Rowlatt, J., in Rederiektiabolaget Amphitrite vs The King (supra) were sought to be pressed into service on behalf of the Government in support of this argument.
We have already referred to these observations earlier and we need not reproduce them over again.
These observation undoubtedly supported the contention of the Government but it was pointed out by this Court that these observations were disapproved by Denning J., in Robertson vs Minister of Pensions (supra) where the learned Judge said that "the Crown cannot escape by praying in aid the doctrine of executive necessity, that is the doctrine that the Crown cannot bind itself so as to fetter its future executive action.
The defence of executive necessity is of limited scope.
It only avails the Crown where there is an implied term to that effect or that is the true meaning of the contract" and this statement of Denning, J., was to be preferred as laying down the correct law of the subject.
Shah, J., speaking on behalf of the Court, observed at p. 376: "We are unable to accede to the contention that the executive necessity releases the Government from honouring its solemn promises relying on which citizens have acted to their detriment.
Under our constitutional set up no person may be deprived of his right or liberty except in due course of and by authority of law; of a member of the Executive seeks to deprive a citizen of his right or liberty otherwise than in exercise of power derived from the law common or statute the Courts will be competent to and indeed would be bound to, protect the rights of the aggrieved citizen.
" The defence of executive necessity was thus clearly negatived by this Court and it was pointed out that it did not release the Government from its obligation to honour the promise made by it, if the citizen, acting in reliance on the promise, had altered his position.
The doctrine of promissory estoppel was in such a case applicable against the Government and it could not be deteated by invoking the defence of executive necessity.
682 It was also contended on behalf of the Government that if the Government were held bound by every representation made by it regarding its intention, when the exporters have acted in the manner they were invited to act, the result would be that the Government would be bound by a contractual obligation even though no formal contract in the manner required by Article 299 was executed.
But this contention was negatived and it was pointed out by this Court that the respondents "are not seeking to enforce any contractual right: they are seeking to enforce compliance with the obligation which is laid upon the Textile Commissioner by the terms of the Scheme, and we are of the view that even if the Scheme is executive in character, the respondents who were aggrieved because of the failure to carry out the terms of the Scheme were entitled to seek resort to the Court and claim that the obligation imposed upon the Textile Commissioner by the Scheme be ordered to be carried out".
It was thus laid down that a party who has, acting in reliance on a promise made by the Government, altered his position, is entitled to enforce the promise against the Government, even though the promise is not in the form of a formal contract as required by Article 299 and that Article does not militate against the applicability of the doctrine of promissory estoppel against the Government.
This Court finally, after referring to the decision in the Ganges Manufacturing Co. vs Surujmull (supra).
The Municipal Corporation of the City of Bombay vs The Secretary of State for India (supra) and Collector of Bombay vs Municipal Corporation of the City of Bombay & Ors.
(supra), summed up the position as follows: "Under our jurisprudence the Government is not exempt from liability to carry out the representation made by it as to its future conduct and it cannot on some undefined and undisclosed ground of necessity or expediency fail to carry out the promise solemnly made by it, nor claim to be the Judge of its own obligation to the citizen on an ex parte appraisement of the circumstances in which the obligation has arisen." The law may, therefore, now be taken to be settled as a result of this decision that where the Government makes a promise knowing or intending that it would be acted on by the promises and, in fact, the promisee, acting in reliance on it, alters his position, the Government would be held bound by the promise and the promise would be enforceable against the Government at the instance of the promises, notwithstanding that there is no consideration for the promise and the promise is not recorded in the form of a formal contract 683 as required by Article 299 of the Constitution.
It is elementary that in a Republic governed by the rule of law, no one, howsoever high or low, is above the law.
Every one is subject to the law as fully and completely as any other and the Government is no exception.
It is indeed the pride of constitutional democracy and rule of law that the Government stands on the same footing as a private individual so far as the obligation of the law is concerned: the former is equally bound as the latter.
It is indeed difficult to see on what principle can a Government, committed to the rule of law, claim immunity from the doctrine of promissory estoppel.
Can the Government say that it is under no obligation to act in a manner that is fair and just or that it is not bound by considerations of "honesty and good faith"? Why should the Government not be held to a high "standard of rectangular rectitude while dealing with its citizens"? There was a time when the doctrine of executive necessity was regarded as sufficient justification for the Government to repudiate even its contractual obligations, but let it be said to the eternal glory of this Court, this doctrine was emphatically negatived in the Indo Afghan Agencies case and the supremacy of the rule of law was established.
It was laid down by this Court that the Government cannot claim to be immune from the applicability of the rule of promissory estoppel and repudiate a promise made by it on the ground that such promise may fetter its future executive action.
If the Government does not want its freedom of executive action to be hampered or restricted, the Government need not make a promise knowing or intending that it would be acted on by the promisee and the promisee would alter his position relying upon it.
But if the Government makes such a promise and the promises acts in reliance upon it and alters his position, there is no reason why the Government should not be compelled to make good such promise like any other private individual.
The law cannot acquire legitimacy and gain social acceptance unless it accords with the moral values of the society and the constant endeavor of the Courts and the legislatures must, therefore, be to close the gap between law and morality and bring about as near an approximation between the two as possible.
The doctrine of promissory estoppel is a significant judicial contribution in that direction.
But it is necessary to point out that since the doctrine of promissory estoppel is an equitable doctrine, it must yield when the equity so requires.
If it can be shown by the Government that having regard to the facts as they have transpired, it would be inequitable to hold the Government to the promise made by it, the Court would not raise an equity in favour of the promisee and enforce the promise against the 684 Government.
The doctrine of promissory estoppel would be displaced in such a case because, on the facts, equity would not require that the Government should be held bound by the promise made by it.
When the Government is able to show that in view of the facts as have transpired, public interest would be prejudiced if the Government were required to carry out the promise, the Court would have to balance the public interest in the Government carrying out a promise made to a citizen which has induced the citizen to act upon it and after this position and the public interest likely to suffer if the promise were required to be carried out by the Government and determine which way the equity lies.
It would not be enough for the Government just to say that public interest requires that the Government should not be compelled to carry out the promise or that the public interest would suffer if the Government were required to honour it.
The Government cannot, as Shah, J., pointed out in the Indo Afghan Agencies case, claim to be exempt from the liability to carry out the promise "on some indefinite and undisclosed ground of necessity or expediency", nor can the Government claim to be the sole judge of its liability and repudiate it "on an ex parte appraisement of the circumstances".
If the Government wants to resist the liability, it will have to disclose to the Court what are the facts and circumstances on account of which the Government claims to be exempt from the liability and it would be for the Court to decide whether these facts and circumstances are such as to render it inequitable to enforce the liability against the Government.
Mere claim of change of policy would not be sufficient to exonerate the Government from the liability: the Government would have to show what precisely is the changed policy and also its reason and justification so that the Court can judge for itself which way the public interest lies and what the equity of the case demands.
It is only if the Court is satisfied, on proper and adequate material placed by the Government, the over riding public interest requires that the Government should not be held bound by the promise but should be free to act unfettered by it, that the Court would refuse to enforce the promise against the Government.
The Court would not act on the mere ipse dixit of the Government, for it is the Court which has to decide and not the Government whether the Government should be held exempt from liability.
This is the essence of the rule of law.
The burden would be upon the Government to show that the public interest in the Government acting otherwise than in accordance with the promise is so overwhelming that it would be inequitable to hold the Government bound by the promise and the Court would insist on a highly rigorous standard of proof in the discharge of this burden.
But even where there is no such over riding public interest, it may still be competent to 685 the Government to resile from the promise "on giving reasonable notice which need not be a formal notice, giving the promisee a reasonable opportunity of resuming his position" provided of course it is possible for the promisee to restore status quo ante.
If however, the promisee cannot resume his position, the promise would become final and irrevocable.
Vide Emmanuel Ayodeji Ajayi vs Briscoe.(1) The doctrine of promissory estoppel was also held applicable against a public authority like a Municipal Council in Century Spinning & Manufacturing Co. Ltd. & Anr.
vs The Ulhasuagar Municipal Council & Anr.(2) The question which arose in this case was whether the Ulhas Nagar Municipal Council could be compelled to carry out a promise made by its predecessor municipality that the factories in the industrial area within its jurisdiction would be exempt from payment of octroi for seven years from the date of the levy.
The appellant company, in the belief induced by the assurance and undertaking given by the predecessor municipality that its factory would be exempt from octroi for a period of seven years, expanded its activities, but when the municipal council came into being and took over the administration of the former municipality, it sight to levy octroi duty on appellant company.
The appellant company thereupon filed a writ petition under Article 226 of the Constitution in the High Court of Bombay to restrain the municipal council from enforcing the levy of octroi duty in breach of the promise made by the predecessor municipality.
The High Court dismissed the petition in limine but, on appeal, this Court took the view that this was a case which required consideration and should have been admitted by the High Court.
Shah, J., speaking on behalf of the Court, pointed out "Public bodies are as much bound as private individuals to carry out representations of facts and promises made by them, relying on which other persons have altered their position to their prejudice.
The obligation arising against an individual out of his representation amounting to a promise may be enforced ex contracted by a person who acts upon the promise: when the law requires that a contract enforceable at law against a public body shall be in certain from or be executed in the manner prescribed by statute, the obligation may be if the contract be not in that form be enforced against it in appropriate cases in equity." The learned Judge then referred to the decision in the Indo Afghan Agencies case and observed that in that case it was laid down by this 686 Court that "the Government is not exempt from the equity arising out of the acts done by citizens to their prejudice relying upon the representations as to its future conduct made by the Government".
It was also pointed out by the learned Judge that in the Indo Afghan Agencies case this Court approved of the observations made by Denning, J. in Robertson vs Minister of Pensions (supra) rejecting the doctrine of executive necessity and held them to be applicable in India.
The learned Judge concluded by saying in words pregnant in the hope and meaning for democracy: "If our nascent democracy is to thrive different standards of conduct for the people and the public bodies cannot ordinarily be permitted.
A public body is, in our judgment, not exempt from liability to carry out its obligation arising out of representations made by it relying upon which a citizen has altered his position to his prejudice." This Court refused to make a distinction between a private individual and a public body so far as the doctrine of promissory estoppel is concerned.
We then come to another important decision of this Court in Turner Morrison & Co. Ltd. vs Hungerford Investment Trust Ltd. (1) where the doctrine of promissory estoppel was once again affirmed by this Court.
Hegde, J, speaking on behalf of the Court, pointed out: "Estoppel" is a rule of equity.
"That rule has gained new dimensions in recent years.
A new class of estoppel i.e. promissory estoppel has come to be recognised by the courts in this Country as well as in England.
The full implication of 'promissory estoppel ' is yet to be spelled out." The learned Judge, after referring to the decisions in High Trees case, Robertson vs Minister of Pensions (supra) and the Indo Afghan Agencies case, pointed out that "the rule laid down in these decisions undoubtedly advanced the cause of justice and hence we have no hesitation in accepting it.
We must also refer to the decision of this Court in M. Ramanatha Pillai vs The State of Kerala & Anr.(1) because that was a decision strongly relied upon on behalf of the State for negativing the applicability of the doctrine of estoppel against the Government.
This was a case where the appellant was appointed to a temporary post and on the post being abolished, the service of the appellant was terminated.
The appellant challenged the validity of termination of service, inter alia, on 687 the ground that the Government was precluded from abolishing the post and terminating the service on the principle of promissory estoppel.
This ground based on the doctrine of promissory estoppel was negatived and it was pointed out by the Court that the appellant knew that the post was temporary, suggesting clearly that the appellant could not possibly be led into the belief that the post would not be abolished.
If the post was temporary to the knowledge of the appellant, it is obvious that the appellant knew that the post would be liable to be abolished at any time and if that be so, there could be no factual basis for invoking the doctrine of promissory estoppel for the purpose of precluding the Government from abolishing the post.
This view taken by the Court was sufficient to dispose of the contention based on promissory estoppel and it was not necessary to say anything more about it, but the Court proceeded to cite a passage from American Jurisprudence, Vol. 28 (2d) at 783, paragraph 123 and observed that the High Court rightly held "that the courts exclude the operation of the doctrine of estoppel, when it is found that the authority against whom estoppel is pleaded has owed a duty to the public against whom the estoppel cannot fairly operate.
" It was this observation which was heavily relied upon on behalf of the State but we fail to see how it can assist the contention of the State.
In the first place, this observation was clearly obiter, since, as pointed out by us, there was on the facts of the present case no scope for the applicability of the doctrine of promissory estoppel.
Secondly, this observation was based upon a quotation from the passage in paragraph 123 at page 783 of Volume 28 of American Jurisprudence (2 d), but unfortunately this quotation was incomplete and it overlooked, perhaps inadvertently, the following two important sentences at the commencement of the paragraph which clearly show that even in the United States the doctrine of promissory estoppel is applied against the State "when justified by the facts": "There is considerable dispute as to the application of estoppel with respect to the State.
While it is said that equitable estoppel will be invoked against the State when justified by the facts, clearly the doctrine of estoppel should not be lightly invoked against the State" (emphasis supplied).
Even the truncated passage quoted by the Court recognised in the last sentence that though, as a general rule, the doctrine of promissory estoppel would not be applied against the State in its governmental, public or sovereign capacity, the Court would unhesitatingly allow the doctrine to be invoked in cases where it is necessary in order "to prevent fraud or manifest injustice".
This passage leaves no doubt that the 688 doctrine of promissory estoppel may be applied against the State even in its governmental, public or sovereign capacity where it is necessary to prevent fraud or manifest injustice.
It is difficult to imagine that the Court citing this passage with approval could have possibly intended to lay down that in no case can the doctrine of promissory estoppel be invoked against the Government.
Lastly, a proper reading of the observation of the Court clearly shows that what the Court intended to say was that where the Government owes a duty to the public to act differently, promissory estoppel cannot be invoked to prevent the Government from doing so.
This proposition is unexceptionable, because where the Government owes a duty to the public to act in a particular manner, and here obviously duty means a course of conduct enjoined by law, the doctrine of promissory estoppel cannot be invoked for preventing the Government from acting in discharge of its duty under the law.
The doctrine of promissory estoppel cannot be applied in teeth of an obligation or liability imposed by law.
We may then refer to the decision of this Court in Assistant Custodian vs Brij Kishore Agarwala & Ors.(1) It is not necessary to reproduce the facts of this case, because the only purpose for which this decision was relied upon on behalf of the State was to show that the view taken by the House of Lords in Howell vs Falmouth Boat Construction Co. Ltd. (Supra) was preferred by this Court to that taken by Lord Denning in Robertson vs Minister of Pension (supra).
It is true that in this case the Court expressed the opinion "that the view taken by the House of Lords is the correct one and not the one taken by Lord Denning" but we fail to see how that can possibly help the argument of the State.
The House of Lords did not in Howell 's case negative the applicability of the doctrine of promissory estoppel against the Government.
What it laid down was merely this, namely, that no representation or promise made by an officer can preclude the Government from enforcing a statutory prohibition.
The doctrine of promissory estoppel cannot be availed to permit or condone a breach of the law.
The ratio of the decision was succinctly put by Lord Normand when he said" neither a minister nor any subordinate officer of the Crown can by any conduct or representation bar the Crown from enforcing a statutory prohibition or entitle the subject to maintain that there has been no breach of it".
It may also be noted that promissory estoppel cannot be invoked to compel the Government or even a private party to do an act prohibited by law.
There can also be no promissory estoppel against the exercise of legislative power.
The Legislature can never be precluded 689 from exercising its legislative function by resort to the doctrine of promissory estoppel.
Vide State of Kerala vs Gwalior Rayon Silk Manufacturing Co. Ltd.(1) The next decision to which we must refer is that in Excise Commissioner, U.P. Allahabad vs Ram Kumar.(2) This was also a decision on which strong reliance was placed on behalf of the State.
It is true that, in this case, the Court observed that "it is now well settled by a catena of decisions that there can be no question of estoppel against the Government in the exercise of its legislative, sovereign or executive powers," but for reasons which we shall presently state, we do not think this observation can persuade us to take a different view of the law than that enunciated in the Indo Afghan Agencies ' case.
In the first place, it is clear that in this case there was factually no foundation for invoking the doctrine of promissory estoppel.
When the State auctioned the licence for retail sale of country liquor and the respondents being the highest bidders were granted such licence, there was in force a Notification dated 6th April, 1959, issued under section 4 of the U.P. Sales Tax Act, 1948, exempting sale of country liquor from payment of sales tax.
No announcement was made at the time of the auction whether the exemption from sales tax under this Notification dated 6th April, 1959 was or was not likely to be withdrawn.
However, on the day following the commencement of the licence granted to the respondents, the Government of U.P. issued a Notification dated 2nd April, 1969 superseding the earlier Notification dated 6th April, 1959 and imposing sales tax on the turnover in respect of country spirit with immediate effect.
This notification dated 2nd April, 1969 was challenged by the respondents by filing a writ petition and amongst the several grounds of challenge taken in the writ petition, one was that "since the State Government did not announce at the time of the aforesaid auction that the Notification dated 6th April, 1959 was likely to be withdrawn and the sales of country liquor were likely to be subjected to the levy of sales tax during the excise year and in reply to the query made by them at the time of the auction they were told by the authorities that there was no sales tax on the sale of country liquor, the appellants herein were estopped from making the demand in respect of sales tax and recovering the same from them".
It was in the context of this ground of challenge that the Court came to make the observation relied upon on behalf of the State.
Now, it is clear that, even taking the case of the respondents at its highest, there was no representation or promise made by the Government that they would continue the exemp 690 tion from sales tax granted under the Notification dated 6th April, 1959 and would not withdraw it, and the Notification dated 2nd April, 1969 could not, therefore, be assailed as being in breach of any such representation or promise.
There was accordingly, no factual basis for making good the plea of promissory estoppel and the observation made by the court in regard to the applicability of the doctrine of promissory estoppel against the Government was clear obiter.
That perhaps was the reason why the Court did not consider it necessary to refer to the earlier decisions in Century Spinning & manufacturing Co. 's case and Turner Morrison 's case and particularly the decision in the Indo Afghan Agencies case where the court in so many terms applied the doctrine of promissory estoppel against the Government in the exercise of its executive power.
It is not possible to believe that the Court was oblivious of these earlier decisions, particularly when one of these decisions in the Indo Afghan Agencies case was an epoch making decision which marked a definite advance in the field of administrative law.
Moreover, it may be noted that though, standing by itself, the observation made by the Court that "there can be no question of estoppel against the Government in exercise of its legislative, sovereign or executive powers" may appear to be wide and unqualified, it is not so, if read in its proper context.
This observation was made on the basis of certain decisions which the Court proceeded to discuss in the succeeding paragraphs of the judgment.
The Court first relied on the statement of the law contained in paragraph 123 at page 783, Volume 28 of the American Jurisprudence (2d), but it omitted to mention the two important sentences at the commencement of the paragraph and the words "unless its application is necessary to prevent fraud or manifest injustice" at the end, which clearly show that even according to the American Jurisprudence, the doctrine of promissory estoppel is not wholly inapplicable against the Government in its governmental, public or sovereign capacity, but it can be invoked against the Government "when justified by the facts" as for example where it is necessary to prevent fraud or injustice.
In fact, as already pointed out above, there are numerous cases in the United States where the doctrine of promissory estoppel has been applied against the Government in the exercise of its governmental, public or executive powers.
The Court then relied upon the decision in the Gwalior Rayon Silk Manufacturing Co. 's case, but that decision was confined to a case where legislation was sought to be precluded by relying on the doctrine of promissory estoppel and it was held, and in our opinion rightly, that there can be no promissory estoppel against the legislature in the exercise of its legislative function.
That decision does not negative the applicability of the 691 doctrine of promissory estoppel against the Government in the exercise of its governmental, public or executive powers.
The decision in Howell 's case was, thereafter, relied upon by the Court, but that decision merely says that the Government cannot be debarred by promissory estoppel from enforcing a statutory prohibition.
It does not countenance an absolute proposition that promissory estoppel can never be invoked against the government.
The Court also cited a passage from the judgment of the High Court of Jammu & Kashmir in Malhotra & Sons & Ors.
vs Union of India & Ors.
,(1) but this passage itself makes it clear that the courts will bind the Government by its promise where it is necessary to do so in order to prevent manifest injustice or fraud.
The last decision on which the Court relied was Federal Crop Insurance Corporation vs Morrill (supra) but this decision also does not support the view contended for on behalf of the State.
We have already referred to this decision earlier and pointed out that the Federal Crop Insurance Corporation in this case was held not liable on the policy of insurance, because the regulations made by the Corporation prohibited insurance of reseeded wheat.
The principle of this decision was that promissory estoppel cannot be invoked to compel the Government or a public authority to carry out a representation or promise which is contrary to law.
It will thus be seen from the decisions relied upon in the judgment that the Court could not possibly have intended to lay down an absolute proposition that there can be no promissory estoppel against the Government in the exercise of its governmental, public or executive powers.
That would have been in complete contradiction of the decisions of this Court in the Indo Afghan Agencies Case, Century Spinning and Manufacturing Co. 's case and Turner Morrison 's case and we find it difficult to believe that the Court could have ever intended to lay down any such proposition without expressly referring to these earlier decisions and over ruling them.
We are, therefore, of the opinion that the observation made by the Court in Ram Kumar 's case does not militate against the view we are taking on the basis of the decisions in the Indo Afghan Agencies ' case, Century Spinning & Manufacturing Co. 's case and Turner Morrison 's case in regard to the applicability of the doctrine of promissory estoppel against the Government.
We may then refer to the decision of this Court in Bihar Eastern Gangetic Fishermen Co operative Society Ltd. vs Sipahi Singh & Ors.(2) It was held in this case in paragraph 12 of the judgment that the respondent could not invoke the doctrine of promissory estoppel because he was unable to show that, relying on the representation of the Govern 692 ment, he had altered his position by investing moneys and the allegations made by him in that behalf were "much too vague and general" and there was accordingly no factual foundation for establishing the plea of promissory estoppel.
On this view, it was unnecessary to consider whether the doctrine of promissory estoppel was applicable against the Government, but the Court proceeded to reiterate, without any further discussion, the observation in Ram Kumar 's case that "there cannot be any estoppel against the Government in the exercise of its sovereign, legislative and executive functions".
This was clearly in the nature of obiter and it cannot prevail as against the statement of law laid down in the Indo Afghan Agencies case.
Moreover, it is clear from paragraph 14 of the judgment that this Court did not intend to lay down any proposition of law different from that enunciated in the Indo Afghan Agencies case because it approved of the decision in the Indo Afghan Agencies case and distinguished it on the ground that in that case there was not enforcement of contractual right but the claim was founded upon equity arising from the Scheme, while in the case before the Court, a contractual right was sought to be enforced.
There is, therefore, nothing in this decision which should compel us to take a view different from the one we are otherwise inclined to accept.
We may point out that in the latest decision on the subject in Radha Krishna Agarwal vs State of Bihar & Ors.(1) this Court approved of the decisions in the Indo Afghan Agencies case and Century Spinning and Manufacturing Co 's case and pointed out that these were cases where it could be held that public bodies or the State are as much bound as private individuals are to carry out obligations incurred by them because parties seeking to bind the authorities have altered their position to their disadvantage or have acted to their detriment on the strength of the representations made by these authorities".
It would, therefore, be seen that there is no authoritative decision of the Supreme Court which has departed from the law laid down in the celebrated decisions in the Indo Afghan Agencies case and the Century Spinning & Manufacturing Co 's case.
The law laid down in these decisions as elaborated and expounded by us continues to hold the field.
We may now turn to examine the facts in the light of the law discussed by us.
It is clear from the letter of the 4th respondent dated 23rd January, 1969 that a categorical representation was made by the 4th respondent on behalf of the Government that the proposed vanaspati factory of the appellant would be entitled to exemption from sales tax 693 in respect of sales of vanaspati effected in Uttar Pradesh for a period of three years from the date of commencement of production.
This representation was made by way of clarification in view of the suggestion in the appellant 's letter dated 22nd January, 1969 that the financial institutions were not prepared to regard the earlier letter of the 4th respondent dated 22nd December, 1968 as a definite commitment on the part of the Government to grant exemption from sales tax.
Now the letter dated 23rd January, 1969 clearly shows that the 4th respondent made this representation in his capacity as the Chief Secretary of the Government, and it was, therefore, a representation on behalf of the government.
It was faintly contended before us on behalf of the State that this representation was not binding on the Government, but we cannot countenance this argument, because, in the first place, the averment in the writ petition that the 4th respondent made this representation on behalf of the government was not denied by the State in the affidavit in reply filed on its behalf, and secondly, it is difficult to accept the contention that the 4th respondent, who was at the material time the Chief Secretary to the government and also advisor to the Governor who was discharging the functions of the Government.
We must, therefore, proceed on the basis that this representation made by the 4th respondent was a representation within the scope of his authority and was binding on the Government.
Now, there can be no doubt that this representation was made by the Government knowing or intending that it would be acted on by the appellant, because the appellant had made it clear that it was only on account of the exemption from sales tax promised by the Government that the appellant had decided to set up the factory for manufacture of vanaspati at Kanpur.
The appellant, in fact, relying on this representation of the Government, borrowed moneys from various financial institutions, purchased plant and machinery from M/s. De Smith (India) Pvt. Ltd., Bombay and set up a vanaspati factory at Kanpur.
The facts necessary for invoking the doctrine of promissory estoppel were, therefore, clearly present and the Government was bound to carry out the representation and exempt the appellant from sales tax in respect out the representation and exempt the appellant from sales tax in respect of sales of vanaspati effected by it in Uttar Pradesh for a period of three years from the date of commencement of the production.
The State, however, contended that the doctrine of promissory estoppel had no application in the present case because the appellant did not suffer any detriment by acting on the representation made by the Government : the vanaspati factory set up by the appellant was quite a profitable concern and there was no prejudice caused to the 694 appellant.
This contention of the State is clearly unsustainable and must be rejected.
We do not think it is necessary, in order to attract the applicability of the doctrine of promissory estoppel, that the promisee acting in reliance of the promise, should suffer any detriment.
What is necessary is only that the promisees should have altered his position in reliance on the promise.
This position was implied accepted by Denning, J., in the High Trees ' case when the learned Judge pointed out that the promise must be one "which was intended to create legal relations and which, to the knowledge of the person making the promise, was going to be acted on by the person to whom it was made and which was in fact acted an" (emphasis supplied).
If a promise is "acted on", "such action, in law as in physics, must necessarily result in an alteration of position.
" This was again reiterated by Lord Denning in W.J. Alan & Co. Ltd. x. El.
Nasr Export and Import Co.(1) where the learned Law Lord made it clear that alteration of position "only means that he (the promise) must have been led to act differently from what he would otherwise have done.
And if you study the cases in which the doctrine has been applied, you will see that all that is required is that the one should have acted on the belief induced by the other party." Viscount Simonds also observed in Tool Metal Manufacturing Co. Ltd vs Tungsten Electric Co. Ltd. (2) that "the gist of the equity lies in the fact that one party has by his conduct led the other to alter his position".
The judgment of Lord Tucker in the same case would be found to depend likewise on a fundamental finding of alteration of position, and the same may be said of that of Lord Coheb.
Then again in Emmanuel Avodeji vs Briscoe (supra) Lord Hodson said: "This equity,is however, subject to the qualification (1) that the other party has altered his position".
The same requirement was also emphasised by Lord Diplock in Kaminins Ballrooms Ltd. vs Zenith Investments (Torquay) Ltd. (3) What is necessary, therefore, is no more than that there should be alteration of position on the part of the promisee.
The alteration of position need not involve any detriment to the promises.
If detriment were a necessary element, there would be no need for the doctrine of promissory estoppel because in that event, in quite a few cases, the detriment would form the consideration and the promise could be binding as a contract.
There is in fact not a single case in England where detriment is insisted upon as a necessary ingredient 695 of promissory estoppel.
In fact, in W. J. Alan & Co. Ltd. vs El Nasar Export and Import Co. (supra), Lord Denning expressly rejected detriment as an essential ingredient of promissory estoppel, saying: "A seller may accept a less sum for his goods than the contracted price, thus inducing (his buyer) to believe that he will not enforce payment of the balance; see Central London Property Trust Ltd. vs High Trees House Ltd. and D. & C. Builders Ltd. vs Rees In none of these cases does the party who acts on the belief suffer any detriment.
It is not a detriment, but a benefit to him to have an extension of time or to pay less, or as the case may be.
Nevertheless, he has conducted his affairs on the basis that he has had that benefit and it would not be equitable now to deprive him of it.
" We do not think that in order to invoke the doctrine of promissory estoppel it is necessary for the promise to show that he suffered detriment as a result of acting in reliance on the promise.
But we may make it clear that if by detriment we mean injustice to the promisee which could result if the promisor were to recede from his promise then detriment would certainly come in as a necessary ingredient.
The detriment in such a case is not some prejudice suffered by the promisee by acting on the promise, but the prejudice which would be caused to the promisee, if the promisor were allowed to go back on the promise.
The classic exposition of detriment in this sense is to be found in the following passage from the judgment of Dixon, J in the Australian case of Grundt vs The Great Boulder Pty.
Gold Mines Ltd. (1): " It is often said simply that the party asserting the estoppel must have been induced to act to his detriment.
Although substantially such a statement is correct and leads to no misunderstanding, it does not bring out clearly the basal purpose of the doctrine.
That purpose is to avoid or prevent a detriment to the party asserting the estoppel by compelling the opposite party to adhere to the assumption upon which the former acted or abstained from acting.
This means that the real detriment or harm from which the law seeks to give protection is that which would flow from the change of position if the assumption were deserted that led to it.
So long as the assumption is adhered to, the party who altered his situation upon the 696 faith of it cannot complain.
His complaint is that when afterwards the other party makes a different state of affairs the basis of an assertion of right against him then, if it is allowed, his own original change of position will operate as a detriment.
His action or inaction must be such that, if the assumption upon which he proceeded were shown to be wrong, and an inconsistent state of affairs were accepted as the foundation of the rights and duties of himself and the opposite party, the consequence would be to make his original act or failure to act or source of prejudice.
" If this is the kind of detriment contemplated, it would necessarily be present in every case of promissory estoppel because it is on account of such detriment which the promisee would suffer if the promisor were to act differently from his promise, that the Court would consider it inequitable to allow the promisor to go back upon his promise.
It would, therefore, be correct to say that in order to invoke the doctrine of promissory estoppel it is enough to show that the promisee has acting in reliance of the promise, altered his position and it is not necessary for him to further show that he has acted to his detriment.
Here, the appellant clearly altered its position by borrowing moneys from various financial institutions, purchasing plant and machinery from M/s. De Smet (India) Pvt. Ltd., Bombay and setting up a vanaspati plant, in the belief induced by the representation of the Government that sales tax exemption would be granted for a period of three years from the date of commencement of the production.
The Government was, therefore bound on the principle of promissory estoppel to make good the representation made by it.
Of course, it may be pointed out that if the U.P. Sales Tax Act, 1948 did not contain a provision enabling the Government to grant exemption, it would not be possible to enforce the representation against the Government because the Government cannot be compelled to act contrary to the statute, but since section 4 of the U.P.Sales Tax Act, 1948 confers power on the Government to grant exemption from sales tax, the Government can legitimately be held bound by its promise to exempt the appellant from payment of sales tax.
It is true that taxation is a sovereign or governmental function, but, for reasons which we have already discussed, no distinction can be made between the exercise of a sovereign or governmental function and a trading or business activity of the Government so far as the doctrine of promissory estoppel is concerned.
Whatever be the nature of the function which the Government is discharging, the Government is subject to the rule of promissory estoppel and if the 697 essential ingredients of this rule are satisfied, the Government can be compelled to carry out the promise made by it.
We are, therefore, of the view that in the present case the Government was bound to exempt the appellant from payment of sales tax in respect of sales of vanaspati effected by it in the State of Uttar Pradesh for a period of three years from the date of commencement of the production and was not entitled to recover such sales tax from the appellant.
Now, for the assessment year 1970 71, that is, 2nd July, 1970 to 31st March, 1971, the appellant collected from its customers sales tax amounting to Rs. 6,81,178.95 calculated at the rate of 3 1/2% on the sale price.
But when the assessment was made by the Sales Tax Authorities, sales tax was levied on the appellant at the rate of 7% and the appellant was required to pay up a further sum of Rs. 6,80,969.42.
The appellant had prayed for an interim order in the present appeal staying further proceedings, but this Court, by an order dated 3rd April, 1974, granted interim stay only on the appellant paying up the amount of sales tax due for the assessment year 1970 71 before 31st July, 1974 and so far as the assessment years 1971 72, 1972 73 and 1973 74 were concerned, the Court directed that the assessments for those years may proceed, but only the final order shall not be passed.
The result was that the appellant had to pay up the further sum of Rs. 6,80,949.42 for the assessment year 1970 71.
The appellant collected from the customers for the assessment year 1971 72 an aggregate sum of Rs. 9,91,206.17 by way of sales tax at the rate of 3 1/2% for the period 1st April, 1971 to 1st July, 1971, 4% for the period 2nd July, 1971 to 24th January, 1972 and 7% for the period 25th January, 1972 to 31st March, 1972 and deposited this amount in the Treasury.
Similarly, for the assessment year 1972 73, the appellant collected from its customers an aggregate sum of Rs. 19,36,597.23 as and by way of sales tax at the rate of 7% of the sale price and this amount was deposited by the appellant in the Treasury, and so also for the first quarter of the assessment year 1973 74 upto the end of which the exemption from sales tax was to continue, the appellant collected and paid an aggregate sum of Rs. 4,84,884.05 at the rate of 7% of the sale price.
It appears that surcharge amounting to Rs. 2,83,008.09 for the period of the exemption was also paid by the appellant into the Treasury.
The assessments for the assessment years 1971 72, 1972 73 and 1973 74 were, however, not completed in view of the stay order granted by this Court.
Now, obviously since the Government is bound to exempt the appellant from payment of sales tax for a period of three years from 2nd July, 1970, being the date of commencement of the production, the appellant would not be liable to 698 pay any sales tax to the State in respect of sales of vanaspati effected during that period and hence the State would have to refund to the appellant the amount of sales tax paid for the period 2nd July, 1970 to 31st March, 1971, subject to any claim which the State may have to retain any part of such amount under any provision of law.
If the State has any such claim, it must be intimated to the appellant within one month from today and it must be adjudicated upon within a further period of one month after giving proper opportunity to be heard to the appellant.
If no such claim is made, or, if made, not adjudicated upon within the time specified, the State will refund the amount of sales tax to the appellant with interest thereon at the rate of 6% per annum from the date when such refund becomes due and if such claim is made and adjudicated upon within the specified time and it is found that a part of this amount is liable to be retained by the State under some provision of law, the State will refund the balance to the appellant with interest at the like rate.
So far as the assessment years 1971 72, 1972 73 and 1973 74 are concerned, the Sales Tax Authorities will proceed to complete the Assessments for those assessment years in the light of the law laid down in this judgment and the amounts of sales tax deposited by the appellant will be refunded to the appellant to the extent to which they are not found due and payable as a result of the assessments, subject to any claim which the State may have to retain those amounts under any provision of law.
We accordingly allow the appeal, set aside the judgment of the High Court and issue a writ, order or direction to the above effect against the respondents.
The State will pay the costs of the appellant throughout.
S.R. Appeal allowed.
| IN-Abs | The appellant is a limited company which is primarily engaged in the business of manufacture and sale of sugar and it has a cold storage plant and a steel foundry.
With reference to a news item dated 10th October 1968 in the National Herald in which it was stated that the State of Uttar Pradesh had decided to give exemption from sales tax for a period of three years under section 4A of the U.P. Sales Tax Act to all new industrial units in the State with a view to enabling them "to come on firm footing in developing stage", the appellant addressed a letter dated 11th October 1968 to the Director of Industries stating that in view of the sales tax holiday announced by the Government the appellant intended to set up a Hydrogenation plant for manufacture of Vanaspati and sought for confirmation that this industrial unit which it proposed to set up, would be entitled to sales tax holiday ' for a period of three years from the date it commenced production.
The Director of Industries by his letter dated 14th October 1968, confirmed that "there will be no sales tax for three years on the finished product of your proposed Vanaspati factory from the date it gets power connection for commencing production".
Thereafter when the appellant 's representative met the 4th respondent, who was at that time the Chief Secretary to the Government as also Advisor to the Governor and apprised the latter that the appellant was setting up the Vanaspati factory solely on the basis of the assurance given on behalf of the Government that the appellant would be entitled to exemption from sales tax for a period of three years from the date of commencement of commercial production at the factory, the 4th respondent reiterated the assurance made.
Again the appellant, by its letter dated 13th December 1968, requested the 4th respondent "to please confirm that we shall be allowed sales tax holiday for a period of three years on the sale of Vanaspati from the date we start production".
The 4th respondent replied on 22nd December 1968 that "the State Government will be willing to consider your request for grant of exemption from U.P. Sales Tax for a period of three years from the date of 642 production" and asked the appellant to obtain the requisite application form and submit a formal application to the Secretary to the Government in the Industries department, and in the meanwhile "to go ahead with the arrangements for setting up the factory".
The appellant in the meantime had submitted an application dated 21st December 1968 for a formal order granting exemption from sales tax under section 4A of the U.P. Sales Tax Act.
The appellant was also subsequently informed by the letter dated 23rd January 1969 of the 4th respondent categorically that the proposed Vanaspati factory of the appellant "will be entitled to exemption from U.P. Sales Tax for a period of three years from the date of going into production and that this will apply to all Vanaspati sold during that period in Uttar Pradesh itself".
The appellant, on the basis of these unequivocal assurances, went ahead with the setting of the Vanaspati factory and made much progress.
By the middle of May 1969, the State Government started having second thoughts on the question of exemption and the appellant was requested to attend a meeting "to discuss the question of giving concession in Sales Tax on Vanaspati products".
The appellant immediately by its letter dated 19th May 1969 pointed out to the 5th respondent that so far as the appellant was concerned, the State Government had already granted exemption from sales tax by the letter of the Chief Secretary dated 23rd January, 1969, but still, the appellant would be glad to send its representative to attend the meeting.
The appellant 's representative did attend the meeting held on 3rd June 69 and reiterated that so far as the appellant was concerned, it had already been granted exemption from sales tax and the State Government stood committed to it The State Government, however, went back upon the assurance and a letter dated 20th January 1970 was addressed by the 5th respondent intimating that the Government had taken a policy decision that new Vanaspati units in the State which go into commercial production by 30th September 1970, would be given only partial concession in Sales Tax at different rates on each year of production.
The appellant, by its letter dated 25th June 1970, pointed out to the Secretary to the Government that the appellant proposed to start commercial production of Vanaspati with effect from 1st July 1970 and stated that, as notified in the letter of 20th January 1970, the appellant would be availing of the exemption granted by the State Government and would be charging Sales Tax at the rate of 3 1/2% instead of 7% on the sales of Vanaspati manufactured by it for the period of one year commencing from 1st July 1970.
The factory of the appellant thereafter went into production from 2nd July 1970 and the appellant informed the Secretary to the Government about the same by its letter dated 3rd July 1970.
The State Government, however, once again changed its decision and on 12th August 1970, a news item appeared in the 'Northern Indian Patrika ' stating that the Government had decided to rescind the earlier decision i.e. the decision set out in the letter dated 20th January 1970, to allow concession in the rates of Sales Tax to new Vanaspati Units.
The appellant thereupon filed a writ petition in the High Court of Allahabad asking for a writ directing the State Government to exempt the sales of Vanaspati manufactured by the appellant from Sales Tax for a period of three years commencing from 2nd January 1970 by issuing a notification under section 4A of the U.P. Sales Tax Act from the appellant for the said period of three years.
The plea based on the 643 doctrine of promissory estoppel was, however rejected by the Division Bench of the High Court principally on the ground that the appellant had waived the exemption, if any, by accepting the concessional rates set out in the letter of the respondent dated 20th January 1970.
Allowing the appeal by certificate, the Court, ^ HELD: 1.
The view taken by the High Court, namely, that even if there was an assurance given by the 4th respondent on behalf of the State Government and such assurance was binding on the State Government on the principle of promissory estoppel, the appellant had waived its right under it by a accepting the concessional rates of sales tax set out in the letter of the 5th respondent dated 20th January, 1970 is not correct.
[656 D E] 2.
Waiver is a question of fact and it must be properly pleaded and proved.
No plea of waiver can be allowed to be raised unless it is pleaded and the factual foundation for it is laid in the pleadings.
[656 E F] In the instant case: (a) the plea of waiver was not taken by the State Government in the affidavit filed on its behalf in reply to the writ petition, nor was it indicated even vaguely in such affidavit.
It was raised for the first time at the hearing of the writ petition.
That was clearly impermissible without an amendment of the affidavit in reply or a supplementary affidavit raising such plea.
[656 F] (b) It was not right for the High Court to have allowed the plea of waiver to be raised against the appellant and that plea should have been rejected in limine.
If waiver were properly pleaded in the affidavit in reply, the appellant would have had an opportunity of placing on record facts showing why and in what circumstances the appellant came to address the letter dated 25th June 1970 and establishing that on those facts there was no waiver by the appellant of its right to exemption under the assurance given by the 4th respondent.
But in the absence of such pleading in the affidavit in reply, this opportunity was denied to the appellant [656F H] 3.
Waiver means abandonment of a right and it may be either express or implied from conduct, but its basic requirement is that it must be "an intentional act with knowledge".
There can be no waiver unless the person who is said to have waived is fully informed as to his right and with full knowledge of such right, he intentionally abandons it.
[657A, B] In the instant case, on the facts, the plea of waiver could not be said to have been made out by the State Government: There was nothing to state that at the date when the appellant addressed the letter dated 25th June 1970, it had full knowledge of its right to exemption under the assurance given by the 4th respondent and that it intentionally abandoned such right.
It is not possible to presume in the absence of any material placed before the Court, that the appellant had full knowledge of its right to exemption so as to warrant an inference that the appellant waived such right by addressing the letter dated 25th June 1970.
It is difficult to speculate what was the reason why the appellant addressed the letter 25th June 1970 stating that it would avail of the concessional rates of sales tax granted under the letter dated 20th January 1970.
[657 D E] 644 Earl of Darnley vs London, Chathan and Dover Rly.
Co. (Proprietors etc.), @ 57 Craine vs Colonial Mutual Fire Insurance Co. Ltd. ; ; Martindala vs Faulkner ; quoted with approval.
The doctrine called 'promissory estoppel ', 'equitable estoppel ', 'quasi estoppel ', and 'new estoppel ' is a principle evolved by equity to avoid injustice where a promise is made by a person knowing that it would be acted on and it is person to whom it is made and in fact it is so acted on and it is inequitable to allow the party making the promise to go back upon it.
Though commonly named promissory estoppel it is neither in the realm of contract nor in the realm of estoppel.
The basis of the doctrine is the inter position of equity, which has always true to its form stepped in to mitigate the rigours of strict law.
[658 E G] 5.
The true principle of promissory estoppel is that where one party has by his words or conduct made to the other a clear and unequivocal promise which is intended to create legal relationship effect a legal relationship to arise in the future, knowing or intending that it would be acted upon by the other party to whom the promise is made and it is infact so acted upon by the other party, the promise would be binding on the party making it and he would not be entitled to go back upon it, if it would be inequitable to allow him to do so having regard to the dealings which have taken place between the parties, and this would be so irrespective whether there is any pre existing relationship between the parties or not.
Equity will in a given case where justice and fairness demand, prevent a person from insisting on strict legal rights even where they arise, not under any contract, but on his own title deeds or under statute.
[662 B D] To the applicability of the doctrine of promissory estoppel it is not necessary that there should be some contractual relationship between the parties.
Nor can any such limitation, namely, that the doctrine of promissory estoppel is limited in its operation to cases where the parties are already contractually bound and one of the parties induces the other to believe that the strict rights under the contract would not be enforced be justifiably introduced to curtail the width and amplitude of the doctrine.
The parties need not be in any kind of legal relationship before the transaction from which the promissory estoppel take its origin.
The doctrine would apply even where there is no pre existing legal relationship between the parties, but the promise is intended to create legal relations or affect a legal relationship whish will arise in future.
[660 G H, 661 A, F G].
Jorden V. Money, , Hughes vs Metropolitan Railway Co., , Birmingam & District Land Co. vs London and North Western Rail Co., ]1888] ; discussed and questioned.
Central London Property Trust Ltd. vs High Trees House Ltd., [1947] K.B. p. 130:: ; explained.
Evenden vs Guildford City Association Football Club Ltd., @ 272 :: @ 255; Crabb vs Arun District Council.
@ 875:: @ 858 CA; quoted with approval.
645 6.
The doctrine of promissory estoppel cannot be inhibited by the same limitation estoppel in the strict sense of the term.
It is an equitable principle evolved by the Courts for doing justice and there is no reason why it should be given only a limited application by way of defence and it should only be a shield and not a sword to found a cause of action.
It can be the basis of a cause of action.
[662 D E, 663 E F].
There is no qualitative difference between 'proprietary estoppel ' and 'promissory estoppel '.
Both are the off springs of equity and if equity is flexible enough to permit proprietary estoppel to be used as a cause of action, there is no reason in logic or principle why promissory estoppel should also not be available as cause of action, if necessary to satisfy the equity.
[665 G H] Central London Property Trust Ltd. vs High Trees House Ltd .
[1947]1 K.B.P. 130: ; Combe vs Combe ; ; Beesly vs Hallwood Estate Ltd. ; Municipal Corporation of Bombay.v Secty.
of State I.L.R. @ 607; Mooregate Mercantile Co. Ltd. vs Twichings,s ; referred to.
Crabb vs Arun District Council @ 875 explained.
Ramsden vs Dysen,[1866] L.R H.L. 129; Dunlop Pneuntafic Tyre Co. vs Saifridge & Co. Ltd. ; discussed.
Law is not a mausoleum.
It is not an antique to be taken down, dusted admired and put back on the shelf.
It is rather like an old but vigorous tree having its roots in history, yet continuously taking new grafts and putting out new sprouts and occasionally dropping dead wood.
It is essentially a social process, the end product of which is justice and hence it must keep on growing and developing with changing social concepts and values.
Otherwise, there will be estrangement between law and justice and law will cease to have legitimacy Though 'continuity with the past is a historical necessity ', 'conformity is not to be turned into a fetish '.
[668 H, 669 A B].
Therefore, despite the fact that allowing promissory estoppel to found a cause of action would seriously dilute the principle which requires consideration to support a contractual obligation, this new principle, which is a child of equity brought into the world with a view to promoting honesty and good faith and bringing, law closer to justice should not be held in fetters but allowed to operate in all its activist magnitude.
so that it may fulfil the purpose for which was conceived and born.
[668 F G].
Robertson v Minister of Pensions.
Evenden Guldford city Association Football Club Ltd. [1975] 3 All.
E.R. p. 269.
Candler vs Crane Christmas & Co. @ 178; quoted with approval.
A promise may, in the United States, derive contractual enforceability if it has been made by the promisor knowing or intending that it would be acted on and the promisee has altered his position in reliance on it, notwithstanding that there is no consideration in the sense in which that word is used in English 646 and Commonwealth jurisprudence.
However, the basic requirement for invoking this principle must be present namely that the fact situation should be such that injustice can be avoided only by enforcement of the promise.
The doctrine of promissory estoppel has been used in the United States to reduce, if not to destroy, the prestige of consideration as an essential of valid contract and also used in diverse other situations as founding a cause of action: [670 D E, 673 B].
Alleghany College vs National Chauteaque Country Bank 57 Am L. R. 980; Drennan vs Stat Paving Company [1958] 31 California 2nd 409; referred.
Under the English law, the judicially formed view is that the crown is not immune from liability under the doctrine of promissory estoppel and the view taken by Denning J., in that the crown cannot escape its obligation under the doctrine of promissory estoppel by "praying in aid the doctrine of executive necessity" still holds the field.
[674 D].
Robretson vs Minister of Pensions [1949] 1 K. B. 227; quoted with approval: Rederiaktiebolaget Amphitrities.
vs The King ; referred to.
Howell vs Falmouth Boat Construction Co. Ltd. ; explained 10.
Even in the United States, the trend in the State Courts, of late, has been strongly in favour of the application of the doctrine of promissory estoppel against the Government and public bodies "where interests of justice, morality and common fairness clearly dictate that course".
It is being increasingly felt that "the Government ought to set a high standard in its dealings and relationships with citizens and the word of a duly authorised Government agent, acting within the scope of his authority, ought to be as good as a Government bond".
The Government would not be estopped "by the acts of its officers and agents who without authority enter into agreements to do what the law does not sanction or permit" and "these dealing with an agent of the Government must be held to have notice of limitations of his authority".
But if the acts of omissions of officers of the Government are within the scope of their authority and are not otherwise impermissible under the law, they "will work estoppel against Government".
[676 F H, 677 A D] Federal Crop Insurance Corporarion vs Maroill ; 92 L. ed.
discussed and explained.
Valsonavich vs United States p. 96; quoted With approval.
Where the Government makes a promise knowing or intending that it would be acted on by the promisee and, in fact, the promisee, acting in reliance on it, alters his position, the Government would be held bound by the promise and the promise would be enforceable against the Government at the instance of the promisee notwithstanding that there is no consideration for the promise and the promise is not recorded in the form of a formal contract as required by Article 299 of the Constitution.
[682 G H, 683 A].
647 It is elementary that in a Republic governed by the rule of law, no one, a however high or low is above the law.
Every one is subject to the law as fully and completely as any other and the Government is no exception.
It is indeed the pride of constitutional democracy and rule of law that the Government stands on the same footing as a private individual so far as the obligation of the law is concerned; the former is equally bound as the latter.
On no principle can a Government committed to the rule of law, claim immunity from the doctrine of promissory estoppel.
The Government cannot be heard to say that it is under no obligation to act in a manner that is fair and just or that it is not bound by considerations of 'honesty and good faith '.
In fact the Government should be held to a high "standard of rectangular rectitude while dealing with its citizens".
[683 A C].
Gangaes Manufacturing co vs Surajmull and Ors., I.L.R. ; Municipal Corporation of Bombay vs The Secretary of State, I,L.R. 29 Bomb.
588; approved.
Collector of Bombay vs Municipal Corporoaton of rlle City of Bombay and Ors.
; ; Union of India vs Indo Afghan Agencies, ; ; followed.
Ransden vs Dyson,[1866] L.R. 1HL 170; referred to.
Robertson vs Minister of Pensions, [1949] 1 K. B. 227; quoted with approval as the correct law.
The doctrine of executive necessity, regarded as sufficient Justification for the Government to repudiate even its contractual obligations was emphatically negatived in the Indo Afghan Agencies case and the supremacy of the laws was established, [683 C D].
Therefore, it is not open to Government to claim immunity from the applicability of the rule of promissory estopped and thereby repudiate a promise made by it on the ground that such promise may fetter its future executive action.
If the Government wants to preserve its freedom of executive action from being hampered or restricted, the Government should not make a promise knowing or intending that it would be acted on by the promisee and the promisee would alter his position relying upon it.
But, if the Government makes such a promise and the promisee acts in reliance upon it and alters his position the Government would be compelled to make good such promise like any other private individual.
[683 D F].
The law cannot acquire legitimacy and gain social acceptance unless it accords with the moral values of the society.
It should be the constant endeavor of the Courts and the legislatures to close the gap between law and morality and bring about as near an approximation between the two as possible.
The doctrine of promissory estopped is a significant judicial contribution in that direction.[683 F G].
Since the doctrine of promissory estoppel is an equitable doctrine, it must yield when the equity so requires.
If it could be shown the by Government that having regard to the facts as they have transpired, it would be inequitable to hold the Government to the promise made by it, the Court would not raise an equity in favour of the promisee and enforce the promise against the Government.
648 The doctrine of promissory estoppel would be displaced in such a case because on the facts, equity would not require that the Government should be held bound by the promise made by it.
[683 G H, 684 A] When the Government is able to show that in view of the facts, as they have transpired public interest would be prejudiced if the Government were required to carry out the promise, the Court would have to balance, the public interest in the Government carrying out a promise made to a citizen which has induced the citizen to act upon it and alter his position and the public interest likely to suffer if the promise were required to be carried out by the Government and determine which way the equity lies.
It would not be enough for the Government just to say that public interest requires that the Government should not be compelled to carry out the promise or that the public interest would suffer if the Government were required to honour it.
The Government cannot claim to be exempt from the liability to carry out the promise 'on some indefinite and undisclosed ground of necessity or expediency ', nor can the Government claim to be the sole judge of its liability and repudiate it 'on an exparte appraisement of the circumstances.
[684 A D] In order to resist its liability, the Government should disclose to the Court the various events necessitating its claim to be exempt from the liability and it would be for the Court to decide whether those events are such as to render it inequitable to enforce the liability against the Government.
[684 D E].
Mere claim of change of policy would not be sufficient to exonerate the Government from the liability: the Government would have to show precisely the changed policy with the reason and justification therefor, to enable the Court to judge for "itself which way the public interest lies and what equity of the case demands.
It is only if the Court is satisfied, on proper and adequate material placed by the Government, that over riding public interest requires that the Government should not be held bound by the promise but should be free to act unfettered by it that the Court would refuse to enforce the promise against the Government.
[684 E F] The essence of the rule of law is that the Court would not act on the mere ipse dixit of the Government, for it is the Court which has to decide and not the Government, whether the Government should be held exempt from liability.[684 F G] The burden would be upon the Government to show that the public interest in the Government acting otherwise than in accordance with the promise is so overwhelming that it would be inequitable to hold the Government bound by the promise and the Court would insist on a highly rigorous standard of proof in the discharge of this burden.
But even where there is no such over riding public interest, it may still be competent to the Government to resile from the promise 'on giving reasonable notice, which need not be a formal notice, giving the promisee a reasonable opportunity of resuming his position ' provided of course it is possible for the promisee to restore status quo ante.
If, however, the promisee cannot resume his position, the promise would become final and irrevocable.
[684 G H, 685 A].
Emmanuel Ayodeji Ajayi vs R. T. Briscoe, [1964] 3 All.
E.R. 556; referred to 649 14.
So far as the doctrine of promissory estoppel is concerned, no distinction can be made between a private individual and a public body.
This doctrine is also applicable against a public body like a municipal council.
However, this doctrine cannot be applied in teeth of an obligation or liability imposed by law.
It cannot be invoked to compel the Government or even a private party to do an act prohibited by law.
There can also be no promissory estoppel against the exercise of legislative power.
The Legislature can never be precluded from exercising its legislative function by resort to the doctrine of pro missory estoppel.
[688C, G H 689 A].
Century Spinng and Manufacturing Co. Ltd. & Anr.
vs The Ulhasnagr Municipal Council and Anr.
[1970] 3 SCR 854; Turner Mossison and Co. Ltd. vs Hunngerfard Investmetn Trust Ltd.[1972] 3 S.C.R. 711; discussed & followed.
M. Ramanatha Pillai vs The Stare of Kerala & Anr.
5 @ 526; Assistant Cusrodian vs Brij Kishore Agarwala & Ors. ; , explained and held inapplicable.
Sate of Kerala vs Gwalior Rayon Silk Manufacturing Co. Ltd. ; @ 688; reiterated.
Malhortra and Sons & Ors.
vs Union of India and Ors.
A.I.R. 1976 J & K p. 41 approved.
Excise Commissioner U.P. Allahabad vs Ram Kumar ; Bihar Eastern Gangetic Fishermen Cooperative Society Ltd. vs Sipali Sangil and Ors.
[1978] 1 S R 375; ; ; Radha Krishan Agarwal vs State of Bihar and Ors. ; ;: ; ; explained.
In order to attract the applicability of the doctrine of promissory estoppel, it is not necessary that the promisee, acting in reliance on the promise, should suffer any deteriment.
What is necessary is no more than that there should be alteration of his position in reliance on the promise.
If detriment were a necessary element, there would be no need for the doctrine of promissory estoppel because, in that event in quite a few cases, the detriment would form the consideration and the promise would be binding, as a contract.
If by deteriment is meant injustice to the promisee which would result if the promisor were to resile from his promisee, then detriment would certainly come in as a necessary ingredient.
The detriment in such a case is not some prejudice sneered by the promisee acting on the promise, put the prejudice which would be caused to the promisee, if the promisor were allowed to back on the promise.
It is not necessary for the promisee to show that he has acted to his detriment.
All that he has to show is that he has acted to reliance on the promise and altered his position.
[694 A B, F G, 695 E, 694 D].
Central London Property Trust Ltd. V. High Trees House, [1947] K.B. p. 130:: [1956] 1 All.
E.R. 256, W. J. Alan & Co. Ltd. vs El Nasar Export and Import Co. [1972] 2 All.
E.R. p. 127, @ p. 140, Tool Metal Manufacturing Co. Ltd. vs Tunosten Electric Co. Ltd. [1955] All.
E. R. 657; [1975] 1 W. L. R. 761 Emmaulel Ayodeji 650 Ajya V. R. T. Briscoe Karnmins Ballrooms Ltd. vs Zenith Investments (Torquay) Ltd. , Grurldt vs the Boulder Pty.
Gold Mines Ltd. ; ; quoted with approval.
In the instant case.
The facts necessary for involving the doctrine of promissory estoppel were clearly resent and the Government was bound to carry out the representation and exempt the appellant from sales tax in respect of sales of Vanaspati effected by it in Uttar Pradesh for a period of three years from the date of commencement of the production.
[693 F G] (a) The letter dated 23rd January 1969 was a representation on behalf of the Government, the representation having been made by the 4th respondent in his capacity as the Chief Secretary of the Government categorically to the effect that the appellant would be entitled to exemption from sales tax in respect of the sale of vanaspati effected in Uttar Pradesh for a period of three years from the date of commencement of production.
This representation was made by way of clarification in view of the suggestion in the appellant letter dated 2 nd January 1969 that the financial institutions were not prep ed to regard the earlier letter of the 4th respondent dated 22nd December 1968 as a definite commitment on the part of the Government to grant exemption from sales tax.
[692 H, 693 A B] (b) The representation made by the 4th respondent was a representation within the scope of his authority and was binding on the Government in as much as the 4th respondent, who was at the material time the Chief Secretary to the Government and also Adviser to the Governor discharging the functions of the Government during the President 's Rule had authority to bind the Governor.
Moreover the averment to this effect in the Writ Petition was not denied by the State in the affidavit in reply filed on its behalf [693 C D].
(c) This representation was made by the Government knowing or intending that it would be acted on by the appellant because the appellant made it clear that it was only on account of the exemption from sales tax promised by the Government that the appellant had decided to set up the factory for manufacture of Vanaspati.
In fact the appellant relying on this representation of the Government, borrowed moneys from various financial institutions, purchased plant and machinery from M/s. De Smith (India) Pvt. Ltd., Bombay and set up a Vanaspati factory at Kanpur.
[693 E F]
|
N: Criminal Appeal Nos.
274 275 of 1974.
Appeals by Special Leave from the Judgment and Order dated 27 11 73 and 11 1 1974 of the Delhi High Court in Criminal Appeal No. 78/67 and Crl.No. 80/73 respectively.
R. K. Garg, V. J. Francis and D. K. Garg for the Appellant.
Soli J. Sorabji, Addl.
, R. N. Sachthey for the Respondent.
The Judgment of the Court was delivered by KAILASAM, J.
These appeals are by special leave against the judgment of the High Court of Delhi in Criminal Appeal No. 78 of 1967 and Order dated 11th January, 1974 in Cr.
(S.C.A.) No. 80 of 1973.
The appellant was chargesheeted on 26th December, 1963 for an offence under section 120 B, Indian Penal Code, for entering into a criminal conspiracy with one Sirajuddin and one Rehman to accept from them illegal gratification in the discharge of his official duties.
He was also charged with specific offences of accepting Rs. 6000 and Rs. 4000 from Sirajuddin and Rehman being offences punishable under section 161, Indian Penal Code, read with section 5(2) and Section 5(1) (d) of the Prevention of Corruption Act, 1947.
He was also charged for the offence punishable under section 5(2) read with section 5(1) (a) of the Prevention of Corruption Act that in pursuance of the aforesaid conspiracy, he, during the period from 1955 to 1961 habitually accepted illegal gratification from the said two co accused persons.
The Special Judge who tried the case acquitted the appellant by his order dated 19th January, 1967 holding that neither the charge of conspiracy nor any other charge against the accused was proved.
But the Special Judge held that the assets of the appellant from 1st July, 1955 to 30th April, 1961 had exceeded his income by Rs. 33,588.34 and they were disproportionate to the known sources of income of the petitioner.
The learned Judge, however, found that as section 5(3) of the Act had been repealed on 18th December, 1964 and as specific instances of payment of bribe to the petitioner could not be proved the accused could not be held guilty of the charges.
Aggrieved by the decision, the State preferred an appeal to the Delhi High Court on 11th April, 1967.
Pending 819 the appeal before the High Court, Act No. 16 of 1967, received the assent of the President on 20th June 1967 and came into effect on 5 5 1967 reintroducing section 5(3) in the Act w.e.f. 18 12 1964.
In the High Court the appellant challenged the vires of Act No. 16 of 1967 on the ground that survival of section 5(3) of the Act and making it applicable retrospectively was void and unconstitutional as it was in violation of article 14 and 20(1) of the Constitution.
A Division Bench of the High Court of Delhi by its judgment dated 27th November, 1973 allowed the appeal upholding the validity of Act No. 16 of 1967 and remanded the case to be tried from the stage at which it was pending on 18th December, 1964.
Criminal Appeal No. 274 of 1974 is against the order of the High Court remanding the case for fresh trial and Criminal Appeal No. 275 of 1974 is against the order of the High Court refusing to grant a certificate of fitness for appeal to this Court.
Mr. R. K. Garg, the learned counsel for the appellant, submitted that since section 5(3) of the Prevention of Corruption Act, 1947 was repealed on 18th December, 1964, the Courts below cannot take into account the provisions of section 5(3) of the Act after the date of its repeal on 18th December, 1964.
It was further submitted that Act No. 16 of 1967 which gave retrospective operation to section 5(3) of the Act is violative of articles 14 and 20(1) of the Constitution.
In order to appreciate the contention of the learned counsel for the appellant it is necessary to set out the relevant provisions of the Act.
Section 5(1) of the Prevention Act, of 1947, states when a public servant is said to commit the offence of criminal misconduct.
The section before the amendment Act No. 16 of 1967 consisted of four clauses (a), (b), (c) and (d).
The appellant was charged for an offence under section 5(1)(a) and section 5(1) (d) punishable under section 5(2) of the Act.
Section 5(1)(a), and section 5(1)(d) and section 5(2) read as follows: "5.(1) A public servant is said to commit the offence of criminal misconduct in the discharge of his duty (a) if he habitually accepts or obtains or agrees to accept or attempts to obtain from any person for himself or for any other person, any gratification (other than legal remuneration) as a motive or reward such as is mentioned in section 161 of the Indian Penal Code.
(b) * * * * (c) * * * * 820 (d) If he, by corrupt or illegal means or by otherwise abusing his position as public servant, obtains for himself or for any other person any valuable thing or pecuniary advantage.
5 (2) Any public servant who commits criminal misconduct in the discharge of his duty shall be punishable with imprisonment for a term which shall not be less than one year but which may extend to seven years and shall also be liable to fine: Provided that the Court may, for any special reasons recorded in writing, impose a sentence of imprisonment of less than one year.
Section 5(2) provides for the punishment of any public servant who commits criminal misconduct as specified in clauses (a) and (d) of section 5(1).
Section 5(3) prescribed a rule of evidence which runs as follows: "5.(3) In any trial of an offence punishable under sub section (2), the fact that the accused person or any other person on his behalf is in possession, for which the accused person cannot satisfactorily account, of pecuniary resources or property disproportionate to his known sources of income may be proved, and as such proof of the Court shall presume, unless the contrary is proved, that the accused person is guilty of criminal misconduct in the discharge of his official duty and his conviction therefor shall not be invalid by reason only that it is based solely on such presumption."
Section 5(3) was repealed on 18th December, 1964 by Act 40 of 1964.
The Act also introduced a new section, section 5 (1) (e) which reads as follows: "(e) if he or any person on his behalf is in possession or has at any time during the period of his office, been in possession for which the public servant cannot satisfactorily account, of pecuniary resources or property disproportionate to his known sources of income." Thus on the date when the Special Judge pronounced his order on 19th January, 1967 section 5(3) was not in existence and the Special Judge acquitted the appellant on the ground that the presumption under section 5(3) was not available for the prosecution on that date.
Subsequently on 5th May 1967 Act No. 16 of 1967 came into force.
Section 2 of the Act provided as follows: "2.Amendment of Anti Corruption Law in relation to certain pending trials.
(1) Notwithstanding (a) the substitution of new provision for sub section (3) of section 5 of the Prevention of Corruption Act, 1947 (hereinafter referred to as the 1947 Act), by section 6(2)(c) of the Anti Corruption Laws (Amendment) Act, 1964 (hereinafter referred to as the 1964 Act); and (b) any judgment or order of any court, the said sub section (3) as it stood immediately before the commencement of the 1964 Act shall apply and shall be deemed always to have applied to and in relation to trial of offences punishable under sub section (2) of section 5 of the 1947 Act pending before any court immediately before such commencement as if no such new provisions had been substituted for the said sub section (3); (2) The accused person in any trial to and in relation to which sub section (1) applies may, at the earliest opportunity available to him after the commencement of this Act, demand that the trial of the offence should proceed from the stage at which it was immediately before the commencement of the 1964 Act and on any such demand being made the court shall proceed with the trial from that stage.
(3) For the removal of doubt it is hereby provided that any court (i) before which an appeal or application for revision against any judgment or order or sentence passed or made in any trial to which sub section (1) applies is pending immediately before the commencement of this Act, or (ii) before which an appeal or application for revision against any judgment, order or sentence passed or made before the commencement of this Act in any such trial, is filed after such commencement 'shall remand the case for trial in conformity with the provisions of this section.
" The contention of the learned counsel for the appellant is that Act No. 16 of 1967 is an ex post facto legislation creating a new offence retrospectively.
We will first consider the effect of repeal of section 5(3) of the Prevention of Corruption Act, Act 2 of 1947.
The nature of section 5(3) has been considered by this Court in several decisions.
In Sajjan Singh vs The State of Punjab this court referring to the sub 822 section held that the sub section provided an additional mode of proving an offence punishable under sub section 5(2) for which an accused person is being tried.
This Court negatived the contention that section 5(3) created a new kind of offence of criminal misconduct by a public servant in the discharge of his official duty.
It held that the section merely prescribed a rule of evidence for the purpose of proving the offence of criminal misconduct as defined in section 5(1) for which an accused person is already on trial.
The court followed the view held by this Court in C.D.S. Swamy vs The State and in Surajpal Singh vs State of U.P.
The question that arises is what is the effect of repeal of the provision under section 5(3).
By Act 40 of 1964 section 5(3) was repealed prospectively.
The statute does not say that the section shall be deemed not to have been in force at all.
Mr. R. K. Garg the learned counsel for the appellant relying on the dissenting judgment of Fazal Ali J. in Keshavan Madhava Menon vs The State of Bombay, (3) submitted that the effect of a repeal will be that it should be construed as the Act not having been in existence at all.
The view of Tindal C. J. that a repeal of the statute obliterated it completely from the records of Parliament as if it had never been passed was followed by Fazal Ali J. Mahajan J. speaking for the majority disagreed with the view holding that "it would be more consonant with reason and justice to say that the law existed and was good at the time when it was passed but that since the date of its repeal it has no longer any effect whatsoever.
" The view taken by the Chief Justice Jindal was abrogated by the enactment of the Interpretation Act, 1889.
Section 32 of the Interpretation Act deals with the effect of repealing an Act after August 30, 1889.
"Such repealing Acts are, unless contrary intention appears, not to effect the previous operation of any enactment so repealed or anything duly done or suffered under any enactment so repealed or effect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed; or affect any penalty, forfeiture, or punishment incurred in respect of any offence committed against any enactment so repealed; or affect any investigation, legal proceeding, or remedy in respect of any such right, privilege," obligation, liability, penalty, forfeiture or punishment as aforesaid." (Maxwell on The Interpretation of Statutes, 12th Ed., p.17).
In India the , contain similar provisions as in the Interpretation Act, 1889.
Section 6 of the runs as follows: 823 "6.Where this Act, or any Central Act or Regulation made after the commencement of this Act, repeals any enactment hitherto made or hereafter to be made, then, unless a different intention appears, the repeal shall not (a) revive anything not in force or existing at the time at which the repeal takes effect; or (b) affect the previous operation of any enactment so repealed or anything duly done or suffered thereunder; or (c) affect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed; or (d) affect any penalty, forfeiture or punishment incurred in respect of any offence committed against any enactment so repealed; or (e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty forfeiture or punishment as aforesaid; and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed as if the repealing Act or Regulation had not been passed.
" Section 6 provides that the repeal shall not affect the previous operation of any enactment so repealed unless a different intention appears.
The operation of all the provisions of the Prevention of Corruption Act would continue in so far as the offences that were committed when section 5(3) was in force.
The offences that were committed after the date of the repeal will not come under the provisions of section 6(b) of the Section 6(c) also preserves all legal proceedings and consequences of such proceedings as if the repealing Act had not been passed.
In this view it is clear that whether Act 16 of 1967 had been brought into force on 20th June, 1967 or not the rule of evidence as incorporated in section 5(3) would be available regarding offences that were committed during the period before the repeal of section 5(3).
Mr. R. K. Garg the learned counsel submitted that the provisions of Act 16 of 1967 by virtue of which the rule of evidence enacted in section 5(3) is deemed to have always been in existence is violative of article 20(1) of the Constitution.
Article 20(1) of the Constitution is as follows: 824 "No person shall be convicted of any offence except for violation of a law in force at the time of the commission of the act charged as an offence, nor be subjected to a penalty greater than that which might have been inflicted under the law in force at the time of the commission of the offence."
Article 20(1) deals with ex post facto laws though that expression has not been used in the Article.
Usually, a law prescribes a rule of conduct by which persons ought to be governed in respect of their civil rights.
Certain penalties are also imposed under the criminal law for breach of any law.
Though a sovereign legislature has power to legislate retrospectively creation of an offence for an act which at the time of its commission was not an offence or imposition of a penalty greater than that which was under the law provided violates article 20(1).
In the well known case of Phillips vs Eyre and also in the American case of Calder vs Bull the principle underlying the provision has been fully discussed.
All that article 20(1) prohibits is ex post facto laws and is designed to prevent a person being punished for an act or omission which was considered innocent when done.
It only prohibits the conviction of a person or his being subjected to a penalty under ex post facto laws.
In Rao Shiv Bahadur Singh & Anr.vs The State of Vindhya Pradesh, the Court pointed out that "what is prohibited under article 20(1) is only conviction or sentence under an ex post facto law and not the trial thereof.
Such trial under a procedure different from what obtained at the time of the commission of the offence or by a Court different from that which had competence at the time cannot ipso facto be held to be unconstitutional.
A person accused of the commission of an offence has no fundamental right to trial by a particular Court or by a particular procedure, except in so far as any constitutional objection by way of discrimination or the violation of any other fundamental right may be involved.
" Thus the appellant cannot object to a procedure different from what obtained at the time of the commission of the offence.
The offence that was committed was when section 5(3) was in force and by Act 16 of 1967 the procedure is revived.
It is not as if the procedure is brought into force for the first time.
"Where an Act is repealed and the repealing enactment is then repealed by another, which manifests no intention that the original Act shall continue repealed, the common law rule was that the repeal of the second Act revived the first ab initio.
" Maxwell on the Interpretation of Statutes, 825 12th Ed., p.19).
There can be no objection in law to the revival of the procedure which was in force at the time when the offence was committed.
The effect of the amendment is that sub section (3) of section 5 as it stood before the commencement of 1964 Act shall apply and shall be deemed to have always applied in relation to trial of offences.
It may be if by this deeming provision a new offence was created then the prohibition under Article 20(1) may come into operation.
But in this case, as already pointed out, what is done is no more than reiterating the effect of section 6(1) of the .
Mr. Garg, the learned counsel, submitted that by amending procedure drastically and giving it retrospective effect a new offence may be created retrospectively.
It was contended that by shifting the burden of proof as provided for in section 5(3) of the Prevention of Corruption Act, 1947, a new offence is created.
It is unnecessary for us to consider the larger question as to whether in certain circumstances giving retrospective effect to the procedure may amount to creation of an offence retrospectively.
In the present case the old procedure is revived and no new procedure is given retrospective effect.
The procedure given effect to is not of such a nature as to result in creation of a new offence.
In the result all the contentions raised by the learned counsel for the appellant fail and these appeals are dismissed.
S.R. Appeal dismissed.
| IN-Abs | The appellant who was charged for the offences (a) under section 120B I.P.C. (b) under section 161 I.P.C. read with section 5(2) and 5(1) (d) of the Prevention of Corruption Act 1947 and (c) under section 5(2) read with section 5(1) (a) of the Prevention of Corruption Act 1947 was acquitted by the special judge holding that neither the charge of conspiracy nor any other charge against the accused was proved.
But the special Judge held that the assets of the appellant from 1st of July '55 to 30th April 1961 had exceeded his income by Rs. 33,588.34 and they were disproportionate to the known sources of income of the petitioner.
The trial Judge, however, found that as section 5(3) of the Act had been repealed on 18 12 1964 and as specific instances of payment of bribe to the petitioner could not be proved the accused could not be held guilty of the charges.
Aggrieved by the decision, the State preferred an appeal to the Delhi High Court on 11th April, 1967.
Pending the appeal before the High Court, Act No. 16 of 1967, came into force on 5th May 1967 re introducing section 5(1)(e) in the Act.
In the High Court the appellant challenged the vires of Act No. 16 of 1967 on the ground that revival of section 5(3) of the Act and making it applicable retrospectively was void and unconstitutional as it was in violation of article 14 and 20(1) of the Constitution.
A Division Bench of the High Court of Delhi by its judgment dated 27th November, 1973 allowed the appeal upholding the validity of Act No. 16 of 1967 and remanded the case to be tried from the stage at which it was pending on 18th December, 1964.
In appeals by special leave it was contended that (a) Since section 5(3) of the P. O. F. A., 1947 was repealed on 18 12 64 the Court below cannot take into account the provisions of section 5(3) of the Act after the date of its repeal on 18 12 64 and (b) Act No. 16 of 1964 which gave retrospective operation to section 5(3) of the Act is violative of Articles 14 and 20(1) of the Constitution.
^ HELD: 1.
Whether Act 16 of 1967 had been brought into force on 20th June 1967 or not the rule of evidence as incorporated in section 5(3) of the P.O.F.A., 1947 would be available regarding offences that were committed during the period before the repeal of section 5(3).
[823 G] 2.
Section 5(3) of the Prevention of Corruption Act, 1947 provided an additional mode of proving an offence punishable under sub sections 5(2) for which an accused person is being tried and, therefore, prescribes a rule of evidence.
Section 5(3) does not create a new kind of offence of criminal misconduct by a public servant in the discharge of his official duty.
[821 H, 822 A].
817 G.D.S. Swamy vs State, ; , Surajpal Singh vs State of U.P., ; and Sajjan Singh vs State of Punjab ; ; applied.
While repealing section 5(3) by Act 40 of 1964 the statute did not say that the section shall be deemed not to have been in force at all.
Section 6 of the provides that the repeal shall not affect the previous operation of any enactment so repealed unless a different intention appears.
The operation of all the provisions of the Prevention of Corruption Act would continue in so far as the offences that were committed when section 5(3) was in force.
The offences that were committed after the date of the repeal will not come under the provisions of section 6(b) of the .
Section 6(c) also preserves all legal proceedings and consequences of such proceedings as if the repealing Act had not been passed.
[822 C, 823 E F].
Keshavan Madhava Menon vs State of Bombay, [1951] 2 SCR followed.
Article 20(1) of the Constitution deals with ex post facto laws though that expression has not been used in the Article.
Usually, a law prescribes a rule of conduct by which persons ought to be governed in respect of their civil rights.
Certain penalties are also imposed under the criminal law for breach of any law.
Though a sovereign legislature has power to legislate retrospectively creation of an offence for an act which at the time of its commission was not an offence or imposition of a penalty greater than that which was under the law provided violates article 20(1).
All that article 20(1) prohibits is ex post facto laws and is designed to prevent a person being punished for an act or omission which was considered innocent when done.
It only prohibits the conviction of a person or his being subjected to a penalty under expost facto laws.
[824 B D].
In the instant case, the appellant cannot object to a procedure different from what obtained at the time of the commission of the offence.
The offence that was committed was when section 5(3) was in force and by Act 16 of 1967 the procedure is revived.
It is not as if the procedure is brought into force for the first time.
[824 F G].
Rao Shiv Bahadur Singh & Anr.
vs The State of Vindhya Pradesh, ; applied; Phillips vs Eyre, , at pp.
23 and 25 and Calder vs Bull, ; ; at 649; quoted with approval.
There can be no objection in law to the revival of the procedure which was in force at the time when the offence was committed.
The effect of the amendment is that sub section (3) of section 5 as it stood before the commencement of 1964 Act shall apply and shall be deemed to have always applied in relation to trial of offences.
It may be, if by this deeming provision a new offence was created then the prohibition under Article 20(1) may come into operation.
In this case what is done is no more than reiterating the effect of section 6(1) of the .
[825 A B].
818 6.
In the present case the old procedure is revived and no new procedure is given retrospective effect.
The procedure given effect to is not of such a natural as to result in creation of a new offence.
[825 D].
|
Civil Appeal No. 246 of 1973.
Appeal from the Judgment and Order dated 1 11 1971 of the Jammu and Kashmir High Court in W.P. No. 124/69.
section V. Gupte, Attorney General, Altaf Ahmed for the Appellant.
L. N. Sinha, K. P. Gupta, D. B. Tawkley and Vineet Kumar for RR 1 21, 23, 25, 27 to 29 and 31 38.
G. L. Sanghi, R. K. Mehta and Miss Uma Mehta for RR 55 and 72.
section section Khanduja for RR 53.
The Judgment of the Court was delivered by SHINGHAL J.
This appeal by certificate is directed against the judgment of the High Court of Jammu and Kashmir dated November 1, 1971, in writ petition No. 124 of 1969.
That petition was filed against the promotions of respondents Nos. 1 to 46 and others as Professors in supersession of the claims of the writ petitioners who contended that they were senior and more qualified for promotion.
The High Court allowed the writ petition and quashed the State Government 's Order No. 643 HTE dated July 25, 1969, in regard to the appointments of respondents Nos. 3 to 46 and directed that it would be open to the State Government to make a fresh selection of Professors in accordance with the law.
A review petition was filed against the judgment but was dismissed on September 14, 1972.
The State Government is aggrieved and has filed the present appeal.
When the case was taken up for hearing on November 28, 1978.
it was brought to our notice by counsel for the respondents that it will not be possible for them to advance their arguments with reference to article 16 of the Constitution of India as the various sealed covers containing the date on which the selections were made have not been received from the High Court.
Learned Attorney General and the counsel for the respondents were in agreement that as the constitutional point which arises for consideration in this case relates to the interpretation of section 133(2) (b) of the Constitution of Jammu and Kashmir, hereinafter referred to as the Constitution, it will be enough to consider, at this stage, whether that section has been correctly interpreted and whether the Public Service Commission for the State of Jammu and Kashmir, hereinafter referred to as the Commission, has been consulted in accordance with its requirement.
We have accordingly heard the arguments only on these two points, and will confine 872 ourselves to them, leaving the question of the applicability of article 16 of the Constitution of India on the merits for consideration by the Bench before which the case may be taken up for hearing hereafter.
The controversy relates to the interpretation of clause (b) of sub section (2) of section 133 of the Constitution which, when read with the other connected provisions, provides as follows. "133 (2) The Commission shall be consulted (a) . . . (b) on the principles to be followed in making appointments to civil services and posts and in making promotions and transfers from one service to another and on the suitability of candidates for such appointments, promotions or transfers; (c). . . and it shall be the duty of the Commission to advise on any matter so referred to them or on any other matter which the Governor may refer to them: Provided that the Governor may make regulations specifying the matters in which either generally or in any particular class of cases or in any particular circumstances, it shall not be necessary for the Commission to be consulted." Although it has been urged in the written arguments of the appellant that section 133(2) (b) was "not at all attracted in the matters of making promotions in the same service", and its true and correct interpretation would be that "it is applicable only to 'making promotions and transfers from one service to another '," learned Attorney General has, with his usual candour and fairness, stated that he does not find it possible to support that contention.
He has therefore argued that what clause (b) of sub section (2) of section 133 requires is that the Commission shall be consulted; (i) on the principles to be followed in making appointments to civil services and posts and in making promotions and transfers from one service to another, and (ii) on the suitability of candidates for such appointments, promotions or transfers.
He has urged that as this requirement of the Constitution was duly complied with, the High Court erred in taking a contrary view.
The interpretation put by learned Attorney General is quite correct and we have no hesitation in approving it as in our opinion no other interpretation is really permissible on the plain language of the clause.
873 The question whether the requirement for consulting the Commission is mandatory or not does not arise in this case, because it is not disputed, and is in fact the case of the appellant State, that the Commission was consulted.
The question which remains for consideration is whether this was really so.
Learned counsel for the respondents was not able to refer us to any averment in the writ petition that the Commission was not consulted either in regard to the principles to be followed in making the promotions in question, or on the suitability of selected candidates for the promotions.
We have, all the same, gone through the record, and we find that the State Government at first framed rules on November 15, 1968, for selections to be made to posts of Professors in the colleges.
By Notification No. SRO 161 dated March 25, 1969, those rules were replaced by the rules made by the Governor specifically for the appointment of Professors, which were called the "Jammu and Kashmir Professors of Colleges (Selection) Rules, 1969.
" It has been specifically stated on behalf of the State that it consulted the Commission under section 133 of the Constitution, and as the writ petitioners have not ventured to take a plea to the contrary, we have no hesitation in holding, on the facts which have been brought on the record, that the Commission was consulted in regard to the principles to be followed in making the promotions to the posts of Professors.
We have also examined the record to ascertain whether the other requirement of clause (b) of sub section (2) of section 133 of the Constitution that the Commission shall be consulted on the suitability of the candidates for promotions to the posts of Professors, has been complied with.
The State Government has stated in its reply to the writ petition that for every post of Professor, names of four Lecturers, strictly in order of seniority, were sent to the Commission "at its direction" and they were interviewed and examined by the Selection Committee which was "formed" by the Commission, and a member of the Commission was appointed its Chairman.
It has further been stated that the commission 's recommendation for selection was made on the basis of the marks obtained by the respondents (to the writ petition) at the interviews and that the selection was also made "on the basis of the recommendation of the Public Service Commission" and there was "no deviation from the merit list prepared by the Public Service Commission.
" The State Government has in fact placed on record the minutes of the Commission dated July 22, 1969, which make it quite clear that the State Government referred the selections to the Commission, a Committee was appointed by the Commission for that purpose, the Committee was 874 presided over by a member of the Commission, the report of the Committee was formally submitted to the Commission under the Chairman 's note dated June 2, 1969, and the Commission then took its decision regarding the recommendation to be made to the State Government for the appointments.
The Commission set out the reasons for its decision, and finally made its recommendation on merits.
The Commission was therefore consulted on the suitability of the candidates for promotion as Professors and the second requirement of clause (b) of sub section (2) of section 133 was also complied with.
It is not provided by section 133 of the Constitution that all the members of the Commission should have interviewed all or any of the candidates, or that it was not permissible for the Commission to entrust the selection to a committee consisting of only one of its members, so long as the Commission reserved to itself the right to approve or disapprove the committee 's report and actually discharged that constitutional responsibility.
No argument to the contrary has in fact been urged for our consideration.
Had the Commission de facto abdicated its power in favour of some committee composed of strangers to the Commission the position might have been different.
Here, it was not so.
It would thus appear that the High Court erred in holding that the Commission was not consulted in the manner required by section 133 of the Constitution and that the selection made by it was invalid for that reason.
With this finding we shall have the rest of the case for decision by the Bench concerned.
V.D.K. Appeal accepted, leaving the merits for decision by another Bench of the Court.
| IN-Abs | The appellant State Government 's Order No. 643 HTE dated July 25, 1969 promoting certain professors was quashed by the High Court of Jammu & Kashmir while allowing the Writ Petition No. 124/69 filed by the respondent.
Leaving out the merits for decision by another Bench of this Court.
^ HELD : 1.
What clause (b) of sub section (2) of section 133 of the Jammu & Kashmir Constitution requires is that the Commission shall be consulted: (i) on the principles to be followed in making appointments to civil services and posts and in making promotions and transfers from one service to another and (ii) on the suitability of candidates for such appointments, promotions or transfers.
No other interpretation is really permissible on the plain language of the clause.
It is not provided by section 133 of the Constitution that all the members of the Commission should have interviewed all or any of the candidates, or that it was not permissible for the Commission to entrust the selection to a committee consisting of only one of its members, so long as the Commission reserved to itself the right to approve or disapprove the committee 's report and actually discharged that constitutional responsibility.
[872 F H, 874 B C] 2.
The question whether the requirement for consulting the Commission is mandatory or not does not arise in this case.
[873 A].
The High Court erred in holding that the Commission was not consulted in the manner required by section 133 of the Jammu & Kashmir Constitution and in regard to the principles to be followed in making the promotions to the posts of professors on the suitability of selected candidates for the promotions.
[873 B, 874 D E] On the facts which have been brought on the record it is established that (a) the Commission was consulted in regard to the principles to be followed in making the promotions to the posts of professors as laid down in the "Jammu & Kashmir Professors of Colleges (Selection) Rules, 1969", and [873 C D].
(b) the Commission was consulted on the suitability of the candidates for promotion as professors and the second requirement of clause (b) of sub section (2) of section 133 was also complied with, since the selection of the respondents (to the Writ Petition) was made on the recommendation of the Public Service Commission after their names were sent strictly in order of seniority as per direction of the Commission, after they had been interviewed and examined by the Selection Committee, formed and presided over by one of the members of the Commission as Chairman.
[873 F H, 874 A] 871
|
ivil Appeal Nos.
565 570 of 1978.
Appeal from the Judgment and Order dated 8 2 1977 of the Calcutta High Court in Income Tax Reference Nos 398, 399 and 400/69 and 456 of 1969.
Devi Pal and D. N. Gupta for the Appellant.
section T. Desai, B. B. Ahuja and Miss A. Subhashini for the Respondent.
The Judgment of the Court was delivered by TULZAPURKAR, J.
These appeals, by certificates are directed against the common judgment and order rendered by the Calcutta High Court on February 8, 1977 in Income Tax Reference No.156 of 1969 and Income Tax References Nos. 398, 399 and 400 of 1969, whereby the assessee 's claim for deduction under s.36(1)(iv) of the Indian Income Tax Act, 1961 (hereinafter referred to as 'the Act ') in respect of three sums of Rs.95,421/ , Rs.1,00,564/ and Rs.1,17,969/ out of the total contributions made by the assessee to a recognised Provident Fund for the assessment years 1962 63, 1963 64 and 1964 65 respectively was disallowed and the principal question raised in these appeals is whether the expression "salary" as defined in Rule 2(h) in Part A of the Fourth Schedule to the Act includes "Commission" paid by the assessee to its salesmen in terms of their contracts of employment ? The assessee is a private limited company and carries on the business of manufacture and sale of duplicating machines and accessories.
It has in its regular employment three categories of salesmen machine salesmen, mixed salesmen and supply salesmen.
As a term of the contract of employment between the assessee and the salesmen of the aforesaid categories, the assessee, besides paying a fixed monthly salary also paid commission to them at fixed percentage of turnover achieved by each salesman, the rate of percentage varying according to the class of article sold and the category to which the salesman belonged.
The assessee maintained a regular Provident Fund for its employees which was recognised by the Commissioner of Income Tax some time in 1937 and the said recognition continued and was in force during the relevant years in question.
In the previous years ending 31st December 1961.
31st December 1962 and 31st December 1963 rele 792 vant to the assessment years 1962 63, 1963 64 and 1964 65 the assessee made contributions, out of its own moneys, to the individual accounts of these salesmen in the said Provident Fund on the basis of salary and commission paid to them and claimed such contributions as allowable deductions under section 36(1) (iv) of the Act and in that behalf reliance was placed by the assessee upon Rule 2 of the assessee company 's Recognised Provident Fund Scheme Rules under which "salary" meant not only the fixed monthly salary but also the commission and dearness allowance as might be paid by the company to its employees.
Out of such total contributions the Income Tax Officer disallowed the sums of Rs. 95,421/ , Rs. 1,00,564/ and Rs. 1,17,969/ on the ground that these amounts pertained to the commission paid by the assessee to its salesmen for the three years respectively and that under Rule 2(h) of Part A of the Fourth Schedule to the Act, which was applicable, the expression "salary" did not include such commission.
Three appeals, for the aforesaid three years, filed by the assessee were heard by two different Appellate Assistant Commissioners, one of whom rejected the appeal for the assessment year 1962 63 in view of Rule 2 (h) of Part A of the Fourth Schedule to the Act but the other Appellate Assistant Commissioner allowed the appeals for the assessment years 1963 64 and 1964 65 by accepting the assessee 's contention.
The assessee as also the Revenue preferred appeals to the Appellate Tribunal.
On the one hand, relying upon the dictionary meaning of the expression "salary" as given in the Shorter Oxford Dictionary and Stroud 's Judicial Dictionary and upon the manner in which the term was defined in Rule 2 of the assessee 's Recognised Provident Fund Scheme Rules, it was contended on behalf of the assessee that the commission of the nature paid by it to its salesmen was nothing but a composite part of the salary itself, the same being determinable as per the terms of the contract and as such the contributions on the basis of such commission made by the assessee to the Provident Fund were deductible under s.36(1)(iv) of the Act; it was further contended that since these payments were being admittedly made to a Provident Fund recognised by the Commissioner of Income Tax, which recognition was in force during the relevant years, the Taxing Authorities could not disallow the deduction claimed by the assessee, and the view taken by the Appellate Assistant Commissioner in respect of assessment years 1963 64 and 1964 65 was canvassed for acceptance.
On the other hand, the Revenue contended before the Tribunal that the definition of the expression "salary" as given in Rule 2(h) of Part A of the Fourth Schedule to the Act which applied to the recognised Provident Fund governed the matter and since that definition excluded all other allowances and perquisites the commission 793 paid by the assessee to its salesmen, which was nothing but some sort of allowance, could not be regarded as salary and, on that basis the Tribunal was pressed to accept the contrary view taken by the Appellate Assistant Commissioner for the assessment year 1962 63.
The Tribunal on a consideration of the rival submissions held that the commission paid by the assessee to various classes of salesmen was a part of the contractual obligation and as such was a part of the salary of the employees and contributions made on that basis were liable to be deducted under s.36(1)(iv) of the Act.
It also took the view that since the Provident Fund maintained by the assessee was a recognised Fund and since it fulfilled the condition laid down in Rule 4(C) of Part A of the Fourth Schedule to the Act the contributions by the employer to the same would be entitled to deduction under the said provision.
In this view of the matter the Tribunal by its order dated June 12, 1968 allowed the assessee 's appeal and dismissed the appeals of the Department.
At the instance of the Revenue the following two questions were referred to the High Court for its opinion: "(1) Whether, on the facts and in the circumstances of the case, the sums of Rs. 95,421/ , Rs. 1,00,564/ and Rs. 1,17,969/ disallowed by the Income Tax Officer out of the total contributions made by the assessee towards the provident fund were allowable under section 36(1)(iv) of the Income Tax Act, 1961 for the assessment years 1962 63, 1963 64 and 1964 65 respectively ? (2) Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the provident fund maintained by the assessee satisfied the condition laid down in Rule 4(c) of the Fourth Schedule, Part 'A ' of the Income Tax Act, 1961 ?" The former question was the subject matter of Income Tax Reference No.156 of 1969 made under s.256(1) of the Act while the latter was the subject matter of Income tax References Nos. 398, 399 and 400 of 1969 made under s.256(2) of the Act.
These References were heard together and disposed of by the High Court by a common judgment and order dated February 8, 1977.
Rejecting the contentions urged on behalf of the assessee the High Court answered both the questions in the negative and in favour of the Revenue.
In doing so the High Court principally relied upon (3) Rule 2(h) of Part A of the Fourth Schedule to the Act where the expression "salary" has been defined as inclusive of dearness allowance but exclusive of all 794 other allowances and perquisites, (b) Circular No. 6 dated January 16, 1941 issued by the Central Board of Revenue under the Indian Income Tax Act, 1922 but which has been continued under s.297(k) of the Act, which provided that unless commission and bonuses are fixed periodical payments not dependent on a contingency, they are not covered by the term "salary" as used in Chapter IXA of the Act (1922 Act) and (c) observations of this Court in M/s Bridge & Roofs Co. Ltd. vs Union of India and Ors.
to the effect that "commission and other similar allowances are excluded from the definition of "basic wages" under the Provident Fund Act 1952 because it was not a universal rule that each and every establishment must pay commission to its employees".
The High Court further held that the Circular No. 80 dated March 4, 1972 on which reliance was placed by the assessee and which stated that "if the terms and conditions of service are such that commission is paid not as a bounty or benefit but is paid as a part and parcel of the remuneration for services rendered by the employees such payment may partake of the nature of salary rather than as a benefit or perquisite" could not be availed of because the same was not in existence during the relevant years and further it had been issued under s.40(c) (iii) of the Act and would not apply to s.36(1)(iv).
The High Court also held that the ordinary meaning of "salary" was a fixed monthly payment while "commission" was not such payment and, therefore, it could not be included within the scope and ambit of the term "salary", the meaning of which could not be extended by the assessee company by defining it in a particular manner in its Provident Fund Scheme Rules for the purposes of recognition of its Fund and deductibility as well.
The High Court 's view on both the questions is challenged by the assessee in the instant appeals preferred on the strength of the certificates granted by that Court under s.261 of the Act.
Counsel for the assessee raised a two fold contention in support of the appeals.
In the first place he contended that once recognition was granted by the Commissioner of Income Tax to the Provident Fund maintained by the assessee under the relevant rules and such recognition was in force during the relevant assessment years, the Taxing Authorities could not disallow the deductions claimed by interpreting the expression "salary" in Rule 2(h) of Part A of the Fourth Schedule to the Act so as to exclude the "commission" that was paid by the assessee to its salesmen, for, by doing so the Taxing Authorities would be sitting in judgment over the recognition granted and allowed to be retained by the Commissioner of Income Tax to the assessee.
It was 795 pointed out that Rule 4 of Part A of the Fourth Schedule to the Act set out the conditions, particularly, the one contained in cl.(c) of the said rule that were required to be satisfied before recognition could be granted and in the instant case the Commissioner after having been satisfied that the said conditions had been fulfilled had granted recognition to the Provident Fund maintained by the assessee.
In particular, counsel placed reliance upon the correspondence which took place between the assessee and the Commissioner of Income Tax, West Bengal, during the course of which, the Commissioner had by his letter dated September 9, 1937 required the assessee to inform him of the basis on which the commission payable to the salesmen participating in the fund was computed with a view to seeing whether the commission would be includible in the definition of "salary" for purposes of Chapter IXA of the 1922 Act and the assessee had by its reply dated September 11, 1937 stated that the commission was the monthly amount payable to the salesmen in accordance with their written contract and was based on a fixed term of rate and that it was after such correspondence that recognition was granted to the Provident Fund of the assessee and that the said recognition had continued and was in operation during the relevant assessment years.
He, therefore, urged that it was not open to the Taxing Authorities to reach a conclusion that the Provident Fund of the assessee did not satisfy the condition laid down in Rule 4(c) of Part A of the Fourth Schedule to the Act during the relevant years nor was it open to them to disallow the deductions claimed under s.36 (1)(iv) of the Act by interpreting the expression "salary" in Rule 2(h) in Part A of the Fourth Schedule to the Act as being exclusive of the commission of the nature and kind paid by the assessee to its salesmen.
Secondly, counsel contended that on a true and proper construction of the expression "salary occurring in the said Rule 2(h) the commission of the nature and type paid by the assessee to its salesmen under the terms of their contract of employment would be included or covered by that expression.
According to him, commission in business practice covered various kinds of payments made under different circumstances and in the cases where a servant was employed by a businessman and as a condition of his employment it was agreed that he would be paid for his services at a fixed rate of percentage over the turnover it was clear that such commission payable to the employee will par take of the character of "salary" received by him for his services.
the percentage basis being the measure of the salary; in other words, according to him, there was no difference between the concept of salary and the concept of commission if the latter was of the aforesaid nature or kind and as such the expression salary in Rule 2 (h) would include such commission.
In this behalf he relied upon a decision of the Allaha 796 bad High Court in the case of Raja Ram Kumar Bhargava vs Commissioner of Income Tax, U.P. He urged that the decision of this Court in M/s Bridge & Roofs Co. Ltd. vs Union of Indian & Ors.
(supra) on which the High Court has relied was inapplicable since it was a case under the Provident Fund Act, 1952 and this Court was required to construe the term 'basic wages ' appearing in that Act and in that context it observed that that term did not include any bonus, commission or other similar allowances.
He, therefore, urged that the Tribunal was right in allowing the deductions claimed by the assessee under s.36(1)(iv) of the Act.
On the other hand, counsel for the Revenue contended that notwithstanding the recognition accorded to the assessee 's Provident Fund by the Commissioner of Income Tax the assessee had to satisfy the taxing authorities every year that the Provident Fund maintained by it satisfied the conditions of Rule 4, particularly, the one contained in Rule 4(c) of Part A of the Fourth Schedule to the Act and if for any particular assessment year the assessee 's Provident Fund failed to satisfy the condition in Rule 4(c) of Part A of the Fourth Schedule to the Act the assessee could not claim deduction under s.36(1)(iv) of the Act in respect of such portion of the contribution made by it to the Fund as was in breach of the said condition.
Secondly, he urged that by relying upon the fact of recognition obtained by it and the further fact that such recognition had remained in force during the relevant assessment years the assessee could not by pass the real question that arose for determination before the taxing authorities for the relevant assessment years, namely, whether the expression 'salary ' as defined in Rule 2(h) of Part A of the Fourth Schedule to the Act included or excluded commission paid by the assessee to its salesmen and he urged that the definition of the expression 'salary ' as given in the said Rule 2(h) clearly showed that the 'salary ' did not include commission, for, according to him, the definition merely included dearness allowance and excluded all other allowances and perquisites and commission payable by the assessee to its salesmen was nothing but an allowance paid without reference to any time factor which is associated with salary or wages as an important concomitant thereof.
In this behalf reliance was also placed by him upon the Circular No.6 dated January 16, 1941 issued by the Central Board of Revenue under the 1922 Act and continued under s.297(k) of the 1961 Act wherein on the question whether the term 'salary ' as used in Chapter IXA (of the old Act) 797 included commissions and bonuses paid to the employees, the Board expressed its view that "unless commissions and bonuses are fixed periodical payments not dependent on a contingency they are not covered by the term 'salary ' as used in Chapter IXA of the Act." Counsel further contended that in the matter of deductions claimable in respect of contributions to the Provident Fund the position of the employer could not be different from that of the employee and in regard to employee 's contribution the condition required to be satisfied in Rule 4 (b) was to the effect that the contribution of an employee in any year shall be a definite proportion of his 'salary ' for that year and shall be deducted by the employer from the employee 's 'salary ' in that proportion at each periodical payment of such salary in that year, and credited to the employee 's individual account in the Fund and under s.80C read with Rule 7 of Part A of the Fourth Schedule to the Act the employee is entitled to a deduction in respect of his contribution which pertains to a definite proportion of the 'salary ' which would not include commission.
He therefore, urged that the High Court was right in answering both the questions against the assessee and in favour of the Revenue.
As stated at the outset, in our view, the main question raised in these appeals is whether the expression 'salary ' as defined in Rule 2(h) of Part A of the Fourth Schedule to the Act includes commission payable by an assessee to his or its employees in terms of their contracts of employment ? We shall, therefore, address ourselves to that question first and then deal with the aspect regarding the true impact of the recognition granted by the Commissioner of Income Tax under the relevant Rules to a Provident Fund maintained by an assessee.
The expression 'salary ' has been defined in section 17 of the Act as well as in Rule 2(h) of Part A of the Fourth Schedule to the Act but each of the said definitions serves a different purpose.
Section 17 defines the expression 'salary ' for purposes of sections 15 and 16 which deal with "Salaries" as a head of income, and under cl.(iv) of sub s.(1) that expression includes: "any fees, commissions, perquisites or profits in lieu of or in addition to any salary or wages.
" In Part A of the Fourth Schedule to the Act, which contains rules relating to Recognised Provident Funds the word 'salary ' has been defined in Rule 2(h) thus : "Salary" includes dearness allowance, if the terms of employment so provide, but excludes all other allowances and perquisites.
" 798 Since we are concerned in this case with contributions made to a recognised Provident Fund and deductions thereof under section 36(1) (iv) it will be the definition of 'salary ' as given in Rule 2(h) of Part A of the Fourth Schedule to the Act and not the one given in section 17 that will be applicable and will have to be considered.
Under section 36(1) (iv) the deduction allowable is in respect of "any sum paid by the assessee as an employer by way of contribution towards a Recognised Provident Fund or an approved superannuation fund, subject to such limits as may be prescribed for the purpose of recognising the Provident Fund or approving the superannuation fund, as the case may be." Rule 2(c) of Part A of the Fourth Schedule defines contribution" as meaning "any sum credited by or on behalf of any employee out of his salary, or by an employer out of his own monies, to the individual account of an employee, but does not include any sum credited as interest." Rule 4 of Part A of the Fourth Schedule lays down the conditions which are required to be satisfied by a Provident Fund in order that it may receive and retain recognition and the conditions in cls.(b) and (c) are material and these conditions are: "4(b) the contributions of an employee in any year shall be a definite proportion of his salary for that year, and shall be deducted by the employer from the employee 's salary in that proportion, at each periodical payment of such salary in that year, and credited to the employee 's individual account in the fund; (c) the contributions of an employer to the individual account of an employee in any year shall not exceed the amount of the contributions of the employee in that year, and shall be credited to the employee 's individual account at intervals not exceeding one year.
" It may be stated that so far as the employer is concerned the contributions credited by him to the employee 's individual account in the funds are deductible under section 36(1) (iv) whereas the contributions of an employee are deductible in the computation of his total income under s.80C read with Rule 7 of Part A of the Fourth Schedule to the Act and the scheme of cls.(b) and (c) of Rule 4 of Part A of the Fourth Schedule does suggest that in the matter of deductions claim 799 able in respect of contributions to the recognised Provident Fund the position of both the employer and the employee would be the same; but since in the case of an employee his contributions are to be a definite proportion of his salary for a particular year, the question whether such proportion would be inclusive of commission received by him from his employer must depend upon the true meaning or construction of the expression 'salary ' as occurring in Rule 2(h) of Part A of the Fourth Schedule; in other words, in the matter of deductions claimable in respect of contributions to the Recognised Provident Fund qua both the employer and the employee the question has to be answered by reference to the true meaning of the expression 'salary ' occurring in Rule 2(h).
Now, Rule 2(h) of Part A of the Fourth Schedule does not define the expression 'salary ' conceptually but merely proceeds to state what is included therein and what is excluded therefrom and, therefore, one is required to turn to the dictionary meaning of that expression as also to ascertain how judicial decisions have understood that expression.
According to the Shorter Oxford English Dictionary (3rd Edn.) 'salary ' means: "To recompense, reward; to pay for something done;" In Jowitt 's Dictionary of English Law (1959 Edn.) the term is explained thus: "a recompense or consideration generally periodically made to a person for his service in another person 's business; also wages, stipend or annual allowance." In Stroud 's Judicial Dictionary (4th Edn.) the expression 'salary ' is explained at item (2) thus: "Where the engagement is for a period, is permanent or substantially permanent in character, and is for other than manual or relatively unskilled labour, the remuneration is generally called a salary".
[Per Latham C. J., in Federal Commissioner of Taxation vs Thompson (J. Walter) (Aus.) Pty. Ltd. 69 C.L.R. 227].
It appears that conceptually 'salary ' and 'wages ' connote one and the same thing, namely, remuneration or payment for work done or services rendered but the former expression is generally used in connection with services of a higher or non manual type while the latter is used in connection with manual services.
In Gordon vs Jennings Grover J. observed as follows: 800 "Though this word (wages) might be said to include payment for any services, yet, in general, the word 'salary ' is used for payment or services of a higher class, and 'wages ' is confined to the earnings of labourers and artisans." In Mohmedalli vs Union of India this Court, while repelling the contention that the Employees ' Provident Fund Act 1952 was intended by Parliament to apply to employees who were mere wage earners and not salaried servants, has made observations clearly indicating that there is no difference between the two concepts of salary and wages.
Chief Justice Sinha speaking for the Court observed in para 10 of the judgment as follows: "It is a little difficult to appreciate the distinction sought to be made.
Both 'salary ' and 'wages ' are emoluments paid to an employee by way of recompense for his labour.
Neither of the two terms is a 'term of art '.
The Act has not defined wages; it has only defined "basic wages" as all emoluments which are earned by an employee while on duty or on leave with wages in accordance with the terms of the contract of employment and which are paid or payable in cash to him,. . 'Salary ', on the other hand, is remuneration paid to an employee whose period of engagement is more or less permanent in character, for other than manual or relatively unskilled labour.
The distinction between skilled and unskilled labour itself is not very definite and it cannot be argued, nor has it been argued, that the remuneration for skilled labour is not 'wages '.
The Act itself has not made any distinction between 'wages ' and 'salary '.
Both may be paid weekly, fortnightly or monthly, though remuneration for the day 's work is not ordinarily termed 'salary '.
Simply because wages for the month run into hundreds, as they very often do now, would not mean that the employees is not earning wages, properly so called.
A clerk in an office may earn much less than the monthly wages of a skilled labourer.
Ordinarily he is said to earn his salary.
But, in principle, there is no difference between the two.
" It will thus appear clear that conceptually there is no difference between salary and wages both being a recompense for work done or 801 services rendered, though ordinarily the former expression is used in connection with services of non manual type while the latter is used in connection with manual services.
It is further common knowledge that this compensation to the labourer or artisan could be a specified sum for a given time of service or a fixed sum for a specified work i.e. payment made by the job, the commonest example of the latter category being a piece rated worker.
In other words, the expression 'wages ' does not imply that the compensation is to be determined solely upon the basis of time spent in service; it may be determined by the work done; it could be estimated in either way.
If conceptually salary and wages mean one and the same thing then salary could take the form of payment by reference to the time factor or by the job done.
In fact, in the case of salary the recompense could be determined wholly on the basis of time spent on service or wholly by the work done or partly by the time spent in service and partly by the work done.
In other words, whatever be the basis on which such recompense is determined it would all be salary.
Having reached the above conclusion, we have to consider the nature of recompense that is being made by the assessee to its salesmen, whether the whole of it partakes of the character of salary or not? The definition of 'salary ' in Rule 2(h) includes dearness allowance if the terms of employment so provide and excludes all other allowances and perquisites.
It does not in terms exclude 'commission ' as such and, in our view rightly, for, though ordinarily according to the Shorter Oxford English Dictionary 'commission ' means 'a pro rata remuneration for work done as agent ', in business practice commission covers various kinds of payments made under different circumstances.
In Raja Ram Kumar Bhargava vs Commissioner of Income Tax, U.P. (supra) the Allahabad High Court has pointed out how in certain circumstances commission payable to an employee may, in fact, represent the salary receivable by him for the services rendered to the employer.
At page 694 of the report the relevant observation run thus: "The word "commission", in business practice, covers various kinds of payments made under different circumstances.
There are cases where a servant is employed by a businessman and, as a condition of his employment, it is agreed prior to the services having been rendered that he would be paid for his services at a fixed rate of percentage of the turnover or profits.
In such a case, it is clear that the commission payable to the employee will, in fact, represent the salary to be drawn by him for his services.
The payment on the percentage basis will only determine the measure of the salary.
" 802 It is thus clear that if under the terms of the contract of employment remuneration or recompense for the services rendered by the employee is determined at a fixed percentage of turnover achieved by him then such remuneration or recompense will partake of the character of salary, the percentage basis being the measure of the salary and therefore such remuneration or recompense must fall within the expression 'salary ' as defined in Rule 2(h) of Part A of the Fourth Schedule to the Act.
In the instant case before us, admittedly, under their contracts of employment the assessee has been paying and did pay during the previous years relevant to the three assessment years to its salesmen, in addition to the fixed monthly salary, commission at a fixed percentage of the turnover achieved by each salesman, the rate of percentage varying according to the class of article sold and the category to which each salesman belonged.
The instant case is therefore, an instance where the remuneration so recompense payable for the services rendered by the salesmen is determined partly by reference to the time spent in the service and partly by reference to the volume of work done.
But it is clear that the entire remuneration so determined on both the basis clearly partakes of the character of salary.
In our view, therefore, the commission paid by the assessee to its salesmen would clearly fall within the expression 'salary ' as defined in Rule 2(h) of Part A of the Fourth Schedule to the Act and as such the three sums of Rs. 95,421/ , Rs. 1,00,564/ and Rs. 1,17,969/ representing proportionate contributions appertaining to the commission paid by the assessee to its salesmen would be deductible under section 36(1) (iv) of the Act.
Turning to the Circular dated January 16, 1941 issued by the Central Board of Revenue on which counsel for the Revenue has relied, it cannot, in our view, affect the question of deductibility, for, if the commission paid by the assessee to its salesmen is covered by the expression 'salary ' on its true construction, which, according to us, it does, the Board 's view or instructions cannot detract from the legal position arising on such proper construction.
In any case we are of the view that by the said Circular what the Board wants to keep out of the term 'salary ' are payments by way of commission which do not partake of the character of salary.
Similarly the decision of this Court in M/s. Bridge & Roof Co. 's case (supra) on which the High Court has relied cannot avail the Revenue.
In the first place it was a case under the Provident Fund Act, 1952 where this Court was required to construe the expression 'basic wages ' as defined in section 2(b) of that Act and to decide whether 'production bonus ' was included in that expression and it was in that context that this Court made observations 803 to the effect that the said expression as defined therein did not include any bonus, commission or other similar allowances.
Secondly, as against the definition of 'basic wages ' in section 2(b) (ii) which excluded any dearness allowance, house rent allowance, over time allowance, bonus, commission or any other similar allowance, section 6, of the Act provided for inclusion of dearness allowance for the purposes of contribution and, therefore, this Court was concerned with trying to discover some basis for the exclusion in cl.
(ii) of section 2(b) as also for the inclusion of dearness allowance and retaining allowance (if any) in section 6 of that Act and the Court found that the basis for inclusion in section 6 and exclusion in cl.
(ii) of section 2(b) was that whatever was payable in all concerns and was earned by all permanent employees was included for the purpose of contribution under section 6 but whatever was not payable by all concerns and was not earned by all employees of a concern was excluded for the purposes of contribution and that is why commission or similar allowances were excluded from the definition of 'basic wages ', for commission and allowances were not necessarily to be found in all concerns nor were they necessarily earned by all the employees of the same concern.
It is, therefore, clear that the ratio of the decision and the observations made by this Court in a different context in that case would be inapplicable to the facts of the present case.
Having regard to the above discussion it is clear that the High Court 's view on the first question is clearly unsustainable and that question must be answered in favour of the assessee and against the Revenue.
Dealing next with the second question it seems to us clear that having regard to our view on the proper construction of the expression 'salary ' occurring in Rule 2(h) of Part A of the Fourth Schedule to the Act it must be held that the Tribunal was right in holding that the Provident Fund maintained by the assessee satisfied the condition laid down in Rule 4(c) of Part A of the Fourth Schedule and that question also must be answered in favour of the assessee and against the Revenue However, we would like to make some observations with regard to the true impact of the recognition granted by the Commissioner of Income Tax to a Provident Fund maintained by an assessee.
The facts in the present case that need be stressed in this behalf are that it was as far back as 1937 that the Commissioner of Income tax had granted recognition to the Provident Fund maintained by the assessee under the relevant rules under 1922 Act, that such recognition had been granted after the true nature of the commission payable by the 804 assessee to its salesmen under their contracts of employment had been brought to the notice of the Commissioner and that said recognition had continued to remain in operation during the relevant assessment years in question; the last fact in particular clearly implied that the Provident Fund of the assessee did satisfy all the conditions laid down in Rule 4 of Part A of the Fourth Schedule to the Act even during the relevant assessment years.
In that situation we do not think that it was open to the taxing authorities to question the recognition in any of the relevant years on the ground that the assessee 's Provident Fund did not satisfy any particular condition mentioned in Rule 4.
It would be conducive to judicial discipline and the maintaining of certainty and uniformity in administering the law that the taxing authorities should proceed on the basis that the recognition granted and available for any particular assessment year implies that the Provident Fund satisfies all the conditions under Rule 4 of Part A of the Fourth Schedule to the Act and not sit in judgment over it.
There is ample power conferred upon the Commissioner under Rule 3 of Part A of the Fourth Schedule to withdraw at any time the recognition already granted if, in his opinion, the Provident Fund contravenes any of the conditions required to be satisfied for its recognition and if during assessment proceedings for any particular assessment year the taxing authority finds that the Provident Fund maintained by an assessee has contravened any of the conditions of recognition he may refer the question of withdrawal of recognition to the Commissioner but until the Commissioner acting under the powers reserved to him withdraws such recognition the taxing authority must proceed on the basis that the Provident Fund has satisfied all the requisite conditions for its recognition for that year; any other course is bound to result in chaos and uncertainty which has to be avoided.
Having regard to the above discussion, both the questions are accordingly answered in favour of the assessee and the appeals are allowed with costs.
P.B.R. Appeal allowed.
| IN-Abs | The expression "salary," under section 17(1)(iv) of the Income Tax Act, 1961, includes "any fees, commissions, perquisites or profits in lieu of or in addition to any salary or wages"; under r. 2(h) in Part A of the Fourth Schedule to the Act, which contains Rules relating to recognised Provident Funds, the term `salary ' includes dearness allowance, if the terms of employment so provide, but excludes all other allowances and perquisites, where an assessee, as an employer, has paid any sum by way of contribution towards a recognised provident fund, section 36(1)(iv) allows such sum as a deduction in computing the income subject to such limits as may be prescribed for the purpose of recognising the provident fund.
The term "contribution ' is defined in r. 2(c), of part A of the Fourth Schedule as any sum credited by or on behalf of any employee out of his salary or by an employer out of his own moneys to the individual account of an employee but does not include any sum credited as interest.
The assessee maintained a provident fund which was recognised by the Commissioner of Income tax in 1937.
Under r. 2 of the Provident Fund Scheme Rules "salary" meant not only fixed monthly salary but also commission and dearness allowance as might be paid by the company to its employees.
As a term of the contract of employment, in addition to monthly salary, the assessee paid to each of the salesmen commission at a fixed percentage of turnover achieved by them.
The assessee 's shares of the contribution to the provident fund was calculated on the basis of both salary as well as the commission paid to each of the salesmen.
In respect of assessment years 1962 63, 1963 64 and 1964 65 the assessee claimed the whole amount paid by it towards provident fund contributions, as a deduction allowable under section 36(1)(iv) of the Income tax Act and for this purpose it relied on r. 2 of its Provident Fund Scheme Rules.
Out of the total Provident Fund contributions claimed as allowable deduction under section 36(1)(iv) the Income tax Officer disallowed that part of the assessee 's contribution which related to the amounts calculated on the basis of commission paid to the salesmen on the ground that under r. 2(h) of Part A of the Fourth Schedule the expression "salary" did not include commission paid to the employees.
789 The assessee 's appeal in respect of the assessment year 1962 63 was rejected by an Appellate Assistant Commissioner; but in respect of the other two assessment years another Appellate Assistant Commissioner allowed its appeals.
On further appeals both by the assessee and the Department the Appellate Tribunal held that the commission paid being a part of the contractual obligation, it was a part of the salary paid to the employees and therefore contributions made towards provident fund on the commission were allowable as a deduction under section 36(1)(iv) of the Act, and secondly since the provident fund was a recognised fund which fulfilled the conditions laid down in r. 4(c) of Part A of the Fourth Schedule, the employer 's contributions were entitled to be deducted.
The High Court answered the reference in favour of the Department.
It held that since commission, unlike salary, was not a fixed monthly payment it could not be included within the meaning of "salary" and that the meaning of the term "salary" could not be extended by the assessee by defining it in a particular manner in its provident fund scheme rules for the purpose of recognition of its fund.
The High Court relied upon a circular dated January 16, 1941 issued by the Central Board of Revenue which provided that unless commission and bonuses were fixed periodical payments not dependent on a contingency, they were not covered by the term "salary".
On further appeal to this Court it was contended on behalf of the Revenue that the definition of "salary" in r. 2(h) clearly showed that it did not include commission and since commission was nothing but an allowance paid without reference to any time factor which is associated with salary or wages, it is not deductible under section 36(1) (iv).
Allowing the assessee appeals, ^ HELD : The commission paid by the assessee to its salesmen would clearly fall within the expression "salary" as defined in r. 2(h) of Part A of the Fourth Schedule to the Act and the amounts representing proportionate provident fund contributions made by the assessee to its salesmen would be deductible under section 36(1)(iv) of the Act.
[802 E] 1(a) The expression "salary" has been defined in section 17 as well as in r. 2(h) of Part A of the Fourth Schedule.
But each of the definitions serves a different purpose.
Since this case is concerned with contributions made to a recognised provident fund and deductions thereof under section 36(1)(iv), it would be the definition of "salary" as given in r. 2(h) of Part A of the Fourth Schedule, and not the one given in section 17, that will be applicable.
A B] (b) Conceptually salary and wages connote one and the samething viz., remuneration or.
payment for work done or services rendered.
The former expression is generally used in connection with services of higher or non manual type while the latter is used in connection with manual services.
If conceptually salary and wages mean one and the same thing then salary could take the form of payment by reference to the time factor or by the job done.
In the case of salary the recompense could be determined wholly on the basis of time spent on service or wholly by the work done or partly by the time spent on service and partly by the work done.
In other words, whatever be the basis on which such recompense is determined it would all be salary.
[799 G; 801C] 790 Gordon vs Jennings, ; Mohmedalli vs Union of India, AIR 1964 SC 980: referred to.
(c) The definition of "salary" in r. 2(h) includes dearness allowance if the terms of employment so provide and excludes all other allowances and perquisites.
It does not, in terms, exclude commission.
But though the dictionary meaning of the term "commission" is "a pro rata remuneration for work done as agent", in business practice commission covers various kinds of payments made under different circumstances.
[801 E] (d) If under the terms of the contract of employment remuneration or recompense for the services rendered by the employee is determined at a fixed percentage of turnover achieved by him, then such remuneration or recompense will partake of the character of salary, the percentage basis being the measure of the salary.
Therefore, such remuneration or recompense must fall within the expression "salary" as defined in r. 2(h).
[802 A] In the instant case under the term of the contract of employment the assessee had been paying to the salesmen, in addition to the fixed monthly salary.
commission at a fixed percentage of the turnover.
It is, therefore, a case where remuneration or recompense payable for the services rendered by the salesman is determined partly by reference to the time spent in the service and partly by reference to the volume of work done.
The entire remuneration so determined on both the bases clearly partakes of the character of salary.
[802 C D] (e) The Circular dated January 16, 1941 issued by the Central Board of Revenue did not affect the question of deductibility because if the commission paid by the assessee to its salesmen was covered by the expression "salary" on its true construction, the Board 's view or instructions could not detract from the legal position arising on such construction.
What the Board, by the said circular, wanted to keep out of the term "salary" were payments by way of commissions which did not partake of the character of salary.
[802 F G] Bridge & Roofs Co. Ltd. vs Union of India & Ors. ; at p. 1477: held inapplicable.
2(a) The Tribunal was right in its view that the provident fund maintained by the assessee satisfied the condition laid down in r. 4(c) of Part A of the Fourth Schedule.
[803 G].
(b) After taking into account the true nature of the commission payable by the assessee to its salesmen under the terms of the employment, the Commissioner granted recognition to the provident fund, as far back as 1937 and that recognition continued to remain in operation during the relevant assessment years.
The provident fund clearly satisfied all the conditions laid down in r. 4 of Part A of the Fourth Schedule.
It was, therefore, not open to the Taxing Authorities to question the recognition on the ground that the assessee 's provident fund did not satisfy any particular condition mentioned in r. 4.
For the sake of certainty and uniformity in administering the law the Taxing Authorities should proceed on the basis that the recognition granted and available for any particular assessment year implied that the provident fund satisfied all the conditions in that rule.
Under r. 3 the Commissioner had ample power to withdraw at any time the recognition already granted if the provident fund contravened any of the conditions required to be satisfied for its recognition.
791 But until the Commissioner withdrew such recognition, the Taxing Authorities must proceed on the basis that the provident fund satisfied all the requisite conditions for its recognition for that year.
Any other course would result in uncertainty.
[803 H 804 F]
|
Civil Appeal No. 1083 of 1969.
Appeal from the Judgment and Order dated 5 12 1967 of the Allahabad High Court in Special Appeal No. 1068 of 1967.
J. P. Goyal and Sobhagmal Jain for the Appellant.
G. N. Dikshit and O. P. Rana for Respondents 1 3.
Yogeshwar Prashad and Mrs. section Bagga for Respondent No. 4.
The Judgment of the Court was delivered by TULZAPURKAR, J.
This appeal by certificate is directed against the judgment rendered by the Allahabad High Court on December 5, 1967 in Special Appeal No. 1068 of 1967 and raises a short question whether the appellant is entitled to the benefit of certain concessions (deductions) in the minimum price notified by the Cane Commissioner in his order issued on June 1, 1955 ? The appellant (Shri Janki Sugar Mills & Company) is a partnership firm carrying on the business of manufacturing sugar.
By an order passed on November 1, 1954 under section 15 of the Uttar Pradesh Sugar Cane (Regulation of Supply and Purchase) Act 1953, the Cane Commissioner reserved certain sugarcane centres for the appellant 's sugar 781 factory.
On November 12, 1954 (i.e. within 14 days of the reservation of the sugarcane centres) the respondent No. 4 (Laskar Co operative Cane Development Union Ltd.) made an offer for the 1954 55 crushing season for the supply of 6 lac maunds of sugarcane out of a total estimated yield of 12 lac maunds of sugarcane from certain centres.
This offer was accepted by the appellant firm on November 27, 1954 (i.e. within 14 days of the receipt of the offer) and an agreement in the prescribed Form 'C ' was duly executed on February 9, 1955.
It contained the usual term that the appellant firm will pay for the sugarcane supplied to it "at the minimum price notified by the Government subject to such deductions, if any, as may be notified by the Government from time to time".
On March 22, 1955 the respondent No. 4 made another offer for supplying additional quantity of 2 lac maunds of sugarcane to the appellant firm, which offer was also accepted on May 4, 1955 and a composite agreement in prescribed Form 'C ' was entered into on that very day for the supply of 8 lac maunds of sugarcane (inclusive of the initial 6 lac maunds).
This agreement also contained the usual term with regard to the payment being made "at the minimum price subject to such deductions as may be notified by the Government from time to time".
By a Press Note dated May 23, 1955 the Government of India notified its decision that certain deductions in the minimum cane price, on the basis of recovery of sugar from sugarcane, will be allowed to sugarcane factories in Uttar Pradesh on the cane supplied to them on and after May 1, 1955 but that the deductions will be allowed only on "unbonded cane" crushed by each factory and not on "bonded cane", the latter of which shall have to be purchased by each factory at the minimum cane price already fixed for the season.
In exercise of the powers under section 3 of the , (delegated to him by the Government of India under a Notification dated April 25, 1955), the Cane Commissioner, Uttar Pradesh issued a Notification on June 1, 1955 whereunder "the producers of sugar by vacuum pan process were allowed to make deductions as specified in the Schedule thereto from the minimum price of per maund of cane fixed for the season 1954 55 in respect of the unbonded sugarcane crushed on and after May 1, 1955".
The appellant firm taking advantage of this Notification granting concessions in the minimum price, made payments to Respondent No. 4 after making deductions in respect of the two lac maunds of sugarcane supplied to it, in respect whereof the offer had been made to it on March 22, 1955.
However, a Recovery Certificate under sections 17 and 18 of Uttar Pradesh Sugar Cane (Regulation of Supply and Purchase) Act, 1953 against the appellant firm for a sum of Rs. 53,878/10/ being the amounts deducted by the 782 appellant firm while making payments to Respondent No. 4.
The appellant firm disputed the legality of the Recovery Certificate on the ground that it had the right to make the deductions in view of the Cane Commissioner 's Notification dated June 1, 1955.
The said dispute was referred by the Cane Commissioner to the District Cane Officer, Bulandshahr as the sole arbitrator under Rule 108 of the U.P. Sugarcane (Regulation of Supply & Purchase) Rules, 1954.
By his award dated May 30, 1962, the District Cane Officer held that the appellant firm had wrongly made the deductions in respect of the supply of two lac maunds of sugarcane which was "bonded cane" and that the appellant firm was liable to pay the minimum price therefor.
Aggrieved by the award the appellant firm preferred an appeal to the Divisional Commissioner, Meerut under Rule 118 of the said Rules, but the appeal was dismissed on March 30, 1963.
The appellant firm challenged the legality of the award of the District Cane Officer as also the appellate order of the Divisional Commissioner by means of a writ Petition in the Allahabad High Court being Civil Miscellaneous Writ No. 2003 of 1963.
The learned Single Judge who heard the writ petition dismissed the same by his judgment and order dated October 24, 1967.
A further Special Appeal No. 1068 of 1967 carried by the appellant firm to the Division Bench of that Court also proved unsuccessful on December 5, 1967.
The appellant firm has come up in appeal to this Court.
The only contention that was urged by counsel for the appellant firm before us in this appeal was that the supply of two lac maunds of sugarcane made by respondent No. 4 to the appellant firm was not bonded sugarcane at all and as such the appellant firm was entitled to the concessions (deductions) in the minimum price payable in respect thereof to respondent No. 4 in view of the Cane Commissioner 's Notification dated June 1, 1955.
In support of this contention counsel relied upon sub cls.
(2) and (3) of cl. 3 of the U.P. Sugarcane Supply and Purchase Order, 1956 issued under section 16 of the Uttar Pradesh Sugarcane (Regulation of Supply & Purchase) Act, 1953 and it was pointed out that under sub cl.
(2) within 14 days of issue of the reserving certain areas for a factory a cane grower or a Cane growers ' Cooperative Society has to make an offer to supply cane grown in the reserved area to the occupier of the factory and under sub cl.
(3) it was obligatory upon the occupier of the factory for which such area has been reserved to accept the same within 14 days of the receipt of the offer and enter into an agreement in the prescribed form and it was urged that unless such offer was made within 14 days as prescribed 783 by sub cl.
(2) and was accepted within 14 days as prescribed by sub cl.
(3) the supply of sugarcane thereunder could not be regarded as supply of bonded sugarcane.
Counsel pointed out that the offer of two lac maunds of sugarcane in the instant case was made by respondent No. 4 long after the expiry of 14 days from the issuance of the order reserving certain areas for the appellant firm 's factory and that offer had been accepted not within the limit prescribed in sub cl.
(3) and, therefore, the sugarcane so supplied by respondent No. 4 to the appellant firm was not bonded sugarcane but ought to be classified as 'unbonded sugarcane ' and as such the appellant firm was entitled to the concessions in the minimum price notified in the Cane Commissioner 's Notification dated June 1, 1955.
It was further pointed out that though under sub cl.
(4) of cl. 3 of the U.P. Sugarcane supply and Purchase Order, 1954, the Cane Commissioner had the power to extend the date for making offers in respect of any reserved area, no such extension had been granted by the Cane Commissioner in the instant case, and, therefore, the offer of two lac maunds of sugarcane which was made by respondent No. 4 on March 22, 1955, long after the expiry of 14 days from the issuance of the order of the Cane Commissioner on November 1, 1954 reserving certain sugarcane centres for the appellant 's factory under section 15 of the Act, could not culminate into an agreement under the statute or the U.P. Sugarcane Supply and Purchase Order, 1954, that the agreement entered into between the parties on May 4, 1955 in respect of the said supply must be regarded as an ordinary contract under the Indian Contract Act and that the sugarcane supplied under such ordinary contract must be regarded as unbonded sugarcane.
In other words, the contention was that only such sugarcane as would be supplied by a cane grower or a Cane growers ' Cooperative Society under an agreement made in strict compliance of sub cls.
(2) and (3) of cl. 3 of the U.P. Sugarcane Supply and Purchase Order, 1954 could be regarded as bonded sugarcane.
The question raised in the appeal really turns upon what is meant by the expression "unbonded sugarcane" occurring in the Cane Commissioner 's Notification dated June 1, 1955 and the true effect of sub cls.
(2) and (3) of cl. 3 of the U.P. Sugarcane Supply and Purchase Order, 1954.
It must be stated, however, that neither the expression "bonded sugarcane" nor "unbonded sugarcane" has been defined either in the statute or in the U.P. Sugarcane Supply and Purchase Order 1954 and, therefore, regard must be had to the ordinary dictionary meaning of the said expressions.
In Shorter Oxford English Dictionary the legal and technical meaning of the expression ' "bond" 784 is given as "a deed by which the Obliger binds himself, his heirs, executors, or assigns to pay a certain sum to the obligee".
In Stroud 's Judicial Dictionary (4th Edn.) the expression "bond" is explained as: "an obligation by deed".
It will thus be clear that the expression "bonded sugarcane" must mean sugarcane secured by a bond or deed.
Under the Notification of the Cane Commissioner dated June 1, 1955 certain deductions from the minimum price per maund of cane fixed for the season 1954 55 had been notified in respect of the "unbonded sugarcane" crushed on or after May 1, 1955.
In other words, the concession is granted in respect of the supply of 'unbonded sugarcane ' in contradistinction with supply of 'bonded sugarcane '.
There is nothing in the Notification to suggest that any particular bond or a bond in accordance with the provisions of the U.P. Sugarcane Supply and Purchase Order 1954 was intended and therefore supply of 'bonded sugarcane ' would mean supply of sugarcane which has been secured by a bond or an agreement and such supply will not be entitled to the concession.
On a plain reading of the Notification in question, therefore, it will appear clear that since the supply of two lac maunds of sugarcane made by respondent No. 4 to the appellant firm had been secured by the agreement that was entered into between the parties on May 4, 1955 the said supply will have to be regarded as supply of "bonded sugarcane" and as such the appellant firm was not entitled to the concession in the minimum price payable in respect thereof to respondent No. 4.
Considering the question in the context of sub cls.(2) and (3) of cl.3 of the U.P. Sugarcane Supply and Purchase Order 1954 also we are clearly of the view that the appellant firm was not entitled to the benefit of the Cane Commissioner 's Notification dated June 1, 1955.
For this purpose it will be necessary to refer to section 15 of the U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953 and set out Cl.
3 of the U.P. Sugarcane Supply and Purchase Order, 1954.
Under s.15(1) of the Act power has been conferred upon the Cane Commissioner after consulting the factory and the cane grower/Canegrowers ' Co operative Society to (a) reserve any area (hereinafter called the reserved area) or, (b) assign any area (hereinafter called an assigned area) for the purpose of the supply of sugarcane to a factory in accordance with the provisions of s.16 during one or more crushing seasons as may be specified.
It was under this provision that the Cane Commissioner has passed order dated November 1, 1954 reserving certain sugarcane centres (reserved area) for the appellant firm for the 1954 55 season.
785 Clause 3 of the U.P. Sugarcane Supply and Purchase Order 1954 runs thus: "3.
Purchase of cane in reserved areas. (1) The occupier of a factory shall estimate or cause to be estimated by the 31st day of October or such later date in a crushing season as, on an application being made to the Cane Commissioner by the occupier of a factory, may be fixed by the Cane Commissioner, the quantity of cane with each grower enrolled in the Grower 's Register and shall on demand submit the estimate to the Cane Commissioner and the Collector.
(2) A cane grower or a Cane growers ' Co operative Society may within 14 days of the issue of an order reserving an area for a factory, offer in Form A of the Appendix, to supply cane grown in the reserved area, to the occupier of the factory.
(3) The occupier of the factory for which an area has been reserved, shall, within fourteen days of the receipt of the offer enter into an agreement in Form B or Form C of the Appendix, with the Cane grower or the Canegrowers ' Cooperative Society, as the case may be, in respect of the cane offered: Provided that any purchase of cane made before the execution of the prescribed agreement shall be deemed to have been made in accordance with such agreement.
(4) The Cane Commissioner may, for reasons to be recorded in writing, extend the date for making offers in respect of any reserved area.
On a fair reading of the sub cls.(2) & (3) of cl. 3 of the Order two or three things become at once clear.
In the first place sub cl.(2) uses the expression 'may ' and provides that a cane grower or Canegrowers ' Co operative Society may within 14 days of the issue of an order reserving an area for a factory make an offer to supply the cane grown in the reserved area to the factory.
That the period of 14 days mentioned in this sub clause is not imperative or mandatory is also clear from sub cl.(4) which confers power upon the Cane Commissioner to extend the date for making offer in respect of any reserved area.
Secondly, sub cl.(3) uses the expression 'shall ' indicating that an imperative obligation is cast upon the factory to accept the offer 786 within 14 days from the receipt of the offer.
Reading the two sub clauses together, it becomes clear that if a cane grower or Canegrowers ' Cooperative Society makes an offer within 14 days mentioned in sub cl.(2) it is obligatory upon the occupier of the factory to accept that offer within 14 days of the receipt of the offer, this only means that if the offer is made by the cane grower or Cane growers ' Cooperative Society beyond the period specified in sub cl.(2) or the extended time under sub cl.(4) it would not be obligatory but optional for the occupier of the factory to accept the said offer but if such offer made beyond the prescribed or extended period is accepted by the occupier of the factory a binding agreement comes into existence between the parties and sugarcane supplied thereunder would be 'bonded sugarcane ', more so when the agreement is entered into in the prescribed form.
Merely because the offer from the cane grower or Cane growers ' Co operative Society emanates after the expiry of the period mentioned in sub cl.(2) it does not mean that the parties are prevented from entering into an agreement in the prescribed form and if they do enter into an agreement in the prescribed form, as was the case here, the sugarcane supplied thereunder would be 'bonded sugarcane '.
It is not possible to accept the contention of learned counsel for the appellant that sugarcane supplied by the cane growers or Canegrowers ' Cooperative Society could be regarded as 'bonded Sugar Cane ' only if offer of the Cane grower or the Cane Growers ' Co operative Society emanates within the period prescribed by sub cl.(2) and the same is accepted by the occupier within the period prescribed by sub cl.
As stated earlier, the true effect of sub cls.
(2) and (3) read together is that the compulsion or obligation to accept the offer on the part of the occupier of the factory arises only when the offer is made by the cane grower or Cane growers ' Co operative Society within the time prescribed by sub cl.(2) or the extended time under sub cl.(4) but if the offer is made after the expiry of that period it is optional for the factory occupier to accept it or not but in cases where he accepts such offer a binding agreement comes into existence, and the sugarcane supplied thereunder becomes "bonded sugarcane".
In the instant case the offer of additional quantity of two lac maunds of sugarcane was undoubtedly made long after the expiry of the period of sub cl.(2) but the same was accepted by the appellant firm and a binding agreement came into existence and what is more that a binding agreement was executed by the parties in the prescribed Form 'C '.
Further the conduct on the part of the appellant firm in referring the dispute to arbitration and filing an appeal against the arbitrator 's award under the relevant Rules clearly shows that the parties, particularly the appellant firm, treated the agreement dated May 4, 1955 787 as one under the Act and the U.P. Sugarcane and purchase Order, 1954.
We are, therefore, of the view that the authorities below were right in coming to the conclusion that the said additional supply of two lac maunds of sugarcane by respondent No.4 to the appellant firm was the supply of "bonded sugarcane" and, therefore, the appellant firm was not entitled to the benefit of the Cane Commissioner 's Notification dated June 1, 1955.
In the result the appeal fails and is dismissed with costs.
V.D.K. Appeal dismissed.
| IN-Abs | The Government of India notified its decision that certain deductions in the minimum cane price, on the basis of recovery of sugar from sugarcane will be allowed to sugarcane factories in U.P. on the cane supplied to them on and after May 1, 1955 but that the deductions will be allowed only on "unbonded cane" crushed by each factory and not on "bonded cane", the latter of which shall have to be purchased by each factory at the minimum cane price already fixed for the season.
In exercise of the powers delegated to him under section 3 of the , the Cane Commissioner U.P. issued a Notification on June, 1, 1955, whereunder "the producers of sugar by vacuum pan process were allowed to make deductions as specified in the Schedule thereto from the minimum price of per maund of cane fixed for the season 1954 55 in respect of the unbonded sugarcane crushed on and after May 1, 1955.
The appellant firm taking advantage of this Notification granting concession in the minimum price, made payment to Laskar Co operative Cane Development Union Ltd; after making deductions in respect of 2 lac maunds of sugarcane supplied to it, under an agreement entered into pursuant to the offer made to it on March 22, 1955.
However, on December 21, 1955 the Cane Commissioner issued a Recovery Certificate under Sections 17 and 18 of U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953 against the appellant firm for a sum of Rs. 53,879.10 being the amount deducted by the appellant firm while making payments to Laskar Co operative Union.
On a challenge to legality of the Recovery Certificate, the dispute was referred to the sole arbitrator, the District Cane Officer under Rule 108 of the U.P. Sugarcane (Regulation of Supply and Purchase) Rules, 1954.
The arbitrator found that the supply of sugarcane was "bonded cane" and therefore gave an award that the appellant was not entitled to the concession and was liable to pay the minimum price therefor.
An appeal to the Divisional Commissioner having been dismissed, the appellant firm filed a Writ Petition in the Allahabad High Court which also was rejected.
A further special appeal also proving unsuccessful the appellant firm appealed to the Supreme Court after obtaining a certificate of fitness.
Dismissing the appeal, the Court, ^ HELD: 1.
Neither the expression "bonded sugarcane" nor "unbonded sugar cane" has been defined either in the Statute or in the U.P. Sugarcane Supply and Purchase Order, 1954.
Having regard to the ordinary dictionary 779 meaning of the said expressions, the expression "bonded sugarcane" must mean Sugar Cane secured by a bond or deed.
[783 G H, 784 A] 2.
Under the Notification of the Cane Commissioner dated June 1, 1955 certain deductions from the minimum price per maund of cane fixed for the season 1954 55 had been notified in respect of the "unbonded sugarcane" crushed on or after May 1, 1955.
In other words, the concession is granted in respect of the supply of 'unbonded sugarcane in contradistinction with supply of 'bonded sugarcane.
There is nothing in the Notification to suggest that any particular bond or a bond in accordance with the provisions of the U.P. Sugarcane Supply and Purchase Order 1954 was intended and therefore supply of bonded sugarcane ' would mean supply of sugarcane which has been secured by a bond or an agreement and such supply will not be entitled to the concession.
On a plain reading of the Notification in question, therefore, it will appear clear that since the supply of two lac maunds of sugarcane made by respondent No. 4 to the appellant firm had been secured by the agreement that was entered into between the parties on May 4, 1955 the said supply will have to be regarded as supply of "bonded sugarcane" and as such the appellant firm was not entitled to the concession in the minimum price payable in respect thereof to respondent No. 4, Laskar Co operative Cane Development Union.
[784 B E] 3.
On a fair reading of the sub cls.
(2) and (3) of cl. 3 of the Order two or there things become at once clear.
In the first place sub cl.
(2) uses the expression 'may ' and provides that a cane grower or cane growers ' cooperative Society may within 14 days of the issue of an order reserving an area for a factory make an offer to supply the cane grown in the reserved area to the factory.
That the period of 14 days mentioned in this subclause is not imperative or mandatory is also clear from sub cl.
(4) which confers power upon the Cane Commissioner to extend the date for making offer in respect of any reserved area.
Secondly, sub cl.
(3) uses the expression 'shall ' indicating that an imperative obligation is cast upon the factory to accept the offer within 14 days from the receipt of the offer.
Reading the two sub clauses together, it becomes clear that if a cane grower or cane growers ' Co operative Society makes an offer within 14 days mentioned in sub cl.
(2) it is obligatory upon the occupier of the factory to accept that offer within 14 days of the receipt of the offer; this only means that if the offer is made by cane grower or cane growers ' Co operative Society beyond the period specified in sub cl.
(2) or the extended time under sub cl.
(4) it would not be obligatory but optional for the occupier of the factory to accept the said offer but if such offer made beyond the prescribed or extended period is accepted by the occupier of the factory a binding agreement comes into existence between the parties and sugarcane supplied thereunder would be bonded sugarcane ', more so when the agreement is entered into in the prescribed form.
Merely because the offer from the cane grower or cane growers ' Co operative Society emanates after the expiry of the period mentioned in sub cl.
(2) it does not mean that the parties are preventive from entering in to an agreement in the prescribed form and if they do, as was the case here, the sugar cane supplied there under would be 'bonded sugarcane '.
Therefore, considering the question in the context of sub cl.
(2) and sub cl.
(3) of the U.P. sugarcane supply and Purchase Order 1954, also the appellant firm was not entitled to the benefit of the Cane Commissioner 's Notification dated June 1, 780 4.
The contention that sugarcane supplied by the cane growers or cane growers ' Co operative Society could be regarded as "bonded sugarcane" only if offer of the Canegrower or the Canegrowers Co operative Society emanates within the period prescribed by sub clause (2) and the same is accepted by the occupier within the period prescribed by sub cl.
(3) is not correct.
[786 D F] 5.
The true effect of sub clauses (2) and (3) read together is that the compulsion or obligation to accept the offer on the part of the occupier of the factory arises only when the offer is made by the cane grower or Cane growers ' Co operative Society within the time prescribed by sub cl.
(2) or the extended time under sub cl.
(4) but if the offer is made after the expiry of that period it is optional for the factory occupier to accept it or not but in cases where he accepts such offer a binding agreement comes into existence, and the sugarcane supplied thereunder becomes "bonded sugarcane".
[786 E M].
In the instant case the offer of additional quantity of two lac maunds of sugarcane was undoubtedly made long after the expiry of the period of sub cl.
(2) but the same was accepted by the appellant firm and a binding agreement came into existence and what is more a binding agreement was executed by the parties in the prescribed Form 'C '.
Further the conduct on the part of the appellant firm in referring the dispute to arbitration and filing an appeal against the arbitrator 's award under the relevant Rules clearly shows that the parties, particularly the appellant firm, treated the agreement dated May 4, 1955 as one under the Act and the U.P. Sugarcane Supply and Purchase Order, 1954.
[786 F H]
|
N: Criminal Appeal No. 118 of 1972.
Appeal by Special Leave from the Judgment and Order dated 24 4 1972 of the Punjab and Haryana High Court in Criminal Appeal No.303 of 1969.
A. N. Mulla, Harbans Singh and Faqir Chand for the Appellant.
Hardev Singh for the Respondent.
The Judgment of Court was delivered by UNTWALIA, J.
The appellant in this appeal by special leave was convicted by the Additional Sessions Judge, Jullundur under section 304 Part I, Indian Penal Code and sentenced to undergo rigorous imprisonment for seven years and a fine of Rs. 10,000/ in default to two years ' further rigorous imprisonment.
The fine, if recovered, was directed to be paid to the dependants of the deceased in equal shares.
The appellant filed a criminal appeal in the High Court of Punjab and Haryana against his conviction and sentence.
The State 808 also filed an appeal and the widow of the deceased filed a revision in the High Court for convicting the appellant under section 302 of the Penal Code instead of section 304 Part I.
The High Court dismissed both the appeals as also the revision.
The appellant only has preferred this appeal in this Court.
The appellant was running a factory at Jullundur and on account of non availability of raw materials the factory remained closed for a fortnight from the 14th to 28th September, 1967 resulting in lay off of the workmen.
A dispute arose between the management and the workmen in regard to the payment of wages for the period aforesaid.
Ultimately a settlement was arrived at through the intervention of the Labour cum Conciliation Officer, Jullundur and the terms of the settlement were reduced to writing which was marked Ext.
D.A. in the case.
Rightly or wrongly the workers, according to the prosecution case, got the impression that they were to be paid their wages for the period of lay off.
They accordingly went to the appellant on 7th October, 1967 for demanding the wages.
The appellant is said to have told them that the same would be paid on the 11th October.
On this date again they went to the factory and sent P.W. Mota Singh to demand wages from the appellant.
He asked him to go away.
Mota Singh came out and passed on the information to the workers present outside the factory premises, who, amongst others, included Sant Ram, the deceased, Darshan Singh, P.W. 4 and Gurcharan Singh, P.W. 5.
According to the prosecution case the workers then started raising innocuous slogans demanding their wages and did nothing else.
It is said that thereupon the appellant opened the door of his office and fired a shot from his revolver towards the workers who were raising slogans.
The shot hit on the forehead of Sant Ram who fell down and died instantaneously at the spot.
The occurrence took place at 2.00 p.m. on the 11th October, 1967.
A First Information Report was lodged at the Thana at 2.15 p.m., on the written report of Mota Singh, P.W. 2, Shadi Lal, P.W. 13, Sub Inspector of Police reached the place of occurrence at about 2.30 p.m. and started investigation.
After submission of Charge Sheet and commitment the appellant was tried for having committed the offence of murder of Sant Ram punishable under section 302 of the Penal Code.
The defence set up by the appellant was that the Labour Officer had given the decision contained in Ext.
D.A. on the 28th September, 1967 that no wages would be paid for the lay off period but that the workmen would be treated on leave and would be paid as per leave due to each one of them.
He along with his son and driver Bansi 809 Lal was in the office at about 1.50 p.m. on the 11th October when eight or nine labourers of his factory and fifteen or twenty labourers who are outsiders came to his factory.
Some of them entered his office while others stood outside.
They demanded wages not only for the period of lay off but also for the period from 7th October onwards when they had decided not to join the work until their wages were paid.
The factory gates were closed and a big crowd of labourers collected outside.
They became violent.
They shouted very abusive and obnoxious slogans and were saying that they would not leave the owner of the factory alive that day.
They showered brick bats at the factory premises.
His office air conditioner was broken so was the electric globe outside the office.
The brick bats hit the office wall and damaged it and also damaged the table glass on the table inside the office.
Numerous brick bats fell both inside and outside the office.
Apprehending imminent danger to his life and in exercise of the right of private defence of property and person, Bansi Lal, the appellant 's driver fired the shot from the revolver and not he.
The labourers had started breaking the barbed wire fixed on the boundary wall of the factory on the other side of which they were standing.
Some of them including Sant Ram tried to scale the boundary wall.
It was in such a situation that the bullet hit Sant Ram causing his death.
Largely, almost wholly, agreeing with the conclusions arrived at by the Trial Court, the High Court has arrived at the following findings of fact: (1) The version of the labourers that they were entitled to their wages for the lay off period was not countenanced by Ext.
D.A., rather, that of the appellant was borne out by it.
"The demand of the workers made on 7th October, 1967 and 11th October, 1967 for payment of full wages was not in accordance with this agreement and therefore was not legal." (2) "That after the refusal by the accused to pay wages to the workers for the lay off period they raised some slogans and might have hurled some brick bats into the factory premises of the accused and caused damages as observed by Shadi Lal (P.W. 13) Sub Inspector, who arrived at the spot within about half an hour of the occurrence." (3) "The workers did not break the barbed wire affixed on the boundary wall of the factory nor they tried to 810 scale the boundary wall and there is no reliable evidence on the file to show that they were armed with any DANDAS or sticks.
Their purpose was to hold a demonstration against the accused when he refused to consider their demand of wages for the lay off period which was obviously not justified in view of the agreement arrived on 28th September, 1968, copy of which is Exhibit D.A." (4) "Provocative slogans might have also been raised by them at that time, when the accused was sitting in the office." (5) "Admittedly the workers were, at that time, standing outside the factory wall which was 5 1/2 feet high and on which barbed wire is fixed.
The distance between that outer wall and the office of the accused was about 13 feet.
No brick bats hurled by the workers could, therefore, enter the office room of the accused.
The defence version that some brick bats fell inside the office of the accused and broke the glass of his table is false and incorrect." (6) The mob hurled bricks bats on the building and the globe outside his office was broken and some damage was done to the air conditioner and as such the mob was guilty of mischief." (7) "The accused on hearing slogans of the workers came out of his office and stood on the THARI in front of the office and fired the shot towards the workers, who were raising slogans outside the factory and as a result of that shot Sant Ram died instantaneously.
" On the basis of the findings aforesaid the High Court, in agreement with the Trial Court, came to the conclusion that the appellant had the right of private defence of property extending to the voluntary causing of any harm other than death to the workers but not to the causing of death and obviously he exceeded his right of private defence and thus this offence falls under Exception 2 of section 300 of the Indian Penal Code.
The High Court found the appellant in the first instance guilty of culpable homicide amounting to murder within the meaning of clause '4thly ' of section 300.
And since the appellant 's case was found to have been covered by Exception 2 he was convicted under section 304, Part I. 811 Mr. A. N. Mulla appearing for the appellant submitted that he was not challenging the concurrent findings of the courts below that it was the appellant who had fired the shot from his revolver and not his driver.
But then, according to his submission, he was forced to do so apprehending imminent danger to his life or of grievous hurt to him and the shot was fired not only to defend his property.
He was, therefore, in exercise of that right, entitled to and justified in law in using force even to the extent of causing the death of Sant Ram, although he never intended to kill any one.
It was further submitted that the workmen were the aggressors.
They had thrown brick bats even inside the office damaging the office table glass; had collected in large numbers outside the boundary wall; had broken the barbed wire on it and some of them were trying to scale down the wall.
In such a situation the appellant was not expected to act like a coward and run from the place, but he had a right to defend his property and person.
In any view of the matter, counsel submitted, that the case did not come under clause '4thly ' of section 300 or even if it falls within that provision, on the application of Exception 2 he could only be convicted under Part II of section 304 and not Part I. On the facts and in the circumstances of this case, counsel submitted, that the sentence imposed upon him is highly excessive and even if his conviction is maintained justice demands only an imposition of fine on him under section 304 Part II.
Mr. Hardev Singh appearing for the State endeavoured to show that the labourers were justified in demanding their wages for the layoff period; they were very few in number and even if their demand was not warranted on the terms of the settlement embodied in Ext.
D.A. they had a right to peacefully demonstrate and ventilate their grievance.
They did nothing which could give any right of private defence to the appellant either of his property or person.
He could escape from his office for his safety or would have taken recourse to the protection of the public authorities.
Counsel further submitted that the appellant was not at all justified in causing the death of Sant Ram by his revolver and his conviction recorded under section 304 Part I is correct and the sentence is not at all excessive.
After having appreciated all that was placed before us by learned counsel for the parties and on perusal of the relevant pieces of evidence in the case we have come to the conclusion that none of the findings recorded by the Courts below is such or so erroneous that we can justifiably interfere with it either this way or that way.
And this, apart from the fact, that since the State had not come to this Court 812 in appeal it was not open to it to argue that the appellant had no right of private defence at all.
The argument that the appellant had time to escape like a coward for protecting his person leaving his property to any amount of danger of being damaged, to say the least, was an obviously wrong argument and has been stated merely to be rejected.
D.A. clearly shows that the workmen were not entitled to claim down right cash wages for the period of lay off.
Their absence was to be adjusted against their leave.
To start with, therefore, the High Court was right in saying that their demand was not legal.
Yet that, by itself, could not give any right of private defence either of property or of person to the appellant.
We have carefully gone through the evidence of P. Ws. 2, 4 and 5 and also the evidence of Vidya Sagar, D.W. 2 on which great reliance was placed by Mr. Mulla.
We see no ample Justification for us to say that any brick bats thrown by the labourers had entered the office room of the appellant breaking the glass of his office table.
But then, brick bats were thrown; they did hit and damage the office wall, the air conditioner and the globe of the electric light.
It may not be possible to determine with exactitude the number of labourers present outside the boundary wall at the time of the occurrence.
But it does appear to us that they were neither present in very large number of hundred or more nor the number was as meagre as about ten as deposed to by the P.Ws.
The factory of the appellant is situated in an industrial area.
It is reasonable to think that some other workers also must have joined their agitational move.
Be that as it may, the number of the workers present outside the boundary wall is not of any great significant although it has some significance.
They did throw brick bats damaging the appellant 's property and endangering it to further damage.
Hurling of brick bats by the labourers towards the office of the appellant must have caused apprehension of some hurt or injury to him but not necessarily the causing of the grievous hurt as on the facts and in the circumstances of this case it was not possible to draw an inference to that extent.
The High Court would have been well advised to try to record a definite finding on the question of hurling of brick bats instead of saying that the workers "might have hurled some brick bats into the factory premises of the accused.
" Similarly the High Court ought to have come to a definite conclusion as to whether the slogans raised by the workers were merely innocuous as they claimed to be or they were raising provocative slogans also which were not only obnoxious but went to the length of saying that the appellant should be killed and the factory should be burnt.
We are inclined to think that the 813 slogans raised by the workers were more offensive and provocative than claimed by them.
But we are not prepared to accept the contention of the appellant in disagreement with the findings of the courts below that they had broken barbed wire or that some of them tried to scale down the boundary wall.
It may well be that some of them tried to raise their heads to mark the reaction of the appellant on the hearing of their slogans.
The boundary wall was only 51/2 high.
The appellant came out of his office room and stood on the THARI which was about 1 1/2 high from the ground level of the factory and fired the shot.
It is not possible to accept his contention that he did so merely to scare away the crowd of the workers.
He could and did fire the shot so that it could pass over the boundary wall almost grazing it.
Sant Ram was standing at a distance of about 5 ' or 6 ' from the boundary wall.
The bullet which must have passed just over the boundary wall could and did hit Sant Ram.
In such a situation the High Court was right in the first instance in not finding the appellant guilty of having committed culpable homicide amounting to murder within clauses '1stly, 2ndly or 3rdly ' and finding him guilty with the aid of clause '4thly ', where the intention to cause murder is absent but "the person committing the act knows that it is so imminently dangerous that it must, in all probability, cause death or such bodily injury as is likely to cause death".
The clause further says that the person "commits such act without any excuse for incurring the risk of causing death or such injury as aforesaid.
" The appellant must have committed the act with the knowledge that it was imminently dangerous and in all probability must cause death or such bodily injuries as was likely to cause death.
Dehors Exception 2 which we shall presently refer he had no excuse for committing the said act.
The law regarding the right of private defence of property or person is well settled and may be briefly recapitulated here.
The onus is on the accused to establish this right not on the basis of the standard of proving it beyond doubt but on the theory of preponderance of probability.
He might or might not take this plea explicitly or might or might not adduce any evidence in support of it but he can succeed in his plea if he is able to bring out materials in the records of the case on the basis of the evidence of the prosecution witnesses or on other pieces of evidence to show that the apparently criminal act which he committed was justified in exercise of his right of private defence of property or person or both.
But the exercise of this right is subject to the limitations and exceptions provided in section 99 of the Penal Code the last one being "The right of private defence in no case extends to the inflicting of more harm than it is necessary to inflict for 814 the purpose of defence." As to when the right of private defence of the body extends to causing death is provided for in section 100.
The appellant 's case is not covered by it.
In the view which we have expressed above we think that the appellant had not only the right of private defence of his properly but also his body to a limited extent with in the meaning of section 101 subject to the restrictions mentioned in section 99.
This did not extend to the inflicting of so much harm to Sant Ram and causing his death, nor the right of private defence of property available to the appellant extended to causing his death as it was not covered by any of the clauses of section 103.
Mr. Mulla tried to bring it under '4thly ' which says: "Theft, mischief, or house trespass, under such circumstances as may reasonably cause apprehension that death or grievous hurt will be the consequence, if such right of private defence is not exercised.
Mischief was caused to his property but it was not caused under such circumstances as may reasonably cause apprehension in his mind that death or grievous hurt would be the consequence if such right of private defence was not exercised.
A mere claim of such apprehension is not enough.
The Court on objective test and on the facts and circumstances of each case must arrive at the conclusion that the situation was such as was likely to reasonably cause such apprehension.
The right of private defence of property also, therefore, in the appellant 's case extended to causing of any harm other than the death.
Undoubtedly the appellant did exceed this right of private defence and apparently the murder which he committed within the meaning of clause '4thly ' of section 300 squarely fell within Exception 2 thereof.
He exceeded the power given to him by law and caused the death of Sant Ram against whom he was exercising such right of defence.
He did so without premeditation and without any intention of doing more harm than was necessary for the purpose of such defence.
He thought that by indulging in this imminently dangerous act he would be able to scare away the labourers and stop them from continuing their unjustified agitation, the raising of the slogans and the throwing of the brick bats.
But then, although the intention was not to kill or cause such bodily injury as was sufficient in the ordinary course of nature to cause death, yet he must have committed the act knowing that it was so imminently dangerous that it must in all probability cause death or such bodily injury as was likely to cause death of the worker or workers standing on the other side of the boundary wall.
815 A question now arises whether the appellant was guilty under Part I of section 304 or Part II.
If the accused commits an act while exceeding the right of private defence by which the death is caused either with the intention of causing death or with the intention of causing such bodily injury as was likely to cause death then he would be guilty under Part I.
On the other hand if before the application of any of the Exceptions of section 300 it is found that he was guilty of murder within the meaning of clause '4thly ', then no question of such intention arises and only the knowledge is to be fastened on him that he did indulge in an act with the knowledge that it was likely to cause death but without any intention to cause it or without any intention to cause such bodily injuries as was likely to cause death.
There does not seem to be any escape from the position, therefore, that the appellant could be convicted only under Part II of section 304 and not Part I. Even so on the facts and in the circumstances of this case we do not feel persuaded to let off the appellant with an imposition of fine only.
We, however, thought that sentence of three years ' rigorous imprisonment would meet the ends of justice in this case.
We were informed at the Bar and an affidavit sworn by the appellant 's wife was also filed before us to the effect that the appellant was in jail for about nine months as an under trial prisoner and for about four months after conviction.
Thus he has already undergone imprisonment for a period of about a year and a month.
The occurrence took place more than a decade ago.
The appellant had to pass this long ordeal all these years both mentally and financially.
Considering, therefore, the totality of the circumstances while maintaining the imposition of fine of Rs. 10,000/ and in default two years ' further imprisonment, we reduce his substantive term of imprisonment to the period already undergone and maintain the conviction of the appellant not under Part I of section 304 of the Penal Code but under Part II.
In the result the appeal is dismissed but subject to the modification made above in regard to the appellant 's conviction and sentence.
N.V.K. Appeal dismissed.
| IN-Abs | There was a dispute between the appellant, a factory owner and his employees in regard to wages, during the period of their lay off.
The prosecution alleged that on the day of the occurrence when the workers gathered outside the factory and raised innocuous slogans demanding their wages, the appellant came out and fired a shot from his revolver, which hit a worker resulting in his death.
The appellant on the other hand alleged that a large number of labourers who collected outside the factory, shouted very abusive slogans, threatening that they would not leave him alive and showered brickbats at the factory premises causing damage to the appellant 's property.
Apprehending imminent danger to his life and property, his driver fired a shot from the revolver which resulted in the death of the deceased.
The trial court, with whose findings the High Court agreed, found that the workers might have hurled brickbats into the factory premises; but they did not break the barbed wire on the boundary wall nor did they try to scale the boundary wall.
that they did not carry any sticks, that no brickbats hurled by the workers could enter the appellant 's office and therefore his version that some brickbats damaged the glass on his office table was incorrect and that it was the appellant and not his driver that fired his revolver which resulted in the death of the deceased.
The High Court, agreeing with the trial court, held that though the appellant had the right of private defence of property it did not go to the extent of causing death and, therefore, he exceeded his right of private defence.
Holding that the offence fell under Exception 2 to section 300 IPC the High Court convicted him under section 304, Part I.
In appeal to this Court it was contended on behalf of the appellant that in the exercise of his right of private defence the appellant was entitled to and justified in law in using force even to the extent of causing death although he never intended to kill the deceased or anyone.
On the facts and circumstances of the case, it did not come within clause 4thly of section 300; or even if it fell within that provision, on the application of exception 2, he could only be convicted under Part II of section 304 and not under Part I. Even if his conviction were maintained, imposition of fine would meet the ends of justice.
Dismissing the appeal in part, ^ HELD: The appellant could be convicted only under Part II of section 304 and not Part I. [813 C].
806 (1) The High Court was right in not finding the appellant guilty of having committed culpable homicide amounting to murder within clauses Firstly, Secondly or Thirdly and finding him guilty with the aid of clause 4thly where the intention to cause murder is absent but "the person committing the act knows that it is so imminently dangerous that it must, in all probability, cause death or such bodily injury as is likely to cause death".
The clause further says that the person "commits such act without any excuse for incurring the risk of causing death or such injury as aforesaid.
" The appellant must have committed the act with the knowledge that it was imminently dangerous and in all probability must cause death or such bodily injury as was likely to cause death.
Dehors Exception 2, he had no excuse for committing the said act.
[813 D E] In the present case the workers ' demand for wages was not legal.
The workers raised provocative slogans and did throw brickbats damaging the appellant 's property and endangering it to further damage.
But that by itself could not give any right of private defence of person to the appellant.
There is no evidence to show that the workers had broken the barbed wire or that some of them tried to scale the boundary wall.
It may well be that some of them tried to raise their heads above the boundary wall.
The appellant came out of his office and fired the shot, which could not be merely to scare away the crowd of workers.
He could and did fire the shot so that it could pass over the boundary wall almost grazing it.
The bullet which must have passed just over the boundary wall could and did hit the deceased killing him instantaneously.
[812C 813C] 2.
(a) In the matter of exercise of the right or private defence of property or person the onus is on the accused to establish this right not on the basis of the standard of proving it beyond doubt but on the theory of preponderance of probability.
He might or might not take this plea explicitly or might or might not adduce any evidence in support of it but he can succeed in his plea if he is able to bring out materials on the record on the basis of evidence of the prosecution witnesses or on other pieces of evidence to show that the apparently criminal act which he committed was justified in exercise of his right of private defence of person or property or both.
But the exercise of this right is subject to the limitation and exceptions provided in section 99 of the Code.
As to when the right of private defence of the body extends to causing death is provided for in section 100.
[813 F 814 A] (b) The appellant had not only the right of private defence of his property but also his body to a limited extent within the meaning of section 101 subject to the restrictions mentioned in section 99.
This did not extend to the inflicting of so much harm to the deceased and causing his death, nor does the right of private defence of property available to an accused extend to causing death, unless it is covered by any of the clause of section 103.
[814 B] (c) When mischief is caused to property it must be shown that it was caused under such circumstances as may reasonably cause apprehension that death or grievous hurt would be the consequence if such right of private defence was not exercised.
A mere claim of such apprehension is not enough.
The court on objective tests and on the facts and circumstances of each case must arrive at the conclusion that the situation was such as was likely to reasonably cause such apprehension.
[814 D E] 807 (d) The right of private defence of property in the appellant 's case extended to causing of any harm other than death.
The appellant did exceed this right of private defence and the murder which he committed was within the meaning of clause '4thly ' of section 300 squarely and fell within Exception 2 thereof.
[814 F] (e) The appellant exceeded the right given to him by law and caused the death of the deceased against whom he was exercising such right of defence.
He did so without premeditation and without any intention of doing more harm than was necessary for the purpose of such defence.
He thought that by indulging in this imminently dangerous act he would be able to scare away the labourers and stop them from continuing their unjustified agitation, the raising of the slogans and the throwing of brickbats.
But then, although the intention was not to kill or cause such bodily injury as was sufficient in the ordinary course of nature to cause death, yet he must have committed the act knowing that it was so imminently dangerous that it must in all probability cause death of the worker or workers standing on the other side of the boundary wall.
[814 G H] 3.
If the accused commits an act while exercising the right of private defence by which death is caused either with the intention of causing death or with the intention of causing such bodily injury as is likely to cause death then he would be guilty under Part I.
On the other hand if before the application of any of the Exception of section 300 it is found that he was guilty of murder within the meaning of clause "4thly" then no question of such intention arises and only the knowledge is to be fastened on him that he did indulge in an act with the knowledge that it was likely to cause death but without any intention to cause it or without any intention to cause such bodily injury as was likely to cause death.
In the instant case the appellant could be convicted only under Part II of section 304 and not Part I. [815A C]
|
Civil Appeal No. 1314 of 1975.
Appeal by Special Leave from the Judgment and Order dated 29 1 1975 of the Allahabad High Court in S.T.R. No. 771 of 1972.
623 S.C. Manchanda, Mrs. Urmila Kapoor and Miss Kamlesh Bansal for the Appellant.
G.N. Dikshit and O.P. Rana for the Respondent.
The Judgment of the Court was delivered by BHAGWATI, J.
The short question that arises for determination in this appeal by special leave is whether a contract for fabrication and erection of a 3 motion electrical overhead travelling crane is a contract of sale or a contract for work and labour.
The question is fortunately not beset with much difficulty since there is a recent decision of this Court in Sentinel Rolling Shutters & Engineering Co. (P) Ltd. vs Commissioner of Sales Tax, Maharashtra which affords considerable guidance and almost concludes the determination of the question in favour of the assessee.
The assessee, who is the appellant before us, is a partnership firm carrying on the business inter alia of manufacturing and erection of cranes.
During the assessment year 1965 66, the assessee entered into two contracts for supply and erection of 3 motion electrical overhead travelling cranes, one with M/s Kamlapat Moti Lal Sugar Mills and the other with M/s Upper Doab Sugar Mills Ltd. The contract with M/s Kamlapat Moti Lal Sugar Mills provided for supply and erection of one 3 motion electrical overhead travelling crane at the price of Rs. 1,34,500/ and on the terms and conditions set out in a letter addressed by M/s Kamlapat Moti Lal Sugar Mills to be assessee: "We confirm all the specifications given in your above referred quotation with the following changes: 1.
Structural capacity will be suitable for safeload of two unloading crabs, i.e. 10 tons.
Span of the long gantry which is given 50 ' will be confirmed shortly.
Your supply will also include gantry of 35 ' x 50 ' to make the crane three motions.
We shall not be required to give any material except electric line up to the crane.
You will be supplying crane drivers cabin with automatic control panel free provided its trial is successful.
624 6.
The minimum number of operations will be 30 per hour approx.
You will give us working trial of the equipment at least by 30th September, 1965.
The price of the above equipment will be Rs.1,34,500/ f.o.r.
Khatauli, sales tax, excise duty will be extra, if payable.
This price includes erection charges.
Terms of payment 40% advance with the order 10% after one month from the date of the order 25% after the erection of bridge and columns 15% after trial.
10% after one month 's satisfactory performance.
A penalty of 1/2% will be payable per week by you in case of delay per week after 30th September, 1965, and to a maximum of 5% of the total value.
You will send your staff for erecting the unloader and we shall be providing you necessary tools and tackles and welding set when required.
Available accommodation will also be provided.
" The contract between Upper Doab Sugar Mills Ltd. was for supply and erection of two 3 motion electrical overhead travelling cranes with two crabs each at the price of Rs. 1,19,000/ for each crane and it was on the following terms and conditions: "That the contractor will supply the company two cranes with two crabs each as under: (i) Crane bridge: The structural design of the crane bridge will be in accordance with the structural specifications of B.S.S. 466 for electric overhead travelling crane.
The structural parts will be fabricated from good quality Tata tested steel sections.
The girders for the main bridge will be of lattice construction type heavy duty.
(ii) Drivers cabin: The driver 's cabin will be of weather proof outdoor construction.
It will be with material in a position that the operator 's view is not obstructed 625 during the load handling and will travel along with the crane crab.
(iii)Electrical equipment for driver 's cabin: The driver 's cabin will be provided with the following electrical equipment and other necessary fittings: 1.
One protective paner for electrical equipment.
Drum controllers for all the motors.
Plug and sockets for hand lamp.
One electric light point.
One alarm bell and all other necessary fittings.
Steps ladders will be provided from the crane bridge for easy access to the cabins.
(iv) Wiring: Wiring with V.I.R. Wrain steel conduit pipes will be provided between individual motors and controllers, current collectors and resistances in the cabin.
For connection of current to the trolley, a set of bars copper conductors complete with insulators and strainers mounted on the bridge will be provided.
A set of current collectors will be mounted on the trolley, containing renewable graphitic carbon collectors.
PRICE: That for two complete cranes of the above mentioned specifications with two crabs each including erection, the company will pay to the contractor at the rate of Rs.1,19,000/ per crane with two crabs each including erection complete in all respects with necessary equipment.
Mode of Payment: 1.
30% with the order 2.
20% after two months of the actual commencement of work 3.
25% after the completion of erection of columns and bridge.
4. 15% after completion and giving satisfactory trials.
10% after one month 's satisfactory work.
That the contractor will execute the entire work i.e. fabrication, erection and construction latest by 30th day of September, 1964 so that the trials can begin on the 1st October, 1964.
The defects will be 626 rectified by the 10th October, 1964.
If the work is not completed by the 30th September, 1964, a penalty of Rs. 400/ per day from the 1st October, 1964 will be paid by the contractor to the company till the date of completion and satisfactory operation of the cranes.
That all such items which are considered defective by the company will be replaced at the contractor 's cost within the above specified date to the company 's entire satisfaction so that regular working of the cranes is ensured.
That all materials will be provided by the contractor and electricity will be charged at cost if consumed by the contractor.
Only such tools which are available in the stores of the Co., will be given to the contractor on loan on returnable basis and the contractor will pay to the company the cost of such material which are not returned to the company.
The final payment of the bills of the contractor will be made on his getting NOTHING DUE clearance certificate from the Stores Department of the Company.
That there will be no liability and responsibility of the company whatsoever besides payment of price of the cranes.
That sales tax or excise duty and other government duty, if any, will be extra.
Packing and forwarding charges will also be extra.
" The assessee carried out both these contracts and fabricated and erected one 3 motion electrical overhead travelling crane at the factory of M/s Kamlapati Moti Lal Sugar Mills and two 3 motion electrical overhead travelling cranes at the factory of M/s Upper Doab Sugar Mills Ltd. according to the contracts specifications.
The question arose in the assessment of the assessee to sales tax for the assessment year 1965 66 whether the amount of Rs. 1,34,500/ received by the assessee under the contract with M/s Kamlapati Moti Lal Sugar Mills and the amount of Rs. 2,38,000/ received under the contract with M/s Upper Doab Sugar Mills Ltd. formed part of the turnover of the assessee and liable to sales tax.
The answer to this question depended upon whether the contracts with M/s Kamlapati Moti Lal Sugar Mills and M/s Upper Doab Sugar Mills Ltd. were contracts of sale or contracts for work and labour.
If they were contracts of sale, the amounts of Rs.1,34,500/ and Rs. 2,38,000/ would be taxable as sale price forming part of the turnover, but not so, if they were contracts for work and labour.
The Sales Tax Officer 627 took the view that the contracts were essentially contracts of sale of ready made cranes and the erection of the cranes at the factory site was merely incidental to the sale and the amounts of Rs.1,34,500/ and Rs. 2,38,000/ received under the contracts were, therefore, taxable.
This view was upheld by the Assistant Commissioner in appeal, but on an application for revision being filed by the assessee, the Additional Judge (Revisions) held that each of the two contracts was a works contract not involving any sale of goods and hence the amounts of Rs. 1,34,500/ and Rs. 2,38,000/ were not exigible to sales tax.
The Commissioner of Sales Tax thereupon applied for a reference and on his application, the following two questions of law were referred for the opinion of the High Court: 1.
Whether in the facts and circumstances of the case the turnover of Rs. 1,34,500/ made by the assessee in respect of Kamlapati Motilal Sugar Mills amounts to a works contract or sale of goods? If so, to what extent? 2.
Whether in the facts and circumstances of the case the turnover of Rs. 2,38,000 made by the assessee in respect of the Upper Doab Sugar Mills amount to a works contract or sale of goods? If so, to what extent? The High Court took the view that each of the two contracts was for supply of 3 motion electrical overhead travelling crane as a complete unit and "the predominent object was supply of crane as a complete unit" and "the bestowing of labour and skill in the execution of the contract" appeared "to have been incidental to the supply of the machine".
The High Court observed that in its view the parties "intended the property to pass in the subject matter of the contract,namely, the completed crane as movable property" and concluded that it was a contract of sale of goods and not a contract for work and labour.
The High Court accordingly answered both the questions referred to it in favour of the Revenue and against the assessee.
The assessee thereupon brought the present appeal with special leave obtained from this Court.
Now, the distinction between a contract of sale and a contract for work and labour has been pointed out in Halsbury 's Laws of England, 3 ed., volume 34, para 3 at page 6 in the following words: "A contract of sale is a contract whose main object is the transfer of the property in, and the delivery of the possession of, a chattel as a chattel to the buyer.
Where the main 628 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.
The test is whether or not the work and labour bestowed and in anything that can properly become the subject of sale; neither the ownership of the materials, nor the value of the skill and labour as compared with the value of the materials, is conclusive, although such matters may be taken into consideration in determinating, in the circumstances of a particular case, whether the contract is in substance one for work and labour or one for the sale of a chattel.
" The primary test is whether the contract is one whose main object is transfer of property in a chattel as a chattel to the buyer, though some work may be required to be done under the contract as ancillary or incidental to the sale or it is carrying out of work by bestowal of labour and service and materials are used in execution of such work.
This test has been recognised and approved in a number of decisions of this Court and it may now be regarded as beyond controversy, but the real difficulty arises in its application as there are a large number of cases which are on the border line and fall within what may be called grey area.
To resolve this difficulty, the courts have evolved some subsidiary tests and one of such tests is that formulated by this Court in Commissioner of Sales Tax, Madhya Pradesh vs Purshottam Premji where it has been said: The primary difference between a contract for work or service and a contract for sale of goods is that in the former there is in the person performing work or rendering service no property in the thing produced as a whole.
In the case of a contract for sale, the thing produced as a whole has individual existence as the sole property of the party who produced it, at some time before delivery, and the property therein passes only under the contract relating thereto to the other party for price.
" This was the test applied by this Court in the State of Rajasthan vs Man Industrial Corporation for holding that a contract for providing and fixing four different types of windows of certain sizes according to "specifications, designs, drawings and instructions" set out in the contract was a contract for work and labour and not a contract for sale Shah, J., speaking on behalf of the Court, analysed the nature 629 of the contract and pointed out that "The window leaves did not pass to the Union of India under the terms of the contract as window leaves.
Only on the fixing of the windows as stipulated, the contract could be fully executed and the property in the windows passed on the completion of the work and not before".
The contract was not for transfer of property in the window leaves as window leaves.
It was a contract for providing and fixing windows and windows could come into existence only when the window leaves were fixed to the building by bestowing labour and skill and it was for this reason that it was held to be a works contract.
The same test reasoning was applied by this Court in Sentinel Rolling Shutters & Engineering Co. (P) Ltd. vs Commissioner of Sales Tax, Maharashtra (supra).
There the question was whether a contract for fabrication, supply and erection of certain types of rolling shutters was a contract of sale or a contract for work and labour.
This Court analysed the nature of the contract and pointed out that "not only are the Rolling Shutters to be manufactured according to the specifications, designs, drawings and instructions provided in the contract, but they are also to be erected and installed at the premises of the company.
The price stipulated in the contract is inclusive of erection and installation charges and the contract does not recognise any dichotomy between fabrication and supply of the Rolling Shutters and their erection and installation so far as the price is concerned.
The erection and installation of the Rolling Shutters is as much an essential part of the contract as the fabrication and supply and it is only on the erection and installation of the Rolling Shutters that the contract would be fully executed.
" This Court then proceeded to examine what is a rolling shutter and how it is erected and installed in the premises and observed that a rolling shutter consists of several component parts and 'the component parts do not constitute a rolling shutter until they are fixed and erected on the premises.
It is only when the component parts are fixed on the premises and fitted into one another that they constitute a rolling shutter as a commercial article and till then they are merely component parts and cannot be said to consitute a rolling shutter.
The erection and installation of the rolling shutter cannot, therefore, be said to be incidental to its manufacture and supply.
It is a fundamental and integral part of the contract, because without it the rolling shutter does not come into being.
The manufacturer would undoubtedly be the owner of the component parts when he fabricates them, but at no stage does he become the owner of the rolling shutter as a unit so as to transfer the property in it to the customer.
The rolling shutter comes into existence as a unit when the components 630 parts are fixed in position on the premises and it, therefore, becomes the property of the customer as soon as it comes into being.
There is no transfer of property in the rolling shutter by the manufacturer to the customer as a chattel.
It is essentially a transaction for fabricating component parts and fixing them on the premises so as to constitute a rolling shutter.
" The contract for fabrication, supply and erection of the rolling shutters was, on this reasoning, held by the Court to be a contract for work and labour and not a contract for sale.
If we consider what is a 3 motion electrical overhead travelling crane and how it is fabricated, erected and installed, it will become immediately clear that the analogy of the decision in Sentinel Rolling Shutters & Engineering Co. (P) Ltd. 's case (supra) to the present case is striking and it must lead us to the conclusion that each of the two contracts with which we are concerned here is not a contract for sale but a contract for work and labour.
The publication of the Indian Standards Institution which lays down the Code of Practice for Design of Overhead Travelling Cranes and Gantry Cranes clearly shows that a 3 motion electrical overhead travelling crane consists of 44 main component parts and it is only when they are put together and assembled at the site that they assume the shape of a crane.
It is not as if a 3 motion electrical overhead travelling crane is fabricated by the manufacturer and then sold and delivered to the customer as a chattel.
One single 3 motion electrical overhead travelling crane covers an area of 10,549 Square Feat at the site.
When an order for fabrication and erection of 3 month electrical overhead travelling crane is received by the manufacturer from the customer alongwith the specifications of the size and the materials, the manufacturer designis the machine according to the specifications and prepares the necessary drawings for its fabrication and manufacture and two copies of the drawings are sent to the customer for preparing the foundation at the site for erection of the columns which are ten in number along with four supporting columns.
Each column has to be placed on a grouted foundation which is 7 feet deep and is securely bolted with foundation bolts, 5 on each side.
which are grouted so as to be able to support the weight of the columns.
The columns thus become permanent fixtures on the land of the customer and they constitute a permanent foundation for the 3 motion electrical overhead travelling crane.
The detailed specifications of the foundation bolts and the columns are given in the publication of the Indian Standards Institution.
It may be noted that even so far as the columns are concerned, they are not fabricatetd by the manufacturer in his factory and then taken to the site.
Each column has a height of about 40 feet and it is made in three or four pieces and these pieces 631 are joined together with bolts and welded at the time of erection at the site.
Thereafter a 120 feet long gantry is assembled by the manufacturer in eight pieces and each piece is placed on two columns and the erection of the gantry on both sides is completed after bolting and svelaing the gantry with the columns.
Then about 60 pieces are fixed on to the gantry on both sides to form a platform to facilitate the operation and maintenance of the crane and the component parts of the railings are assembled at the site with bolts and welded to the gantry.
Two distance pieces assembled out of diverse component parts are then fixed between both ends of the gantry to ensure stability.
The manufacturer has to examine and ensure the levelling and alignment of the gantry and then the component parts of the rails are assembled and fixed on both sides of the gantry by means of M.S. cleats and bolts.
The bridge which is fabricated out of numerous component parts at the site, is then put on the rails so that it can run on the gantry and travel about 180 feet from one end Or the gantry to another.
Then rails are fixed on the bridge and the trolley is put on the rails.
The trolley consists of several component parts which are brought and assembled at the site.
There is also a platform erected on the bridge for maintenance of the bridge and trolley and lastly, there is a lifting grab which is made of 36 pieces assembled at the site and this grab is fitted on to the trolley.
It would thus be seen that the fabrication and erection of a 3 motion electrical overhead travelling crane is a highly skilled and specialised job and the component parts have to be taken to the site and they are assembled and erected there and it is only when this process is complete then a 3 motion electrical overhead travelling crane comes into being.
The process of assembling and erection, requires a high degree of skill and it is not possible to say that the erection of a 3 motion electrical overhead travelling crane at the site is merely incidental to its manufacture and supply.
The fabrication and erection is one single indivisible process and a 3 motion electrical overhead travelling crane comes into existence only when the erection is complete.
The erection is thus a fundamental and integral part of the contract, because without it the 3 motion electrical overhead travelling crane does not come into being.
The manufacturer would undoubtedly be the owner of the components parts when he fabricated them but at no stage does he become the owner of the 3 motion electrical overhead travelling crane as a unit so as to transfer the property in it to the customer.
The 3 motion electrical overhead travelling crane comes into existence as a unit only when the component parts are fixed in position and erected at the site, but at that stage it becomes the property of the customer because it is permanently embedded in the land belonging to the customer.
The result is that as 632 soon as 3 motion electrical overhead travelling crane comes into being it is the property of the customer and there is, therefore, no transfer of property in it by the manufacturer to the customer as a chattel.
It is essentially a transaction for fabricating component parts and putting them together and erecting them at the site so as to constitute a 3 motion electrical overhead travelling crane.
The transaction is no different than one for fabrication and erection of an open godown or shed with asbestos or tin sheets fixed on columns.
There can, therefore, be no doubt that the contract in the present case was a contract for work and labour and not a contract for sale.
This view which we are taking is completely supported by the decision of this Court in the Sentinel Rolling Shutters & Engineering Co. (P) Ltd. vs Commissioner of Sales Tax, Maharashtra (supra).
We accordingly allow the appeal, set aside the judgment of the High Court and hold that the contract in the present case was a con tract for work and labour and not a contract for sale and comformably with this view we answer the question referred by the Sales Tax Tribunal in favour of the assessee and against the Revenue.
The State will pay the costs of the assessee throughout.
V.D.K. Appeal allowed.
| IN-Abs | The appellant assessee was a partnership firm carrying on business inter alia of manufacture and erection of cranes.
During the assessment year 1965 66, the assessee entered into two contracts for supply and erection of 3 motion electrical overhead travelling cranes.
The assessee carried out both the contracts and fabricated and erected 3 motion electrical overhead travelling cranes according to the contract specifications.
A question arose in the assessment of the assessee to sales tax for the assessment year 1965 66 whether the amount of Rs. 1,34,500/ received by the assessee under the contract with M/s. Kamlapati Motilal Sugar Mills and the amount of Rs. 2,38,000/ received under the contract with M/s. Upper Doab Sugar Mills Ltd., formed part of the turnover of the assessee and was liable to sales tax.
The Sales Tax Officer took the view that the contracts were essentially contracts of sale of ready made cranes and the erection of the cranes at the factory site was merely incidental to the sales and the amounts of Rs. 1,34,500/ and Rs. 2,38,000/ received under the contracts were, therefore taxable.
This view was upheld by the Assistant Commissioner in appeal, but in revision the Additional Judge (Revisions) held that each of the two contracts was a works contract not involving any sale of goods and hence the amounts were not exigible to sales tax.
On a reference to the High Court at the instance of the Commissioner of Sales Tax, the High Court took the view that each of the two contracts was for supply of 3 motion electrical overhead travelling cranes as a complete unit and "the predominant object was supply of crane as complete unit" and "the bestowing of labour and skill in the execution of the contract" appeared to have been incidental to the supply of the machine.
" The High Court observed that in its view parties "intended the property to pass in the subject matter of the contract, namely, the completed crane as movable property" and concluded that it was a contract of sale of goods and not a contract for work and labour.
The High Court accordingly answered both the questions referred to it against the assessee and in favour of the Revenue.
Allowing the appeal by special leave the Court, ^ HELD: 1.
The primary test to find out whether a contract is a contract of sale or a contract for work and labour is whether the contract is one whose main object is transfer of property in a chattel as a chattel to the buyer, though some work may be required to be done under the contract as ancillary or incidental to the sale or it is carrying out of work by bestowal of labour and service and materials are used in execution of such work.
The Court 's have evolved some subsidiary tests to resolve the difficulty arising in the application of this primary test as there are a large number of cases which are on the 622 border line and fall within what may be called "grey area".
One such test formulated by the Supreme Court in Commissioner of Sales Tax, Madhya Pradesh vs Purshottam Premji, 26 STC 38 is: "The primary difference between a contract for work or service and a contract for sale of goods is that in the former there is in the person performing work or rendering service no property in the thing produced as a whole. .In the case of a contract for sale, the thing produced as a whole has individual existence as the sole property of the party who produced it (at some time before delivery, and the property therein passes only under the contract relating thereto to the other party for price." [628 C G] Commissioner of Sales Tax, M.P. vs Purshottam Premji, 26 STC 38; State of Rajasthan vs Man Industrial Corporation 24 STC 349; Sentinel Rolling Shutters & Engineering Co. (P) Ltd. vs Commissioner of Sales Tax, Maharashtra, ; ; applied.
Each of the two contracts for fabrication and erection of a 3 motion electrical overhead travelling crane is not a contract for sale but a contract for work and labour, (a) It is essentially a transaction for fabricating component parts and putting them together and erecting them at the site so as to constitute a 3 motion electrical overhead travelling crane.
The transaction is no different than one for fabrication and erection of an open godown or shed with asbestos or tin sheets fixed on columns, (b) It is not as if a 3 motion electrical overhead travelling crane is fabricated by the manufacturer and then sold and delivered to the customer as a chattel, (c) The fabrication and erection of a 3 motion electrical overhead travelling crane is a highly skilled and specialised job and the component parts have to be taken to the site and they are assembled and erected there and it is only when this process is complete, then a 3 motion electrical overhead travelling crane comes into being.
The process of assembling and erection requires a high degree of skill and it is not possible to say that the erection of a 3 motion electrical overhead travelling crane at the site is merely incidental to its manufacture and supply.
The fabrication and erection is one single indivisible process and a 3 motion electrical overhead travelling crane comes into existence only when the erection is complete.
The erection is thus a fundamental and integral part of the contract, because without it the 3 motion electrical overhead travelling crane does not come into being.
The manufacturer would undoubtedly be the owner of the component parts when he fabricated them but at no stage does he become the owner of 3 motion, electrical overhead travelling crane as a unit so as to transfer the property in it to the customer.
The 3 motion electrical overhead travelling crane comes into existence only when the component parts are fixed in position and erected at the site, but at that stage it becomes the property of the customer because it is permanently embedded in the land belonging to the customer.
The result is that as soon as 3 motion electrical overhead travelling crane comes into being, it is the property of the customer and there is, therefore, no transfer of property in it by the manufacturer to the customer as a chattel.
[630C D, 631E H 632 A] Sentinel Rolling Shutters & Engineering Co. (P) Ltd. vs Commissioner of Sales Tax, Maharashtra, [1979] 1 SCR page 644: followed.
|
ivil Appeals Nos.
357/77 and 1142 1143/78.
Appeals by Special Leave from the Judgment and Order dated 28 8 75 and 17 9 75 of the Allahabad High Court in Special Appeal Nos. 233, 254 and 264 of 1975.
L. N. Sinha, Santosh Chatterjee, Vineet Kumar and P. P. Singh for the Appellant in CA 357/77.
section N. Kacker, Sol.
General, M. V. Goswami and Rajiv Dutt for the Appellants in CA 1142 1143/78 and RR 4 and 5 in CA 357/77 A. K. Sen, section C. Patel and Bishamber Lal for Respondent No. 1 in All the appeals.
V. M. Tarkunde, section C. Patel and Bishamber Lal for R. 2 in all appeals G. L. Sanghi, section C. Patel and Bishamber Lal for R. 3 in all appeals.
Rajiv Dutt and P. C. Kapur for R. 6 in CA 357/77.
Santosh Chatterjee and Vineet Kumar for R. 6 in CA 1142/78.
The Judgment of the Court was delivered by DESAI, J.
Respondents Nos. 1, 2 and 3 in Civil Appeal No. 357/77 filed writ petition No. 5462/74 challenging the selection by U.P. Public Service Commission ( 'Commission ' for short) and subsequent appointment by U.P. State Government of appellant and respondent No. 6 to the post of Professor in Medicine in State Government Medical Colleges.
A learned single Judge of the High Court quashed the selec 855 tions.
Four appeals came to be preferred against the judgment quashing selections.
Special Appeal No. 232/75 was filed by Dr. R. N. Tandon, respondent No. 6; Special Appeal No. 233 of 1975 was preferred by the present appellant Dr. M. C. Gupta; Special Appeal No. 264 of 1975 was preferred by the State of U.P.; and Special Appeal No. 256 of 1975 was filed by respondents Nos. 1, 2 and 3 in Civil Appeal No. 357/77 against that part of the judgment of the learned single Judge by which appointment of appellant Dr. M. C. Gupta and respondent No. 6, Dr. R. N. Tandon, was not quashed.
The appellate Bench partly allowed the appeals and while confirming the order quashing the selection of Dr. M. C. Gupta and Dr. R. N. Tandon, also quashed their appointment and remitted the matter to the Commission directing it to re examine the relative merits of all candidates in the light of the interpretation put upon the relevant regulations by the Court.
Arising from this common judgment, three appeals by special leave are preferred to this Court.
Civil Appeal No. 357/77 is preferred by Dr. M. C. Gupta and Civil Appeals Nos. 1142 & 1143 of 1978 are preferred by the State of U.P. To focus the attention on the contention raised at the hearing of these appeals, a brief resume of facts would be advantageous.
The Commission invited applications for two posts of Professor of Medicine in the State Medical Colleges as per its advertisement dated 8th September 1973, subsequently extending the last date for receipt of applications to 30th March 1974, Dr. M. C. Gupta and Dr. R. N. Tandon (referred to as the 'appellants ') along with Dr. A. K. Gupta, Dr. Brij Kishore and Dr. section N. Aggarwal (referred to as 'respondents 1, 2 and 3), applied for the post.
The advertisement set out the prescribed qualifications for the post under Regulations made under section 33 of the ( 'Act ' for short).
They were in respect of the academic attainments, teaching/research experience, upper age limit, etc.
The Commission was assisted by four medical experts in the matter of interview, selection and recommendation of suitable candidates satisfying the requisite qualifications for the post.
The Commission selected Dr. M. C. Gupta and Dr. R. N. Tandon for the two posts of Professor in Medicine and recommended their names to the State Government, Respondents 1, 2 and 3 who were also candidates for the post, presumably came to know about the recommendation and moved the High Court on 13th September 1974 by way of a writ petition questioning the selection.
The petition was admitted and rule nisi was issued.
An ex parte interim stay restraining the Government from making the appointments was granted but sub 856 sequently it was vacated.
The State Government accepted the recommendations of the Commission and appointed Dr. M. C. Gupta and Dr. R. N. Tandon as Professors of Medicine on 30th October 1974.
The petition was subsequently amended questioning the order of appointment.
As already stated above, the learned single Judge held that neither Dr. M. C. Gupta nor Dr. R. N. Tandon had the requisite teaching experience and that neither of them was qualified for selection as Professor of Medicine and accordingly allowed the writ petition and quashed the selection.
By a common judgment in the appeals arising from the judgment of the learned single Judge, the appellate Bench confirmed the order quashing the selections and further quashed the order of appointment and remitted the matter to the Commission directing it to make fresh selection in consonance with the interpretation put upon the relevant regulations by the Court.
Three appeals are before us.
These three appeals obviously were heard together and are being disposed of by this common judgment.
The selection and appointment of Dr. M.C. Gupta and Dr. R. N. Tandon were questioned only on one ground in that each of them did not satisfy the requisite teaching/research experience.
The controversy in these appeals centres round the question of teaching/research experience and the relevant regulation in this behalf may be extracted: ___________________________________________________________ Post Academic Subject Teaching/ Qualification Research experience ___________________________________________________________ (b) Professor/ M.D., M.R.C.P., Medicine (b) As Reader/ Associate F.R.C.P., Asst.
Professor Professor Speciality in Medicine for Board of 5 years in a Internal Medicine Medical College (USA) or an after requisite equivalent post graduate qualification in qualification.
the subject.
___________________________________________________________ Regulation 4 of General Regulations provides as under: "4.
50% of the time spent in recognised research under the Indian Council of Medical Research or a University or a Medical College, after obtaining the requisite post graduate qualification be counted towards teaching experience in the same or an allied subject provided that 50% of the teaching experience shall be the regular teaching experience.
" The teaching/research experience claimed by each of the appellants may be set out and then the comments of each side in respect of each item may be examined: 857 Experience of Dr. M. C. Gupta.
I. 25th January 1965 to 19th About 6 years and July 1971 Lecturer in Cardio 6 month 's teaching logy in the Dept. of Medicine experience.
II July 71 upto the date of About 3 years, 2 appointment as Professor months ' teaching Reader in Medicine in S.N. experience.
Medicine College, Agra.
Experience of Dr. R.N. Tandon I. 1st October 1965 to 31st One years ' teaching October, 1966 Post doctoral experience.
teaching fellow, Dept. of Medicine, State University of New York at Buffalo, USA.
II 1st February, 1967 to 31st One year 's teaching 1968 As a Lecturer while experience.
posted as Pool Officer Dept. of Medicine in GSVM Medical College, Kanpur.
III 5th April 1968 to 4th July 15 Months ' teaching 1969 Post doctoral research experience.
fellow, Dept. of Medical in GVSM Medical College, Kanpur.
IV 29th July 1969 to 30th October Over 5 years teaching 1974 (date of appointment as experience.
Professor) Asst.
Professor of Medicine, State University of New York, at Buffalo USA.
Before the rival comments are probed and analysed, it would be necessary to keep in view the twilight zone of Court 's interference in appointment to posts requiring technical experience made consequent upon selection by Public Service Commission, aided by experts in the field, within the framework of Regulations framed by the Medical Council of India under section 33 of the , and approved by the Government of India on 5th June 1971.
When selection is made by the Commission aided and advised by experts having technical experience and high academic qualifications in the specialist field, probing teaching/research experience in technical subjects, the Courts should be slow to interfere with the opinion expressed by experts unless there are allegations of mala fides against them.
It would normally be prudent and safe for the Courts to leave the decision of academic matters to experts who are more familiar with the problems they face than the Courts generally can be.
Undoubtedly, even such a body if it were to contravene rules and regulations binding upon it in making the selection and recommending the selectees for appointment, the Court in exercise of extraordinary jurisdiction to enforce rule of law, may interfere in a writ petition under Article 226.
Even then the Court, while enforcing the rule of law, should give due weight 858 to the opinions expressed by the experts and also show due regard to its recommendations on which the State Government acted.
If the recommendations made by the body of experts keeping in view the relevant rules and regulations manifest due consideration of all the relevant factors, the Court should be very slow to interfere with such recommendations (see, The University of Mysore & Anr.
vs C. D. Govinda Rao & Anr.,(1).
In a more comparable situation in State of Bihar & Anr.
vs Dr. Asis Kumar Mukherjee, and Ors.
,(2) this Court observed as under: "Shri Jagdish Swaroop rightly stressed that once the right to appoint belonged to Government the Court could not usurp it merely because it would have chosen a different person as better qualified or given a finer gloss or different construction to the regulation on the score of a set formula that relevant circumstances had been excluded, irrelevant factors had influenced and such like grounds familiarly invented by parties to invoke the extraordinary jurisdiction under article 226.
True, no speaking order need be made while appointing a government servant.
Speaking in plaintitudinous terms these propositions may deserve serious reflection.
The Administration should not be thwarted in the usual course of making appointments because somehow it displeases judicial relish or the Court does not agree with its estimate of the relative worth of the candidates.
Is there violation of a fundamental right, illegality or a skin error of law which vitiates the appointment".
With these blurred contours of periphery of jurisdiction under Article 226 to interfere with selections made by an independent body like Public Service Commission not attributed any mala fides, assisted by four experts in the field who presumably knew what constituted teaching/research experience, what institutions are treated prestigious enough, in which teaching/research experience would be treated valuable, we may examine the rival contentions.
Two contentions which have found favour with the High Court must engage our attention: (1) In order to satisfy the experience qualification for the post of Professor in Medicine, the teaching/research experience must be in medicine and stricto sensu Cardiology being a separate branch, experience of teaching/research in Cardiology cannot be availed of, and (2) any such experience to satisfy the regulation must be acquire while holding the post of Reader or Assistant Professor (including the post of Lecturer) in Medicine.
The controversy centres round the connotation of the expression 859 'medicine '.
Does it include Cardiology or Cardiology is a separate Branch ? Section 2(f) of the Act defines medicine to mean modern scientific medicine in all its branches and includes surgery and obstetrics, but does not include veterinary medicine and surgery.
This is too wide a definition to assist us in the problem posed for the decision of the Court.
In the world of medical science there are general subjects and specialities.
Medicine and surgery are general subjects.
To wit, Cardiology is a speciality in medicine and orthopaedics is a speciality in surgery.
Even the regulation from page 8 onwards bears the heading 'Specialist Branch under Medicine and Surgery '.
Cardiology finds its place as a specialist branch under medicine.
The relevant regulation requires teaching/research experience in medicine.
Contention is, if any one who has teaching/research experience in Cardiology, could he be said to have such experience in medicine ? In this context we must recall regulation 4 which provides that 50% of the time spent in recognised research after obtaining the requisite post graduate qualification shall be counted towards teaching experience in the same or allied subject provided that 50% of the teaching experience shall be the regular teaching experience.
If research in allied subject can be taken to satisfy the requisite experience, teaching experience in a speciality under the general head could not be put on an inferior footing.
Undoubtedly, if the post is in a specialist department, the requisite teaching/research experience will have to be in the speciality.
To illustrate, if one were to qualify for being appointed as Professor/ Associate Professor of Cardiology, his teaching experience must be in Cardiology though his research experience could as well be in Cardiology or allied subject.
A person having such experience in the general subject medicine cannot qualify for the speciality.
That it what distinguishes the speciality from the general subject.
This becomes clear from the fact that in a number of hospitals there may not be posts in specialist branches and someone working in the general department may be assigned to do the work of specialist branches.
If a particular hospital has not got Cardiology as a specialist branch, a Reader or Assistant Professor in the Department of Medicine may be required to look after Cardiology cases and teaching of Cardiology as a subject.
In that event he is certainly a Reader/Assistant Professor in Medicine teaching one of the subjects, viz., Cardiology which again forms part of the general curriculum of the subject of medicine.
Therefore, it is not proper to divorce a specialist branch subject from the general subject.
It cannot be seriously contended that medicine does not include Cardiology.
To be qualified for the specialist branch of Cardiology, the minimum academic qualification is M.D. (Medicine).
This would clearly show that after acquiring the general qualification one can take the specialist branch.
If any other approach is adopted it would work 860 to the disadvantage of the person who while being posted in the Department of Medicine, is asked to teach a subject which is necessary for being taught for qualifying for M.D. but which can be styled as speciality.
He would simultaneously be denied the teaching experience in the subject of Medicine.
An extreme argument was urged that in adopting this approach it may be that somebody may be working in different specialist branches such as Neurology, Gastroenterology, Psychiatry, etc.
and each one would qualify for being appointed as Professor of Medicine without having even a tickle of experience on the subject of general medicine.
This wild apprehension need not deter us because it should be first remembered that any one going into specialist branch under medicine has to be M.D. (Medicine).
Thereafter, if he wants to become a Professor in the specialist branch such as Cardiology, the academic qualification required is to hold a degree of D.M. in the Specialist Branch.
This becomes clear from a perusal of the regulations.
It is not necessary, therefore, to go into the dictionary meaning of the expression 'medicine ' to determine whether it includes Cardiology.
The Medical Council of India, a body composed of experts have in the regulations clearly manifested their approach when they said that Cardiology is a specialist branch under medicine.
Ipso facto, medicine includes Cardiology.
It was not disputed that one qualifying for M.D. (Medicine) has to learn the subject of Cardiology.
And it must be remembered that the four experts aiding and advising the Commission have considered teaching experience in Cardiology as teaching experience in Medicine.
The counter affidavit on behalf of the Commission in terms states that medicine is a wide and general subject and includes Cardiology whereas for the post of Professor of Cardiology a further two years ' special training in Cardiology or D.M. in Cardiology after M.D. in Medicine has been laid down as a requisite qualification by the Medical Council.
It is further stated that teaching experience in Cardiology will make the person eligible for the post of Professor of Medicine.
That was the view of the experts who assisted the Commission.
Incidentally it may be mentioned that Mr. V. M. Tarkunde, learned counsel for respondents 1, 2 and 3 took serious exception to giving any weight to the counter affidavit because it has not been sworn to by any expert aiding or advising the Commission or by any officer or Member of the Commission but by an Upper Division Assistant whose source of knowledge is the legal advice tendered to him.
In paragraph 1 of the affidavit the deponent says that he has been deputed by the Commission to file the counter affidavit on their behalf and as such he is fully acquainted with the facts deposed to in the affidavit.
It is our sad experience that responsible authorities avoid filing affidavits in courts when it behoves them to assist the Court and facilitate the decision of the questions brought before the Court 861 but on this account alone we would not wholly ignore the counter affidavit.
Some documents were brought to our notice showing that in State University of New York at Buffalo, U.S.A. the Assistant Professor of Cardiology is designated as Assistant Professor of Medicine.
Further, in the Agra University Calendar, Cardiology is included in the Department of Medicine.
Similarly it was also pointed out that the Department of Medicine in the University of Manchester includes Lecturer in Cardiology.
Apart from this administrative arrangement, it could not be seriously disputed that Cardiology is a specialist branch under medicine and it could not be wholly divorced from medicine.
Under the general head 'medicine ' number of subjects are to be taught, one such being Cardiology.
If a teacher is asked to teach Cardiology as one of the subjects for general medicine, could he be at a disadvantage by being treated as having not acquired teaching experience in medicine ? Even under general medicine, apart from medicine as a subject, there are numerous other subjects and papers and there would be one or more persons incharge of one or more subjects and papers and indisputably each one would be gaining experience in general medicine.
If general medicine is to be restricted only to the paper on medicine, it would lead to a startling as result, as startling as it was sought to be urged when it was said that a person teaching Neurology could not be said to be gaining teaching experience in medicine.
The matter has to be looked at from this angle, viz., that where general subject such as medicine or surgery is being dealt with in a regulation, the specialist branch under it would be covered, though not vice versa, because if one wants to hold a post in the specialist branch he must be of necessity have teaching experience in the specialist branch.
In reaching this conclusion the seniority list maintained branch wise would hardly be helpful.
Therefore, it is not possible to agree with the High Court that the subject of medicine under the regulation is exclusive of the other subjects mentioned therein and, therefore, does not include Cardiology.
The second contention which found favour with the High Court was that the requisite teaching or research experience must be acquired while holding the post set out in the regulation in that subject.
In other words, the view of the High Court is that the teaching/research experience must be acquired while holding the post of Reader/Assistant Professor in Medicine for five years in a Medical College.
The High Court placed the emphasis on the experience acquired while holding the post.
The relevant regulation requires teaching/research experience as Reader/Assistant Professor (which includes Lecturer) 862 in Medicine for five years in a Medical College.
Regulation 4 has to be read along with specific regulation.
Regulation 4 clearly shows that 50% of the time spent in recognised research in the same or allied subject will be given credit provided that 50% of the teaching experience shall be regular teaching experience.
The specific regulation prescribing the qualification will have to be read subject to the general regulation prescribed under regulation 4 because the experience qualification prescribed in specific regulation must be calculated according to the formula prescribed in general regulation No. 4.
The specific regulation requires 5 years ' teaching/research experience.
In calculating the research experience in the light of regulation 4, 2 1/2 years ' experience shall be specifically teaching experience and credit can be given to the extent of 50% of the time spent in recognised research as prescribed in the regulation, which experience can be in the same subject, viz., the subject for which the recruitment is being made or in allied subject.
So far there is no dispute.
The question is: while acquiring research experience, is it incumbent that the person conducting research must also hold of necessity designated post in the regulation ? Now, if general regulation 4 is properly analysed for the purposes of computing research experience, the pre requisite is that the research must be done after obtaining requisite post graduate qualification.
It has no reference to the post held by the person engaged in research at the time of conducting the research.
The heading is 'teaching/research experience '.
The dichotomy will have to be applied to teaching and research experience for the purpose of computation.
So far as teaching experience is concerned, it must be acquired while holding the post specified in the regulation.
But to say that holding of the post is a pre requisite while conducting research is to read in regulation 4 what is not prescribed thereunder.
The specific regulation prescribing qualification will have to be read subject to general regulation 4 and not vice versa.
This also becomes manifest from the fact that general regulation 4 also provides that 50% of the teaching experience shall be regular teaching experience meaning thereby that if someone is engaged exclusively in research, he cannot claim to satisfy the teaching experience qualification prescribed in the regulation.
Reading specific regulation with general regulation 4, it emerges that teaching experience shall be acquired while holding the particular post specified therein and the research experience can be taken into account if the person is engaged in research after obtaining post graduate qualification and it has nothing to do with the holding of the post.
One may be engaged as a research scholar and holds no teaching post.
The research is hardly related to post though capacity for research is directly related to academic attainment.
That has been 863 taken care of.
Teaching it indisputably related to the post because a higher post may entail greater responsibility for coaching in higher classes.
This conclusion is reinforced by the language of general regulation 4 which permits recognised research under the Indian Council of Medical Research which body may not have such hierarchical posts of Lecturer or Assistant Professor or Reader.
These three designations are to be found in teaching institutions and not in research institutions.
If it were, therefore, to be held that even while acquiring research experience one must hold the post of either Reader or Assistant Professor, it would discourage many persons conducting research under the Indian Council of Medical Research.
It is, therefore, not possible to agree with the generalisation made by the High Court that teaching/research experience to qualify for the post of Professor must be acquired while working as a Reader or Lecturer.
Having cleared the ground about the interpretation of requisite regulations, we must now turn to examine the two individual cases.
In re :Dr. M. C. Gupta.
The experience qualification of Dr. M.C. Gupta has been extracted above.
There is no dispute between the parties that he was appointed and was working as Reader in Medicine in S.N. Medical College, Agra, from 28th July 1971 till 30th March 1974 which was the last date by which applications had to be submitted to the Commission.
This would give him a teaching experience of 2 years 8 months and 10 days.
Dr. Gupta also claims teaching experience, being a Lecturer in Cardiology in the Department of Medicine, section N. Medical College, Agra, from 25th January 1965 to 19th July 1971, in the aggregate period of 6 years, 6 months and 24 days.
There is a serious dispute between the parties whether Dr. Gupta is entitled to get credit for teaching experience while working as Lecturer in Cardiology.
On the view that we have taken that Cardiology is a specialist branch under medicine and, therefore, a Lecturer in Cardiology could be said to be a Lecturer in one of the subjects under general medicine and hence he had requisite experience as Lecturer in Medicine.
However, Dr. Gupta has produced a certificate issued by the Principal and Chief Superintendent, S.N. Medical College & Hospital, Agra, dated 19th September 1974 in which it is stated that 'Dr. Gupta joined the Department of Medicine as Lecturer in Cardiology on 25th January 1965 and continued till July 19, 1971 when he was appointed as Reader in Medical by Public Service Commission '.
It is further certified by 864 the Principal & Chief Superintendent that 'Dr. Gupta was actively involved in patient care, teaching of undergraduates and post graduates in general medicine in addition to conducting Cardiac Out Patient, looking after cardiac beds and taking Cardiology lectures during his tenure as Lecturer in Cardiology, as Cardiology forms a part of general medicine in this college and there is no separate Department of Cardiology here '.
There is another certificate issued by Dr. K. section Mathur, Professor & Head, Department of Medicine (RD), dated 17th September 1974, in which it is in terms stated that Dr. Gupta was actively involved in the patient care and teaching of undergraduates and postgraduates in General Medicine in addition to Cardiology during this period.
Further, Dr. Gupta used to be the Senior Physician to attend to Emergencies of all medical cases on a particular day of week and he looked after indoor beds of general medical units during leave arrangements.
He was also incharge of T.B. Clinic for a period of one month.
It was further stated that Dr. Gupta had been assigned 'Special Clinics ' to 5th year and 3rd year and 'Long Clinics ' to final year students from time to time in addition to Cardiac Clinics and Cardiology lectures.
He was also taking regular classes in clinical methods for third year and has also been called upon to teach them kidney diseases.
There are further references in the certificate which we may ignore for the time being.
Dr. Gupta also produced a certificate issued by Professor of Clinical Medicine, section N. Medical College, Agra, which, inter alia, states that Dr. Gupta was associated from time to time with teaching and patient care in general medicine and he was also actively associated with teaching of post graduates in general medicine in the way of clinical conferences, seminars, etc.
He was also incharge of beds in general medicine in Professors ' Unit in the leave vacancy.
A notice dated 24th October 1970 issued by the Department of Medicine, section N. Medical College, Agra, was also brought to our notice in which it was shown that Dr. Gupta was to be the Senior Physician on call on every Tuesday.
It would thus appear that even if Dr. Gupta was designated as Lecturer in Cardiology for the period 25th January to July 19, 1971, undoubtedly he was teaching general medicine to undergraduate students and to some post graduate students also and this is testified by persons under whom he was working.
It would be unwise to doubt the genuineness of these certificates.
Therefore, even apart from the fact that Cardiology is a part of medicine, the teaching experience acquired while holding the post of Lecturer in Cardiology, was teaching experience in subject which substantially formed part of general medicine and over and above the same, he was also working as Lecturer in Cardiology and, therefore, the Commission was amply justified in reaching the conclusion that Dr. Gupta 865 had the requisite teaching experience qualification and the High Court was in error in quashing the selection of Dr. M. C. Gupta on this ground.
Mr. L. N. Sinha, learned counsel, also wanted us to examine the research experience of Dr. M. C. Gupta when he pointed out that Dr. Gupta had published as many as 40 research papers in leading medical journals in India during 10 years he worked as Lecturer/Reader and that he had also been a recognised appraiser for the thesis submitted for the award of Doctor of Medicine.
Mr. Sen seriously objected to our examining this contention because Dr. Gupta himself never claimed any credit for research experience.
Undoubtedly, the counter affidavit on behalf of the Commission refers to having taken into consideration the research experience of Dr. Gupta but the affidavit is blissfully vague on the question which research experience was examined by the Commission.
Therefore, we would not take into account the research experience claimed on behalf of Dr. Gupta.
In re: Dr. R. N. Tandon.
We have already extracted above the teaching/research experience qualification claimed on behalf of Dr. Tandon.
Mr. Kacker, learned Solicitor General requested us to start examining each item of experience commencing from the last one as first.
Before we proceed to examine each item of experience claimed by Dr. Tandon, one contention raised on behalf of the respondents must be dealt with.
It was urged that wherever the regulations prescribe teaching or research experience, it must be one acquired in an institution in India or in any foreign institution recognised by the Medical Council of India or the Government of India.
It is not necessary to examine this argument in depth because the point could be said to have been concluded by A. K. Mukherjee 's case, wherein same set of regulations came in for consideration of this Court and in which it was seriously contended that the teaching experience specified in regulations in question must be acquired in teaching institutions in India and, therefore, any teaching experience in a foreign country cannot be taken into consideration.
This contention was in terms negativated simultaneously negativing the other extreme submission that teaching experience from any foreign institution is good enough, and after referring to sections 12, 13, and 14, it was held that those which are good enough for the aforementioned sections, are good enough for the teaching experience gained therefrom being reckoned as satisfied.
The matter undoubtedly was not further pursued by this Court because the final decision was left to the Commission.
866 Proceeding in the order suggested by Mr. Kacker it is claimed that Dr. Tandon worked as Assistant Professor of Medicine, State University of New York at Buffalo from 29th July 1969 to 30th October 1974.
This includes some period subsequent to the last date for submitting application to the Commission and we would exclude that part of the experience claimed by Dr. Tandon.
Therefore, Dr. Tandon claims to be working as Assistant Professor of Medicine from 29th July 1969 to 30th March 1974 which was the last date for submitting the application to the Commission.
Computing the period, he would have teaching experience of four years, six months and one day.
It was also said that even if teaching experience in foreign teaching institution is to be taken into account, they must be some recognised institutions of repute and not any institution outside the territory of India.
That of course is true.
In A. K. Mukherjee 's case the pertinent observation is as under: "Teaching institutions abroad not being ruled out, we consider it right to reckon as competent and qualitatively acceptable those institutions which are linked with, or are recognised as teaching institutions by the Universities and organisations in Schedule II and Schedule III and recognised by the Central Government under section 14.
Teaching institutions as such may be too wide if extended all over the globe but viewed in the perspective of the , certainly they cover institutions expressly embraced by the provisions of the statute.
If those institutions are good enough for the important purposes of sections 12, 13 and 14, it is reasonable to infer they are good enough for the teaching experience gained therefrom being reckoned as satisfactory.
" But it could hardly be urged with some confidence that the State University of New York at Buffalo would not be an institution of repute.
An attempt was made to refer to the Schedules, not upto date, to the Act published by the Medical Council of India showing recognised institutions.
In fact, the Schedules set out recognised degrees, certificates and diplomas of various Universities and certain examining Boards of U.S.A. being recognised by the Medical Council of India.
This brochure hardly helps in coming to conclusion one way or the other.
It refers to degrees and the Boards awarding the degrees and diplomas.
It does not refer to teaching institutions.
It nowhere shows that the certificates and diplomas issued by the State University of New York at 867 Buffalo would not be under one of the American Boards and, therefore, it is not recognised.
Such a contention was not even urged before the High Court or specifically in affidavits so that factual material could have been more carefully examined.
The experts aiding and advising the Commission must be quite aware of institutions in which the teaching experience was acquired by Dr. Tandon and this one is a reputed University.
It was, however, contended that there is no proof in support of the submission that Dr. Tandon was working as Assistant Professor of Medicine at State University of New York at Buffalo, commencing from 29th July 1969.
Dr. Tandon has produced a certificate, Annexure CA.
5 issued by Associate Professor of Medicine, Director Angiology Department, Buffalo General Hospital dated 3rd June 1971, in which it is stated that Dr. Tandon is an Assistant Professor of Medicine in the Department of Medicine on the full time staff of the Buffalo General Hospital having an annual salary of $ 15,000.
Mr. Tarkunde urged that this certificate does not show that Dr. Tandon was appointed effective from 29th July 1969.
Further, exception was taken to the certificate in that it is issued by the Buffalo General Hospital which the certificate does not show to be a teaching institution.
If it was not a teaching institution, one would fail to understand how it had a post of Assistant Professor of Medicine.
In a nonteaching hospital there could not be a post of Assistant Professor.
Therefore, the very fact that Dr. Tandon was shown to be an Assistant Professor of Medicine, by necessary implication shows that Buffalo General Hospital was a teaching institution under State University of New York.
In this connection reference may be made to a certificate dated 12th September 1974 issued by James P. Nolan, Professor of Medicine and Head, Department of Medicine, Buffalo General Hospital, in which it is stated that since July 1969 Dr. Tandon has been a teacher in general medicine at the Buffalo General Hospital.
This removes any doubt about the commencement of appointment of Dr. Tandon as Assistant Professor at the Buffalo General Hospital.
Mr. Tarkunde however urged that the certificate does not appear to be genuine in view of the inquiry made by a telegram (p. 257, Vol.
II of the record) from the authorities incharge of the Buffalo General Hospital and the reply received that Dr. Tandon is in India and, therefore, cannot get any information as he left instructions not to release it.
Who has sent this telegram is left to mere speculation.
And who sent the reply is equally unknown.
It would be improper to reject the certificate on such nebulous ground and we 868 can do no better than reject the contention of Mr. Tarkunde as unworthy of consideration as was done in A. K. Mukherjee 's case where in it was observed as under: "There are 6 certificates now on record and the 1st respondent is stated to have taken part in teaching work as Registrar.
You cannot expect to produce those surgeons in Patna in proof and unless serious circumstances militating against veracity exist fair minded administrators may, after expert consultations, rely on them".
Therefore, we see no justification for rejecting the certificates.
It would appear that Dr. Tandon had the teaching experience while holding the post of Assistant Professor of Medicine for a period of four years, six months and one day.
The minimum requirement is five years.
We would next examine one more item of experience claimed by Dr. Tandon in that he was post doctoral teaching fellow, Department of Medicine, State University of New York at Buffalo from 1st October 1965 to 31st October 1966.
Now, undoubtedly this was teaching experience in the same University where he was subsequently Assistant Professor.
The grievance is that he was a Fellow and neither a Lecturer nor an Assistant Professor.
What does 'Fellow ' in the University connote ? A certificate has been produced, Annexure CA.
(page 50, Vol.
IV) by Dr. Tandon issued by Eugine I. Lippasch, Professor & Administrative Associate Chairman of the Department of Medicine, State University of New York at Buffalo, dated 13th October 1966, in which it is stated that Dr. Tandon completed one year teaching fellowship in the Division of Cardiology of the Department of Medicine at the State University of New York at Buffalo and the Buffalo General Hospital on October 31, 1966.
It is not very clear what is the equivalent of a Fellow in teaching Hospitals in India but Dr. Tandon has also claimed teaching experience from 5th April 1968 to 4th July 1969, being posted as post doctoral research fellow, Department of Medicine in G. section V. M. Medical College, Kanpur.
In this connection, Annexure R 2, produced by none other than some of the contesting respondents shows that during the tenure of Fellowship, Dr. Tandon was expected to take part in the teaching and research activities of the College though he would not be treated as part of the regular establishment of the College.
Now, if the certificate produced by Dr. Tandon shows that Fellowship included teaching work, it would be unwise to doubt it.
Even if 50% of the time spent in these two places is given credit, Dr. Tandon had certainly 869 more than five years ' teaching experience.
The Court is not competent to work out figures with mathematical precision.
It can broadly examine the question whether the requirement is satisfied or not.
Therefore, he had the requisite teaching/research experience and the Commission was fully justified in treating Dr. Tandon as having requisite teaching/research experience.
It thus clearly appears that both Dr. M. C. Gupta and Dr. R. N. Tandon had the requisite qualifications, both academic and experience, and they were eligible for the post for which they had applied and if they were selected by the Commission and appointed by the Government, no exception can be taken to the same.
The High Court was, therefore, in error in interfering with the same.
Accordingly, all the three appeals are allowed and the writ petition filed by respondents 1, 2 and 3 in the High Court is dismissed with no order as to costs in the circumstances of the case.
M.R. Appeals allowed.
| IN-Abs | The appellant Dr. M. C. Gupta and the sixth respondent Dr. R. N. Tandon, were appointed to the post of 'Professor in medicine in State Government Medical Colleges.
The appointments were made by the State Government, on the recommendation of U.P. Public Service Commission, which had earlier with the assistance of four medical experts, selected them through an interview.
The respondents No. 1, 2 and 3 who were also candidates for the post filed a writ petition in the High Court, challenging the selection and appointment of Dr. M. C. Gupta and Dr. R. N. Tandon, though no mala fides were attributed to the Commission.
A Single Judge of the High Court issued a writ quashing the selection, on the ground that neither of the two selected doctors had the requisite teaching experience and that neither of them was qualified for selection as Professor of Medicine.
In appeal, the appellate Bench of the High Court confirmed the order quashing the selections, and further quashed the order of appointment, remitting the matter to the Commission, directing it to make fresh selection in consonance with the interpretation put upon the relevant regulation, by the court.
Allowing the three connected appeals, one by Dr. M. C. Gupta, and two by the State of U.P., the Court ^ HELD .
I. Medicine includes cardiology.
The Medical Council of India, a body composed of experts, have in the regulations clearly manifested their approach when they said that cardiology is a specialist branch under medicine.
Where general subject such as medicine or surgery is being dealt with, in a regulation, the specialist branch under it would be covered, though not vice versa, because if one wants to hold a post in the specialist branch, he must of necessity have teaching experience in the specialist branch.
[859 G, 860 D, 861 E].
If general regulation 4 is properly analysed for the purpose of computing research experience, the prerequisite is that the research must be done after obtaining the requisite post graduate qualification.
It has no reference to the post held by the person engaged in research at the time of conducting the research, and, to say that holding of the post specified in the regulation, is a pre requisite while conducting research, is to read in regulation 4, what is not prescribed thereunder.
[862 D F].
Teaching experience in foreign teaching institutions can be taken into account, but, they must be some recognised institutions of repute and not any institution outside the territory of India.
865 G, 866 C].
854 State of Bihar & Anr.
vs Dr. Asis Kumar Mukherjee & Ors., ; ; followed.
Vade Mecum : In view of the twilight zone of Court 's interference in appointment to posts requiring technical experience made consequent upon selection by Public Service Commission, aided and advised by experts having technical experience and high academic qualifications in the specialist field, probing teaching/research experience in technical subjects, within the framework of Regulations framed by the Medical Council of India, under section 33 of the and approved by the Government of India, the courts should be slow to interfere with the opinion expressed by the experts, unless there are allegations of mala fides against them.
[857E G].
University of Mysore & Anr.
vs C. D. Govinda Rao & Anr., ; applied.
State of BIhar & Anr.
vs Dr. Asis Kumar Mukherjee & Ors., ; ; explained.
|
Civil Appeal No. 277 of 1969.
Appeal from the Judgment and Order dated 30 8 67 of the Punjab and Haryana High Court in L.P.A. No. 50/67.
Naunit Lal for the Appellants.
section K. Bisaria for Respondent No. 2.
848 Appeal set down ex parte for RR 1 and 3.
The Judgment of the Court was delivered by SARKARIA, J.
This appeal on certificate is directed against a Full Bench judgment of the High Court at Chandigarh, rendered on November 22, 1968 in Letters Patent Appeal No. 47 of 1967.
It arises out of these facts: Bishan Das was a displaced person from West Pakistan, where he owned a considerable area of agricultural land.
He died on April 11, 1948, after his migration to India, leaving behind his five sons, who are the appellants before us.
After Bishan Das 's death, the Rehabilitation Department allotted 124 standard acres and 1/4 unit of evacuee land in his (Bishan Das) name on August 26, 1949.
Permanent rights in regard to this allotted land were conferred by the Managing Officer on behalf of the President of India under the provisions of the Displaced Persons (Compensation and Rehabilitation) Act, in the names of the sons of Bishan Das on January 2, 1956.
Prior to it, a mutation was allowed by the Rehabilitation Authorities on February 17, 1953 in favour of the appellants, herein, showing each of them entitled to 24 standard acres and 13 units of land.
Ram Dhan, respondent 2, was in possession of the land as a tenant.
The appellants applied under Section 9(1) (i) of the Punjab Security of Lands Tenure Act, 1953 (hereinafter called the Act) for his ejectment on the ground that each of them is a 'small land owner ' as defined in Section 2(2) of the Act; and that they require the land for self cultivation.
The Assistant Collector, Hissar, rejected their application.
Their appeal was dismissed by the Collector, on January 4, 1965.
Their Revision was rejected by the Commissioner of Ambala Division on October 26, 1965.
Their further Revision to the Financial Commissioner, also, met the same fate on May 17, 1966.
The appellants then moved the High Court by a writ petition under Articles 226 and 227 of the Constitution, alleging that the aforesaid orders of the Assistant Collector, Commissioner and the Financial Commissioner, were illegal, without jurisdiction and ultra vires the provisions of the Act and the rules made thereunder.
Their contention was that the land had been allotted to them in lieu of the land abandoned by their father, Bishan Das, in Pakistan, and consequently, the permissible area of each of them is to be computed under Proviso 849 (ii) to Section 2(3) of the Act, and so computed, the holding of each of the five would be well below the permissible limit of 30 standard acres prescribed thereunder.
It was further contended that since the allotment was made in standard acres, and not in ordinary acres, the 'permissible area ' of each of the appellants would be 30 standard acres, notwithstanding the fact that on conversion into ordinary acres, it exceeds 60 ordinary acres.
On these grounds, the appellants claimed that each of them is a 'small land owner ' and as such, entitled to move for eviction of the tenant under Section 9(1) (i) of the Act.
The learned Single Judge of the High Court dismissed the writ petition.
Munshi Ram and his four brothers filed Letters Patent Appeal, which was eventually heard by a Full Bench.
The Bench held that since the appellants were not 'displaced persons ' within the meaning of the East Punjab Displaced Persons (Land Resettlement) Act, 1949, the concession of an enhanced permissible area under Proviso (ii) to sub section (3) of Section 2 of the Act was not available to them, and their permissible area would be 60 ordinary acres, each; that since the holding of each of the appellants exceeds that limit, they are not 'small land owners ', and as such, were not competent to seek ejectment of the tenant.
With this reasoning, the Full Bench dismissed the appeal.
Before considering the contentions canvassed, let us have a look at the definition of 'permissible area ' in Section 2(3) of the Act.
This definition reads as under : " 'Permissible area ' in relation to a landowner or a tenant, means (thirty standard acres) and where such thirty standard acres on being converted into ordinary acres exceeds sixty acres such sixty acres; Provided that (i) . . . (ii) for a displaced person (a) who has been allotted land in excess of fifty standard acres, the permissible area shall be fifty standard acres or one hundred acres, as the case may be; (b) who has been allotted land in excess of thirty standard acres, but less than fifty standard 850 acres, the permissible area shall be equal to his allotted area; (c) who has been allotted land less than thirty standard acres the permissible area shall be thirty standard acres, including any other land or part thereof, if any, that he owns in addition.
Explanation.
For the purposes of determining the permissible area of a displaced person, the provisions of proviso (ii) shall not apply to the heirs and successors of the displaced person to whom land is allotted.
" The first contention of Mr. Naunit Lal is that the words "such thirty standards acres" in the substantive part of the definition clearly exclude conversion into ordinary cases, where the area held in standard acres falls below 30 standard acres.
In short, the point sought to be made out is that the definition ensure an irreducible minimum of 30 standard acres to a land holder.
The contention does not stand a close examination.
The flaw in the proposition propounded by the counsel is that it takes into account only one aspect of the definition while ignoring the other.
As rightly observed by the High Court, in devising this formula for computing the permissible area, the Legislature was concerned to put limits on the holdings of land both in its qualitative and quantitative aspects.
The concept of 'standard acre ', being 'a measure of area convertible into ordinary acres of any class of land according to the prescribed scale with reference to the quantity of yield and quality of soil ', has been introduced in the definition of 'permissible area ' to emphasise the qualitative aspect of a land holding, and the maximum limit of 60 ordinary acres delineates its quantitative aspect.
The language of sub section (3) of Section 2 is plain and unambiguous.
It proclaims in no uncertain terms, the legislative imperative that no land owner or tenant shall hold land exceeding 30 standard acres or 60 ordinary acres.
By no stretch of imagination, therefore, the words "such thirty acres" occurring in the definition can be construed to limit the conversion into ordinary acres only to a case where the holding is 30 'standard acres ', and not less.
Mr. Naunit Lal next contended that since the land was allotted in the name of Bishan Das deceased, who was a displaced person, the EXPLANATION will not be attracted, with the result that the per 851 missible area of each of his five sons would be 30 standard acres in accordance with Clause (c) of Proviso (ii) of sub section (3) of Section 2.
Since each of them was holding only about 24 standard acres, they were small land owners.
The argument rests on the fallacy that the land was allotted to a 'displaced person '.
The true position is that it was allotted to the sons of Bishan Das, who were not 'displaced persons ' within the contemplation of the aforesaid Proviso (ii).
Section 2(11) of the Act says: "Displaced person" has the meaning assigned to it in the East Punjab Displaced Persons (Land Resettlement) Act, 1949 (Act XXXVI of 1949).
According to the definition of the term in East Punjab Act XXXVI of 1949, a 'displaced person ' means "a landholder in the territories now comprised in the Province of Punjab in Pakistan or a person of the Punjab extraction who holds land in the (West Pakistan) and who has since the 1st day of March 1947, abandoned or has been made to abandon his land in the said territories on account of civil disturbances or the fear of such disturbances, or the partition of the country.
" Now, the sons of Bishan Das never owned or abandoned any land in West Pakistan.
Evidently, they were not 'displaced persons ' within the meaning of Proviso (ii) to Section 2(3).
They are merely "heirs of a displaced person" who died after his migration to India.
Proviso (ii) therefore, does not apply to the case of the appellants who, and not their father, were the persons to whom the land in dispute has been allotted.
The EXPLANATION appended to Section 2(3), therefore, clearly excludes the application of Proviso (ii), to their case.
Their case is fully covered by the substantive part of the definition of 'permissible area ' according to which the maximum which they could hold is 60 ordinary acres.
Each of them was holding, at the material date, in excess of that area and as such, they were not 'small land owners '.
The last contention of Mr. Naunit Lal is that in computing the 'permissible area ' of each of the appellants, the Collector had illegally and wrongfully included uncultivated area of Banjar Jadid, Banjar Qadim and Gair Mumkin land as on April 15, 1953, and had also through some oversight, failed to allow deduction for the dimunition in their holdings resulting from consolidation.
The argument is that Banjar land does not fall within the definition of 'Land ' for the purpose of Punjab Security of Land Tenures Act, 1953.
In support of this contention, reference has been made to several decisions of the High Court at Chandigarh.
According to sub section (8) of Section 2 of the Act, "Land" shall have the same meaning as is assigned to it in the Punjab Tenancy Section 2(c) of that Act defines 'Land ' to mean "land which is not occupied as the site of any building in a town or village and is occupied or has been let for agricultural purposes or for purposes subservient to agriculture, or for pasture, and includes the sites of buildings and other structures on such land".
In Nemi Chand Jain vs Financial Commissioner, Punjab(1), H. R. Khanna, J. speaking for a Division Bench of the High Court, held that Banjar Qadim and Banjar Jadid land cannot be taken into account while computing the surplus area, under the Act, because not being occupied or let for agricultural purposes or purposes subservient to agriculture, it does not fall within the purview of 'Land ' under the Act.
This ruling has been consistently followed by the High Court in its subsequent decisions, some of which are reported as Sadhu Ram vs Punjab State(2), Amolak Rai vs Financial Commissioner, Planning, Punjab(3) and Jaggu vs Punjab State(4) and Jiwan Singh vs State of Punjab(5).
In our opinion, this view taken by the High Court proceeds on a correct interpretation of the statutory provisions as it stood at the relevant time.
Learned counsel for the tenant respondent also, does not question the soundness of this view.
He, however, does not accept the particulars of the areas of Banjar and Gair Mumkin Land supplied by Mr. Naunit Lal, in the form of a Goshwara.
We will, therefore, while upholding the view taken by the High Court in regard to the interpretation and application of Section 2(3) Proviso (ii) of the Act, allow this appeal and set aside the decision of the High Court and the impugned orders of the Assistant Collector, Collector, and the Commissioner and remit the case to the Collector concerned of Hissar District with the direction that he should ascertain the extent of the Banjar Qadim and Banjar Jadid and Gair Mumkin land of the appellants allottees at the relevant date and recompute their permissible area after excluding such Banjar and Gair Mumkin land; then dispose of the applications of the appellants under Section 9(1)(i) afresh.
In the circumstances of the case, there will be no order as to costs.
N.V.K. Appeal allowed.
| IN-Abs | In relation to a land owner or a tenant, the term "permissible area" as defined in section 2(3) of the Punjab Security of Land Tenures Act, 1953 means thirty standard acres and where such thirty standard acres on being converted into ordinary acres exceed sixty acres such sixty acres, Clause (ii) (b) of the proviso enacts that if a displaced person who has been allotted land in excess of thirty standard acres but less than fifty standard acres, the permissible area shall be equal to his allotted area.
The Explanation states that for the purposes of determining the permissible area of a displaced person the provisions of proviso (ii) shall not apply to the heirs and successors of the displaced person to whom land is allotted.
The appellants ' father, a displaced person, owned considerable agricultural land in West Pakistan.
After his migration to India and subsequent death, in lieu of the land abandoned in Pakistan 124 standard acres were allotted in his name.
Mutation of the property was sanctioned in favour of the appellants and permanent rights were conferred in their names.
Alleging that they were 'small land owners ' as defined in the Act, and that they required the land for self cultivation they applied for ejectment of the respondent No. 2 who at that time was in possession of the land.
The Assistant Collector, rejected their request, their appeal to the Collector was dismissed and revision application to Commissioner and Financial Commissioner were also rejected.
In their writ petition under article 226 of the Constitution they contended that if the "permissible area" is computed under proviso (ii) to section 2(3) of the Act, the holding of each of them would be below the permissible limit of thirty standard acres; that since the allotment was made in standard acres, the 'permissible area ' of each of them would be 30 standard acres notwithstanding that on conversion into ordinary acres it exceeds sixty ordinary acres.
A single Judge of the High Court dismissed their writ petition.
On appeal, the Full Bench of the High Court held that since the appellants were not displaced persons, the concession of an enhanced permissible area under proviso (ii) to section 2(3) was not available to them and their permissible area would be sixty ordinary acres, each, and since the holding of each of them exceeded sixty ordinary acres they were not 'small land owners ' and so could not seek ejectment of the tenant.
847 On further appeal to this Court it was contended, (1) that the words "such thirty standard acres" in the definition exclude conversion into ordinary acres where the area already held in standard acres falls below thirty standard acres; (2) that they were small land owners because each of them was holding only 24 standard acres and the Explanation to section 2(3) had no application to them because the land was allotted to their father who was a displaced person; and (3) that while computing the "permissible area" uncultivated Banjar land which does not fall within the definition of "land" for the purposes of the 1953 Act had wrongly been included.
Rejecting contentions (1) and (2), ^ HELD: 1.
The language of section 2(3) proclaims in no uncertain terms the legislative imperative that no land owner or tenant shall hold land exceeding 30 standard acres or 60 ordinary acres.
The words "such thirty acres" occurring in the definition cannot be construed to limit the conversion into ordinary acres only to a case where the holding is thirty standard acres and not less.
The concept of standard acre being "a measure of area convertible into ordinary acres of any class of land according to the prescribed scale with reference to the quantity of yield and quality of soil" has been introduced in the definition of "permissible area" to emphasise the qualitative aspect of a landholding and the maximum limit of sixty acres delineates its quantitative aspect.
[850 G, F] 2.
The appellants were not displaced persons within the meaning of proviso (ii) to section 2(3).
They were heirs of a displaced person who died after his migration of India.
Therefore, proviso (ii) had no application to the appellants.
The Explanation clearly excludes application of proviso (ii) to their case, which is fully covered by the substantive part of the definition of "permissible area" under which the maximum they could hold was sixty ordinary acres.
At the material time, each of them was holding land in excess of the sixty ordinary acres and therefore, they were not 'small land owners. ' [851 D F] Accepting the third contention and allowing the appeal and remitting the case to the Collector concerned.
[852 F].
HELD that 3.
(a) Banjar Qadim and Banjar Jadid cannot be taken into account while computing the surplus area under the Act because, not being occupied or let for agricultural purposes or purposes subservient to agriculture, it does not fall within the purview of 'land ' under the Act.
[852 B C] Nemi Chand Jain vs Financial Commissioner, Punjab, AIR 1964 Punj. 373; approved.
(b) The Assistant Collector should ascertain the extent of the Banjar Qadim and Banjar Jadid and Gair Mumkin area of the appellants at the relevant date and recompute their permissible area after excluding such areas.
[852 G].
|
Appeal No. 17 of 1954.
Appeal by Special Leave from the Judgment and Order dated the 11th day of June 1951 of the Punjab High Court in Civil Reference No. 2 of 1951.
Hardyal Hardy and Sardar Singh, for the appellant.
C. K. Daphtary, Solicitor General of India (G. N. Joshi and R. H. Dhebar, with him) for the 'respondent.
February 21.
The Judgment of the Court was delivered by VENKATARIAMA AYYAR J.
The appellant is a firm carrying on business at Ludhiana in the Punjab.
The Income tax Officer assessed its income for 1945 1946 at Rs. 71,186, and on 17 9 1947 a notice of demand was served on it for Rs. 29,857 6 0 on account of income tax and super tax.
The appellant preferred an 168 appeal against the assessment, and it was actually received in the office of the Appellate Assistant Commissioner on 5 11 1947.
It was then out of time by 19 days; but the appeal was registered as No. 86, and notice for hearing under section 31 was issued for 13 12 1947, and after undergoing several adjournments, it was actually heard on 1 10 1948.
For the year 1946 1947, the Income tax Officer assessed the income of the firm at Rs. 1,09,883, and on 29 9 1947 a notice of demand was served on it for Rs. 51,313 14 0 on account of income tax and super tax.
The appellant preferred an appeal against this assessment, and it was actually received in the office of the Appellate Assistant Commissioner on 5 11 1947, and it was then 7 days out of time.
It was registered as No. 89, and notice for hearing under section 31 was issued for 24 6 1948.
Eventually, it was heard along with Appeal No. 86 on 1 10 1948.
At the hearing, the Department took the objection that the appeals were presented out of time, and were therefore liable to be dismissed.
The appellant prayed for condonation of the delay on the ground that following on the partition of the country the conditions were very unsettled, that curfew order had been promulgated and was in force, and that the post office did not accept registered letters, and that the traffic on the Grand Trunk Road was closed., and that in view of these exceptional circumstances, it bad sufficient cause for not presenting the appeals in time.
On 31 12 1948 the Appellate Assistant Commissioner passed orders in both the appeals, holding that there was not sufficient ground for condoning the delay, and rejecting them in limine.
These orders were purported to be passed under section 31 read along with section 30(2).
Against these orders, the appellant preferred appeals under section 33 of the Act to the Appellate Tribunal which by its order dated 4 4 1950 dismissed them on the ground that the orders of the Assistant Commissioner were in substance passed under section 30 (2) and not under section 31 and that no appeal lay against them under section 33, On the applica 169 tions of the appellant, the Tribunal referred under section 66(1) of the Income Tax Act the following question for the decision of the High Court of Punjab: "Whether in the circumstances of the case appeals lay to the Tribunal against orders of the Appellate Assistant Commissioner dismissing the appeals against the assessments for the years 19451946 and 1946 1947 in limine".
The reference was beard by Khosla and Harnam Singh JJ., who held following an earlier decision of that court in Dewan Chand vs Commissioner of Incometax(1) that the orders of the Appellate Assistant Commissioner were under section 30(2) and not appealable under section 33.
Certificate to appeal to this Court against this order having been refused by the High Court, the appellant applied for and obtained leave to appeal to this Court under article 136 of the Con stitution, and that is how the appeal comes before US.
The provisions of the Act bearing on the question may now be referred to.
Section 30(1) confers on the assessee a right of appeal against orders passed under the sections specified therein.
Section 30(2) provides that the appeal shall ordinarily be presented within thirty days of the order of assessment, but the Appellate Assistant Commissioner may admit an appeal after the expiration of the period if he is satisfied that the appellant bad sufficient cause for not presenting it within that period.
Section 30(3) provides that "the appeal shall be in the prescribed form and shall be verified in the prescribed manner".
Section 31(1) enacts that "the Appellate Assistant Commis sioner shall fix a day and place for the hearing of the appeal, and may from time to time adjourn the hearing".
Section 31(3) specifies the orders that may be passed in appeals according as they are directed against orders passed under the one or the other of the sections of the Act which are specified in section 30(1).
When the appeal is against an order of assessment under section 23 and this is what we are con (1) (1951] 20 , 170 cerned with in this appeal it is provided in section 31(3), clauses (a) and (b) that in disposing of the appeal the Appellate Assistant Commissioner may (a) confirm, reduce, enhance or annul the assessment, or (b) set aside the assessment and direct the.
Incometax Officer to make a fresh assessment after making such further enquiry as the Income tax Officer thinks fit.
Section 33(1) enacts that, "Any assessee objecting to an order passed by an Appellate Assistant Commissioner under section 28 or section 31 may appeal to the Appellate Tribunal within sixty days of the date on which such order is communicated to him".
Stated succinctly, section 30 confers a right of appeal on the assessee, section 31 provides for the hearing and disposal of the appeal, and section 33 confers a right of further appeal against orders passed under section 31, Now, on these provisions the question is whether an order dismissing an appeal presented under section 30 as out of time is one under section 30(2) or under section 31 of the Act.
If it is the former, there is no appeal provided against it; if it is the latter, it is open to appeal under section 33.
On this question, there has been a sharp conflict of opinion among different High Courts and even among different Benches of the same High Court.
The Bombay High Court has held that when an appeal is presented out of time, and there is no order of condonation of delay under section 30(2), there is, in law, no appeal before the Appellate Assistant Commissioner, and that an order by him rejecting the appeal does not fall within section 31 and is not appealable: Commissioner of Income tax vs Mysore Iron and Steel Works(1) and K. K. Porbunderwalla vs Commissioner of Income tax(2); but that if the appeal is admitted after an order of condonation is made under section 30(2), an order subsequently passed dismissing it on the ground of limitation would be one under section 31 and would be appealable under section 33 and the result will be the same even when the appeal is admitted without (1) .[1949] , (2) 171 any order of condonation under section 30(2): Champalal A sharam vs Commissioner of Income tax(1).
The High Court of Allahabad has also taken the same view, and held that an order refusing to condone delay and rejecting an appeal before it was admitted was not one under section 31 and was not appealable: Vide Shivnath Prasad vs Commissioner of Income tax, Central and U. P.(3) and Municipal Board, Agra vs Commissioner of Income tax, U. P.( 3 ); but that ail order dismissing the appeal as time barred after it had been admitted was one under section 31 and was appeable: Mohd. Nain Mohd. Alam vs Commissioner of Income tax(1).
The High Court of Punjab has held following Shivnath Prasad vs Commissioner of Incometax, Central and U. P.(2) and Commissioner of Incometax vs Mysore Iron and Steel Works(5) that when the Appellate Assistant Commissioner declines to condone delay and rejects the appeal, it is one under section 30(2) and not appealable.
It has further held that even if the appeal bad been admitted without an order of condonation and dismissed at the hearing on the ground of limitation, it would not be under section 31, because the scheme of the Act contemplated that an order to be passed under that section must relate to the merits of the assessment.
It is on this decision that the judgment under appeal is based It may be mentioned that the decision in Dewan Chand vs Commissioner of Income tax(6) was dissented from in a recent decision of the Punjab High Court in General Agencies vs Income tax Commissioner(7) .
In Commissioner of Income tax vs Shahzadi Begum the Madras High Court has held that an order declining to excuse delay and rejecting the appeal is one under section 31, whether it is made before the appeal is admitted or after, and that an appeal which is filed out of time is, nonetheless, an appeal for purposes of section 31, and that an order dismissing it would be appealable under section 33.
In Gour Mohan (1) , (3) (5) (7) A.I R. 1956 Punjab 26.
(2) (4) (6) (8) 172 Mullick vs Commissioner of Agricultural Income tax(1), the Calcutta High Court has, after a full discussion, come to the conclusion that an order of dismissal on the ground of limitation at whatever stage was one which fell under section 31.
It is unnecessary to refer to the views expressed in decisions of other High Courts, as the point now under discussion did not directly arise for decision therein.
The question is which of these views is the correct one to adopt.
We start with this that under section 33 it is only orders under section 31 that are appealable.
The question therefore narrows itself to this whether an order declining to condone delay and dismissing the appeal as barred by time is an order under section 31.
It will be, if it is passed in appeal against an order of assessment, and is one which affirms it.
Now, the conflicting views expressed by the several High Courts centre round two points: (1) when an appeal is presented out of time and there has been a refusal to condone delay under section 30(2), is an order rejecting it as time barred one passed in appeal; and (2) if it is, is such an order one confirming the assessment within section 31(3)(a)? On the first point, as already stated, it has been held by the Bombay High Court that while an order dismissing an appeal as time barred after it is admitted is one under section 31, a similar order passed before it is admitted is one under section 30(2).
The ratio of this distinction is stated to be that in law there is no appeal unless it is presented in time, and if presented beyond time, unless the delay is excused.
In Commissioner of Income tax vs Mysore Iron and Steel Works(2), Chagla, C.J. stated the position thus: "An asseesee has a statutory right to present an appeal within thirty days without any order being required from the Appellate Assistant Commissioner for admission of that appeal.
But if the time prescribed expires, then that statutory right to present an appeal goes; and an appeal can only be entertained provided it is admitted by the Appellate Assistant Commissioner after condoning the delay.
(1) (2) 173 Therefore before an appeal could be admitted in this case, an order from the Appellate Assistant Commissioner was requisite that the delay had been condoned and it was only on such an order being made that the appeal could be entertained by the Appellate Assistant Commissioner.
Now section 31 deals only with such appeals which are presented within the prescribed period or admitted after the delay has been condoned, and the procedure laid down in section 31 with regard to the hearing of appeals only applies to such appeals.
Therefore, in my opinion, when the Appellate Assistant Commissioner refused to condone the delay, there was no appeal before him which he could hear and dispose of as provided under section 31 of the Act.
Section 33 then gives the right of appeal to the assessee from an order made by the Appellate Assistant Commissioner either under section 28 or under section 31.
Therefore the Legislature did not give the right of appeal to the assessee against an order made by the Appellate Assistant Commissioner under section 30 of the Act".
Learned counsel for the appellant disputes the correctness of the last observation that an order of the Appellate Assistant comissioner refusing to condone the delay is one under section 30(2), and contends that the only order that could be passed under that section was one excusing delay, and an order refusing to condone it will fall outside it, and that such an order could only be made under section 31.
We find it difficult to accede to this contention.
When power is granted to an authority to be exercised at his discretion, it is necessarily implicit in the grant that he may exercise it in such manner as the circumstances might warrant.
And if the Appellate Assistant Commissioner has a discretion to excuse the delay, he has also a discretion in appropriate cases to decline to do so.
We are therefore of opinion that the refusal to excuse delay is an order under section 30(2.).
But the question still remains whether the view taken in Commissioner of Income tax vs Mysore Iron 23 174 and Steel Works(1) and K. K. Porbunderwalla v Commissioner of Income tax (2) that an appeal which is filed beyond the period of limitation is, in the eye of law, no appeal, unless and until there is a condonation of delay, and that, in consequence, an order passed thereon cannot be held to be passed in appeal so as to fall within section 31 is right.
Now, a right of appeal is a substantive right, and is a creature of the statute.
Section 30(1) confers on the assessee a right of appeal against certain orders, and an order of assessment under section 23 is one of them.
The appellant therefore had a substantive right under section 30(1) to prefer appeals against orders of assessment made by the Income tax Officer.
Then, we come to section 30(2), which enacts a period of limitation within which this right is to be exercised.
If an appeal, is not presented within that time, does that cease to be an appeal as provided under section 30(1)? It is well established that rules of limitation, pertain to the domain of adjectival law, and that they operate only to bar the remedy but not to extinguish the right.
An appeal preferred in accordance with section 30(1) must, therefore, be an appeal in the eye of law, though having been presented beyond the period mentioned in section 30(2) it is liable to be dismissed in limine.
There might be a provision in the statute that at the end of the period of limitation prescribed, the right would be extinguished, as for example, section 28 of the Limitation Act; but there is none such here.
On the other hand, in conferring a right of appeal under section 30(1) and prescribing a period of limitation for the exercise thereof separately under section 30 (2), the legislature has evinced an intention to maintain the distinction well recognised under the general law between what is a substantive right and what is a matter of procedural law.
In Nagendranath Dey vs Suresh Chandra Dey(3) Sir Dinshaw Mulla construing the word ' appeal ' in the third column of article 182 of the Limitation Act observed: "There is no definition of appeal in the Civil Pro (1) (2) (3) 59 I.A. 283, 287.
175 cedure Code, but their Lordships have no doubt that any application by a party to an appellate, Court, asking it to set aside or revise a decision of a subordinate Court, is an appeal within the ordinary acceptation of the term, and that it is no less an appeal because it is irregular or incompetent".
These observations were referred to with approval and adopted by this Court in Raja Kulkarni and others vs The State of Bombay(1).
In Promotho Nath Roy vs W. A. Lee(2), an order dismissing an application as barred by limitation after rejecting an application under section 5 of the Limitation Act to excuse the delay in presentation was held to be one "passed on appeal" within the meaning of section 109 of the Civil Procedure Code.
On the principles laid down in these decisions, it must be held that an appeal pre sented out of time is an appeal, and an order dismissing it as time barred is one passed in appeal.
Then, the next question is whether it is an order passed under section 31 of the Act.
That section is the only provision relating to the hearing and disposal of appeals, and if an order dismissing an appeal as barred by limitation is one passed in appeal, it must fall within section 31.
And as section 33 confers a right of appeal against all orders passed under section 31, it must also be appealable.
But then, it is contended that in an appeal against assessment the only order that could be passed under section 31 (3)(a) is one which confirms, reduces, enhances or annuls the assessment, that such an order could be made only on a consideration of the merits of the appeal, and that an order dismissing it on the ground of limitation is not within the section.
That was the view taken in Dewan Chand vs Commissioner of Income tax(3).
But there is practically a unanimity of opinion among all the other High Courts that to fall within the section it is not necessary that the order should expressly address itself to and decide on the merits of the assessment, and that it is sufficient that the effect of the order is to confirm the assessment (1) [1954] S.C.R. 384, 388.
(2) A.I.R. 1921 Cal.
(3) 176 as when the appeal is dismissed on a preliminary point.
In Commissioner of Income tax vs Shahzadi Begum(1), Satyanarayana Rao, J. said: "If the appeal is dismissed as incompetent or is rejected as it was filed out of time and no sufficient cause was established, it results in an affirmation of the order appealed against".
In Gour Mohan Mullick vs Commissioner of Agricultural Income tax(2), construing sections 34, 35 and 36 of the Bengal Agricultural Income Tax Act which are in terms identical with those of sections 30, 31 and 33 of the Indian Income Tax Act, Chakravarti, J. observed: "I would base that view on the ground that the order, in effect, confirmed the assessment or, at any rate, disposed of the appeal and was thus an order under section 35, because what that section really contemplates is a disposal or conclusion of the appeal and the forms of orders specified in it are not exhaustive.
An appellate order may not, directly and by itself, confirm, or reduce or enhance or annul an assessment and may yet dispose of the appeal.
If it does so, it is immaterial whether the ground is a finding that the appeal is barred by limitation or a finding that the case is not a fit one for extension of time or both".
This reasoning is also the basis of the decisions of the Bombay and Allahabad High Courts which bold that an order rejecting an appeal on the ground of limitation after it had been admitted is one under section 31, though there is no consideration of the merits of the assessment.
Thus, in K. K. Porbunderwalla vs Commissioner of Income tax(3), Chagla, C. J. observed: ``. although the Appellate Assistant Commis sioner did not hear the appeal on merits and held that the appeal was barred by limitation his order was under section 31 and the effect of that order was to confirm the assessment which bad been made by the Income tax Officer".
In Special Manager of Court of Wards vs Commissioner (1) (2) (3) 177 of Income tax(1), the Allahabad High Court stated that the view was "possible that even though the period of limitation is prescribed under section 30 and the power to grant extension is also given in that section the power is really exercised under section 31 as the Appellate Assistant Commissioner when he decides not to extend the period of limitation may be said in a sense to have confirmed the assessment".
The respondent relied on a later decision of the) 'Allahabad High Court in Mahabir Prasad Niranjanlal vs Commissioner of Income tax(2), wherein it was held by the learned Judges, departing from the previous course of authorities of that court, that an order of the Appellate Assistant Commissioner dismissing an appeal as time barred was one under section 30(2) and not under section 31, and was therefore not appealable.
This conclusion they felt themselves bound to adopt by reason of certain observations of this Court in Commissioner of Income tax, Madras vs Mtt.
section Ar.
Arunachalam Chettiar(3).
But when read in the context of the point that actually arose for decision in that case, those observations lend no support to the conclusion reached by the learned Judges.
There, the facts were that an appeal was preferred by the assessee under section 30(1) against an order of the Income tax Officer, and that was dismissed by the Appellate Assistant Commissioner on 19 11 1945 as incompetent.
No appeal was filed against this order, and it became final.
But acting on a suggestion made in the order dated 19 11 1945, the assessee filed an original miscellaneous application before the Appellate Tribunal for relief, and by its order dated 20 2 1946 the Tribunal set aside the findings of the Income tax Officer, and directed him to make a fresh computation.
Then, on the application of the Commissioner of Income tax, the Tribunal referred to the High Court under section 66(1) of the Income tax Act the following question: "Whether in the facts and circumstances of the case, the order of the Bench dated 20th February, (1) , 212.
(2 ) (3) ; 474 475, 178 1946 in the miscellaneous application is an approoriate order and is legally valid and passed within the jurisdiction and binding on the Income tax Officer".
The High Court declined to answer this reference on the ground that the order of the Tribunal was not one passed in an appeal under section 33(1), and that In consequence, the reference under section 66(1) was itself incompetent.
The correctness of this decision was challenged on appeal to this Court, and in affirm ing it, this Court observed: . . when on 19th November 1945, the Appellate Assistant Commissioner declined to admit the appeal, the assessee did not prefer any appeal but only made a miscellaneous application before the Appellate Tribunal.
There is no provision in the Act permitting such an application.
Indeed, in the statement of the case the Appellate Tribunal states that in entertaining that application and correcting the error of the Income tax Officer it acted in exercise of what it regarded as its inherent powers.
There being no appeal under section 33(1) and the order having been made in exercise of its supposed inherent jurisdiction, the order cannot possibly be regarded as one under section 33(4) and there being no order under section 33(4) there could be no reference under section 66(1) or (2), and the appellate Court properly refused to entertain it".
There is, of course, nothing in the decision itself which bears on the point now under discussion.
But certain observations occurring at pages 474 and 475 were referred to by the learned Judges as leading to the conclusion that an order dismissing an appeal as barred by time would fall undersection 3O(2).
Now, those observations came to be made by way of answer to a new contention put forward by the learned, Attorney General in support of the appeal.
That contention was that the miscellaneous application presented to the Tribunal might be treated as an appeal against the order dated 19 11 1945, in which case the order passed thereon on 20 2 1946 would fall under section 33(4) and the reference would be com 179 petent. 'In disagreeing with this contention, this Court observed that the appeal to the Appellate Assistant Commissioner was incompetent under section 30(1), that even if it was competent, the order dated 19 11 1945 was not one contemplated by section 31, and there could be no appeal against such an order under section 33(1).
Now, it should be noticed that the question actually referred under section 66(1) was the correctness and legality of the order passed in a miscellaneous application and not of any order made in an appeal preferred under section 33(1).
In this context, the point sought to be raised by the learned, Attorney General did not arise at all for decision, and the observations in answer thereto cannot be read as a pronouncement on the question of the maintainability of the appeal, much less as a decision that an order dismissing an appeal as barred by limitation is one under section 30(2).
Accordingly, the question whether an order dismissing an appeal as barred by limitation falls under section 30(2) or section 31 remains unaffected by the observations in Commis sioner of Income tax, Madras vs Mtt.
section Ar.
Aruna chalam Chettiar(1).
Then again, under the provisions of the Act, limitation is not the only preliminary ground on which an appeal could be disposed of without a consideration of the merits.
Section 30(3) provides that an "appeal shall be in the prescribed form and shall be verified in the prescribed manner".
If the Appellate Assistant Commissioner holds that the appeal does not comply with the requirements of this enactment and rejects it on that ground, the order must be one made under section 31, since section 30(3) makes no provision for such an order, as does section 30(2) in the case of limitation.
All the orders under section 31 being appealable under section 33, the order of dismissal for noncompliance with section 30(3) must also be appealable, and it was so decided in Maharani Gyan Manjari Kuari vs Commissioner of Income tax(2) .
How is this view to be reconciled with the contention that section 31 contemplates only orders on the (1) ; (2) 180 merits of the assessment and not on preliminary issues? Vide also the decision in Kunwarji Ananda vs Commissioner of Income tax(1), which was followed in Maharani Gyan Manjari Kuari vs Commissioner of Income tax(2), and in Ramnarayana Das Mandal vs Commissioner of Income tax(3).
There is thus abundant authority for the position that section 31 should be liberally construed so as to include not only orders passed on a consideration of the merits of the assessment but also orders which dispose of the appeal on preliminary issues, such as limitation and the like.
The learned Solicitor General sought to get over these decisions by taking up the position that section 31(3) (a) construed in its literal and ordinary sense, conferred jurisdiction on the Appellate Assistant Commissioner only to pass orders on the merits of the assessment, that it was not therefore open to him to entertain any question which did not directly relate to such merits, and that accordingly he could not hear or decide any issue of a preliminary nature such as limitation, and dispose of the appeal on the ,basis of the finding on that issue.
He conceded that this contention would run counter to numerous authorities, but argued that they were all wrong.
Having given due consideration to this contention, we are of opinion that it is not well founded.
Taking the plea of limitation which is what we are concerned with in this appeal when there is a judgment or order against which the statute provides a right of appeal but none is preferred within the time prescribed therefor, the respondent acquires a valuable right, of which he cannot be deprived by an order condoning delay and admitting the appeal behind his back.
And when such an order is passed ex partehe has a right to challenge its correctness at the bearing of the appeal.
That is the position under the general law (vide Krishnasami .
Panikondar vs Ramasami Chettiar(4), and there is nothing in the provisions of the Income Tax Act, which enacts a different principle.
(1) I L.R. 11 Patna 187; A.I.R. 1931 Patna 306; 5 I.T.C. 417.
(2) [1944]12 I.T.R. 59.
(3) (4) Mad. 412; 45 I.A. 25.
181 Therefore, if an appeal is admitted without the fact of delay in presentation having been noticed, clearly it must be open to the Department to raise the objection at the time of the hearing of the appeal.
That would also appear to be the practice obtaining before.
the Income tax Tribunal, as appears from the decisions cited before us, and that, in our opinion, is right.
Similar considerations would apply to other objections of a preliminary character, such as one based on section 30, sub section (3).
We should be slow to adopt a construction which deprives parties of valuable rights.
We are therefore of opinion that contentions relating to preliminary issues are open to consideration at the time of the hearing of the appeal, and that the jurisdiction of the Appellate Assistant Commissioner is not limited to the bearing of the appeal on the merits of the assessment only.
In this view, the orders of the Appellate Assistant Commissioner holding that there were no sufficient reasons for excusing the delay and rejecting the appeals as time barred would be orders passed under section 31 and would be open to appeal, and it would make no difference in the position whether the order of dismissal is made before or after the appeal is admitted.
The question referred must accordingly be answered in the affirmative.
This appeal will therefore be allowed, and the order of the court below set aside.
The appellant will have his costs here and in the court below.
| IN-Abs | The appellant firm filed appeals against orders assessing it to income tax and super tax for the years 1945 1946 and 1946 1947 beyond the time prescribed by section 30(2) of the Income tax Act.
The appeals were numbered, and notices were issued for their hearing under section 31.
At the hearing of the appeals before the Appellate Assistant Commissioner, the Department took the objection that the appeals were barred by time.
The appellant prayed for condonation of delay, but that was refused, and the appeals were dismissed as time barred.
The appellant then preferred appeals against the orders of dismissal to the Tribunal under section 33 of the Act, and the Tribunal dismissed them on the ground that the orders of the Assistant Commissioner were in substance passed under section 30(2) and not under section 31 of the Act and that no appeal lay against them under section 33 of the Act.
On a reference under section 66(1) of the Act the High Court held that the orders of the Appellate Assistant Commissioner were made under section 30(2) and were not appealable under section 33 of the Act.
On appeal by special leave to the Supreme Court the question for determination was whether an order dismissing an appeal presented under section 30 as out of time was one under section 30(2) or under section 31 of the Act because if it was the former there was no appeal provided against it; if it was the latter it was open to appeal under section 33.
Held that the orders of the Appellate Assistant Commissioner fell within section 31.
A right of appeal is a substantive right and is a creature of the statute.
section 30(1) confers on the assessee a right of appeal against certain orders and an order of assessment under section 23 is one of them.
The appellant had therefore a substantive right under section 30(1) to prefer appeals against orders of assessment made by the Income Tax Officer.
167 An appeal presented out of time is an appeal and an order dismissing it as time barred is one passed in appeal.
Section 31 is the only provision relating to the hearing and disposal of appeals and if an order dismissing an appeal as barred by limitation as in the present case is one passed in appeal it must fall within section 31 and as section 33 confers a right of appeal against all orders passed under section 31, it must also be appealable.
To fall within section 31 it is not necessary that the order should expressly address itself to and decide on the merits of the assessment and it is sufficient that the effect of the order is to confirm the assessment as when the appeal is dismissed on a preliminary point.
An order rejecting an appeal on the, ground of limitation after it had been admitted is one under section 31, though there is no consideration of the merits of the assessment.
Held therefore that the orders of the Appellate Assistant Commissioner holding that there were no sufficient reasons for excusing the delay and rejecting the appeals as time barred would be orders passed under section 31 and would be open to appeal, and it would make no difference in the position whether the orders of dismissal were made before or after the appeals were admitted.
Commissioner of Income tax, Madras vs Mtt.
`r. section Ar.
Arunachalam Chettiar, ([1953] S.C.R. 463), explained.
Case law discussed.
|
Civil Appeal No. 829 of 1975.
From the Judgment and Order dated 11 4 74 of the Calcutta High Court in Appeal from original Order dated 221/70.
section C. Manchanda, and Miss A. Subhashini for the Appellant V. section Desai, Sanjay Bhattacharya and Rathin Dass for the Respondent.
The Judgment of the Court was delivered by BHAGWATI, J.
This appeal by certificate is directed against an order passed by a Division Bench of the High Court of Calcutta allowing an appeal against a decision of a Single Judge dismissing the writ petition of the respondent.
The facts giving rise to the appeal may be briefly stated as follows: The respondent was assessed to income tax for the assessment year 1959 60 and certain interest paid by the respondent to creditors from whom it claimed to have borrowed monies on hundis, was allowed as deductible expenditure.
The assessment of the respondent was completed on 23rd August, 1960.
On or about 25th January, 1968, however, a Notice was issued by the Income Tax Officer under Section 148 of the Income Tax Act, 1961 to re open the assessment of the respondent for the assessment year 1959 60.
The Notice was obviously under Section 147(a) since a period of four years had already elapsed from the close of the assessment year 1959 60 and no Notice could be issued under Section 147(b).
The Income Tax Officer claimed that the transactions of loan represented by the hundis were bogus and no interest was paid by the respondent to any of the 907 creditors shown in the hundis and it was wrongly allowed as a deduction and hence a part of the income of the respondent had escaped assessment by reason of the failure of the respondent to disclose fully and truly all material facts necessary for its assessment.
The respondent challenged the validity of the Notice issued by the Income Tax Officer by filing a writ petition in the Calcutta High Court.
The respondent contended that there was no failure on its part to disclose fully and truly all material facts necessary for its assessment and that in any event the Income Tax Officer had no reason to believe that any part of the income of the respondent had escaped assessment by reason of such failure on the part of the respondent.
The Income Tax Officer in the affidavit in reply filed by him on 5th December, 1968 declined to disclose the facts which had weighed with him in reaching the belief that the income of the respondent had escaped assessment by reason of its failure to disclose fully and truly all material facts, on the ground that if such facts were disclosed to the respondent, it would cause great prejudice to the interests of the Revenue and would frustrate the object of re opening the assessment.
This was obviously an untenable stand because the existence of reason to believe on the part of the Income Tax Officer was a justiceable issue and it was for the court to be satisfied whether in fact the Income Tax Officer had reason to believe that income had escaped assessment by reason of failure of the respondent to make a full and true disclosure.
The Income Tax Officer realising this position filed a further affidavit on 27th January, 1970 stating as follows: "In January 1968 I was the Income Tax Officer 'I ' Ward, Hundi Circle, Calcutta.
On or about the 25th January 1968 I issued a notice under Section 148 of the Income Tax Act, 1961 on the petitioner.
My reasons for issuing such notice were these.
In the course of assessment of the petitioner for assessment year 1963 64 it was discovered that various items shown as loans against the security of hundis in the petitioner 's books of account for the previous year relevant to assessment year 1959 60 were in fact fictitious.
Credits against the names of certain persons as having advanced loans viz. Amarlal Moolchand, Girdharidas, Reghoomal, Murlidhar, Kanhaiyalal and Deudaram Basdeo in the petitioner 's books were found not to be genuine.
It appeared during assessment proceedings for 1963 64 that none of such loans were genuine.
In the premises, it appeared to me that the petitioner had failed to disclose fully and truly all material facts necessary for its assessment, and a portion of the petitioner 's income had escaped assessment by reason of such failure".
908 The writ petition was heard by a Single Judge of the High Court and he took the view that the affidavit of the Income Tax Officer dated 27th January, 1970 clearly showed that he had reason to believe that income of the respondent had escaped assessment by reason of its failure to disclose fully and truly all material facts and he accordingly dismissed the writ petition.
The respondent preferred an appeal and a Division Bench of the High Court disagreeing with the view taken by the Single Judge held that there was no failure on the part of the respondent to disclose fully and truly all material facts and in any event there was no material on the basis of which it could be said that the Income Tax Officer had reason to believe that any part of the income had escaped assessment by reason of such failure on the part of the respondent.
The Division Bench accordingly allowed the writ petition and quashed and set aside the Notice for re opening the assessment.
The Income Tax Officer thereupon preferred the present appeal to this Court after obtaining a certificate from the High Court.
The present case is clearly covered by the decision of this Court in Commissioner of Income Tax, Calcutta vs Burlop Dealers Ltd. There the assessee in the course of its original assessment to income tax for the assessment year 1949 50 had produced a partnership agreement with one Ratiram Tansukhrai and claimed that the profits earned by it from H. Manory Ltd. had been divided between itself and Ratiram Tansukhrai under the partnership agreement and its one half share of the profit, namely, Rs. 87,937/ was the only amount assessable to tax in respect of this source.
The Income Tax Officer accepted the partnership agreement and assessed the assessee only on the profit of Rs. 87,937/ .
It appears that while making assessment for the assessment year 1950 51 the Income Tax Officer found that the partnership agreement between the assessee and Ratiram Tansukhrai was a got up device to reduce the profit received from H. Manory Ltd. and the assessee was, therefore, liable to tax on the entire amount of profit coming from H. Manory Ltd. This view taken by the Income Tax Officer was confirmed on appeal by the Appellate Assistant Commissioner and the Income Tax Tribunal.
The High Court also on a reference agreed with the view of the Tribunal.
The Income Tax Officer thereupon issued a Notice under Section 34(1) (a) of the Income Tax Act to re open the assessment of the assessee for the assessment year 1949 50 in order to bring to tax the further amount of Rs. 87,937/ being the half share of the profit from H. Manory Ltd. alleged to have been paid to Ratiram Tansukhrai under the partnership agreement.
The assessee con 909 tended that it had produced all the relevant accounts and documents necessary for completing the assessment and it was under no obligation to inform the Income Tax Officer about the true nature of the transaction and there was accordingly no failure on its part to disclose fully and truly all material facts necessary for its assessment.
This contention was negatived by the Income Tax Officer and the income of the assessee was re assessed by adding Rs. 87,937/ to the income returned by the assessee.
The Appellate Assistant Commisioner confirmed the order of the Income Tax Officer on appeal, but on further appeal, the Tribunal accepted the contention of the assessee and held that there was no failure on the part of the assessee to make a full and true disclosure of the material facts and hence the Income Tax Officer was not justified in seeking to re open the assessment under Section 34(1) (a) of the Income Tax Act.
The Revenue applied to the Tribunal for a reference but the application was rejected and the High Court also dismissed the application of the Revenue for calling for a reference from the Tribunal.
The Revenue thereupon preferred an appeal to this Court by special leave.
The appeal was rejected by this Court on the ground that the assessee had disclosed all its books of account and evidence from which material facts could be discovered and it was under no obligation to inform the Income Tax Officer about the possible inferences which might be raised against him and hence there was no failure on its part to disclose the preliminary facts relevant to the assessment which would invite the applicability of Section 34(1) (a).
It will thus be seen that according to this judgment, there was no obligation on the assessee to disclose that the partnership agreement produced by it was bogus and that the entries made by it in its books of accounts were false.
The assessee discharged the obligation which lay upon it by disclosing its books of account and evidence from which material facts could be discovered and it was for the Income Tax Officer to decide whether the documents produced by the assessee were genuine or false.
Here also the respondent produced all the hundis on the strength of which it had obtained loans from creditors as also entries in the books of account showing payment of interest and it was for the Income Tax Officer to investigate and determine whether these documents were genuine or not.
The respondent could not be said to have failed to make a true and full disclosure of the material facts by not confessing before the Income Tax Officer that the hundis and the entries in the books of account produced by it were bogus.
We do not see any distinction at all between Burlop Dealers case (supra) and the present one and the language of Section 147(a) being identical with that of Section 34(1)(a), the ratio of the decision in Burlop Dealers case (supra) must govern the decision of the present case.
We 910 must, therefore, hold that there was no failure on the part of the respondent to disclose fully and truly all material facts necessary for its assessment and the condition for the applicability of Section 147(a) was not satisfied.
We may also point out that though it was contended in the Writ Petition that the Income Tax Officer could have no reason to believe that any part of the income of the respondent had escaped assessment by reason of its failure to make a full and true disclosure of material facts, the Income Tax Officer did not disclose in his affidavit any material on the basis of which it could be said that he had come to the requisite belief.
All that the Income Tax Officer stated in his affidavit was that he discovered that the transactions of loan against security of hundis were not genuine and that the credits against the names of certain persons who were alleged to have advanced loans were bogus.
The Income Tax Officer merely stated his belief but did not set out any material on the basis of which he had arrived at such belief so that the Court could decide for itself whether there was any material on the basis of which the Income Tax Officer could reasonably entertain such belief.
We are, therefore, not at all satisfied on the affidavit that the Income Tax Officer had reason to believe that a part of the income of the respondent had escaped assessment by reason of its failure to make a true and full disclosure of the material facts.
The Notice under Section 147(a) of the Income Tax Act for re opening the assessment must in the circumstances be held to be void.
We accordingly dismiss the appeal with costs.
P.B.R. Appeal dismissed.
| IN-Abs | In respect of the assessment year 1959 60 the assessee was allowed deduction of interest paid to creditors from whom it claimed to have borrowed moneys on hundis.
In January, 1968 the Income Tax Officer issued a notice to the assessee under section 147(a) of the Income tax Act, 1961 on the ground that the transactions of loans represented by the hundis were bogus and no interest was paid by it to any of the creditors shown in the hundis, that it was wrongly allowed as a deduction and therefore a part of the assessee 's income had escaped assessment by reason of its failure to disclose fully and truly all material facts necessary for the assessment.
In the assessee 's writ petition before the High Court the Income Tax Officer at first declined to disclose the facts which had weighed with him in reaching the belief that income had escaped assessment on the ground that if they were disclosed it would cause great prejudice to the interests of revenue and would frustrate the object of reopening the assessment.
Later however, realising that this stand was untenable he gave his reasons for issuing the notice.
A Single Judge of the High Court dismissed the assessee 's writ petition.
On appeal a Division Bench held that there was no failure on the part of the assessee to disclose fully and truly all material facts and that in any event the Income Tax Officer had no reason to believe that any part of the income had escaped assessment by reason of such failure on the assessee 's part.
Dismissing the appeal, ^ HELD: There was no failure on the part of the asscssee to disclose fully and truly all material facts necessary for its assessment and the condition for the applicability of section 147(a) was not satisfied.
The notice in the circumstances was void.
[1910 A] (1) In CIT vs Burlop Dealers Ltd., this Court held that there was no obligation on the part of the assessee to disclose that the documents produced by it were bogus and that the entries made in its books of account were false.
The assessee discharged its obligation by disclosing its books of accounts and evidence from which material facts could be discovered and it is for the Income Tax Officer to decide whether the documents were genuine or false.
In the instant case the assessee could not be said to have failed to make true and full disclosure of the material facts by not confessing before the Income Tax Officer that the hundis and the entries in the books of account produced before him were bogus.
[909 G] CIT vs Burlop Dealers Ltd. ; applied.
(2) All that the Income Tax Officer stated in his affidavit was that he discovered that the transactions of loan against security of hundis were not genuine and that the credits against the names of certain persons who were alleged to have advanced the loans were bogus.
He merely stated his belief but did not set out any material on the basis of which he had arrived at such belief.
[910 C] (3) The existence of reason to believe on the part of the Income Tax Officer is a justiceable issue and it is for the court to be satisfied whether in fact the Income Tax Officer had any material on the basis of which he could reasonably entertain such belief.
[907 D]
|
ivil Appeal Nos.
1724/69 and 1732 of 1971.
Appeals by Special Leave from the Judgment and Order dated 12 5 69 of the Allahabad High Court in Special Appeal Nos. 492 and 437 of 1968.
Naunit Lal and Faqir Chand for the Appellant in CA Nos.
1724/69.
G. N. Dikshit, O. P. Rana for Respondent No.1 in C.A. 1724/69 J. P. Goyal, section M. Jain and section K. Jain for Respondent No.2 in CA Nos.
1724/69 Miss Meera Bali for the Appellant in C.A. 1732/71 G. N. Dikshit and O.P. Rana for the Respondents in CA 1732/71 The Judgment of the Court was delivered by SEN J.
These two appeals by special leave, directed against the judgment of the Allahabad High Court dated May 12, 1969 raise common questions and therefore, are disposed of by this common judgment.
By separate notifications issued under section 3 of the U.P. Mahapalika Adhiniyam, 1959, the State Government constituted Municipal Corporations in five cities in the State, namely Kanpur, Agra, Varanasi, Allahabad and Lucknow w.e.f. February 1, 1960.
The appellant in the present appeal, Mohd. Rashid Ahmad was a permanent Assistant Engineer in the Development Board, Kanpur, constituted under the Cawnpore Urban Area Development Act, 1945.
In 1953, an Administrator was appointed of both the Development Board and the Municipal Board, Kanpur, constituted under the U.P. Municipalities Act, 1916, under the U.P. Local Bodies (Appointment of Administrators) Act, 1953.
The two local bodies, however, continued to have separate legal existence and their officers and servants continued as the employees of the respective bodies.
The appellant Mohd. Rashid Ahmad was appointed as Offg.
Executive Engineer by the Administrator of the Municipal Corporation, Kanpur, for a period of one year on September 12, 1960.
He has since then continued to function in the same capacity, on a purely temporary arrangement under s.577(ee), that is, for so long as no substantive appointment could be made to that post under s.106.
The Uttar Pradesh Public Service Commission, however, considered that he was not fit for appointment for the post of the Executive Engineer, Municipal Corporation, Kanpur.
831 The appellant in the connected appeal, Ashfaq Hussain was a permanent Sanitary Inspector in the Municipal Board, Kanpur.
After the constitution of the Municipal Corporation, Kanpur, he continued to hold that post under section 577(e).
On July 24, 1967 he was transferred in the same capacity to the Municipal Corporation, Allahabad, where he was promoted temporarily as an Assistant Engineer.
He, therefore, stood provisionally absorbed under s.577(e).
Both the U.P. Nagar Mahapalika Adhiniyam, 1959, and the U.P. Municipalities Act, 1916 empowered these local bodies to appoint their employees subject to certain regulatory control by the State Government.
By section 12 of the U.P. Nagar Mahapalika (Sanshodhan) Adhiniyam, 1964, the State Legislature added section 112A to the U.P. NagarMahapalika Adhiniyam, 1959.
Similarly, by s.37 of the U.P. Municipalities (Amendment) Act, 1964, s.698 was added to the U.P. Municipalities Act, 1916, which was identical in terms to s.112A. Section 112A of the Adhiniyam empowered the State Government to provide by rules for the creation of one or more services to be known as Centralised Palika Services, as it may deem fit and proper, common to all the Municipal Corporations and Municipal Boards, and prescribe the method for recruitment and conditions of service of persons appointed to any such service.
Section 112A of the U.P. Nagar Mahapalika Adhiniyam, 1959, enacts: "112A. Centralization of services. (1) Notwithstanding anything contained in section 106 to 110, the State Government may at any time by rules provide for the creation of one or more services of such officers and servants as the State Government may deem fit, common to the Mahapalikas or to the Mahapalikas and Municipal Boards, of the State, and prescribe the method of recruitment and conditions of service of persons appointed to any such service.
(2) When any such service is created, officers and servants serving on the posts included in the service, as well as officers and servants performing the duties and functions of those posts under sub clause (1) of clause (ee) of section 577 may, if found suitable, be absorbed in the service, provisionally or finally, and the services of others shall stand determined, in the prescribed manner.
(3) Without prejudice to the generality of the provisions of sub sections (1) and (2), such rules may also provide for 832 consultation with the State Public Service Commission in respect of any of the matters referred to in the said sub sections." The State Government in exercise of the powers conferred by section 112A of the U.P. Nagar Mahapalika Adhiniyam, 1959 and s.69B of the U.P. Municipalities Act, 1916, made the U.P. Palika (Centralised) Services Rules, 1966, which came into force on July 9, 1966.
Rule 3 created 19 Palika (Centralised) Services, covering 76 posts, common to all the Municipal Corporations and Municipal Boards.
The rules provided for regulating the recruitment and conditions of service of the persons appointed to these newly created services.
Rule 6 dealt with recruitment to the Centralised Palika Services.
Due to inadvertence r.6 was not drafted in conformity with the requirements of s.112A and s.69B. That was because cl.(1) provided for automatic final absorption of officers and servants provisionally absorbed under s.577(e), contrary to the provisions of s.112A of the Adhiniyam and s.69B of the Municipalities Act.
On September 5, 1966, the Governor promulgated the U.P. Local Self Government (Amendment) Ordinance, 1966, which was replaced by the U.P. Local Self Government Laws (Amendment) Act 1966.
Section 19 of the Act reads as follows: "19.
Deeming, validation, etc.
The Uttar Pradesh Palika (Centralised Services Rules, 1966, shall be deemed to have been made under the provisions of the Uttar Pradesh Nagar Mahapalika Adhiniyam, 1959, and the U.P. Municipalities Act, 1916, as if the amendments made by this Act to the said Acts were always in force and be deemed to be and always to have been valid and shall, subject to any amendments made thereto, continue in force, and notwithstanding anything contained in the said Acts, the power to make amendments to the said rules may, during the period ending on September 4, 1967, be exercised retrospectively.
" It, in effect, amended section 112A of the Adhiniyam and s.69B of the Municipalities Act.
Section 4 of the Act provided that the U.P. Palika (Centralised) Services Rules, 1966 shall be deemed to be valid.
The Act further provided that the amendments made to the rules may be given retrospective effect.
The power of making retrospective rules was, however, limited to a period of one year from the commencement of the ordinance.
833 On October 10, 1966, the State Government passed the U.P. Palika (Centralised) Services (Amendment) Rules, 1966.
These rules repealed and re enacted r.6 with retrospective effect from July 9, 1966.
Under cl.
(ii) of r.6(2) the State Government had to pass a final order of absorption, in respect of particular officers and servants of the erstwhile Municipal Boards, if they were found suitable, in accordance with s.112A of the Adhiniyam.
Clause (iii) provided that such orders had to be made on or before March 31, 1967.
By cl.(iv) if no orders of final absorption were passed till then, the officer or servant concerned was to be deemed to have been finally absorbed.
The State Government was, however, constrained to make the U.P. Palika (Centralised) Services (Amendment) Rules, 1967 on March 30, 1967 and amend cl.
(iii) of r.6(2), as the work of final absorption could not be completed by March 31, 1967.
The date of passing the necessary orders in that behalf was sought to be shifted to June 30, 1967.
A new cl.
(iii) was accordingly substituted by this amendment effected on March, 30, 1967.
But, unfortunately the amendment was made to come into effect from April 1, 1967.
This created a serious legal infirmity, as on the expiry of March, 31 1967, the legal fiction embodied in cl.
(iv) was brought into play.
Thereafter, the State Government made the last amendment to the U.P. Palika (Centralised) Services (Amendment) Rules, 1967 on June 26, 1967, in supersession of the U.P. Palika (Centralised) Services (Amendment) Rules, 1967 made on March 30, 1967.
This amendment introduced a new cl.(iii) to r.6(2), in place of the existing cl.(iii) of U.P. Palika (Centralised) Services Rules, 1966, by which the date of passing the order was shifted from March 31, 1967 to August 31, 1967, with retrospective effect from July 9, 1966.
Having provided for the creation of Centralised Palika Services, the State Government had, in the meanwhile, laid down the procedure by which an office or servant provisionally absorbed under section 577 (e) of temporarily appointed under s.577(ee), were to be finally absorbed, if found suitable, under s.112A. By its three circulars dated January 11, 1967; January 31, 1967 and February 23, 1967, addressed to the Divisional Commissioners, it intimated the constitution of Divisional Committees for making necessary recommendations to the State Government in this behalf.
The first circular embodied the Government policy in these terms: "Government desire that all officers and servants, whose services are proposed to be determined on grounds of unsuita 834 bility may be given an opportunity of personal interview by the Committee." After such interviews, the Committees were to finalise their recommendations and furnish the same to the Government.
In view of the limited time available to the Government, for finalising action in the matter, it was desired that the first meeting of the Committees should be held in the last week of January or in the first week of February, 1967.
The Divisional Commissioner were required to intimate the date to the Secretary to the Government, Local Self Government Department, so that all necessary arrangements could be made to forward the character rolls and service records of the Centralised Services officers and servants.
By the second circular, the State Government re constituted the Committees, so far as the five Municipal Corporations were concerned, and directed that these Divisional Committees were to make selections for all Centralised Services except those whose starting salary was Rs. 500/ and above.
Selection for the posts in the latter category were to be made by the State Selection Committee.
Thus, the Government divided the officers and servants into two categories, and their cases were to be dealt with at two different levels for purposes of final absorption under r.6(2)(iii) read with s.112A. By its third circular, the State Government without disturbing the earlier categorisation of officers and servants into two classes, laid down certain broad criteria with a view to secure a reasonable uniformity in the standards to be applied by the Divisional Committees in making the selection.
It may, however, be observed that the Government reiterated its declared policy that all such officers and servants, whose services were proposed to be determined on the ground of unsuitability be given an opportunity of personal interview by the Committees stating: ". the committee should interview the official concerned to judge his suitability or otherwise for absorption in the centralised services.
When it is proposed to declare an official to be unsuitable for absorption on the basis of adverse entries, the divisional committee should afford an opportunity to the official concerned to appear before it and clear up his position.
" It was also desired that only those adverse remarks may be considered against the official concerned, which were found to have been duly communicated to him.
835 It must at once be stated that though the State Government had by its circular dated January 31, 1967 entrusted the task of determining the suitability or otherwise of officers and servants holding Centralised Services posts drawing less than Rs. 500/ , to Divisional Committees, and reserved such function in respect of officers and servants drawing Rs 500/ or more, to the State Selection Committee, and by its subsequent circular dated February 23, 1967 maintained the classification of such officers and servants for purposes of judging their suitability for absorption in the Centralised Palika Services, the final orders of absorption in each case under s.112A were passed by the State Government.
In the former class, the recommendations of Divisional Committees were scrutinised by the State Government in the Local Self Government Department, in the light of the service records of the officials concerned, and the necessary orders thereon were passed.
In respect of the latter category, the Secretary to the Government, Local Self Government Department prepared a note and put it up for the Minister for passing the final orders.
It is also worthy of mention that the delay in completing the work of final absorption by the State Government was mainly due to three factors, namely; (1) due to shortness of the time available at its disposal, (2) the number of officers and servants holding the Centralised Services posts under s.577(e) and (ee) was quite large, and (3) because of delay on the part of the erstwhile Municipal Boards to forward the character rolls and service records of the officers and servants concerned.
On account of this, the task of absorption under s.112A could not be completed before March 31, 1967 i.e., the date originally fixed by cl.(iii) of r.6(2) of the U.P. Palika (Centralised) Services Rules 1966.
The period was, therefore, subsequently extended from March 31, 1967 to June 30, 1967, and thereafter from March 31, 1967 to August 31, 1967.
Eventually, the State Government in exercise of its powers under cl.(iii) of r.6(2) of the U.P. Palika (Centralised) Services Rules, 1966 determined the services of the appellant Mohd. Rashid Ahmad on July 18, 1967 and that of Ashfaq Hussain on August 27, 1967, on the ground that they were not found fit for absorption under s.112A of the Adhiniyam.
The two appellants and several other employees of the erstwhile Municipal Boards and District Boards challenged the validity of the various orders passed by the State Government terminating their services before the Allahabad High Court on several grounds.
Amongst others, they challenged the validity of r.6(2) (iii), framed under section 112A 836 of the Adhiniyam, on the ground that it was ultra vires the State Government as it brings about extinction of the relationship of employer and employees between them and the erstwhile Municipal Boards.
It was also urged that the impugned orders were violative of Articles 14 and 16 of the Constitution because the classification made by the State Government by its circular dated January 31, 1967 entrusting the task of determination of the suitability or otherwise of officers and servants holding Centralised Services posts drawing less than Rs. 500/ to Divisional Committees, which were enjoined to give them the right of a personal hearing to have their say in the matter of final absorption, and entrusting of such function in respect of officers and servants drawing Rs. 500/ and above to the State Selection Committee without a corresponding right of hearing, was without any rational basis.
It was also urged that the impugned orders were vitiated being in breach of the rules of natural justice.
A Division Bench of the Allahabad High Court, however, rejected all these contentions.
In view of the language of Entry 5, List II of the Seventh Schedule, the objection regarding the validity of r.6(2) (iii) was rightly not pressed before us.
On the view that we take of the various circulars issued by the State Government laying down the procedure for dealing with the question of suitability or otherwise of officers and servants of the erstwhile Municipal Boards for absorption in the Centralised Services under r.6(2)(iii) the contention based on Articles 14 and 16 of the Constitution also does not arise.
Learned counsel appearing for the appellants assailed the impugned orders of the State Government on two grounds, namely: 1.
By reason of the legal fiction contained in cl.(iii) of r.6(2), the services of the appellants stood finally absorbed in the U.P. Palika Centralised Services on March 31, 1967 due to the failure of the State Government to pass the necessary orders in that behalf before that date.
Under the legal fiction contained in cl.(iv) thereof, and the subsequent amendment made by the U.P. Palika (Centralised) Services (Amendment) Rules, 1967 which came into force on April 1, 1967, the vested rights acquired by them to hold their respective posts could not be affected to their detriment; and 2.
The orders of termination of services passed by the State Government were vitiated due to its failure to give to the appellants an opportunity of hearing.
837 With respect to the first contention it is urged that the appellants stood provisionally absorbed under section 577(e) read with cl(i) of r.6(2).
It is said that they would be deemed to have been finally absorbed on March 31, 1967, if no orders contemplated by cl.(ii) thereof were made with respect to them on or before that date.
The argument is that the two subsequent amendments made on March 30, 1967 and June 26, 1967, by which the State Government purported to shift the date first from March 31, 1967 to June 30, 1967 and then from March 31, 1967 to August 31, 1967, were legally ineffective, as the first amendment made to cl.(iii) of r.6(2) came into force on April 1, 1967 by which date the appellants already stood finally absorbed.
There was, therefore, no power in the State Government to re open the question of final absorption under section 112A(2) of the Adhiniyam.
There is a fallacy in the argument.
The validity of the two amendments made by the State Government in r.6(2) from time to time cannot be questioned.
While it is true that a rule cannot be made with retrospective effect, the legislature by enacting s.19 of the U.P. Local Self Government (Amendment) Act, 1966, expressly conferred powers on the State Government to make retrospective rules.
Indeed, the validity of the amendments was not questioned before us.
Even if the first amendment of March 30, 1967 was ineffective because it was brought into force from April 1, 1967, the second amendment of June 26, 1967, which introduced a new clause (iii) to r.6(2) with retrospective effect from July 9, 1966, was fully effective.
It shifted the date for passing of the order of final absorption from March 31, 1967 to August 31, 1967.
Till the expiry of the date now fixed, i.e. August 31, 1967, the legal fiction contained in cl.
(iv) of r.6(2) would not be brought into play.
That is the inevitable legal consequence of the subsequent amendment made on June 26, 1967.
It would be clear that cl.
(iii) of r. 6(2), as amended on October 10, 1966, gave power to the State Government to pass an order of absorption under section 112A of the Adhiniyam, of an officer or servant of the Municipal Corporations provisionally absorbed under section 577(e) if found suitable, on or before March 31, 1967.
If there was a failure on the part of the State Government to pass such an order in respect of a particular officer or servant by that date, it would, unless there was a provision to the contrary, bring into play the legal fiction contained therein, and he would, by its force, be deemed to be finally absorbed in the post held by him.
838 The State Government in their return have candidly stated that due to inadvertence, the subsequent amendment effected on March 30, 1967, was made to take effect on April 1, 1967, by which date the legal fiction under cl.
(iv) had already taken effect.
It, therefore, became necessary to correct the serious legal infirmity.
It was for that reason that the subsequent amendment was made on June 26, 1967 by which a new cl.
(iii) was substituted in place of the existing cl.
(iii) to r.6(2).
The amendment substituted new cl.
(iii) to r. 6(2) with effect from July 9, 1966 i.e., from the very inception.
It was legitimately within the powers of the State Government to give to the amended rule a retrospective effect.
As a result of the amendment, the original cl.
(iii) was substituted by a new cl.
(iii) by which the date for passing an order of absorption by the State Government was shifted to August 31, 1967, which again introduced another legal fiction.
It provided that if there was a failure on the part of the State Government to pass an order of absorption by August 31, 1967, the officer or servant concerned shall be deemed to be finally absorbed.
This legal fiction was brought into force with effect from July 9, 1966.
It is needless for us to stress that both the legal fictions, one created by the original cl.
(iii) fixing the fictional date of absorption as March 31, 1967 and the subsequent legal fiction providing for the fictional date of absorption as August 31, 1967, could not co exist.
With the subsequent amendment effected on June 26, 1967, the earlier legal fiction was never brought into play, as by reason of the amendment, the State Government had the power to pass the necessary orders till August 31, 1967.
The introduction of the second fictional date i.e., August 31, 1967, was to "eclipse" the earlier fictional date of absorption.
Perhaps no rule of construction is more firmly established than this that retrospective operation is not to be given to a statute so as to impair an existing right or obligation other than as regards the matter of procedure, unless that effect cannot be avoided without doing violence to the language of the enactment.
If the enactment is expressed in a language which is fairly capable of either interpretation, it ought to be construed as prospective only.
But where, as here, it is expressly stated that an enactment shall be retrospective, the courts will give it such an operation.
It is obviously competent for the legislature, in its wisdom, to make the provisions of an Act of Parliament retrospective.
That is precisely the case here.
In Quinn vs Prairiedale where a subsequent enactment provided that the relevant section should be 839 deemed never to have been contained in the earlier statute, it was held to be sufficient to rebut the presumption against retrospectivity.
In State of Punjab vs Mohar Singh and in Inder Sohan Lal vs Custodian of Evacuee Property Delhi & Ors.(3) this Court had to consider the effect of repeal of an enactment followed by re enactment in the light of s.6 of the .
The line of enquiry, as observed in Mohar Singh 's case, would be not whether the new Act expressly keeps alive old rights and liabilities, but whether it 'manifests an intention to destroy them '.
It was held that section 6 of the was not entirely ruled out when there was a repeal of the enactment followed by a fresh legislation unless the new legislation manifested an intention to the contrary.
Such incompatibility had to be ascertained from a consideration of all the relevant provisions of the new law and the mere absence of a saving clause was, by itself, not conclusive.
In the present case, however, there can be no doubt that by the introduction of the new fictional date of absorption as August 31, 1967, there was a clear intention to destroy the earlier fictional date of March 31, 1967.
It would clearly be incompatible, on consideration of subsequent amendment, for both the provisions, i.e., the original cl.
(iii) fixing March 31, 1967 and the new cl.
(iii) fixing August 31, 1967 to be the fictional date, to operate simultaneously.
The effect of introduction of the new fictional date was to annihilate the earlier fictional date.
The appellants, therefore, did not stand automatically absorbed by the failure of the State Government to pass the necessary orders by March 31, 1967, as its powers stood extended by the subsequent amendment to August 31, 1967.
Before that date expired, the State Government in both these cases, passed the necessary orders terminating the services of the appellants as they were not found fit for absorption under section 112A (2) of the Act.
The first contention, therefore, fails.
That takes us to the second contention, namely, whether the impugned orders are vitiated on account of the failure of the State Government to afford to the appellants an opportunity of a hearing.
With the establishment of Municipal Corporations in five cities in the State, namely, Kanpur, Agra, Varanasi, Allahabad and Lucknow, w.e.f.
February 1, 1960, the Municipal Boards, Improvement Trusts, Development Boards etc.
in these cities, ceased to exist with the 840 repeal, by s.581 of the U.P. Nagar Mahapalika Adhiniyam, 1959, of the U.P. Municipalities Act, 1916, the U.P. Town Improvement Act, 1919, the U.P. District Boards Act, 1922, the Cawnpore Urban Area Development Act 1945, the U.P. Local Bodies (Appointment of Administrator) Act 1953, with effect from that date, in relation to these cities.
In consequence thereof, the existing posts held by the officers and servants of these bodies stood abolished.
Consequent upon the abolition of the posts, all officers and servants of the erstwhile local bodies lost their right to hold their posts.
The Adhiniyam, however, provided by s.577(e), notwithstanding anything contained in ss.106 and 107, for the provisional absorption of these officers and servants in the Municipal Corporations, till they were finally absorbed in any Centralised Services created by rules made under s.112A, or their services did not stand determined in accordance with such rules.
By s.577(ee) the Administrator was authorised to make temporary appointments of officers and servants against the posts mentioned in s.106 till substantive appointments were not made thereto as provided in the Adhiniyam, and they were to be treated as on deputation with the Municipal Corporations.
This was, not doubt, an ad interim arrangement until the State Government by rules framed under s.112A(1) provided for the creation of the Centralised Palika Services, common to all the Municipal Corporations and Municipal Boards, and made final absorption of officers and servants serving on the posts included in such Centralised Services under s.112A(2).
In the very nature of things, the officers and servants provisionally absorbed under s.577(e) or temporarily appointed under s.577(ee) could not be automatically absorbed in the newly created Centralised Services.
There had to be a screening of all such officers and servants with a view to determine their suitability or otherwise for final absorption in Centralised Services.
It was particularly necessary to weed out the dead wood to bring about an overall improvement in the municipal administration in these cities.
The very nature of the functions entrusted to the State Government under r.6(2) (iii) of the U.P. Palika (Centralised) Services Rules, 1966 for purposes of final absorption under s.112A of the Adhiniyam, implies a duty to act in a quasi judicial manner.
It cannot be denied that an officer or servant provisionally absorbed under s.577(e) or temporarily appointed under s.577(ee) had the right to be considered for purposes of final absorption.
Such officers or servants, particularly those in permanent employment who had put in 20 to 25 years of service in the erstwhile Municipal Boards or Development Boards were vitally affected in the matter of final absorption.
841 By s.112A of the Act, the legislature created a machinery for determining the suitability or otherwise of such officers or servants for absorption in the newly created Centralised Services.
The entrustment of this work to the State Government under s.112A, imposed a corresponding duty or obligation on the Government to hear the officers and servants concerned.
In view of this, it is rightly urged that the impugned orders, unless they conform to the rules of natural justice, were liable to be struck down as invalid.
It is a fundamental rule of law that no decision must be taken which will affect the rights of any person without first giving him an opportunity of putting forward his case.
In Local Government Board vs Arlidge Lord Haldane, L. C. tried to reconcile the procedure of a Government department with the legal standards of natural justice.
In Ridge vs Baldwin & Ors.
Lord Reid stated: "It is not suggested that he holds the position of a judge or that the appellant is entitled to insist on the forms used in ordinary judicial procedure, but he had 'a duty of giving to any person against whom the complaint is made a fair opportunity to make any relevant statement which he may desire to bring forward and a fair opportunity to correct or controvert any relevant statement brought forward to his prejudice." These decisions rest on the classical formulation of the "duty to hear" evolved by Lord Loreburn in Board of Education vs Rice.
The main requirements of a fair hearing are two: (1) a person must know the case he is to meet, and (2) he must have an adequate opportunity of meeting that case.
There has, ever since the judgment of Lord Reid in Ridge vs Baldwin (supra), been considerable fluctuation of judicial opinion in England as to the degree of strictness with which the rules of natural justice should be extended, and there is growing awareness of the problems created by the extended application of natural justice, or the duty to act fairly, which tends to sacrifice the administrative efficiency and despatch, or frustrates the object of the law in question.
Since this Court has held Lord Reid 's judgment in Ridge vs Baldwin would be of assistance in deciding questions relating to natural justice, there is always "the duty to act judicially".
There is, therefore, the insistence upon the requirement of a "fair hearing". 842 In A. K. Kraipak vs Union of India there was a reiteration of the principles, albeit in a different form, laid down by this Court in Dr. (Miss) Binapani Devi vs State of Orissa and by the House of Lords in Padfield vs Minister of Agriculture, Fisheries & Food that the executive should not arbitrarily or capriciously act and that the myth of executive discretion is no longer there.
Indeed, in Kraipak 's case (supra) it was observed: "The dividing line between an administrative power and a quasi judicial power is quite thin and is being gradually obliterated.
Under our Constitution the rule of law pervades over the entire field of administration.
Every organ of the State under our Constitution is regulated and controlled by the rule of law.
In a welfare State like ours it is inevitable that the jurisdiction of the administrative bodies is increasing at a rapid rate.
The concept of the rule of law would lose its vitality if the instrumentalities of the State are not charged with the duty of discharging their function in a fair and just manner.
The requirement of acting judicially in essence is nothing but a requirement to act justly and fairly and not arbitrarily or capriciously.
The procedures which are considered inherent in the exercise of a judicial power are merely those which facilitate if not ensure a just and fair decision.
In recent years the concept of quasi judicial power has been undergoing a radical change.
What was considered as an administrative power some years back is now being considered as a quasi judicial power.
" This Court pertinently drew attention to the basic concept of natural justice vis a vis administrative and quasi judicial enquiries, and stated that any decision, whether executive, administrative or judicial or quasi judicial, is no decision if it cannot be "just", i.e. an impartial and objective assessment of all the pros and cons of a case, after due hearing of the parties concerned.
In the light of these principles, we have to see whether the State Government acted in breach of the rules of natural justice in passing the impugned orders.
It is, however, strenuously urged on behalf of the State Government that on a true construction of the two circulars in question, while it was incumbent on the Divisional Committees to give all officers 843 and servants whose services were proposed to be determined on the ground of unsuitability, an opportunity of a personal hearing, no such duty was cast on the State Government.
We are unable to agree with this line of reasoning.
The first circular dated January 11, 1967 was all pervasive, and it covered all categories of officers and servants either provisionally absorbed under s.577(e) or temporarily appointed under s.577(ee), irrespective of their salary.
The Government policy was made quite clear in that circular, which we have quoted earlier.
At this stage, the functions of the Divisional Committees were to be purely recommendatory in nature.
The Committees had to make their selection of officers and servants suitable for absorption after an interview of all such officers and servants, and forward their recommendations to the Government, for finalising action in the matter of final absorption under s.112A.
The subsequent circular dated January 31, 1967, making a categorisation of the officers and servants concerned, into two groups, reserving the power of selection for final absorption to the State Selection Committee in case of all Centralised Services whose starting salary was Rs. 500/ and more, and entrusting the function to the Divisional Committees in case of those whose starting salary was less than Rs.500/ , was still subject to the Government policy already laid down.
It is, therefore, not right to suggest that the State Government was absolved of the "duty to hear" the officers and servants of the erstwhile Municipal Boards and other local authorities drawing Rs. 500/ and above All the officers and servants of the erstwhile Municipal Boards and other local authorities provisionally absorbed under s.577(e) or temporarily appointed under s.577 (ee) were therefore, entitled to be heard in the matter of their final absorption under s.112A read with r.6(2) (iii), irrespective of their salary.
The requirements of a fair hearing are fulfilled in the case of officers and servants of the erstwhile Municipal Boards and other local authorities drawing a salary of less than Rs. 500/ but not in the case of those drawing Rs. 500/ or more.
It is accepted before us that the appellant Ashfaq Hussain was called for an interview by the Divisional Committee.
The State Government in its return has placed material showing that he had a uniformly bad record and there were adverse entries in his character rolls for several years.
It is not disputed that Ashfaq Hussain had been called for an interview by the Divisional Committee.
We are not impressed by the submission that the adverse remarks were not put to him when he appeared before the Divisional Committee.
It is clear 844 from the two circulars of the State Government dated January 11, 1967 and February 23, 1967 that in all cases in which the services of an officer or servant were to be determined on the ground of his unsuitability, they were to be given an opportunity of personal interview by the Committee.
The whole purpose of the personal interview was that when it was proposed to declare such an official unsuitable for absorption, the Committee had to afford an opportunity to appear before it and clear up his position.
It is reasonable to presume that when the appellant, Ashfaq Hussain, was called for that purpose, the adverse remarks in his character rolls must have been put to him.
On an overall view of the record of service of Ashfaq Hussain, the Divisional Committee was not wrong in recommending to the Government to terminate his services, and the Government was within its rights in passing the impugned order of termination in regard to him.
In the case of the appellant Mohd. Rashid Ahmad, it however appears from the return filed by the State Government that no such opportunity was afforded to him before the State Government passed the impugned order dated July 18, 1967 terminating his services.
It is evident, no doubt, from the return filed by the State Government that the service record of the appellant was before the Government, on the basis whereof it was decided that he was unsuitable for being finally absorbed and also that the Secretary for Local Self Government in his note of July 10, 1967 recommended that he was not suitable for final absorption in the Centralised Services, but it is clear that the Minister for Local Self Government before passing the impugned order of termination dated July 11, 1967 did not give to the appellant an opportunity of a hearing.
The order of termination of his services passed by the State Government, therefore, suffers from a serious legal infirmity.
It was said, however, on behalf of the State Government that under s.107(1) of the Adhiniyam no appointment to a post carrying an initial salary of not less than Rs. 500/ per mensem, could be made except after consultation with the Public Service Commission, and that the Commission did not find the appellant fit for appointment as Executive Engineer, Municipal Corporation, Kanpur.
It was also pointed out that under section 108 the appellant could not hold the post beyond the period of one year.
It was, therefore, urged that the State Government was justified in terminating the services of the appellant as he could not be finally absorbed in the post of an Executive Engineer in the Centralised Services.
It was said that the post had to be advertised for filling up the vacancy as required under section 107 of the Adhiniyam.
We are afraid, the contention cannot be accepted.
845 Under section 112A (1) of the Adhiniyam, the State Government having by U.P. Palika (Centralised) Services Rules, 1966, constituted the Centralised Palika Services, the appellant Mohd. Rashid Ahmad, who was performing the duties and functions of the post of Executive Engineer under section 577(ee), was entitled to be considered, if found suitable, for absorption under s.112A(2).
Admittedly, the appellant was not heard in the matter of his final absorption.
It is also not in dispute that the procedure laid down in the U.P. Palika (Centralised) Services Rules, 1966, was not followed.
If the appellant was at all found fit for absorption, it was for the State Government next to decide the suitable post on which he could be absorbed.
The method of recruitment provided by r. 20 had to be followed.
Evidently, this has not been done.
In view of the fore going reasons, Civil Appeal No. 1724 of 1969 succeeds and is allowed, while Civil Appeal No. 1732 of 1971 fails and is dismissed.
There shall be no order as to costs.
P.B.R. C.A. 1724/69 allowed.
C.A. 1732/71 dismissed.
| IN-Abs | Rule 6(2)(iii) If imposed a duty on State Government to act in a quasi judicial manner.
Rules of natural justice Applicability of.
The U.P. Nagar Mahapalika Adhiniyam 1959 as well as the U.P. Municipalities Act, 1916 empowered local bodies in the State to appoint their employees subject to certain regulatory control by the State Government.
In 1964 section 112A was added to the 1959 Adhiniyam empowering the State Government to make rules for the creation of one or more services to be known as Centralised Palika Services common to all the municipal corporations and municipal boards and prescribe the method for recruitment and conditions of service of persons appointed to any such service.
Section 69B which was added to the U.P. Municipalities Act, 1916 was in identical terms as section 112A. Section 577(e) of the Adhiniyam provided for provisional absorption of officers and servants of the erstwhile municipalities till they were finally absorbed in any centralised services created under the Act.
By section 577(ee) the Administrators of Boards etc., were authorised to make temporary appointments of officers and servants till substantive appointments were made and such officers and servants were treated as on deputation with the municipal corporations.
In exercise of the powers conferred under section 112A the State Government made the U.P. Palika (Centralised) Service Rules, 1966 which came into force on July 9, 1966.
Since r. 6 of the Rules was found to be contrary to the provisions of section 112A and section 69B, the U.P. Local Self Government (Amendment) Ordinance, 1966 (which later became an Act) was promulgated to validate the 1966 Rules.
Section 19 of the Act provided that the amendments made to the Rules might be given retrospective effect, limited to a period of one year from the commencement of the Ordinance.
Thereafter the U.P. Palika (Centralised) Services (Amendment) Rules, 1966 were passed by which r. 6 was repealed and re enacted with retrospective effect from July 9, 1966.
Clause (ii) of r. 6(2) empowered the State Government to pass a final order of absorption in respect of particular officers and servants of the erstwhile municipal boards if they were found suitable.
Clause (iii) provided that such orders had to be made on or before March 31, 1967.
827 Since the work of final absorption could not be completed by March 31, 1967, r. 6(2) (iii) was amended shifting the date to June 30, 1967.
But this amendment having been made to come into effect from April 1, 1967 the legal fiction created by cl.
(iv) of r. 6 that if no orders of final absorption were passed till March 31, 1967 the officer or servant concerned was to be deemed to have been finally absorbed, came into play.
Clause (iii) was, therefore, again amended shifting the date of passing the order from March 31, 1967 to August 31, 1967.
The rule was made with retrospective effect from July 9, 1966.
For the purpose of final absorption of all officers and servants who were found suitable in the two categories viz., those appointed under section 577(e) and section 577(ee) of the Adhiniyam, the State Government laid down a procedure.
It constituted Divisional Committees for making necessary recommendations to the State Government.
On January 11, 1967 the State Government issued the first Circular stating that all officers and servants whose services were proposed to be determined on the ground of unsuitability might be given an opportunity of personal interview by the Divisional Committees.
The Government divided the officers and servants into two categories, those getting salary above Rs. 500/_ and those getting salary below Rs. 500/ and provided that cases of each category were to be dealt with at different levels.
By this circular the Government re constituted the composition of the divisional Committees so far as the five municipal corporations which were created under the 1959 Adhiniyam were concerned and directed that these Divisional Committees should make selections for all Centralised Services except those whose starting salary was Rs. 500/ and above.
The selection for this category was to be made by the State Selection Committee.
With a view to secure a reasonable uniformity in the standards to be applied by the Divisional Committees in making the selection, the third Circular dated February 23, 1967 provided that the Committees should interview the official concerned to judge his suitability for absorption in the Centralised Services and that if it was proposed to declare an official to be unsuitable for absorption on the basis of adverse entries, the Divisional Committees should afford an opportunity to the official concerned to appear before it and clear up his position.
It was further provided that only those adverse remarks which were found to have been duly communicated to the official concerned might be considered against him.
Thus the procedure laid down was this: The recommendations of the Divisional Committees in respect of persons drawing salary less than Rs. 500/ would be scrutinised by the State Government in the Local Self Government Department and the necessary orders passed thereon while in respect of the second category officers drawing a salary above Rs. 500/ p.m. the Secretary to the Government Local Self Government Department would obtain the orders of the Minister concerned in passing the final orders.
The appellant RA was a permanent Assistant Engineer in the Development Board, Kanpur.
Before the coming into force of the Adhiniyam he was appointed as officiating Executive Engineer and since then he continued to function in that capacity on a purely temporary arrangement under section 577(ee).
The appellant AH was a Sanitary Inspector in the Municipal Board, Kanpur and 828 continued to hold that post.
He was later promoted temporarily as Assistant Engineer and he stood provisionally absorbed under section 577(e).
Writ Petitions filed by the appellants and others challenging the vires of the Rules were dismissed by the High Court.
On appeal to this Court it was contended that the appellants must be deemed to have been absorbed on March 31, 1967 by virtue of the fiction contained in Cl.
(iv) of r. 6(2), as originally enacted, because the amendment made to the Rule shifting the date of final absorption first from March 31, 1967 to June 30, 1967 and subsequently to August 31, 1967 were legally ineffective and (2) that the impugned orders were vitiated on account of the failure of the State Government to afford to the appellants an opportunity of being heard.
^ HELD: 1.
(a) The validity of the two amendments made by the State Government in r. 6(2) cannot be questioned.
Although a rule cannot be made with retrospective effect, the Legislature by enacting section 19 of the U.P. Local Self Government (Amendment) Act, 1966 expressly conferred powers on the State Government to make retrospective rules.
[837 D].
(b) It is well established that retrospective operation is not to be given to a statute so as to impain that existing right or obligation other than as regards matter of procedure.
If the enactment is expressed in a language which is fairly capable of either interpretation, it ought to be construed as prospective only.
But where it is expressly stated that an enactment shall be retrospective, courts will give it such operation.
It is competent for the Legislature by retrospective legislation to make the provision contained in an carrier enactment ineffective.
[838 F G] Quinn vs Prairiedate ; referred to.
(c) In considering the effect of repeal of an enactment followed by reenactment in the light of section 6 of the the line of enquiry would be not whether the new Act expressly keeps alive old rights and liabilities, but whether it manifests an intention to destroy them.
Any incompatibility in the provision has to be ascertained from a consideration of all the relevant provisions of the new law and the mere absence of a saving clause is by itself not conclusive.
[839 B C] In the instant case by the introduction of the new fictional date of absorption as August 31, 1967 there was a clear intention to destroy the earlier fictional date of March 31, 1967.
It would clearly be incompatible, on consideration of subsequent amendments for both the provisions i.e. the original clause (iii) fixing March 31, 1967 and the new clause (iii) fixing August 31, 1967 to operate simultaneously.
The effect of introduction of the new fictional date was to annihilate the earlier fictional date.
The appellants, therefore, did not stand automatically absorbed by the failure of the State Government to pass the necessary orders by March 31, 1967, as its powers stood extended by the subsequent amendment to August 31, 1967.
Before that date expired the State Government, in both cases, passed the necessary orders terminating the services of the appellants as they were not found fit for absorption.
[839 D F].
829 2.
(a) The entrustment to the State Government of the work of determining the suitability or otherwise of officers and servants of the erstwhile Municipal Boards and other local authorities for absorption in the newly created Centralised Services under section 112A, imposed a corresponding duty or obligation on the Government to hear the officers and servants concerned.
All such officers were, therefore, entitled to be heard in the matter of final absorption irrespective of their salary.
[841 A; 843 F].
(b) By virtue of the repealing provision contained in section 581 of the Adhiniyam, 1959 the various Municipal Boards and other local authorities constituted under the relevant Acts ceased to exist as a result of which the existing posts held by the officers and servants in these bodies stood abolished.
Consequent upon the abolition of the posts, all the officers and servants of the erstwhile local bodies lost their right to hold their posts.
The Adhiniyam, however, provided by section 577(e) and (ee) for provisional absorption or temporary appointment of these officers and servants till substantive appointments were made and these officers and servants were treated as on deputation with the Municipal Corporations.
Therefore, in the very nature of things the officers and servants provisionally absorbed under these sections could not be automatically absorbed in the newly created Centralised Services.
There had to be screening of all of them for determining their suitability for final absorption in the Centralised Services.
[840 A; B F] (c) The very nature of the functions entrusted to the State Government under r. 6(2) (iii) of the Rules implies a duty to act in a quasi judicial manner.
Unless the State Government 's orders conformed to the rules of natural justice, the orders were liable to be struck down as invalid.
[840 G 841 B].
(d) It is not correct to say that it is incumbent only on the Divisional Committees to give an opportunity of personal hearing and that the State Government was absolved of the duty to hear in respect of officers drawing Rs. 500/ and above.
The first Circular dated January 11, 1967 was all pervasive and the Government 's policy was made quite clear in it.
The second Circular dated January 31, 1967 was equally subject to the Government policy.
All the officers and servants of the erstwhile Municipal Boards and other local authorities were, therefore, entitled to be heard in the matter of final absorption irrespective of their salary.
[843 E, A, D].
In the case of AH on an overall view of the records it cannot be said that the Divisional Committee was wrong in recommending to the Government to terminate his services.
The Government was within its right in passing the impugned order of termination in regard to him.
[844 C] In regard to RA before passing the impugned order of termination of services, the Minister for Local Self Government did not give him an opportunity of a hearing.
The procedure laid down in the Centralised Services Rules was not followed.
The State Government could decide on the question of his absorption only after he was found fit but that has not been done.
The order passed by the State Government, therefore, suffers from a serious legal infirmity.
[844 D F].
|
Civil Appeal No. 2335 of 1978.
Appeal by Special Leave from the Judgment and Order dated 14 7 78 of the Industrial Tribunal U.P. in Adjudication Case No. 15/77.
F. section Nariman, O. C. Mathur and D. N. Misra for the Appellant.
M. K. Ramamurthi, Jitendra Sharma and Janardan Sharma for the Respondent.
The Judgment of the Court was delivered by SHINGHAL J.
This appeal by special leave is directed against the order of Industrial Tribunal (III) U.P. at Kanpur dated July 14, 1978, deciding the following two preliminary issues which were raise by the Indian Oxygen Ltd. (hereinafter referred to as the Company) "(1) Whether present dispute is not an industrial dispute in the light of the objections raised by the employers in paragraph (1) of their written Statement? 914 (2) Whether the present Order of Reference is bad in law in the light of the objections raised by the employers in paragraph (1) of their Written Statement?" The Company employed some 5400 workmen in its establishment in West Bengal, Bihar, U.P., Assam, Punjab, Delhi, Maharashtra, Gujarat, Tamilnadu, Andhra Pradesh, Karnataka and Kerala.
There were several recognised trade unions of the workmen.
The All India Federation of Indian Oxygen Employees Union (hereinafter referred to as the Federal Union) was the recognised federation of some of the trade unions from 1973 onwards.
The Indian Oxygen Shramik Sangh (hereinafter referred to as the Shramik Sangh), which represented some of the workmen at Kanpur, was affiliated to the Federal Union.
There was another union known as the Indian Oxygen Karamchari Union (hereinafter referred to as the Karamchari Union) which was registered much earlier but its constitution was revised because of the merger of two other unions in it and was approved by the Registrar of Trade Unions on May 10, 1978.
It was not a member of the Federal Union.
The Federal Union raised a charter of demands in February 1973 of all India nature and a settlement was arrived at on June 22, 1973, according to which the demand for revision of pay scales was to be taken up for discussion at a mutually convenient date.
A similar settlement was made with the Shramik Sangh on November 22, 1973.
It was followed by negotiations and an order was made for the constitution of a Conciliation Board under section 3(d) of the U.P. (hereinafter referred to as the U.P. Act).
A memorandum of settlement was drawn up on April 30, 1974 between the Company and the Shramik Sangh.
It was agreed, interalia, that the question of revision of the dearness allowance of the Kanpur unit employees would be negotiated by the Company with the Federal Unit and/or the Union on or before April 1, 1975.
In the meantime, the Karamchari Union made on application on January 23, 1975, for the constitution of a Conciliation Board under section 3(d) of the U.P. Act and the Board was constituted by an order dated January 30, 1975.
The Company raised objections to the constitution of the Board on February 24, 1975, but the proceedings were commenced by the Board on February 26, 1975, and March 19, 1975 was fixed for appearance.
The Company however proceeded with its efforts for a settlement with the Federal Union, and entered into a settlement with it on June 30, 1975.
In order to bring it under the purview of the U.P. Act, the Shramik Sangh applied on 915 July 18, 1975, for the constitution of a Conciliation Board under that Act and a Conciliation Board was constituted on July 29, 1975.
A memorandum of settlement about the dearness allowance was drawn up with the Shramik Sangh on August 27, 1975; in accordance with rule 5A of the U.P. Industrial Disputes Rules, 1957, in Form IA, even though the dispute regarding the variable dearness allowance, which had been raised by the Karamchari Union earlier, was pending all the while.
The settlement with the Shramik Sangh made a specific reference to the all India Federation settlement which had been made on June 30, 1975.
That settlement with the Federal Union was in fact annexed to the settlement with the Shramik Sangh and was treated as a settlement under the U.P. Act.
The dispute regarding the variable dearness allowance which had been raised by the Karamchari Sangh by its application dated January 23, 1975 for the constitution of a Conciliation Board, did not however bear fruit.
Moreover the settlement which had been reached between the Company and the Federal Union was opposed by the Shramik Sangh and the Karamchari Sangh.
The Conciliation Officer did not therefore pass an order for the registration of the aforesaid settlement.
The Shramik Sangh, which had claimed dearness allowance according to the Kanpur cost of living index, however changed its stand and, as has been stated, it filed a memorandum of the settlement on August 27, 1975.
These facts are not in dispute before us.
It was in these circumstances that the State Government made an order on May 23, 1977, referring the dispute between the Company and the Karamchari Sangh for adjudication under section 4K of the U.P. Act.
The precise matter of dispute was the question whether the dearness allowance payable by the Company to its workmen should be revised and linked with the consumer price index for the industrial workers at Kanpur computed by the Labour Bureau at Simla and, if so, from what date and with what other details.
The Company filed a written statement in which it raised preliminary objections to the maintainability of the reference.
That gave rise to the two issues mentioned above and as they have been found against the Company by the impugned order of the Tribunal, it has come up in appeal to this Court.
It has been argued by Mr. Nariman, learned counsel for the Company, that it is implicit in the various provisions of the U.P. Act that a settlement arrived at before a Conciliation Board, by a union of a majority of the workmen, is binding on all the workmen.
Reference in this connection has been made to the Preamble and sections 916 2(t), 3(d), 6B, 6 1, 7(ii) of the U.P. Act, rules 5A and 40 and Forms 1A and III of the U.P. Industrial Disputes Rules, and to clauses (4) and (8) of the order dated December 3, 1957 made under section 3(d) of the U.P. Act.
It has further been argued that the power to enforce a settlement under section 7 of the U.P. Act shows that the settlement is meant to be binding on all the workmen.
It has also been argued that once a valid settlement is made, it is not permissible to refer a dispute (covered by it) for adjudication.
An attempt has been made to support that contention with reference to some decisions.
Learned counsel has gone to the extent of arguing that as there is no provision in the U.P. Act similar to sub sections (1) and (3) of section 18 of the , (hereinafter referred to as the Central Act), it is not permissible for the Karamchari Union to contend that the settlement which had been made with the Shramik Sangh will bind only the workmen who were members of that Sangh.
In the alternative, it has been argued that the State Government did not have the jurisdiction to make a valid reference under section 4K of the U.P. Act as the demand for variable dearness allowance had been settled through the Shramik Sangh in respect of a majority of the workmen of the Kanpur unit and was binding on the members of that Union.
Then it has been argued that the settlement which had been made with the Federal Union on June 30, 1975 was by itself and independently of the U.P. Settlement (with the Shramik Sangh), a settlement under section 18(1) of the Central Act and was binding on the members of the Shramik Sangh as it was affiliated to the Federal Union and for that reason also it was not permissible to make a reference for adjudication in respect of all the workmen including those who belonged to the Shramik Sangh.
It has further been argued that the settlement of June 30, 1975 with the Federal Union would have been operative even without the Shramik Sangh settlement and section 18(1) of the Central Act would be applicable to it as it was not a settlement during the course of conciliation proceedings and was binding on the Federal Union under section 36(1)(a) and (b) of the Central Act and it was not permissible to make a general reference covering even the workmen belonging to a union affiliated to the Federal Union.
It has been urged that the reference should have been restricted to those workmen who were not governed by the settlement of June 30, 1975 or that settlement should also have been referred to the Tribunal if it was felt by the State Government that it was not valid or fair.
Lastly, it has been argued that the settlements of June 30, 1975 and August 27, 1975 were in the nature of package deals arising out of collective and mutual bargaining and a reference relating to one term of the deals 917 was invalid.
Reference for this proposition has been made to Herbertsons Limited vs Workmen of Herbertsons Limited and others(1) and New Standard Engg.
Co. Ltd. vs M. L. Abhayankar and others(2).
Thus the question for consideration before us is whether the State Government had the authority or jurisdiction to make the order dated May 23, 1977, under section 4K of the U.P. Act referring the dispute regarding variable dearness allowance for adjudication to the Tribunal.
The two issues before the Tribunal related to that basic question and it will be sufficient for us to examine it in the facts and circumstances of this case and the law bearing on it.
Section 4K of the U.P. Act provides that where the State Government is of opinion that any industrial dispute exists or is apprehended, it may refer the dispute or any matter appearing to be connected with, or relevant to the dispute to a Tribunal.
Clause (1) of section 2 of that Act defines an industrial dispute to mean, inter alia, any dispute or difference between employers and workmen which is connected with the terms of their employment.
The expression "workmen" has been defined in clause (z) of section 2 to mean, speaking generally, "any person" employed in any industry in the capacity mentioned therein.
There is nothing in the Act to require that the dispute or difference should be raised by all the workmen of the industry, or by every one of them, or even by a majority of them.
It is enough if the controversy is between the employer on the one side and workmen on the other.
So also, there is nothing in the Act to require that the workmen raising the controversy should form a majority of the employees.
The reason appears to be that where it is found that the controversy affects, or will affect, the interest of workmen as a class, the law envisages that, in the interest of industrial peace, it should be examined and decided in one of the modes provided by it.
An individual dispute cannot however be said to be an industrial dispute unless of course the other workmen associate themselves with it.
No hard and fast rule can possibly be laid down in such circumstances to decide when and by how many workmen an industrial dispute can be raised within the meaning of the Act, or whether a minority union, or even an unrecognised union, can raise an industrial dispute.
It is enough if there is a potential cause of disharmony which is likely to endanger industrial peace, and a substantial number of workmen raise a dispute about it, for then it is permissible to take the view that it is an industrial dispute within the meaning of clause (1) of section 2 of the U.P. Act, and to refer it for adjudication to a Tribunal.
Reference in this connection may be made to the Tribunal 's finding 918 of fact that although the Karamchari Union was not a recognised union and it was not a member of the Federal Union, it had a "substantial number of workmen of the concern as its members.
" We have no doubt therefore that the State Government rightly took the view that the controversy raised by the Karamchari Union was an industrial dispute.
It cannot be gainsaid that the dispute in the present case was raised by the Karamchari Union and they made an application for the constitution of a Conciliation Board as far back as January 23, 1975, and the Board was constituted on January 30, 1975.
It will be recalled that the Company filed its objections before the Board on February 24, 1975, and the Board fixed March 19, 1975 for their consideration.
It is not in controversy before us that the conciliation effort met with failure, and the point for consideration is whether the State Government lost its power to make a reference under section 4K of the U.P. Act merely because of the settlement dated June 30, 1975 between the Company and the Federal Union under the Central Act and the settlement dated August 27, 1975 between the Company and the Shramik Sangh in the conciliation proceedings under the U.P. Act.
Section 18 of the Central Act deals with the binding effect of settlements and awards.
Sub section (1) of that section provides that a settlement arrived at by agreement between the employer and workmen otherwise than in the course of conciliation proceeding shall be binding on the parties to the agreement.
The settlement dated June 30, 1975, with the Federal Union did not therefore bind the Karamchari Union as it was not a party to it and was not affiliated to the Federal Union.
It is true that the Shramik Sangh made an application for the constitution of a Conciliation Board on July 18, 1975, and a Board was constituted on July 29, 1975.
That in fact led to a settlement with the Shramik Sangh on August 27, 1975.
But that took place under the provisions of the U.P. Act and Mr. Nariman has himself pointed out the proceedings in fact took place under rule 5A of the U.P. Industrial Disputes Rules, 1957 and the memorandum of settlement was prepared in Form 1 A. Sub section (3) of section 18 of the Central Act could not therefore be attracted to that settlement and there is no provision similar to it in the U.P. Act.
We have gone through section 7(ii) of the U.P. Act and the rules made thereunder, as well as the order dated December 31, 1957, on which much reliance has been placed by Mr. Nariman.
Clause (ii) of section 7 deals with the power of the State Government to 919 enforce, by order in the prescribed manner, for such period as may be specified, the whole or any part of an agreement reached in conciliation proceedings between the parties to an industrial dispute.
But the section, it appears, is mainly intended to deal with an order passed under any other enactment, and is meant to serve the purposes contemplated in section 3, namely, for securing the public safety or conveniences or the maintenance of public order or supplies and services essential to life of the community, or for maintaining employment etc.
It has not been urged before us that there was any such occasion for invoking section 7.
A mere reference to that section cannot therefore sustain the argument that the settlement dated August 27, 1975, became binding on all workmen including the Karamchari Union, which had nothing to do with it and was not even a party to it, and that the Union was precluded from raising an industrial dispute and the State Government was precluded from referring it for adjudication under section 4K of the U.P. Act.
Rule 5A of the U.P. Industrial Disputes Rules and the preparation of the memorandum of settlement in Form 1 A could not therefore justify the argument to the contrary.
So also, a reference to Form III of the Rules which provides that a person who contravenes or attempts to contravene, any provision of the State Government 's order shall be liable, on conviction, to fine or to imprisonment not exceeding three years or both, is hardly of any avail for obvious reasons.
In fact Mr. Nariman has not found it possible to support his argument about the binding nature of the settlement dated August 27, 1975, on the basis of such a penal provision in a form appended to a set of Rules, and we need not examine it any further.
We have gone through the order which has been made under section 3(d) of the U.P. Act, on paragraph 8 of which considerable reliance has been placed by Mr. Nariman.
It was made on December 31, 1957, and was to remain in force for one year under paragraph 15.
Even otherwise, paragraph 8 merely makes provision for impleading other workmen, or concerns, or a union, in proceedings before a Conciliation Board.
It provides that it would be enough to implead a union covering the majority of such "concern or workmen".
But such a provision cannot justify the argument that merely because a union consisting of a majority of workers can represent all the workmen, the settlement made in the Conciliation Board will bind those who are not parties to it.
As regards the alternative argument of Mr. Nariman that as the settlement dated August 27, 1975, was made by a "majority union", it was, at any rate, binding on the members of the Shramik Sangh, and 920 that the State Government had no jurisdiction to make a general reference under section 4K of the U.P. Act, it will be sufficient to say that no such bar could possibly be raised in the absence of any prohibitory provision in the law.
As has been stated, the Tribunal has found it as a fact that the Karamchari Union represented a substantial number of the workmen of the Company at Kanpur, and there is no reason why they should be debarred from raising a dispute for the benefit of all the workmen as a class.
It is well recognised, and cannot be disputed, that "collective bargaining" can take place between the employer and a bona fide labour union, and there is nothing on the record to show that the Karamchari Union was not a bona fide union.
In fact it may well be said that as the Shramik Sangh was an affiliated unit of the Federal Union, it was not permissible for it to make the application dated July 18, 1975, for the constitution of a Conciliation Board to resolve the dispute and to enter into the memorandum of settlement dated August 27, 1975.
The Tribunal has examined the file (No.391 of 1975) of the Conciliation Board case relating to the industrial dispute raised by the Karamchari Union on January 23, 1975, about the payment of the dearness allowance to the workers of the Kanpur unit according to the cost of living index for industrial workers at Kanpur, and the file of the other conciliation case relating to the similar dispute raised by the Shramik Sangh on July 18, 1975, and has stated the factual position as follows "It is clear from the latter file that the management of the Kanpur unit of the Company had applied on 29 7 75 to the Regional Conciliation Officer for the registration of the settlement reached between the company and the All India Federation of Indian Oxygen Employees Unions on 30 6 75 but on account of the pendency of C.B. Case No.391/75 some information was asked to be furnished by the company which the company did not furnish.
On the other hand, the representatives of the Shramik Sangh and the Kanpur unit of the company appeared before the Regional Conciliation Officer, Kanpur on 27 8 75 and submitted a brief memorandum of settlement making applicable to the Kanpur unit the settlement which had been reached between the company and the Federation on 30 6 75.
" It will thus appear that the Shramik Sangh entered into the settlement dated August 27, 1975 in collusion with the Company and that the Conciliation Board allowed the memorandum of settlement to be filed and finalised even though the Karamchari Union 's dispute dated January 23, 1975 was pending and no effort was made to make it a 921 party to the proceedings which were taken at the instance of the Shramik Sangh.
It is important to remember in this connection that although the settlement which had been made by the Federal Union on June 30, 1975 was opposed by both the Unions when it was placed on the notice board of the Kanpur unit, the Shramik Sangh changed its stand and filed a memorandum of settlement on August 27, 1975 endorsing the settlement which had been made with the Federal Union on June 30, 1975.
The Tribunal has also stated it as a fact that the settlement dated August 27, 1975 was not even put on the notice board of the Company.
If, therefore, the State Government decided to make a reference of the dispute to the Tribunal in these circumstances, it cannot be said that it did not apply its mind to the controversy or committed an illegality in doing so.
It has to be appreciated that it would not have been practicable for the State Government to exclude the workmen who were members of the Shramik Sangh (at Kanpur) from the scope of the reference under section 4K of the U.P. Act and to confine the dispute to the rest of the workmen, for that might have given rise to one pay structure for one section of the workmen (represented by the Karamchari Union) and another for the other workmen (represented by the Shramik Sangh).
At any rate, this was not a matter at the threshold, and is essentially for the Tribunal to examine on the merits of the controversy.
We have also considered the other argument of Mr. Nariman that as the settlements dated June 30, 1975 and August 27, 1975 were in the nature of package deals, and arose out of collective bargaining, it was not permissible for the State Government to make a reference to the Tribunal about one item of that deal, namely, that relating to the variable dearness allowance.
Our attention in this connection has been invited to the statement of the Company 's Personnel Manager V. John in which reference has been made to the nature and the contents of the package.
The point does not however relate to the jurisdiction or the maintainability of the reference under section 4K of the U.P. Act, for it is essentially a matter for the Tribunal 's examination with due regard to the evidence before it.
It appears from the record that the Company brought this aspect of the matter specifically to the notice of the State Government in its representation dated April 20, 1976, and it cannot be said that it was not before the Government when it made the impugned order of reference dated May 23, 1977.
At any rate, it cannot be said that there is any legal bar to the reference of the dispute regarding one particular item of a 922 package deal for adjudication by the Tribunal so as to vitiate the reference at the threshold.
We have gone through the two cases which have been cited by Mr. Nariman in this connection.
Herbertsons Ltd. (supra) was a case where all the workers of the Company had accepted the settlement and received the arrears and the emoluments according to it.
In fact it was in the facts and circumstances of that case that this Court took the view that it was not possible to scan the settlement in bits and pieces and hold some parts good and acceptable and others bad.
Even so, this Court expressed the view that if the objectionable part was shown to outweigh all the other advantages, the Court would be slow to hold the settlement unfair and unjust.
Herbertsons is therefore no authority for the argument that a part of a package deal cannot be the subject matter of a reference for adjudication by the Tribunal.
New Standard Engineering Co. Ltd (supra) was also a different case, for there the justness and fairness of the settlement was examined with reference to the situation as it stood on the date on which it was arrived at, and it cannot also avail the argument of Mr. Nariman about the illegality of a reference merely because it relates to a part of a package deal.
That is essentially a matter for the Tribunal to examine and adjudge on the merits of the reference.
Lastly, Mr. Nariman has argued that as the members of the Karamchari Union accepted the benefits of the settlement which had been made with the Federal Union on June 30, 1975, they were precluded from obtaining the order of reference dated May 23, 1977.
The argument is futile because the Tribunal has specifically stated in its order under appeal that even the settlement dated August 27, 1975 was not put on the Company 's notice board and the emoluments of the workmen were increased from July 1975.
It has further been stated that the members of the Karamchari Union "took the increase but under protest vide the Union 's letter dated 28 7 75 which is annexure D to the Workmen 's written statement.
" There is thus no force in the argument which have been advanced for the purpose of showing that the settlements dated June 30, 1975 and August 27, 1975 debarred the State Government from making the impugned order of reference dated May 23, 1977 under section 4K of the U.P. Act or that the dispute was not an industrial dispute and the order was otherwise bad in law.
The appeal fails and is dismissed with costs.
N.V.K. Appeal dismissed.
| IN-Abs | (14 of 1947) section 18 Applicability of.
The appellant company had its establishments in a number of States in the country.
In its establishment at Kanpur there were two unions, one of which, the Shramik Sangh, was affiliated to the Federal Union comprising of some of the trade unions in the various establishments while the other, the Karamachari Union, was not.
A demand relating to revision of dearness allowance among others, was raised by both the Unions at Kanpur.
The Shramik Sangh and the appellant entered into a settlement.
Karamchari Union which was not a party to the settlement, made an application to the State Government to constitute a conciliation board for reference of the dispute.
The Board was constituted.
In the meantime, however, to bring the settlement within the purview of the U.P. the Shramik Sangh applied for the constitutation of a conciliation board.
A conciliation board was constituted and the memorandum of settlement arrived at between the parties was registered even though the dispute on the same point raised by the Karamchari Union was pending before the Conciliation Board all the while.
The dispute raised by the Karamchari Union was, therefore, referred to a Tribunal under s 4K of the Act.
The Tribunal rejected the appellant 's contention that it had no jurisdiction to adjudicate on the dispute.
On appeal to this Court it was contended that it was implicit in the various provisions of the U.P. Act that a settlement arrived at before a Conciliation Board by a Union of the majority of workmen was binding on all the workmen and that in the absence of a provision like section 18 of the it was not permissible for the Karamchari Union to contend that the settlement would bind only the members of the Shramik Sangh and in any event reference of the dispute to a Tribunal was without jurisdiction.
Dismissing the appeal, ^ HELD: 1.
The State Government rightly took the view that the controversy raised by the Karamchari Union was an industrial dispute.
[922 G H] 2.
A reading of the relevant provisions of the U.P. , clearly shows that there is nothing in the Act to require that the dispute 912 or difference should be raised by all the workmen of the industry, or by everyone of them, or even by a majority of them.
It is enough if the controversy is between the employer on the one side and workmen on the other.
There is also nothing in the Act to require that the workmen raising the controversy should form a majority of the employees, the reason being that where it is found that the controversy affects, or will affect, the interests of workmen as a class, the law envisages that, in the interest of industrial peace, it should be examined and decided in one of the modes provided by it.
[917 D F] 3.
An individual dispute cannot, however, be said to be an industrial dispute unless the other workmen associate themselves with it.
No hard and fast rule can be laid down to decide when and by how many workmen an industrial dispute could be raised within the meaning of the Act, or whether a minority union or even an unrecognised union, could raise an industrial dispute.
It is enough if there is a potential cause of disharmony which is likely to endanger industrial peace, and a substantial number of workmen raise a dispute about it, for then it is permissible to view it as an industrial dispute within the meaning of clause (1) of section 2 of the Act, and to refer it for adjudication to a tribunal.
[917 F H] 4.
The settlement arrived at with the Federal Union did not bind the Karamchari Union as it was not a party to it and was not affiliated to the Federal Union.
Section 18 of the Central Act provides that a settlement arrived at by agreement between the parties otherwise than in the course of conciliation proceedings shall be binding on the parties to the agreement.
[918 E] 5.
Moreover, the settlement arrived at with the Shramik Sangh was under the provisions of the U.P. Act and, therefore, section 18 of the Central Act had no application.
There is no provision similar to it in the U.P. Act.
[918 G] 6.
There was no occasion for invoking section 7 of the U.P. Act.
That section is mainly intended to serve the purposes contemplated by section 3 of the Act, namely, securing the public safety or convenience or the maintenance of public order or supplies and services essential to the life of the community or for maintaining employment etc.
It cannot therefore be said that the settlement arrived at by the Sangh became binding on all workmen including the Karamchari Union which was not a party to it nor is there any other provision in the Act or the Rules making the settlement binding on the Karamchari Union.
Nor again can it be said that section 3(d) of the U.P. Act justifies the argument that merely because a union, consisting of a majority of workers, can represent all the workmen, the settlement arrived at before a conciliation board would bind those who are not parties to it.
[919 B, C, F G] 7.
In the absence of any prohibitory provision in the Act it cannot be said that the State Government had no jurisdiction to make a general reference under section 4K of the U.P. Act merely because the settlement was made by a majority union and was binding on the Shramik Sangh.
The Tribunal has found it as a fact that the Karamchari Union represented a substantial number of the workmen of the company at Kanpur, and there is no reason why they should be debarred from raising a dispute for the benefit of all the workmen as a class.
It is well recognised, that "collective bargaining" can take place between the employer and a bona fide labour union and there is nothing on the record to show that the Karamchari Union was not a bona fide union.
[920 A C] 913 In the instant case the Shramik Sangh entered into the settlement in collusion with the company and the Conciliation Board finalised the settlement even though the Karamchari Union 's dispute was still pending.
No effort was made to make it a party to the proceedings.
Although, to begin with, a both the Shramik Sangh and the Karamchari Union were opposed to the settlement earlier arrived at by the Federal Union the Shramik Sangh changed its stand and endorsed the settlement of the Federal Union when it was placed on the notice board.
The Tribunal also found as a fact that the settlement was not even put on the notice board of the company.
In these circumstances if the State Government had decided to make a reference of the dispute to the Tribunal it could not be said that it did not apply its mind to the controversy or committed an illegality in doing so.
[920 H 921 C] 8.
Even assuming that the earlier settlements were in the nature of a package deal arrived at between the company and the Federal Union it cannot be said that there was any legal bar to the reference of the dispute regarding one particular item of the package deal for adjudication by the tribunal so as to vitiate the reference.
The company brought this aspect of the matter specifically to the notice of the State Government.
The point does not, however, relate to the jurisdiction or the maintainability of the reference under section 4K for it is essentially a matter for the Tribunal 's examination with due regard to the evidence before it.
[921 F G] Herbertsons Ltd. vs Workmen of Herbertsons Ltd. & Ors. ; and New Standard Engg.
Co. Ltd. vs M. L. Abhyankar & Ors., ; held inapplicable.
|
Civil Appeal No. 1931 of 1969.
Appeal by Special Leave from the Judgment and Order dated 3 6 1969 of the Calcutta High Court in Civil Rule No. 2924/68.
Sukumar Ghosh for the Appellant.
The Judgment of the Court was delivered by CHANDRACHUD, C. J.
On November 27, 1962 respondents filed a suit for eviction against the appellant under the West Bengal premises Tenancy Act, 1956 ("The Act") on the ground that the appellant was in arrears of rent, that he had sublet the premises and that the respondents required the premises for their personal use.
The summons of the suit was served on the appellant on January 9, 1963 and he deposited the arrears of rent within a period of thirty days thereafter i.e. on February 5, 1963.
On July 10, respondents filed an application under section 17(3) of the Act for striking off the defence of the appellant on the ground that though the appellant had deposited the arrears of rent, he had not deposited the interest due on the arrears, as required by section 17(1) of the Act.
By an order dated July 25, 1963 the trial court accepted the respondents ' contention and struck off the appellant 's defence.
On August 26, 1963 the 947 appellant filed a civil revision application in the Calcutta High Court against that order but it was dismissed by the High Court on April 4, 1968.
Between August 26, 1963 when the appellant filed the revision application in the High Court and April 4, 1968 when the revision application was dismissed, certain important events happened.
On August 26, 1967 an Ordinance was passed by the West Bengal Government by which a new section, namely, Section 17B was introduced into the Act.
By that section, tenants were given the right, if the proceeding for eviction was not yet disposed of, to apply within thirty days of the commencement of the Ordinance, for setting aside the order striking off the defence.
On the expiry of that Ordinance, another Ordinance containing identical provisions was passed on January 8, 1968.This Ordinance was replaced on March 26, 1968 by President 's Act 4 of 1968.
Section 17 B which was inserted in the Act by the two Ordinances was numbered as section 17 A under the President 's Act, the provisions of the section remaining unaltered.
Section 1(2) of the President 's Act provided that the said Act shall be deemed to have come into force on August 26, 1967 which was the date on which the first Ordinance had come into force.
After the dismissal of the revision application on April 4, 1968,the appellant filed an application on May 3, 1968 in the Trial Court under section 17 A praying that the order dated July 25, 1963 passed by it, striking off his defence be set aside.
It ought to be mentioned that though the Trial Court had passed the order striking off the appellant 's defence as long back as in 1963, the eviction suit filed by the respondents continued to remain on the file because, on September 16, 1963 the High Court in the revision application filed by the appellant had issued an order staying all further proceedings in the suit.
Along with the application under section 17 A, the appellant filed an application under section 5 of the Indian praying that the delay caused in filing the application may for reasons stated therein be condoned.
Both the applications were dismissed by the Trial Court by an order dated August 17, 1968 which was confirmed by the Calcutta High Court in revision on June 3, 1969.
Being aggrieved by the judgment of the High Court in Civil Rule No. 2924 of 1968, the tenant has preferred this appeal by special leave of this Court.
The High Court has dismissed the application filed by the appellant under section 17 A of the Act on the ground that it was not filed within 30 days of August 26, 1967 when the first Ordinance 948 came into force and further on the ground that since Section 5 of the had no application to the proceeding, the Court had no power to condone the delay.
It is patent that the application under section 17 A was not filed within the prescribed period of thirty days.
The sole question for decision, therefore, is whether the provisions of section 5 of the can apply to an application under section 17 A of the Act.
Section 5 of the provides, to the extent relevant, that any application may be admitted after the prescribed period if the applicant satisfies the Court that he had sufficient cause for not making the application within the said period.
On the applicability of section 5 to the proceedings under section 17 A of the Act, the provisions of section 39 of the Act have a material bearing and must be noticed.
Section 39 of the Act provides: "Subject to the provisions in this Act relating to limitation, all the provisions of the Indian Limitation Act, 1908, shall apply to suits, appeals and proceedings under this Act." This provision, which is clear and specific, leaves no doubt that the provisions of the Limitation Act would apply to proceedings under the West Bengal Premises Tenancy Act, subject to the condition that if there is a provision in the West Bengal Act relating to limitation, that provision would prevail over the provisions of the Indian Limitation Act relating to limitation.
Since the West Bengal Act prescribes a specific period of limitation for filing an application for setting aside an order striking out the defence, namely, a period of 30 days commencing on August 26, 1967 when the first Ordinance came into force, that period would undoubtedly apply to the making of the application under section 17A of the Act.
And since the appellant did not file his application under section 17 A before the due date, that is to say, before September 25, 1967, the application must be held to be barred by limitation.
But, by reason of section 39 of the Act, all other provisions of the Limitation Act would be attracted, including section 5 of the latter Act.
Whether the appellant has made out sufficient ground for the condonation of delay is another matter but, in view of the provisions of section 39 of the Act, it seems to us clear that the application filed by the appellant under section 5 of the Limitation Act for condonation of delay is maintainable and has to be decided on merits.
The learned Single Judge of the Calcutta Court has referred in his judgment of June 3, 1969 to the provisions of section 39 but he took the view that since section 17A lays down a special period of 949 limitation for filing a petition to set aside an order striking out the defence, that period could not be extended by invoking the provisions of the Limitation Act.
This view is unsupportable.
The true meaning and effect of section 39 is that if any special period of limitation is prescribed by the Act, that period will govern the proceeding under the Act in perference to the period, if any, prescribed by the Limitation Act.
But, apart from such an over riding effect of the period of limitation prescribed by the Act, not only that the other provisions of the Limitation Act do not stand excluded or superseded, but they are expressly made applicable by section 39 of the Act.
When a Court condones the delay caused in filing a proceeding, it does not extend the period of limitation prescribed by law for filing it.
It treats the proceeding as if it is filed within limitation, which it has the power to do if sufficient cause is shown for not filing the proceeding within the prescribed period.
In M/s. Pakarmal Gurudayal vs Sagarmal Bengani(1) a Division Bench of the Calcutta High Court took the view that section 5 of the Limitation Act would apply even to an application made for setting aside the decree passed after and following upon an order striking out of the defence.
We endorse the view of the High Court which, ex hypothesi, would justify the application of section 5 of the Limitation Act to an application for setting aside an order striking out the defence.
That leaves for consideration the question whether the appellant has shown sufficient cause for not preferring his application within a period of thirty days after August 26, 1967.
On this aspect of the matter, it is relevant to bear in mind that in the revision application filed by the appellant against the order striking out his defence, the High Court on September 16, 1963 had stayed all further proceedings in the suit.
If the, appellant were to succeed in that revision application, the suit would have been required to be heard on merits and there would have been no reason or occasion for him to resort to the provision newly inserted by the Ordinance, under which an application could be made for setting aside the order striking out the defence.
The appellant was evidently advised wrongly as regards the true legal position, as a result of which he awaited the disposal of his revision application.
He filed the application under section 17A within 30 days of the date on which the revision application was dismissed.
The appellant acted bona fide in pursuing his remedy by way of a revision application which he had already filed and which, if successful, could have given him effective relief.
We are satisfied that he had sufficient cause for not filing the application under 950 section 17A within the prescribed period.
Accordingly, the delay caused in filing that application must be condoned under section 5 of the Limitation Act and the application under section 17A must be allowed.
For these reasons, we allow the application filed by the appellant under section 17A of the Act, set aside the order dated July 25, 1963 striking out his defence and remit the matter back to the Trial Court for deciding the respondents ' suit for eviction in accordance with law The suit has been pending since September 1962 and we direct that it shall be disposed of expeditiously.
The appeal is accordingly allowed and the High Court 's Judgment is set aside but without an order of costs.
V. D. K. Appeal allowed.
| IN-Abs | In the eviction suit filed by the respondents against the appellant under the West Bengal Premises Tenancy Act, 1956, on the ground that the appellant was in arrears of rent, that he had sub let the premises and that the respondents required the premises for their personal use, the appellant deposited the arrears of rent within a period of 30 days i.e. within the time but did not deposit the interest due on the arrears as required by section 17(i) of the Act.
The respondents therefore, filed an application under section 17(3) of the Act to strike off the appellant 's defence for failure to deposit the interest.
The said application was accepted by the Trial Court and, therefore, the respondents filed a civil revision application in the Calcutta High Court against that order which was dismissed on April 4, 1968.
During the pendency of the said revision application, section 17A was newly introduced in the 1956 Act with retrospective from 26 8 1967.
By that section tenants were given the right, if the proceedings for eviction was not disposed of, to apply within 30 days of the said date for setting aside the order for striking off the defence.
In view of the challenge by way of revision application in the High Court against the order striking off his defence the appellant did not take recourse to the provisions of the newly introduced section 17A of the West Bengal Premises Tenancy Act.
After the dismissal of the revision petition, the appellant filed an application under the new section 17A of the Act praying that the order dated July 25, 1963 passed by the Trial Court, striking off his defence be set aside.
Along with the said application, an application to condone the delay under section 5 of the Limitation Act was also filed.
The Trial Court dismissed both the applications and the High Court confirmed that order in revision.
Allowing the appeal by special leave, the Court ^ HELD: 1.
The true meaning and effect of section 39 is that if any special period of limitation is prescribed by the Act, that period will govern the proceeding under the Act in preference to the period, if any, prescribed by the Limitation Act.
But apart from such an over riding effect of the period of limitation prescribed by the Act, not only that the other provisions of the Limitation Act do not stand excluded or superseded, but they are expressly made applicable by section 39 of the Act.
[949 A B] 2.
Section 39 of the West Bengal Premises Tenancy Act, 1956, which is clear and specific, leaves no doubt that the provisions of the Limitation Act 946 would apply to proceedings under the West Bengal Premises Tenancy Act, subject to the condition that if there is a provision in the West Bengal Act relating to limitation, that provision would prevail over the provisions of the Indian Limitation Act relating to limitation.
Since the West Bengal Act prescribed a specific period of limitation for filing an application for setting aside an order striking out the defence, namely a period of 30 days commencing on August 26.
1967 when the first Ordinance came into force, that period would undoubtedly apply to the making of the application under section 17A of the Act.
Since the appellant did not file his application under section 17A before the due date, that is to say, before September 25, 1967, the application must be held to be barred by limitation.
But, by reason of section 39 of the Act, all other provisions of the Limitation Act would be attracted including section 5 of the latter Act.
[948 D F] In the instant case since the appellant did not file his application under section 17A of the Act, before the due date, that is to say, before September 25, 1967, the application under section 17A is barred by limitations.
However, the application filed by him under section 5 of the Limitation Act for condonation of delay is maintainable.
[948 A B, G] M/s. Pakarmal Gurudayal vs Sagarmal Bengani approved.
When a Court condones the delay caused in filing a proceeding, it does not extend the period of limitation prescribed by law for filing it.
It treats the proceeding as if it is filed within limitation, which it has the power to do if sufficient cause is shown for not filing the proceeding within the prescribed period.
[949 B C]
|
N: Criminal Appeal No. 103 of 1975.
Appeal by Special Leave from the Judgment and Order dated 12 2 1973 of the Bombay High Court in Criminal Application No. 774/72.
U. P. Singh for the Appellant.
H. R. Khanna and M. N. Shroff for the Respondent.
The Judgment of the Court was delivered by FAZAL ALI, J.
In this appeal by special leave the appellant has been convicted under section 27 (a) (i) of the Drugs and Cosmeties and sentenced to rigorous imprisonment for one year and a fine of Rs. 200/ as modified by the High Court.
The trial court also convicted the appellant under section 27 (a) (ii) and section 28 of the Act but no separate sentence was awarded under these counts.
The trial court had, in fact, imposed a sentence of imprisonment only till the rising of the Court but the High Court in its revisional jurisdiction enhanced the sentence to one year 's rigourus imprisonment, and hence this appeal by sepcial leave.
According to the prosecution, on 5.5.1970 at about 11.30 a.m. the complainant Drugs Inspector, Jalagaon received a telephonic meassage from the Senior Railway Sub Inspector Bhusawal to the effect that the appellant had been caught at the Bhusawal railway station with 17 plastic containers containing 17,000 white coloured tablets.
On receiving this message the complainant went to Bhusawal railway station on the next day and after taking permission from the magistrate he took the sample of the tablets and sent it to the public analyst and after receiving his report, he filed a complaint against the appellant under the various sections of the .
The learned trial magistrate framed two charges against the appellant.
One charge was under section 27 (a) (i) and 27 (a) (ii) of the (hereinafter referred to as the "Act") and the other charge related to section 28 read with section 18A of the Act.
The appellant pleaded guilty to the charge and admitted all the facts contained in the charge.
The appellant, however, stated that as this was his first offence, he promised not to commit any offence again and as he was an agriculturist and a young man, he pleaded for mercy.
The prosecution in support of the case examined the complainant to prove the facts leading to the prosecution of the appellant.
The learned magistrate acccpted the plea of guilty and convicted the appellant as indicated in the judgment.
The High Court, however, enhanced the sentence as mentioned above.
Mr. U. P. Singh appearing in support of the appeal has raised a short point before us.
He has submitted that taking the prosecution case at its face value, no offence can be said to have been committed under section 27 (a) (i) or (ii) of the Act.
It was submitted that the ingredients required by section 27 have not been proved in this case and therefore, even if, the accused pleaded guilty, that will not enable the prosecution to convict him on his plea of guilty.
Section 18 (c) runs thus : "manufacture for sale, or sell, or stock or exhibit for sale, or distribute any drug or cosmetic, except under, and in accordance with the conditions of, a licence issued for such purpose under this Chapter.
" 999 Section 27 is the penal section under which the offence is punishable and this section runs thus: "Whoever himself or by any other person on his behalf manufactures for sale, sells, stocks or exhibits for sale or distributes (a) any drug (i) deemed to be misbranded under clause (a), clause (b), clause (e), clause (d), clause (f) or clause (g) of secton 17 or adulterated under section 17B; or (ii) without a valid licence as required under caluse (c) of section 18." shall be punishable with imprisonment for a term which shall not be less than one year but which may extend to ten years and shall also be liable to fine; Provided that the Court may, for any special reasons to be recorded in writing impose a sentence of imprisonment of less than one year;" It was contended by Mr. Singh that in order to fall within the, ambit of this section the accused must manufacture the drugs for sale or stock or exhibit for sale or distribute the same.
There is no evidence in this case to show that the appellant had any shop or that he was a distributing agent.
All that has been shown is that the tablets concerned were recovered from his possession.
It was urged that possession simpliciter of the tablets of any quantity whatsoever would not fall within the mischief of section 27 of the Act.
On an interpretation of section 27, it seems to us that the arguments of Mr. Singh is well founded and must prevail.
The words used in section 27, nameely, "manufacture for sale", sells, have a comma after each clause but there is no comma after the clause "stocks or exhibits for sale".
Thus the section postulate three separate categories of cases and no other.
(1) manufacture for sale; (2) actual sale; (3) stocking or exhibiting for sale or distribution of any drugs.
The absence of any comma after the word "stocks" clearly indicates that the clause "stocks or exhibits for sale" is one indivisible whole and it contemplates not merely stocking the drugs but stocking the drugs for the purpose of sale and unless all the ingredients of this category are satisfied, section 27 of the Act would not be attracted.
In the present case there is no evidence to show that the appellant had either got these tablets for sale or was selling them or had stocked them for sale.
Mr. Khanna appearing for the State, however, contended that the word "stock" used in section is wide enough to include the possession 1000 of a person with the tablets and where such a person is in the possession of tablets of a very huge quantity, a presumption should be drawn that they were meant for sale or for distribution.
In our opinion, the contenton is wholly untenable and must be rejected.
The inter pretation sought to be placed by Shri Khanna does not flow from a true and proper interpretation of section 27.
We, therefore, hold that before a person can be liable for prosecution or conviction under section 27 (a) (i) (ii) read with section 18 (c) of the Act, it must be proved by the prosecution affirmatively that he was manufacturing the drugs for sale or was selling the same or had stocked them or exhibited the articles for sale.
The possession simpliciter of the articles does not appear to be punishable under any of the provisions of the Act.
If, therefore, the essential ingredients of section 27 are not satisfied the plea of guilty cannot lead the Court to convict the appellant.
As regards the second charge, it seems to us that the case of the appellant is clearly covered by the language contained in section 18A read with section 28.
Section 18A runs thus: "Every person, not being the manufacturer of a drug or cosmetic or his agent for the distribution thereof, shall, if so required, disclose to the Inspector the same, address and other particulars of the person from whom he acquired the drug or cosmetic.
" Section 28 which makes no disclosure of 18A punishable reads thus: "Whoever contravenes the provisions of section 18A shall be punishable with imprisonment for a term which may extend to one year, or with fine which may extend to five hundred rupees, or with both." In this case, there is unchallengable evidence of the complainant that after recovering tablets from the possession of the appellant, he had served a registered notice to him to disclose the source from which he had acquired the tablets and despite this notice the appellant refused to disclose the source.
Thus the act of the appellant clearly falls within the ambit of section 28 of the Act.
The trial court further did not impose any separate sentence under this section.
But that will not be a bar to imposing a proper sentence by this Court provided the sentence does not exceed the sentence already imposed under section 27 (a) (i).
When the High Court was moved for enhancing the sentence, it was moved only under section 27 (a) (ii) of the Act because under that 1001 section the minimum sentence to be given was one year.
As the High Court was not satisfied with the reasons given by the trial court for giving sentence less than one year it appears to have enhanced the sentence to one year.
In view of our finding that section 27 (a) (i) have no application to this case, the charge on this count against the appellant must fail and the appellant must be acquitted of this charge.
So far as section 28 is concerned the maximum punishment which can be imposed is only one year.
The appellant is a young man and comes from a respectable family and had made a very candid confession before the Court in pleading guilty.
In these circumstances, we therefore do not think that any deterrent sentence is called for.
We would, therefore, uphold the conviction of the appellant under section 28 but give the sentence till the rising of the Court which he has already undergone.
The appellant will now be released forthwith.
The sentence of a fine of Rs. 200 will be maintained under section 28 and not under section 27 (a) (i).
The fine if not paid shall be paid within a month from today.
Accordingly, the appeal is allowed in part.
M.R. Appeal allowed in part.
| IN-Abs | The apellant was apperhended at the Bhuysawal railway station, and 17 containers with 17,000 white tablets were recovered from him.
The tablets were tested by the public analyst, and found to be not in accordance with the standard specified under section 18(a) of the Drugs and Cosmeties Act.
The appelant was duly tried and convicted by the Trial Magistrate, under Sections 27(a)(ii) and 28 of the Act.
The appellant pleaded guilty, and in view of his young age, and that it was his first offence, the Magistrate sentenced him only till the rising of the Court.
But in revision, the High Court enhanced the sentence to one year 's R.I.
It was contended that as there was no evidence to show that the tablets were "for sale", their possession simpliciter, of any quantity whatsoever, would not constitute an offence under section 27.
Allowing the appeal as regards the conviction under section 27, the Court, ^ HELD:1.
The absence of any cmma after the word "stocks" clearly indicates that the clause "stocks or exhibits for sale" is one indivisible whole and it contemplates not mere stocking the drugs, but stocking the drugs for the purpose of sale, and unless all the ingredients of this category are satisfied, section 27 of the Act would not be satisfied.
[999 F G] 2.
There is no evidence to show that the appellant had either got these tablets for sale, or was selling them or had stocked them for sale.
Before a person can be liable for prosecution or conviction under section 27(a)(i)(ii) read with section 18(c) of the Act, it must be proved by the prosecution affirmatively that he was manufacturing the drugs for sale or was selling the same, or had stocked them or exhibited the articles for sale.
The possession simpliciter of the articles does not appear to be punishable under any of the provisions of the Act.
[999 G. 1000 B C]
|
N: Criminal Appeal Nos. 346 and 387 of 1975.
Appeals by Special Leave from the Judgment and Order dated 6 8 75 of the Bombay High Court in Criminal Appeal No. 1005 and 1006 of 1973.
Lalit Chari, P. R. Guna, A. K. Srivastava and Vineet Kumar for the Appellant in Crl.
A. No. 387/75.
R. L. Kohli, P. P. Rao, R. C. Kohli and R. Nagarathnam for the Appellant in Crl.
A. No. 346/75.
V. section Desai, H. R. Khanna and M. N. Shroff for the Respondent in both the appeals.
The Judgment of the Court was delivered by JASWANT SINGH, J.
The above noted two criminal appeals which are directed against the common judgment and order dated August 6, 1975 of the High Court of Judicature at Bombay affirming on appeal the judgment and order dated August 6, 1973 of the Special Judge, Greater Bombay, convicting section P. Bhatnagar, appellant in the aforesaid first appeal, (hereinafter described as A 1) under section 120B read with sections 409 and 109 of the Indian Penal Code and section 5(2) of the Prevention of Corruption Act, 1947, and sentencing him to six months simple imprisonment on each of the said two courts as well as convicting A. section Krishnaswamy, appellant in the aforesaid second appeal (hereinafter described as A 2) under the aforesaid two counts but reducing his sentence from nine months ' imprisonment to six months simple imprisonment on each one of those counts, shall be disposed of by this judgment.
Briefly put the case as set up by the prosecution was: In 1964, the Indian Oil Corporation (hereinafter referred to as 'the Corporation ') which is a Government owned company, decided to purchase 13 acres and odd of a hilly tract of land situate in village Mahul in Trombay (Bombay) from the Tatas for the purpose of erecting black furnace oil storage tanks and construction of administrative buildings.
After the area was taken over by the Corporation Varandani (P. W. 20), Junior Engineer of the Corporation surveyed the land in October, 1964, under the directions of A 1 and A 2, the Engineering Manager and Senior Engineer respectively of the Engi 878 neering Department of the Marketing Division of the Corporation with a view to find out the extent of rock cutting and filling which might be required to be done for levelling the area of 7 acres out of the said tract of land.
The kacha level plan (Exh. 125) and worksheets prepared by Varandani on October 13, 1964 and November 3, 1964 respectively during the course of his aforesaid survey (which were signed by A 1 and A 2, showed that 16,80,000 cft.
of rock cutting work and 8,00,000 cft.
of filling work would have to be done to suit the purpose for which the land was acquired.
Estimate (Exh. 27) prepared by Varandani indicated that expenditure at the rate of Rs. 30/ per 100 cft.
for rock cutting and Rs. 10/ per 100 cft.
for filling would have to be incurred.
Pucca tracing (Exh. 34) of level plan (Exh. 125) and copies thereof signed by A 1 and A 2, and contour plan prepared by Varandani and approved by Engineering Manager were kept on the record.
On the basis of the survey and the estimate of expenditure made by Varandani, notice (Exh. 28) inviting tenders from experienced civil contractors for rock cutting, filling and levelling of the land in question was prepared by A 2 on February 2, 1965, and was forwarded (under his signatures) by A 1 to the Finance Department for approval on February 5, 1965.
After the approval of the Finance Department, the Public Relations Officer of the Corporation by his letter (Exh. 29) dated February 11, 1965 requested Times of India, Indian Express and Free Press to publish the tender notice (Exh. 28) wherein it was stated that the tenders which should reach the Corporation by 2.30 P.M. on March 2, 1965 would be opened at 3.00 P.M. on that date.
In response to this notice eleven firms of contractors including Ram & Co. submitted their tenders.
N. N. Desai (hereinafter described as A 4) however abstained from submitting his tender.
In the meanwhile, it was decided that instead of having stack measurement as provided in Exhibit 28, it would be desirable to have the measurements on the basis of differences between the existing and finished levels.
Accordingly, on March 5, 1965, the aforesaid eleven tenderers were asked to submit revised tenders on the basis of the amended tender notice by March 15, 1965.
Although fresh tenders were restricted to the original eleven tenderers, a tender form was issued to A 4 in response to the application made by him on March 8, 1965.
On opening the tenders on March 15, 1965, it was found that five out of the eleven original tenderers and four new ones including A 4 had submitted their tenders, that the tender of Ram & Co. whereby it had quoted Rs. 28/ per 100 cft.
for cutting work and 'nil amount for filling was the 879 lowest and that the second lowest tender was of A 4 who had quoted Rs. 26/ per 100 cft.
for cutting and Rs. 6/ per 100 cft.
for filling work.
Thus, the actual amount as per quotation of Ram & Co. was Rs. 4,70,400/ and that of A 4 was Rs. 4,84,800/ for 16,80,000 cft.
of cutting work and 8,00,000 cft.
of filling work.
On discovering that the tender of his firm was the lowest, Roshan Lal, a partner of Ram & Co. addressed communication dated March 20, 1965 to the Managing Director of the Corporation requesting him that the aforesaid job of rock cutting and filling be entrusted to his firm in view of its working experience detailed therein but handed over the same to A 1.
At or about this time, Messrs Labitos Oil Fields Limited, a British firm whom the Corporation was trying to collaborate in its project advised the Corporation that instead of three levels (steppings) which had been planned as per cantour map (Exh. 34) there should be a single level and instead of the survey being on the basis of 100 ft. spacing as done earlier by Varadani, it should be on the basis of 10 ft. spacing.
Accordingly A 1 and A 2 told Varadani (P.W. 20) and section D. Vaidya, another Assistant Engineer (hereinafter described as A 3) to make a fresh survey alongwith A 4 according to the advice of Messers Labitos Oil Fields Limited as it had been almost decided to entrust the aforesaid work to A 4.
Pursuant to the instructions of A 1 and A 2, B. N. Desai, a representative of A 4 was associated with the revised survey which was carried from March 21 to March 26, 1965.
As a result of the joint survey, kacha level plan (Exh. 22) and work sheet (Exh. 23) were prepared by A 3 under the directions of Varandani.
As a result of this survey, it was found that rock cutting and filling would have to be done to the extent of 23,30,454 cft.
and 31,500 cft.
respectively as against 16,80,000 cft.
and 8,00,000 cft.
respectively as found as a result of the earlier survey.
Notwithstanding the large variations in the cutting and filling work which required to be done as a result of the revised joint survey, the Engineering Department did not invite fresh tenders but instead prepared another comparative statement on the basis of the rates quoted by Ram & Co. and A 4 in their tenders opened on March 15, 1965 and showed therein that the tender of A 4 had turned out to be the lowest and that of Ram & Co. to be the second lowest.
On April 7, 1965, A 2 drew up tender committee proceedings (Exh. 16) as reproduced below and got them signed by A 1 in the hope that the recommendations made therein would be accepted by Srivastava, (P.W. 5) the Financial Controller and Patel, the Operation Manager of the Corporation, who were the other members of the Tender Committee, in addition to A 1 and finally by Gopal Krishan, the then Chairman of the Company : 880 "Ref.
No. ENG/ASK/Q 250 April 7, 1965.
Subject : Tender Committee proceedings for the finalisation of rock cutting, levelling of plot, taken over from M/s. Tata at Bombay.
(1) We had taken over 13.5 acres of land from M/s. Tata Power House at Trombay.
It was intended to level this plot of land and recover about 7 acres of land by cutting and levelling in order to put up our Black Storage tanks and other allied facilities.
Due to the uneven terrain, it was decided to have two steppings so that the storage tanks may be installed at a higher level and the remaining administrative blocks, were house stores etc., at a lower level.
Accordingly, Public Tenders were invited for rock cutting and filling this area on 100 cft.
basis.
(2) Subsequently, M/s.
Lobitos Oil Fields Ltd. Ellesmere Port, Wirral, Cheshire, had negotiations with us for putting up a Transformer Oil Blending Plant at this site.
The representatives of the above firm during their discussions with C. & section M. and M. E. (accused No. 1) stated, that they would like to have only plain piece of land instead of steppings as was decided by us previously.
This will entail additional cutting and minimise the quantity of filling.
(3) Our estimated quantity previously was 16,80,000 cft.
of cutting and 8,00,000 cft.
of filling.
As per the revision in the levels to be maintained at this site that the total quantity of cutting comes to 23,30,456 cft.
The quantity of filling comes to 31,500 cft.
The total estimated cost for the original work was Rs. 6,13,200/ .
A comparative statement has been drawn as per the tendered rates quoted by the various parties and the position of the first three is as follows: ____________________________________________________________ section Name of Contractor Qty.
Rate Amount Total No. %Cft.
____________________________________________________________ 1 N.N. Desai Cutting 23,30,450 26/ Sd.
605917 607807 Filing 31500 Cft.
1890 6/ 2 Ram & Co. Cutting 2330450 652526 652526 28/ Cft.
Filing 31500 Cft.
free 3 Library Construction Cutting 2330450 652526 28/ Cft.
655676 Filing 31500 Cft.
3150 ____________________________________________________________ 881 M/s. N. N. Desai, Contractor are the lowest.
The Tender Committee therefore recommends that this work may be allotted to M/s. N. N. Desai, Contractor at their quoted rate of Rs. 6,07,807/ being the lowest tenderer.
Sd/ (section P. Bhatnagar) M. E. (A. K. Srivastava) F.O. (H. B. Patel) O.M. Approved (P. A. Gopalakrishnan) Chairman.
" Contrary to the expectations of A 1 and A 2, Srivastava (P.W. 5) refused to be a party to the Tender Committee recommendations.
Ignoring not only the opposition of Srivastava and the suggestion of the Accounts Officer of the Finance Department and the Assistant Finance Controller of the Corporation made vide Exhibit 68 and Exhibit 31 respectively while processing the tender committee proceedings that in view of the fact that both the quantity and value of the work had increased substantially as a result of the revised survey, it would be fair and proper to ask all the contractors who had responded to the tender notice to re submit their quotations but also the offer made by Ram & Co. (which possessed the requisite skill and equipment) to execute the contract at the lower rates of Rs. 20/ per 100 cft.
for rock cutting and Rs. 15/ per 100 cft.
for filling as well as the flat refusal to reduce his rates given by A 4 during the negotiations conducted at the suggestion of the Accounts Department of the Corporation on April 17, 1965 with the three contractors mentioned in Exhibit 16, A 2 carried on, in pursuance of the conspiracy entered into between himself and A 1 and A 4 fresh negotiations with A 4 on or about April 20, 1965 without associating any member of the Finance Department and persuaded him to accept the lowest revised rates offered by Ram & Co. although he did not possess the requisite experience in and equipment for rock cutting and filling and by passing the Financial Controller forwarded the papers to the Operation Manager who not being conversant with the proceedings supported A 2 for entrusting the contract to A 4 at the lowest rates offered by Ram & Co. On the Tender Committee recommendations reaching him in circulation.
Srivastava put on record his bold and emphatic protest but eventually reluctantly gave his con 882 currence to the recommendations made by A 1 and the Operation Manager as is evident from the concluding sentence of the Note: "The case is recommended for acceptance of the Chairman only because the Engineering Manager has certified that he would not be able to accept any responsibility about the deadline if work is not given to Desai." Although according to A 2 's note (Exh. 33) dated April 19, 1965, the Coordinator and Sales Manager was keen to have the site developed as early as possible, the latter held up the matter for nearly three months in the vain expectation that the work would be done free of cost either by the Government of Maharashtra or the Bharat Sevak Samaj and it was not before July 15, 1967 that he gave his approval to A 1 's proposal to award the contract to A 4 whereafter accepting the said proposal the Managing Director of the Marketing Division and Chairman of the Board of Directors of the Corporation accorded sanction to the entrustment of the work to A 4.
On receipt of the sanction, A 1 forwarded the papers with his endorsement to the Financial Controller on July 29, 1965.
On July 30, 1965, work order (Exh. 19) manifesting quantity of rock cutting work as 29,30,450 cft., filling work as 90,000 cft.
and value of the work as Rs. 5,99,590/ as against the corresponding figures of 23,30,450 cft., 31,500 cft.
and Rs. 4,70,000/ respectively as specified in the final sanction which was based on the aforesaid level statement (Exh. 22) and work sheet (Exh. 23) was prepared and handed over by A 2 to A 4.
Copies of the work order were also endorsed by A 2 to the Bills Section of the Engineering Department and the Accounts Section of the Finance Department of the Corporation with the endorsement "the above has Chairman 's approval on our note of even reference dated 7th April 1965.
Please have the agreement executed.
Earnest money of unsuccessful tenderers may also please be refunded early.
" On July 30, 1965, formal contract (Exh. 74) mentioning only the number and date of the work order in the blank columns of the printed form was prepared and signed by A 4 and a representative of the Company.
The joint level statement Exhibit 22 and the work sheet Exhibit 23 in respect of the joint survey made between March 21 and 26, 1965 for ascertaining the extent of rock cutting and filling which formed the basis for invitation of tenders and the final sanction in favour of A 4 were not only left unsigned by the concerned but were actually removed from the file and were substituted by spurious level plan (Exh. 24) and its copy (Exh. 38) which were fabricated by A 3 to justify the inflated figures of rock cutting and filling work mentioned in the work order (Exh. 19) dated 883 July 29/30, 1965.
On August 19, 1965, fabricated level plans (Exhibits 24 and 38) prepared by A 3 were sent to A 4 as annexures to Exhibit 106 which ran as under: "We are enclosing herewith two prints of spot level of land area to be dressed and levelled at our Trombay plot.
The whole plot should be brought to a level of 102.00 as directed.
Please return to us a copy of the Blue Print showing spot levels duly signed as a token of acceptance of the same for payment." While A 4 retained one of the spurious plans viz. Exhibit 38 with himself, he returned the other viz. Exhibit 24 after putting his initials thereon.
Thereafter A 3 endorsed on the letter Exhibit 106 that 'the print signed by A 4 should be filed by Sukhtankar (P.W. 13) who is in charge of the filing section. ' Accordingly, Sukhtankar filed Exhibit 106 alongwith Exhibit 24 in the Bill Section.
The actual rock cutting operations commenced with effect from August 1, 1965 and on August 27, 1965, A 4 prepared and submitted the first running bill (Exhibit 51) indicating that 8,00,000 cft.
of cutting work and 80,000 cft.
of filling work had been completed.
This bill was accompanied by the certificate of A 3 reading as under : "The measurements on which column No. 3 of this bill are based were taken by me on 24 8 65 and recorded at pages of MMC No. 7201.
Certified that the quantities of work actually executed as shown in column No. 4 has actually been done and in no case less than the on account payments claimed.
" The above certificate was countersigned by A 2 on August 26, 1965.
A 2, A 3 and A 4 also signed measurement certificate (Exhibit 52) which read as follows: "We certify that the measurements given above are the actual works carried out in accordance with the drawings and specifications as indicated in the work order referred to above.
" On the basis of these certificates, the first on account running bill was passed and paid for.
Thereafter the second and third running bills and measurement certificates Exhibits 53 and 54 dated Septem 884 ber 16, 1965 and November 17, 1965 respectively claiming that the additional cutting work of 5,00,000 cft.
and 8,00,000 cft.
had been done were likewise prepared by A 4 and signed by A 3 and counter signed by A 2.
The fourth running bill and measurement certificate (Exh.
55) dated February 22, 1966 claiming that additional work to the extent of 7,00,000 cft.
had been done was prepared by A 4 and signed by A 3.
This bill which was countersigned by K. section Joshi, another Senior Engineer who was put incharge of the Project in the absence of A 2 who had been transferred to Delhi was also paid.
On November 8, 1966, one Gurunath Naik (P.W. 17) who was working as a Junior or Assistant Engineer for some time in Bombay and for the remaining period at Allahabad, Kanpur and Mugalsarai was called by A 1 and asked to see Ramrao, the then Junior Engineering Manager.
Accordingly Naik met Ramrao who directed him to go to the spot and have the level drawings.
Pursuant to this direction, Naik went to the site for spot verification and reported to Ramrao vide Exhibit 18 that excepting at one place where he got a level of 102 9 nowhere else did he get a level of 102.
Naik also reported that as against an area of 7.4 acres which had to be levelled hardly an area of 4.8 acres was attempted to be levelled.
On December 30, 1966, A 4 submitted his final bill (Exh. 56) claiming to have completed the work by August 11, 1966.
This bill bore the certificate dated December 29, 1966 of A 3 to the effect that the measurements on which column No. 3 of the bill was based was taken by him on that date, and had been recorded in the measurements of the M.B.M.C. book.
A 3 also recorded a further certificate to the effect that the work had been completed 100% according to the specifications and drawings.
This certificate of A 3 was followed by another certificate of A 4 that he accepted the above certificate and certified that the amount of payment which he received on that bill would be in full and final settlement of all his claims in respect of the work excepting the refund of his security deposit.
By this bill, A 4 claimed to have done 3,84,720 cft.
of cutting work and 18,200 cft.
of filling work in addition to the work covered by the four earlier running bills.
Thus A 4 claimed to have done 31,84,720 cft.
of rock cutting work and 98,200 cft.
of filling work.
On this bill, which bore the certificates of A 3 and A 4 was countersigned by Ramrao on December 30, 1961 and wherein it was falsely claimed by A 4 that the work was completed on August 11, 1966 although that date was also much beyond the stipulated date A 3 recorded the following note: 885 "The final bill amounts to Rs. 6,51,674/ and is in excess of work order amount by Rs. 52,084.
Since this excess is within 10% of the ordered amount, M.E. may kindly approve." Accordingly the papers were laid before A 1 who accorded the desired approval the moment the bill was laid before him and sent it for payment to the Accounts Officer ignoring the practice which required all such bills involving an excess of 10% over the sanctioned amount to be submitted to the Chairman for sanction.
On the bill coming before the Accounts Department for scrutiny, it pointed out that since the actual work exceeded the sanctioned amount by Rs. 52,084/ for which originally the approval of the Chairman was taken, the excess needed to be regularised by obtaining his sanction.
It was also pointed out that as the contractor had not completed the work within the stipulated time, the question of imposition of penalty also required to be considered.
On the pay order being returned to the Engineering Department, Ramrao, the then Deputy Engineering Manager, submitted the following reply vide Exhibit 59 dated January 12, 1967: "The work is now completed as required.
However to acquire the required level and gradient, the quantity of work has increased.
The party has now submitted their final bill for this work amounting to Rs. 6,51,674/ which is in excess by Rs. 52,084/ than the original amount of work order.
The excess is within 10% of the original estimate, M.D. is therefore requested to kindly approve the excess work done and to pass the final bill for Rs. 6,51,674/ .
As per the work order, the work was to be completed within 4 months (120 working days).
However, the Contractors could not complete this work including the disposal of the excavated stuff within this time limit due to the fact that there was no approach available to this plot.
The party has completed the work expeditiously, after the approach was given to them by M/s. Tatas.
M. D. is therefore, requested to consider this aspect and approve the time limit extension upto 11 8 1966, the date on which the party has completed the work." 886 On the matter coming back to the Finance Department, Shende (P.W. 16) pointed out that not only the quantities of rock cutting and filling work which were found as a result of the survey made between March 21 and 26, 1965 had been enormously inflated in the work order but the work claimed to have been done also exceeded the inflated figures mentioned in the work order.
He, therefore, suggested that the Department might agree to the payment of extra amount to A 4 subject to A 1 's obtaining the Board 's ratification.
Sometime before March 28, 1967, Krishnaswamy Rajam (P.W. 1), the Chief Internal Auditor, was summoned by the Managing Director and the General Manager and was asked to have a personal talk with A 3 in connection with the matter.
On P.W. 1 's questioning A 3 on March 28, 1967, the latter made confessional statement (Exh. 21) which is reproduced below for facility of reference: "Regarding rock cutting and filling at Trombay site I wish to bring to your kind attention the following: I was assigned to this job after the work was started at site by M/s N. N. Desai.
The original estimates for cutting and filling were 16,80,000 cft.
and 8,00,000 cft.
respectively.
It was later revised to 23,30,450 cft.
and 31,500 cft.
for cutting and filling.
I have got the workings for this revision with me at Ahmedabad.
(He refers to the genuine level statements and plans and worksheets Exs. 22 and 23 which were prepared by him under the directions of Varandani between 21st and 26th March, 1965).
Later on I was advised by my superiors to give a still further upward revision giving the quantities as 29,30,450 cft.
for cutting and 90,000 cft.
for filling.
The work sheets prepared by me and signed by contractor only (N. N. Desai) has no bearing to actual quantities involved.
I had merely acted as asked by my superiors in preparing worksheets accordingly which has resulted in this upward revision.
I have also given measurement certificates in this regard in line with the revised wrong quantities.
I realise now this has resulted in making excess payments to the contractor.
I beg to be excused for having done such a thing which was done solely at the instance of my superiors in Engineering Depart 887 ment.
E.M. (accused No. 1) and Dy.
E.M. are aware of this.
" Thereupon P.W. 1 put up the papers before the Managing Director and the General Manager who advised him to start investigation on particular lines.
During the course of the inquiry, A 2 told P.W. 1 that the work order which as far as he remembered was prepared by A 3 was cursorily signed by him due to heavy rush of work and that while checking the running bills submitted for payment, he normally checked the percentage of progress of work certified by the Assistant Engineer.
On further investigation made on April 1, 1967, A 3 produced the genuine level statement (Exh. 22) and the work sheet (Exh. 23) before P.W. 1 and told him that the substitution of the fabricated level statement and work sheet relating to rock cutting and filling at Trombay was done at the instance of Joshi, A 2 and A 1 and that they were aware of the same.
To the further question as to what was the basis for the work order for the figure of 29,00,000 cft.
of rock cutting and 90,000 cft.
of filling, A 3 told P.W. 1 that there was no basis for the work order and the quantities were fixed to suit sanctioned amount.
On a query being made by P.W. 1 from Ramrao regarding the final bill, he admitted that he had not personally checked the calculations and had counter signed the bill relying on the accuracy of the measurements shown in the bill which was prepared by A 3.
He further stated that he had not personally checked the calculations based on the final bill and initialled joint levels which according to him were normally done by the Assistant Engineer.
During the course of this inquiry, Murthy (P.W. 18) was deputed by A 1 and Krishnaswamy (P.W. 1) to go to the spot and find out the work which had actually been done.
Thereupon, Murthy (P.W. 18) submitted his interim report on April 6, 1967 pointing out that at only one place the level was 103.94 and elsewhere it remained much more.
By his final report (Exh. 44) dated April 20, 1967, Murthy (P.W. 18) pointed out that actually on the spot only 9,73,000 cft.
of rock cutting and 50,000 cft.
of filling had been done.
After recording the statements of A 2, A 3 and A 4, Krishnaswamy (P.W. 1) submitted a detailed report (Exh. 25) on April 8, 1967 to the Managing Director through the Financial Controller.
In his report, P.W. 1 also pointed out that contour plan/levels statement which in case of this nature are jointly signed by the contractor and the representative of the Engineering Department were not available in the instant case for inspection and that A 3 had produced a level statement alleged to have been processed by him and Varandani which was not signed by any body including A 3 's superiors.
P.W. 1 also 888 pointed out in the course of the report that the quantities of rock cutting and filling shown in the work order were 29,30,450 cft.
and 90,000 cft.
respectively and that there was an increase of 6,00,000 cft.
of rock cutting straightaway.
Krishnaswamy (P.W. 1) also mentioned in his report that according to A 3, the level statement giving the figure of 29,30,450 cft.
for cutting and 90,000 cft.
for filling had been signed by A 4.
On the report being put up before the then Financial Controller, he directed that before proceeding with the matter, it was necessary to call for the comments of A 1.
Thereupon after calling for a report from Ramrao, A 1 gave his comments vide Exhibit 178 dated April 17, 1967 wherein after doubting the competence and qualification of P.W. 1 to hold the investigation, he offered to send one of the senior engineers from Western Branch to carry out an independent survey to find out the quantity of work done by A 4 and suggested that measurements might be made by reference to the kacha level statement (Exh. 125), the work sheet (Exh. 126) and the contour plan (Exh. 34) which were checked by A 2 and approved by him and which must be with the department.
On April 18, 1967, A 1 sent for A 3 and questioned him in regard to the matter.
In the statement penned by A 3 himself, he stated that he changed the levels of drawing of Trombay plot regarding rock cutting and filling job at the instance of A 2 and KSJ (i.e. Joshi) but did not inform A 1.
On May 3, 1967, A 1 issued show cause notices to A 2 and A 3 with a view to hold departmental enquiry against them.
By his reply dated May 20, 1967 to the show cause notice, A 3 stated that he had changed the original contour plan at the instance of A 2.
On getting information on July 15, 1967 that A 4 was having some rock cutting done on the site although he had in his final bill claimed that he had fully completed the work on August 11, 1966, A 1 and A 2 visited the site along with Lakshmanan, the Operations Manager and finding that the work of rock cutting was still going on and that the claim of A 4 as certified by A 3 and countersigned by Ramrao about the work having been completed on August 11, 1966 was apparently false had the measurements of rock cutting and filling work taken by Ganapathy.
As the measurements taken by Ganpathy were on the basis of level plans prepared by Tatas in which the bench mark was 94.5 as against the bench mark of 100 for the survey in question, the Managing Director had the measurements taken by M/s R. L. Dalal & Co. The report of Dalal & Co. showed that the rock cutting work done was 9,60,000 cft.
and filling work was 1,96,000 cft.
889 On July 28, 1967, the Managing Director issued a charge sheet to A 1, A 2, A 3 and Ramrao.
In his reply (Exh.64) dated August 4, 1967 to the charge sheet, A 3 submitted that whatever he did was under the orders of A 1 and the Deputy Engineering Manager.
This time he did not mention A 2 to be responsible for anything done by him.
On the same day i.e. August 4, 1967, A 1 sent for A 3 in his cabin and questioned him in the presence of three other officers viz. Roy Chowdhary (P.W.2), who was the Deputy Financial Controller, Shriyan (P.W.23), the Assistant Engineer, and Vora, the Senior Engineer.
On this Occasion, A 3 allegedly made statement (Exh.43) absolving A 1 and throwing the entire responsibility on A 2.
While the three other officers and A 1 signed the statement (Exh.48) made by A 3, A 3 declined to sign it and fled away from the chamber on some excuse and rushed to the chamber of Krishnaswamy, Chief Internal Auditor whereupon Roy Chowdhary (P.W.2) also followed A 3 to the chamber of Krishnaswamy.
In the chamber of Krishnaswamy, A 3 resiled from the statement.
Having regard to the position adopted by A 3 in resiling from his earlier statement of that very day before A 1, Roy Chowdhary reminded him that in the morning in his presence, he had stated that it was A 2 who was responsible for asking him to change the drawing and increase the quantities.
To this question of Roy Chowdhary in the chamber of Krishnaswamy, A 3 replied in the negative and stated that A 1 called him and Joshi into his room and instructed him personally to increase the quantity.
When questioned by Roy Chowdhary as to why he did not come out with that truth in the room of A 1 in the presence of Roy Chowdhary, A 3 replied that he did not do so out of fear or A 1.
In his reply to the charge sheet, Ramrao inter alia stated that he signed the bill (Exh.56) relying on the certificate of A 3 who had been assigned to the job and added that according to the practice prevailing in the Corporation, Senior Engineers were not expected to verify the measurements.
Elaborating his explanation, he stated that just as Senior Engineer, Doraiswamy could not proceed to a BPI nor Senior Engineer Vora nor Senior Engineer Chari could proceed to an installation just to verify the billed quantities in view of the fact that there were a number of bills on each work order and so many work orders for each location.
Similarly in the Branches, Senior Engineers who were controlling the work for so many depots and installations were not expected to verify the quantities in each bill; that however, if there was a dispute with the contractor or there was some other reason to doubt the correctness of the Assistant Engineer 's certificate, the Senior 890 Engineer might either take measurements himself or get them taken by another Assistant Engineer; that subsequent to the counter signature by the Senior Engineer, the bill was passed on to the Engineering Bills Section where the bills were checked by the Accountant against sanctions, work order, rates and amounts, deductions for cement A.C. sheets or other materials supplied and security; deposit etc; that the Accountant prepared the pay order giving all these details for signature by a Senior Engineer as far as possible other than the countersigning Senior Engineer; that the bill then went to the Accounts Department where it was subjected to further detailed scrutiny before payment; that on December 30, 1966 Vaidya brought the bill for Rs.79, 674/ dated December 30, 1966 to him for counter signature; that it would have normally been put up to K. section Joshi but was brought to him as he was not available; that Vaidya was the Assistant Engineer who had handled that contract from the time of placing the work order; that the bill was for the work carried out by the Contractor subsequent to the previous 'on account bill ' 21 2 66 (nearly 10 months earlier) i.e. about 3.18 lakhs cft.
at Rs. 20/ per 100 cft.
of cutting and 18,200 cft.
of filling at Rs. 15/ per 100 cft; that he had visited Trombay number of times in connection with other works during the period commencing from August, 1966 and was aware that the Contractor had carried out approximately that much work during 1966; that the extra quantity required sanction of competent authority; that the previous bills passed showed that the major portion of the work was carried out during the period August to December, 1965 and about 7 lakhs CFT of cutting during December, 1965 to February, 1966; that A. section Krishnaswamy who placed the work order had countersigned bills upto 21 lakhs cft.
of cutting and 80,000 cft.
of filling as early as November 17, 1965 and subsequently K. section Joshi had countersigned a bill for an additional 7 lakhs cft.
of cutting and the contractor had already been paid Rs. 5.72 lakhs less security deposit; that he, therefore countersigned the bill dated December 30, 1966 and passed it on to M.E. for approval of the extra quantity of cutting; that M.E. approved on the same date and the bills was sent to Engineering Bills for scrutiny by the Accountant in respect of sanctions, work order terms etc; that he also particularly instructed that the bill should be shown to K. section Joshi before the pay order was issued since normally the bill should have gone to him for counter signature; that the Accountant carried out his instructions; that the counter signature did not denote final passing of a bill but only that it might be proceeded further and subjected to all the necessary administrative and financial checks before payment; that all the bills for the work had been certified by the Assistant Engineer incharge who was fully familiar with work and the previous bills had been counter 891 signed by colleagues of status equal to him; that he had no reasons to suspect any malpractice or mistakes and also there was no dispute with contractor; that he had exercise the normal technical checks which were the functions denoted by counter signature as per the prevailing practice and that countersignature did not imply correctness of the quantities certified by the Assistant Engineer (who alone was responsible for the correctness) in either the current or previous bills.
When the matter was thus pending, a confidential information reached Rege, the Deputy Superintendent of Police, C.B.I. (P.W. 27) who registered the case on December 27, 1967.
During the course of investigation, he visited the office of the Corporation, took charge of all the concerned documents, had the site measured by Shivashankar, Technical Examiner, Central Intelligence Service, (P.W.4) according to whom the cutting and filling work done by the contractor was to the extent of 9,61,000 cft.
and 1,50,000 cft.
respectively and after securing the requisite sanction, prosecuted A 1, A 2 and A 3 and also submitted the charge sheet against A 4 with the result that all the four accused were convicted.
In these appeals, we have had the advantage of hearing full dressed arguments of counsel on both sides who diligently prepared the case and put across their respective contentions with great ability.
We must point out at the outset that although the trial court had clearly acquitted A 1 of the charge under section 409 read with section 120 B and section 109 of the Indian Penal Code it unfortunately forgot to keep that fact in mind with the result that while concluding its judgment it held him guilty on that charge as well.
In the circumstances, it was not open to the High Court in the appeal by A 1 to go into that charge and reverse the findings arrived at by the trial court.
We will accordingly be concerned with the question of validity of A 1 's conviction under section 5(2) read with section 5(1)(d) of the Prevention of Corruption Act only but so far as A 2 is concerned, we will have to examine the validity of his conviction under all the charges.
Before examining the sufficiency or otherwise of the material bearing, on the charges against both the appellants, we consider it necessary to have a clear concept of the meaning and ambit of the phraseology "by corrupt or illegal means or by otherwise abusing his position as public servant" used in section 5(1)(d) of the Prevention of Corruption Act, 1947 (hereinafter referred to as 'the Act ') for the contravention of which the appellants have been convicted.
It will be advantageous in this connection to refer to two decisions rendered by this 892 Court in M. Narayanana Nambiar vs State of Kerala(1) and Major section K. Kale vs State of Maharashtra.(2) In the first case, Subba Rao, J. (as he then was) while construing clause (d) of sub section (1) of section 5 of the Act observed: "The pharaseology 'by otherwise abusing his position as public servant ' covers acts done otherwise than by corrupt or illegal means by an officer abusing his position.
The gist of the offence under this clause is that a public officer abusing his position as a public servant obtains for himself or for any other person any valuable thing or pecuniary advantage.
"Abuse" means misuse i.e. using his position for something for which it is not intended.
That abuse may be by corrupt or illegal means or otherwise than those means.
The word 'otherwise ' has wide connotation and if no limitation is placed on it the words 'corrupt ', 'illegal ' and 'otherwise ' mentioned in the clause become surplusage, for on that construction every abuse of position is gathered by the clause.
So some limitation will have to be put on that word and that limitation is that it takes colour from the preceding words along with which it appears in the clause, that is to say something savouring of dishonest act on his part.
The contention of the learned counsel that if the clause is widely construed even a recommendation made by a public servant for securing a job for another may come within the clause and that could not have been the intention of the Legislature.
But in our view such inocuous acts will not be covered by the said clause.
The juxtaposition of the word otherwise ' with the words "corrupt or illegal means" and the dishonesty implict in the word "abuse" indicate the necessity for a dishonest intention on his part to bring him within the meaning of the clause.
Whether he abused his position or not depends upon the facts of each case.
" Following the decision in M. Narayanan Nambiar vs State of Kerala (supra), it was held by this Court in Major section K. Kale vs State of Maharashtra (supra) that the abuse of a position in order to come within the mischief of the section must necessarily be dishonest so that it may be proved that the accused caused deliberate loss to the department.
It was further held in this case that it is for the prosecution to prove affirmatively that the accused by corrupt or illegal means or by abusing his position obtained any pecuniary advantage for some other 893 person.
It would, therefore, be necessary to find out in this case as to whether the accused abused their position and acted dishonestly or with a corrupt or oblique motive in having the contract in question entrusted to A 4.
As the courts below have rested their judgments on a constellation of circumstances, it would be well to bear in mind the fundamental rule relating to the proof of guilt based on circumstantial evidence which has been settled by a long line of decisions of this Court.
The rule is to the effect that in cases depending on circumstantial evidence, there is always the danger that conjecture or suspicion may take the place of legal proof.
In such cases the mind is apt to take a pleasure in adapting circumstances to one another, and even in straining them a little, if need be, to force them to form parts of one connected whole; and the more ingenious the mind of the individual, the more likely it is, considering such matters to cover reach and mislead itself, to supply some little link that is wanting, to take for granted some fact consistent with its previous theories and necessary to render them complete.
In cases where the evidence is of a circumstantial nature, the circumstances from which the conclusion of guilt is to be drawn should in the first instance be fully established, and all the facts so established should be consistent only with the hypotheisis of the guilt of the accused.
Again, the circumstances should be of a conclusive nature and they should be such as to exclude every hypothesis but the one proposed to be proved.
In other words, there must be a chain of evidence so far complete as not to leave any reasonable grounds for a conclusion consistent with the innocence of the accused and it must be such as to show that within all human probability the act must have been done by the accused.
(See Hanumant Govind Nargundkar vs State of M.P.,(1) Palvinder Kaur vs State of Punjab(2) and Charan Singh vs State of U.P.(3).
The principle that inculpatory fact must be inconsistent with the innocence of the accused and incapable of explanation on any other hypothesis than that of guilt does not mean that any extravagant hypothesis would be sufficient to sustain the principle, but that the hypothesis suggested must be reasonable.
(See Govinda Reddy vs State of Mysore(4).
894 Keeping in view the aforesaid construction placed on section 5(1)(d) of the Act and the principles with regard to proof of guilt based on circumstantial evidence, let us now turn to the various circumstances which have been relied upon by the High Court in holding the appellants guilty and see whether they factually exist and if so whether they are of such a character as to be wholly incompatible with the innocence of the appellants and consistent only with their guilt.
In so doing, we purpose to divide the aforesaid circumstances under the following broad heads and deal with them seriatim: 1.
The conduct of the appellants evidencing their keenness to have the contract entrusted to A 4. 2.
Issue of work order (Exh. 19) with inflated figures relating to rock cutting and filling.
Removal of statement of level plan (Exh. 22) and work sheet (Exh. 23) from the departmental file and fabrication and substitution in their place of the fabricated ones by A 3. 4.
Despatch on August 19, 1965 of spurious level plan (Exh. 24) and its copy (Exh. 38) by A 2 to A 4 as annexures to Exhibit 106.
Counter signing of the on running bills by A 2. 6.
The initialling of the final bill by A 1.
The first circumstance relied upon by the High Court in this behalf is that though the revised tender notice was limited to the eleven contractors who had originally submitted their tenders in response to the Tender Notice (Exh. 28), the appellants improperly got a tender form issued to A 4 and entertained by the Tender Committee.
It is true that the copies of Exhibit 15 on which the prosecution has sought to rely were sent by registered post to the eleven original tenderers by the Engineering Department of the Corporation but it cannot be overlooked that there is nothing in Exhibit 15 or elshhere on the record to indicate that other contractors were precluded from submitting their tenders or that the corrigendum extending the date for submission of the tenders was neither intended to be published nor was it actually published.
It seems that the attention of the High Court was not drawn to the communication (Exh. 29) dated March 9, 1965 addressed by Ranganath, Public Relations 895 Officer, to the Advertisement Manager, Times of India and others and the corrigendum forming annexure thereto which ran as under: " INDIAN OIL CORPORATION LIMITED (MARKETING DIVISION) Clarke Road, Mahalaxmi, Bombay 34, WB, India IN REPLY PLEASE REFER TO PR 31 317 9th March, 1965 To The Advertisement Manager, The Times of India, (Bombay) The Indian Express, (Bombay) Free Press Journal, (Bombay) Dear Sir, Subject: Tender No. 249/65 Corrigendum Attached is text of an advertisement for IMMEDIATE Publication utilising the minimum possible space under Public Notice/Tenders or in its appropriate place.
We would appreciate your treating this request as URGENT.
Thanking you.
Yours faithfully, Sd/ (B. V. Ranganath) Public Relations Officer Encl: One.
Engineering Manager, H.O. with reference to their inter office memo No Eng/ASK dated 9 3 1965.
We are trying to get it published on March 10.
INDIAN OIL CORPORATION LTD.
(MARKETING DIVISION) Corrigendum to Public Tender No. 249/65 The last date for receiving this Tender has been extended to 15th March, 1965 at 2 30 P.M. and will be opened the same day at The attention of the High Court also does not seem to have been invited to the above noted endorsement at the foot of Exhibit 29.
The High Court also seems to be wrong in thinking that out of the nine contractors who submitted their tenders in response to the revised tender notice, eight were from the original nine tenders and the ninth was A 4.
A comparison of the two lists viz. the one of the original tenders and the other of those contactors who submitted their tenders in response to the revised tender notice would make it clear that five contractors appearing in the second list were fresh tenderers.
The Financial Controller 's note (Exh. 17) dated April 2, 1965 which appears to be the outcome of some personal pique itself shows that it was only on April 15, 1965 that it was agreed between the members of the Tender Committee that the grant of the contract would be confined to one the of the three lowest tenderers, one of whom was A 4.
The fact that none of the eleven officers of the Finance and the Engineering Department of the Corporation who handled the file relating to the grant of the contract in question ever raised any objection regarding the improper reception or entertainment of A 4 's tender by the Engineering Department is a proof positive of the fact that there was nothing wrong about the issue of tender form to A 4 or its entertainment by the appellants.
Thus it is clear that the first circumstance relied upon by the High Court had no factual existence and could not be pressed into service against the appellants.
The next finding of the High Court that while Ram & Co. was best fitted for entrustment of the contract in question in view of the vast experience and equipment possessed by it, A 4 did not have any such merit.
It is a matter of common knowledge that rock cutting is not a specialised job and no extra ordinary skill or experience is required for the same and that every civil construction involves some sort of rock cutting.
It is also in evidence that A 4 who was the Corporation 's old and tried contractor had previously executed 98 works including the one on the An top Hill in Bombay for the Corporation to its entire satisfication, and out of the aforesaid works many related to installations which were more complicated than rock cutting and filling.
It would also be noticed that in the notes put up 897 by them neither Srivastava (P.W. 5) nor Shivananda, Superintendent, nor Khurana, Assistant Financial Controller of the Finance Department, nor the Operation Manager ever pointed out that A14 lacked the requisite experience or competence which disentitled him to the grant of the contract.
In fact Shivananda and Khurana had suggested as an alternative to inviting fresh tenders that A 4 should be asked to reduce his rates in view of the revised figures on account of which the value of the contract had gone up considerably.
It would also be noticed that the High Court while rightly holding that Exhibit 122 was not delivered to A 1 by Roshan Lal (P.W. 19) tell into an error in observing that A 1 had a hand in suppressing it.
It seems to have escaped its notice that at the negotiations conducted on April 17, 1965 with the three lowest tenderers viz. Ram and Co., Liberty and Co., and A 4 by the Tender Committee, of which P.W. 5 was a prominent member, Roshan Lal was present and while pressing his firm 's claim to the grant of the contract he did draw the attention of the members of the Committee to the contents of Ext.
122 sent earlier by his firm to the Corporation.
This is evident from Roshan Lal 's own admission that he informed the corporation in writing as to his experience in the line and whatever he had written he had also told the concerned officers who were two or there in number.
If A 1 would have had a hand in suppressing Ext.
122 he would not have allowed it is to remain on the file.
That apart a bare perusal of report Ext.
33 which is fairly detailed is enough to show that neither A 1 nor A 2 was interested in suppressing or distorting any material fact.
There was, therefore, hardly any justification for the observation in question.
The third finding of the High Court that the appellants told Vrindani (P.W. 20) and Vaidya (A 3) that it had already been decided to entrust the contract to A 4 and in order not to loose time, a joint survey should be made, is also erroneous.
It is unbelievable that A 1 and A 2 who were pre occupied with several projects would go and tell Vrindani who was three or four steps below them and was admittedly not a member of the conspiracy nor concerned with policy matters that it had been already decided to assign the contract to A 4.
The aforesaid briefing attributed to the appellants also seems to be incredible in view of the fact that it was only on the basis of the level measurements taken by P.W. 20 and A 3 during the survey made by them between March 20 and 26, 1965 that A 4 turned out to be the lowest tenderer and at the time when the briefing is alleged to have been given the lowest tender was of Ram & Co. 898 The insinuation implicit in the fourth finding of the High Court that Exts.
16, 17, 30 33 and 123 led to the inference that A 1 was the author and architect of the proposal for acceptance of A 4 's tender, is also unwarranted.
There is nothing in these documents which can be interpreted to indicate that the appellant was actuated by any ulterior or corrupt motive or that he was guilty of any mis demeanour, irregularity or impropriety.
On the contrary the said documents particularly Exts.
16 and 33, which like an open book fairly set out all the facts and circumstances bearing upon the allotment of the contract in question including the claim thereto of Ram & Co. not only manifest, that the procedure referred to by P.W. 1 in his deposition for inviting and finalizing the tenders was meticulously followed in the present case, but also establish A 1 's bona fides.
It has also to be borne in mind that the Tender Committee which comprised of the Operation Manager and the Financial Controller in addition to A 1 had only an advisory role to play and the decision to entrust the contract to a particular contractor lay with the Chairman of the Board of Directors in consultation with the coordinator and Sales Manager who was above the Tender Committee.
That the appellant 's proposal favouring A 4 was in the interest of the corporation both from the point of view of economy as well as speedy and satisfactory execution of work and was solely inspired by his concern to avoid the sad experience which the corporation had in respect of rock cutting work at An top hill with the Kore Brothers which was a new party is evident from the following endorsement made on A 33 by H. B. Patel, Operation Manager: "In view of the urgency and our past experience with a new party at An top hill, I agree to Senior Engineer 's proposal that we give the job to M/s. N. N. Desai at the lowest tendered rates.
" The fifth finding of the High Court that the appellants had negotiations on their own with A 4 with a sinister object is also against the weight of the material on the record.
The act of the appellants in trying to ascertain from A 4 whether he was prepared to reduce his rates to the level of M/s. Ram & Co. which seems to have been taken in consultation and agreement with P.W. 5 was, in our opinion, guiltless, It would be well to remember in this connection that Shrivastava P.W. 5 himself admitted in the course of his deposition that there was practice in their corporation of asking the second lowest tenderer to match his rates with the lowest tender.
The proposal about the allotment of work in favour of A 4 was, therefore, not only consistent with the practice but was also in the interest of the corporation.
899 In view of the foregoing we are inclined to think that the conduct of the appellants in prefering A 4 to any new contractor did not savour of dishonest intention.
Re. 2: Coming to the work order (Exh. 19) containing inflated figures which is the corner stone of the prosecution case, it may be pointed out that the prosecution has not been able to produce any evidence showing the circumstances under which it was prepared.
The observation od the High Court that the work order must be the creation of not only A 2 but of A 1 as well seems to be based upon mere conjecture.
It would be noticed that the work order does not bear the signatures of A 1 and there is nothing to show that in the normal course, the work order had to come to A 1 before being issued to A 4 We cannot also in this connection afford to lose sight of the observations made by the trial court at page 279 of the Paper Book that 'it is a common ground that accused No. 1 is not concerned with the making of the order and that it is also a common ground that a work order is issued by the Engineer Incharge '.
In these circumstances, it is difficult to understand how the High Court came to the conclusion that the work order (Exh. 19) was the creation of not only A 2 but of A 1 as well.
It seems that the finding of the High Court was influenced by its finding with regard to Exhibits 16 and 33.
In view, however, of our finding with regard to Exhibits 16 and 33, the observation of the High Court that the work order was also the creation of A 1 cannot be substained.
We will, accordingly advert to the material on the record with a view only to see how far it reflects on the bonafides of A 2.
The prosecution has not led any evidence to prove that A 2 dictated or prepared the work order.
The proven facts show that according to the normal practice prevalent in the department it is not the Senior Engineer like appellant No. 2 who is incharge of the Project that prepared a work order but an assistant or Junior Engineer in charge of the work working under him.
Although Varandani has in the course of his deposition tried to suggest that the work order was prepared by A 2, his suggestion cannot be relied upon in the face of Exhibit 67 wherein he told P.W. 1 that the work order was presumably prepared by Vaidya, A 3.
It is highly improbable that on the very day of the grant of the sanction of the contract in question A 2 would take the extremely hazardous step of inflating the figures to obtain undue advantage for A 4 specially when he knew that the fraud would be at once discovered by reference to the sanction which had been transmitted to the Finance Department.
The prosecution theory that the work order giving inflated figures was not only signed but was also prepared by A 2 is also negatived 900 by the following endorsement on the copy of the work order sent to the Bills and Accounts Sections of the Engineering Department of the Corporation: "The above has Chairman 's approval on our note of even reference dated 7th April, 1965.
Please have the agreement executed.
Earnest money of unsuccessful tenderers may be refunded early.
" The above quoted endorsement completely demolished the prosecution case.
If A 2 had been the author of Exhibit 19, or had suspected that his subordinate would have dared to inflate the quantities of the work, it is inconceivable that he would have made the above quoted insertion giving the particulars of the above mentioned note meant for the Chairman 's aproval in the copy of the work order addressed to the Bills and Accounts Sections which would have furnished a valuable clue for the speedy detection of the fraud that is alleged to have been perpetrated.
Again if A 2 were really a conspirator who had falsely inflated the figures of rock cutting and filling in the work order he would have seen to it that the potential documentary evidence embodied in Exhibit 125 which showed the genuine levels on the spot was destroyed or done away with.
The fact that he did not do anything of the kind raises a strong doubt about his culpability.
Thus though it cannot be gainsaid that A 2 has been extremely negligent in not scrutinising the papers, it seems to us that he affixed his signatures in a routine manner to the work order prepared by his subordinate engineer without realizing the importance of his act placing implicit faith in the integrity of the latter.
Re. 3: There is no clear, cogent and convincing evidence to show that A 1 or A 2 or both had a hand in the removal of the level plan (Exh. 22) or the work sheet (Exh. 23) from the departmental file relating to the contract in question and substitution in their place of the faked level plan (Exh. 24) and work sheet (Exh. 38) which were admittedly fabricated by A 3.
The statements made from time to time by A 3 in this behalf being contradictory and discrepant as would be evident from the following table: ____________________________________________________________ section Date No.of Text of the statement No the Exhi bit ____________________________________________________________ 1 28 3 1967 21 The Original estimates for cutting and filling were 16,80,000 cft.
and 8,00,000 cft.
respectively.
It was later revised 23,30,450 cft.
and 31,500 cft 901 ____________________________________________________________ section Date No.of Text of the statement No the Exhi bit ____________________________________________________________ for cutting and filing.
Later on I was advised by my superior in Engg.
Dept., E and Dy.
E.M. to give a still further upward revision giving the quantities as 29,30,450 cft.
for cutting and 90,000 cft.
for filling.
2 1 4 1967 36 ASK, KSJ and SPB asked me to substi tute SHS relating to rock cutting & filling at Trombay which was resulted in larger quantities of cutting and filling and they are fully aware of it.
3 18 4 1967 39 & 41 I told R. Krishnaswamy when he called me on 29 3 1967 that A.S. Krishnaswamy and K.S. Joshi told me to change the levels of drawings of Trombay plot regarding rock cutting/filling job .
In reply to the further query of R. Krishna swamy, I told him that I did not inform M.E. about this and that he might be knowing.
5 20 5 1967 69 In addition to the statement dated 18 4 1967, I have to submit that I was asked to change the original contour, place by A.S. Krishnaswamy, Senior Engineer.
6 4 8 1967 43 Sometime in September, 1965, A.S. Krishnaswamy told me to increase the levels at random and bring the quality to about 30 lakhs cft.
I did so accordingly.
7 4 8 1967 42 The Engineering Manager called me and Shri Joshi into his room one day and instructed me personally to increase the quantity.
____________________________________________________________ the prosecution ought to have made a serious attempt to produce K. section Joshi whose testimony was essential to clear up the mystery in which the whole affair is shrouded.
The non production of K. section Joshi who appears to have been one of the main actors in the drama has left a lacuna which is very difficult to bridge.
In the present state of evidence, it is inconceivable that A 1 who admittedly had a meritorious record of service, had won commendation from the Board of Directors for designing a tank and saving considerable sums of money and who was the only Head of Department to be given three advance increments for his integrity and efficient work and who had no are to grind would be a party to the unholy conspiracy for the removal of genuine level plan and work sheet and their substitution by spurious ones simply to obtain some pecuniary advantage for A 4 who was neither his friend nor relative.
The position of A 2 is also 902 not materially different as in his case also the prosecution has not been able to show that he derived any monetary gain out of the transaction.
Re. 4 : A bare perusal of statement contained in Exhibit 43 which according to H.N. Roy Chowdhary (P.W. 2) and C. L. Shriyan (P.W. 23) was voluntarily and without any pressure made by A 3 is enough to show that it was in September, 1965 that A 3 increased the levels shown in the original drawings and brought up the quantity of rock cutting to 30 lakhs cft.
This statement totally knocks the bottom out of the prosecution case that the spurious level plan and the work sheet were despatched to A 4 on August 19, 1965 as annexures to Exhibit 106.
If the spurious plan and the work sheet came into existence in September, 1965, it is difficult to understand how they could be despatched to A 4 alongwith Exhibit 106 on August 19, 1965.
The conclusion, therefore, is irresistible that when the communication (Exh. 106) was despatched to A 4, it was not accompanied by fabricated level plan (Exh. 24) and work sheet (Exh. 38) but by the genuine ones viz. Exhibits 22 and 23 and that it was later on that the genuine ones were removed and retained by A 3 who during the course of the enquiry by R. Krishnaswamy (P.W. 1) brought them from Ahmedabad and handed them over to P.W. 1.
The ommission on the part of Shriyan who claims to be certain that A 3 got the tracings Exhibits 24 and 38 prepared by him in April/May, 1965 to contradict A 3 when he made the aforesaid statement (Exh. 43) is also intriguing and lends assurance to the correctness of our conclusion.
5: The first thing to be borne in mind with regard to the measurement certificates on the running bills is that it is the Assistant Engineer incharge of the work who is responsible for taking measurements of the actual quantities of the work executed by the contractor for entering the same in the measurement book and for recording a certificate that the measurements given in the bill are of the actual work carried out on spot in accordance with the Department 's drawings and specifications.
It has also to be remembered that A 1 had to look after the Corporation 's projects and installations all over India and A 2 had to look after and supervise a large number of the Corporation 's projects under the Western Branch which included installations at Sabarmati, Ahmedabad, Okha and Kandla in Gujarat and Sewri, Wadala and Trombay in Maharashtra and parts of Madhya Pradesh.
It cannot also be ignored that according to Ganpati (D.W. 3) when a Senior Engineer visits the site, he determines the progress of the work by visual inspection determining visually the approximate 903 quantity of the work done.
All this apart, an examination of the running bills (Exhibits 51, 53, 54, 55 and 56) shows that all of them bear the certificates as referred to and reproduced at page 11 of this judgment.
It would be noted that whereas first three of these bills bear the counter signatures of A 2, Bill (Exh. 55) bears the countersignatures of K. section Joshi, Senior Engineer and Bill (Exh.
56) bears the counter signatures of Ramrao, another Senior Engineer, who was absolved in the departmental enquiry.
Now the fact that A 2 countersigned the first three bills does not appear to be material in view of the following statement made by Ramrao vide Exhibit 107: "I had no reason to doubt Shri Vaidya 's figures.
Countersignature of a bill as per our prevailing practice is not indicative of verification but only indicates that there is no reason to doubt the correctness of the figures.
" The fact that K. section Joshi, Senior Engineer, also countersigned the bill (Exh. 55) which contains inflated figures and no action was taken against him also lends assurance to the inference that the counter signatures were appended merely as a routine by the Senior Engineers who seem to have reposed blind and unflinching faith on the honesty of their subordinates.
Now if Ramrao who countersigned the bill (Exh. 56) showing the quantity of cutting work as 31 lakhs cft.
was exonerated in the departmental enquiry and no action was taken against K. section Joshi who made the wrong endorsement in respect of the measurement on Exhibit 55 or against Vora who had prepared the note (Exh. 58) showing that the work had been completed, it is difficult to understand how A 2 could be treated differently and criminal intention attributed to him.
The finding of the High Court in respect of the third running bill (Exh. 54) that the very defence of A 2 would itself furnish the best evidence of the conspiracy involving A 1 is not correct for apart from other infirmities from which if suffer, it is well settled that the defence taken by one accused cannot in law be treated as evidence against his co accused.
Re. 6 : The finding of the High Court that A 1 signed the bill (Exh. 56) and sanctioned excess amount involved knowing full well that the bill was not true is also against weight of the evidence on the record.
It cannot in the first instance be forgotten that it was on July 29, 1965 that A 1 could have had occasion to see the figures of the work for which sanction was granted by the Chairman of the Board of Directors and the bill (Exh. 56) was put up to him on 904 December 30, 1967.
In the absence of the sanction from which the genuine figures could have been gleaned, it would not be reasonable to expect A 1 to remember the sanctioned figures after the lapse of 17 months specially when it is admitted on all hands that being the head of the Engineering Department, he had to tour extensively to supervise several projects spread all over the country and to discharge multifarious duties in connection therewith.
The bill, it would be noted was prepared by A 3 and was countersigned by no less a functionary than the Deputy Engineering Manager, Ramrao, who was next below A 1 in the hierarchy of the Department.
In the note prepared by him, it was not pointed out by A 3 that the bill had to go to the Managing Director.
The evidence in the case also shows that A 1 was not expected to meticulously scrutinize the bill but was concerned only with the initialling of the note which although it had passed through several hands did not indicate that the competent authority to grant sanction for the excess amount was the Chairman of the Board of Directors.
It will also be wrong to hold A 1 responsible for simply initialling the note contained in Exhibit 56 without examining Ramrao who approved the bill including the note and also countersigned the measurement certificate before it came to A 1.
In the circumstances, the mere initialling by A 1 of the bill alongside the note marked for him by A 2 is, therefore not a circumstance which can unmistakably be said to point to the guilt of the appellant.
An analysis of the circumstantial evidence adduced by the prosecution does not in our opinion lead to an unerring certainty that A 1 and A 2 acted with any dishonest or corrupt motive or abused their position.
In conclusion we cannot help observing that non examination by the prosecution of Ramrao, Joshi, Vora and Patel who were material witnesses for the unfolding of its case has left some yawning gaps in the evidence which we have found very difficult to bridge.
If these persons had been produce many of the points which have remained obscure and hidden up would have been cleared up.
For the foregoing reasons, we allow the appeals, set aside the convictions of the appellants and the sentences imposed upon them and acquit them of the offences with which they were charged.
P.B.R. Appeals allowed.
| IN-Abs | Both the appellants were officers of Indian Oil Corporation.
The Corporation invited tenders from experienced contractors for rock cutting, filling and levelling of certain land acquired by it.
On the notified date it opened the tenders received from eleven contractors.
But in the meantime since it made a change in the specification of work to be done it asked the tenderers to submit revised tender.
The direction to submit fresh tenders was restricted only to the original 11 tenderers.
Even so it was alleged that a tender form was issued by the appellants to A 4, who was not one of the 11 tenderers.
there was again a change in the specification of the work to be done at the suggestion of foreign collaborators.
The appellants were alleged to have asked the concerned officers of the Corporation to make a fresh survey along with A 4, keeping in view the suggestion of the foreign collaborators.
Eventually the contract was given to A 4.
The prosecution alleged that (1) the conduct of the appellants showed their keenness to have the contract entrusted to A 4.
(2) the issue of work order was inflated with figures relating to rock cutting and filling; and (3) the appellants removed certain original documents from the departmental files and substituted in their place fabricated material.
The appellants who were charged with offences under section 120B and section 109 IPC and section 5(2) read with section 5(1)(d) of the Prevention of Corruption Act, 1947 were convicted and sentenced to undergo imprisonment.
On the question whether the appellants had been rightly convicted under section 5(1)(d) of the Prevention of Corruption Act.
Allowing the appeals, ^ HELD: 1.
An analysis of the circumstantial evidence adduced by the prosecution did not lead to the unerring certainty that the appellants acted with any dishonest or corrupt motive or abused their position.
[904 F] 2.
(a) It is well settled that abuse of position, in order to come within the mischief of section 5(1)(d) of the Act, must necessarily be dishonest so that it may be proved that the accused caused deliberate loss to the department.
Further it is for the prosecution to prove affirmatively that the accused, by corrupt or illegal means or by abusing his position, obtained any pecuniary advantage for some other person.
[892 G; 893 A].
(b) Again, the fundamental rule relating to the proof of guilt based on circumstantial evidence is that there is always danger that conjecture or suspicion might take the place of legal proof.
In such cases the mind is apt to take a pleasure in adapting circumstances to one another and even in straining them a 876 little, if need be to force them to form parts of one connected whole and the more ingenious the mind of the individual the more likely it is, in considering such matters, to over reach and mislead itself to supply some little link that is wanting, to take for granted some fact consistent with its previous theories and necessary to render them complete.
[893 B D].
(c) In cases where the evidence is of a circumstantial nature, the circumstances from which the conclusion of guilt is to be drawn should in the first instance be fully established, and all the facts so established should be consistent only with the hypothesis of the guilt of the accused.
Again, the circumstances should be of a conclusive nature and should be such as to exclude every hypothesis but the one proposed to be proved.
In other words there must be a chain of evidence so far complete as not to give any reasonable ground for a conclusion consistent with the innocence of the accused and it must be such as to show that within all human probability the act must have been done by the accused.
[893 D F].
M. Narayanana Nambiar vs State of Kerala, [1963] Supp.
2 SCR 724; Major section K. Kale vs State of Maharashtra, ; ; Hanumant Govind Nergundkar vs State of M.P., [1952] SCR 1091, AIR 1952 SC 343; Palvinder Kaur vs State of Punjab, ; ; Charan Singh vs State of U.P., AIR 1967 SC 529; referred to.
(d) The principle that inculpatory fact must be inconsistent with the innocence of the accused and incapable of explanation on any other hypothesis than that of guilt does not mean that any extravagant hypothesis would be sufficient to sustain the principle, but that the hypothesis suggested must be reasonable.
[893 G].
Govinda Reddy vs State of Mysore, AIR 1960 SC 29; referred to.
In the instant case the conduct of the appellants in preferring A 4 to any new contractor did not savour of dishonest intentions on their part.
Although the notice was sent by registered post to the 11 original tenderers there is nothing in that notice or elsewhere on the record to indicate that other contractors were precluded from submitting their tenders or that the corrigendum extending the date for submission of the tenders was neither intended to be published nor was it actually published.
The High Court had missed this fact.
The High Court was also wrong in thinking that out of the nine contractors who submitted their revised tenders eight were from the original nine tenderers and the ninth was A 4.
In fact five of the contractors that submitted the fresh tenders were fresh tenderers.
Moreover none of the officers of the Finance and Engineering Department of the Corporation who handled the file relating to the grant of contract ever raised any objection regarding the improper reception or entertainment of A 4 's tender.
This showed that there was nothing wrong about the issue of tender Form to A 4 or its entertainment by the appellants.
The contract in question was not a specialised job requiring any extra ordinary skill.
A 4 was the Corporation 's old and tried contractor who had previously executed a number of works including rock cutting.
(2) Though it cannot be gainsaid that the second appellant had been extremely negligent in not scrutinising the papers, he affixed his signature in a routine manner to the work order prepared by his subordinates without realising 877 the importance of his act, placing implicit faith in the integrity of the latter.
[900 E F] (3) There is no clear, cogent and convincing evidence to show that the appellants had a hand in the removal of the level plans from the departmental file relating to the contract and substitution of the faked plans.
[900 G].
|
N: Criminal Appeal Nos.
373 374 of 1978.
Appeals by Special Leave from the Judgment and Orders dated 10 1 1978 and 14 9 1978 of the Delhi High Court in Criminal Misc.
(M) No. 323 and 322/77 and Criminal Misc.
1083, 1149 of 1978 in Special Misc.
(M) No. 322/77.
Ram Jethmalani (In Crl. A.373), A. K. Sen (In Crl. A.374) and Harjinder Singh for the Appellants.
U. R. Lalit and R. N. Sachthey for the Respondent.
The Judgment of the Court was delivered by CHINNAPPA REDDY, J.
On the intervening night of 31st March 1967 and Ist April 1967, two sandstone pillars of great antiquity, beauty and value were stolen from Suraj Kund temple, in Village Amin (District Karnal, Haryana).
They were of the Sunga period (2nd Century B.C.) and their present estimated value in the International Art Treasures ' Market is said to be around five hundred thousand American dollars.
A first information report (F.I.R. No. 72 of 1967) was registered by the Police of Butana, District Karnal.
The pillars were recovered on 2nd May 1967.
On completion of investigation a charge sheet was filed on 3rd October 1967 in the Court of the Ilaqa Magistrate at Karnal, against one Bali Ram Sharma and two others.
3 119 SCI/79 928 The case ended in their acquittal on 16th July 1968.
During the pendency of the case one Narinder Nath Malik (N. N. Malik) filed an application before the Magistrate alleging that he was a research scholar and requesting that he might be given custody of the two pillars to enable him to make a detailed study.
At the instance of H. L. Mehra, the then Chief Judicial Magistrate, Karnal and a friend of N. N. Malik, the learned Ilaqa Magistrate gave custody of the two pillars to N. N. Malik on his executing a personal bond in a sum of Rs. 20,000/ .
The order was written by H. L. Mehra himself and signed by the Ilaqa Magistrate.
The pillars remained in the custody of N. N. Malik from Ist March 1968 to 27th May 1968, when N. N. Malik purported to return them to the Court of the Ilaqa Magistrate, Karnal.
After the acquittal of Bali Ram Sharma and others, the pillars were handed over to the Lambardar of village Amin.
Later, it came to light that the pillars returned by N. N. Malik were not the original pillars but fakes.
Thereupon, First Information Report No. RC.2/71 CIA/SPE/CBI was registered at Delhi against N. N. Malik and H. L. Mehra under Section 120 B read with Sections 406 and 420 Indian Penal Code.
After completing the investigation the C.B.I. filed a charge sheet No. R.C. 2 of 1971 in the Court of Special Magistrate, Ambala, against N. N. Malik and H. L. Mehra for alleged offences under Section 120 B read with Sections 406 and 420 Indian Penal Code.
The charge sheet was filed on 30th December, 1972.
On 17th May, 1976, the learned Special Magistrate, Ambala, passed an order directing the framing of charges against N. N. Malik and H. L. Mehra.
But, no charges were actually framed as the accused were not present in the Court.
On 17th April, 1977, the Public Prosecutor filed an application under Section 494 Criminal Procedure Code for permission to withdraw the case against Malik and Mehra.
The learned Special Magistrate, Ambala, by his order dated 16th May 1977, permitted the withdrawal of the case and discharged the accused.
Between May 1976 and May 1977 several other things happened and the Narang brothers, the appellants in the two appeals, made their appearance on the scene.
It may be mentioned here, that of the three Narang brothers, Om Prakash alias Omi Narang had been living in London since 1970, Manohar Lal alias Manu Narang had been similarly living in London since July 1974 and Ram Lal Narang alone had been living in India.
Ram Lal Narang was detained first under the MISA from September 1974 till he was released under orders of the High Court, and later, under the COFEPOSA from 1st July 1975 till after the revocation of the internal Emergency in March 1977.
929 The two genuine pillars which had been removed from Suraj Kund temple were traced and found in London in the warehouse of Messrs Spink & Co. It was suspected that Manoharlal Narang and Ramlal Narang had engaged Balkishan Rawal and Nathubhai Rawal of Delhi to make three sets of fakes and had exported the genuine pillars to London.
A First Information Report (R.C. 4/76 CIU(A)/SPE) was registered by the Superintendent of Police, CIU (Antiquities, SPE/CBI, New Delhi) against Manohar Lal Narang and others, for alleged offences under Section 120 B Indian Penal Code read with Section 411 Indian Penal Code and Section 25(1) of the , On 26th June, 1976, N. N. Malik made and application before the Chief Metropolitan Magistrate, Delhi, in case R.C. No. 4/76 CIU(A)/SPE, New Delhi, purporting to be under Section 306 of the Code of Criminal Procedure, 1973, praying that he might be granted pardon.
The application mentioned Sections 411, 406 and 420 Indian Penal Code read with Section 120 B and Section 25(1) of the , as the offences involved.
The application was supported by the reply filed by the Superintendent of Police, C.B.I. On 3rd July 1976, the Chief Metropolitan Magistrate, Delhi, granted pardon to N. N. Malik.
Before the grant of pardon the confessional statement of N. N. Malik was got recorded by the Metropolitan Magistrate, Delhi.
Thereafter, on 19th July 1976, a charge sheet (R.C. 4/1976) was filed in the Court of Chief Judicial Magistrate, Delhi, for offences under Section 120 B Indian Penal Code read with Sections 420, 411 and 406 Indian Penal Code and Section 25 of the .
The case was transferred to the Court of the Additional Chief Metropolitan Magistrate.
On 20th July 1976, the Additional Metropolitan Magistrate issued process for the appearance of the three Narang brothers.
The learned Magistrate also issued warrants for the extradition of Omi Narang and Manu Narang who were in London.
Extradition proceedings were initiated in Britain at the instance of the Government of India.
The Metropolitan Magistrate, Bow Street, London ordered the detention of Omi Narang and Manu Narang pending the issue of warrants by the Secretary of State under Section 5 of the Fugitive Offenders Act.
A petition for the issue of Writ of Habeas Corpus Ad Subjiciendum was filed in the High Court of Justice, Queen 's Bench Division, London.
The Divisional Court directed the release of Omi Narang and Manu Narang.
The Government of India filed an appeal to the House of Lords and on 24th March, 1977, the appeal was allowed.
Omi Narang and Manu Narang were finally extradited and brought to India on 27th July, 1977.
930 Meanwhile internal emergency was lifted in India in March 1977 and Ram Lal Narang was released.
Almost immediately he filed a petition before the Additional Metropolitan Magistrate to drop the proceedings against him, to cancel the extradition warrants and to discharge the accused.
The contention was that the entire investigation in First Information Report No. R.C. 4/76 was illegal as a case on the same facts was already pending before the Ambala Court and that the Delhi Court acted without jurisdiction in taking cognizance of the case pursuant to a report of police based upon such illegal investigation.
The learned Magistrate held that he was not competent to sit in judgment, as it were, over the order of his predecessor taking cognizance of the case.
He, however, found that the conspiracy which was the subject matter of the case before the Court at Ambala and the conspiracy which was the subject matter of the case before himself were one and the same, but, he held that the question as to which Court should proceed with the case, was not for him to decide; it was a matter for the High Court to decide under Section 186 Criminal Procedure Code.
The learned Magistrate also noticed an application filed before him, after the conclusion of arguments, informing him that the case in the Court at Ambala against Malik and Mehra had since been withdrawn on 16th May 1977.
On 21st June 1977, two applications were filed in the Delhi High Court under Section 482 Criminal Procedure Code, one by Ramlal Narang and the other on behalf of Omi Narang and Manu Narang who were still in England awaiting extradition.
The applicants sought quashing of the orders of the learned Metropolitan Magistrate issuing process to them and warrants for the extradition of Omi Narang and Manu Narang.
It was also sought to be declared that the entire investigation in R.C. 4 of 1976 was illegal and the orders of the Chief Metropolitan Magistrate and the Additional Metropolitan Magistrate taking cognizance of R.C. 4 of 1976 were illegal.
The grant of pardon to N. N. Malik was questioned.
It was also prayed that the proceedings before the Metropolitan Magistrate might be quashed.
The petitions were admitted by the Delhi High Court on 22nd June, 1977, but ultimately dismissed on 10th January 1978, by a common judgment.
Ramlal Narang having obtained special leave from this Court has filed Criminal Appeal No. 373 of 1978 and Omi and Manu Narang have preferred Criminal Appeal No. 374 of 1978.
We may mention here that on 1st August, 1977, a supplemental charge sheet was filed making Mehra an accused in the Delhi case, the case in the Ambala Court having been withdrawn on 16th May, 1977, as mentioned earlier.
Malik, we may add, died sometime during August, 1977.
931 We are given to understand that Mehra also was subsequently granted pardon.
Shri Harjinder Singh, learned Counsel for the appellant in Criminal Appeal No. 373 of 1978 and Shri Ashok Sen, learned Counsel for the appellants in Criminal Appeal No. 374 of 1978 argued that the conspiracy and the overt acts which were the subject matter of the two First Information Reports and the two charge sheets were the same and, therefore, there was an implied bar to the power of the Police to investigate into First Information Report No. R.C. 4 of 1976 and the power of the Court at Delhi to take cognizance of the case upon the report of such information.
It was submitted that the mere circumstance that some more persons were mentioned as involved or the mere circumstance that the property was said to have been recovered later would not affect the legal position.
It was submitted that gist of the conspiracy in both the cases was to obtain possession of the pillars.
The offence of conspiracy relating to the obtaining of the pillars having been investigated and a charge sheet having been filed in the Ambala Court, the Police had no authority in law to start a fresh investigation under the Criminal Procedure Code by registering another First Information Report and to submit a charge sheet in the Delhi Court for the very same offence.
That was an unwarranted interference by the Police with the proceedings pending in the Court.
The whole of the investigation subsequent to the filing of the charge sheet in the Ambala Court was without jurisdiction and no material or fact gathered during the course of such illegal investigation could be used to found further proceedings.
The Delhi Court was, therefore, in error in taking cognizance of offences which had already been investigated and which were the subject matter of proceedings in another Court.
It was also argued that the subsequent withdrawal of the case from the Ambala Court did not and could not confer jurisdiction on the Delhi Court.
The withdrawal itself was an abuse of the process of the Court.
Shri Lalit, learned Counsel for the respondents urged that the conspiracy which was the subject matter of the charge sheet filed in the Delhi Court was not the same as the conspiracy which was the subject matter of the charge sheet filed in the Ambala Court.
The circumstance that some of the conspirators were common and part of the case was the same did not make the two conspiracies identical with each other.
There was, therefore, no question of any bar against the Delhi Court from taking cognizance of the case based upon the wider conspiracy merely because the Ambala Court had taken cognizance of the case based upon the narrower conspiracy.
Shri Lalit also urged that the statutory right of the Police to investigate into cognizable 932 offences was not fettered and did not end with the submission of a charge sheet to the Court.
He submitted that the Police had the right and indeed, the duty, to investigate into fresh facts coming to light and to appraise the Court of the same.
The basic submission on behalf of the appellants was that the two conspiracies alleged in the two cases were but one.
The sequitur was that the investigation into and the taking of cognizance of the second case were without jurisdiction.
We will first examine the question whether the conspiracy which was investigated by the Police and which investigation led to the filing of the charge sheet in the Ambala case can be said to be the same as the conspiracy which was later investigated and which led to the filing of the charge sheet in the Delhi Court.
For this purpose, it is necessary to compare the First Information Report and the charge sheet in the two cases.
The First Information Report relating to the case in the Ambala Court was registered against "N. N. Malik and others" for alleged offences under "Section 120 B Indian Penal Code read with Section 420 and Section 406 Indian Penal Code.
" It was stated therein that N. N. Malik applied to the Court of the Judicial Magistrate 1st Class, Karnal and obtained possession of the two stone pillars and dishonestly substituted two fake pillars in their place and returned them to the Court.
The charge sheet which was filed on 30th December, 1972 mentioned N. N. Malik and H. L. Mehra as the two accused in the case and recited that N. N. Malik was introduced by Mehra to the Magistrate as an eminent archaeologist and that he obtained possession of the pillars on the pretext that he wanted to make some research.
The actual order granting custody of the pillars to Malik was written by Mehra but signed by the Magistrate R. K. Sen.
It was further recited that sometime after the pillars were returned by Malik to the Court it was discovered that the pillars so returned were fakes and that N. N. Malik was not an archaeologist.
It was finally said that Malik and Mehra had "thus dishonestly made misrepresentation of fact and got the delivery of the two statues which were subsequently substituted by them" and they had "thus committed the offence under Section 120 B read with Section 420 Indian Penal Code and Section 406 Indian Penal Code.
" It is, therefore, seen from the allegations in the charge sheet filed in the Ambala Court that the conspirators involved in the conspiracy which was its subject matter were two, namely, Malik and Mehra, that the object of the conspiracy was to dishonestly obtain possession of the pillars by making false representation to the Magistrate and to substitute the pillars by fakes after 933 obtaining possession of the same and that the offences committed were under Section 120 B read with Section 420 and 406 Indian Penal Code.
The First Information Report in the Delhi case was registered on 13th May, 1976, and the offences mentioned were Section 120 B Indian Penal Code read with Section 411 Indian Penal Code and Section 25(1) of the .
The accused mentioned in the report were Manu Narang and Ramlal Narang.
After reciting that the pillars had been taken from the Court by N. N. Malik and had been substituted by fake pillars, the First Information Report went on to recite that the genuine pillars, which were stolen from Suraj Kund temple as mentioned above were found to be in the possession and control of Manohar Lal alias Manu Narang in London.
It was further recited that Manu Narang was negotiating the sale of the pillars through some London brokers and the price expected to be fetched was approximately five hundred American dollars.
It was recited further that Manu Narang and his brother Ramlal Narang had commissioned two well known sculptors of Delhi to make three sets of fake pillars.
The two brothers and others, acting in conspiracy, had dishonestly received and exported the two stone pillars.
The charge sheet which followed the investigation was filed on 19th July 1976 in the Delhi Court.
The charge sheet mentioned the three Narang brothers, Ramlal Narang, Manoharlal Narang and Om Parkash Narang, as the three accused persons sent up for trial and H. L. Mehra as a person not sent up for trial as he was already facing trial before the Special Magistrate, Ambala.
The charge sheet recited, among other facts, that the Narang brothers had come to know in or about the month of February 1978 about the invaluable nature of the pillars and devised a stratagem to get the custody of the pillars.
They discussed their stratagem with their family friend N. N. Malik, informing him that the pillars were worth a fortune.
Ramlal Narang and Malik met Mehra and it was decided that Malik should file an application for temporary custody of the pillars and that Mehra should wield his influence over the Magistrate to help N. N. Malik to get such temporary custody.
That was done.
Temporary custody of the pillars was obtained and they were removed to Delhi in a truck at the instance of the Narang brothers to a place in Defence Colony, New Delhi.
Replicas of the pillars were made by Balkrishan Rawal and Natwarlal, two eminent sculptors of Delhi under the supervision of Ramlal Narang and Omi Narang.
Manu Narang also used to visit Delhi and check the progress made.
The original pillars were transported to Bombay by Manu Narang and smuggled out of the country.
934 Fake pillars were substituted and returned by N. N. Malik to the Court.
Later on, suspicion was created by the discovery of two fake pillars which were also attempted to be smuggled out of the country.
The two pillars returned by N. N. Malik were then got examined by experts and were found to be fakes.
Malik was presented by the Narang brothers with a Fiat car, a revolving brass bed and a sum of Rs. 70,000/ .
They also paid for two pleasure trips made by Malik and his wife to Bombay.
It was recited in the charge sheet that the facts disclosed "the commission of offences under Section 406 (criminal breach of trust), Section 411 (receiving and retaining stolen property), Section 420 (cheating) Indian Penal Code and Section 25(1) of the , all read with Section 120 B Indian Penal Code, in pursuance of criminal conspiracy to which Manoharlal Narang, Ramlal Narang and Om Prakash Narang, H. L. Mehra and N. N. Malik (already granted pardon) were parties.
" It was further recited "Manoharlal Narang, Ramlal Narang and Omi Narang also abetted the commission of offences under Section 420 and Section 406 Indian Penal Code by N. N. Malik approver and these three accused were, therefore, liable for prosecution under Section 406 and Section 420 Indian Penal Code read with Section 109 Indian Penal Code and they had also committed other offences under Section 411 Indian Penal Code.
" It was further mentioned in the charge sheet that Manoharlal Narang and Omi Narang were in London and that proceedings for their extradition were under way.
It was also mentioned that H. L. Mehra was facing trial before the Special Magistrate, Ambala, for the offences committed by him and, therefore, he was nor being sent up for trial in this case.
It is obvious that neither at the time when the First Information Report pertaining to the Ambala case was registered nor at the time when the charge sheet was filed in the Ambala Court, were the Narang brothers known to be in the picture.
The investigating agency was not also aware of what Malik and Mehra had done with the pillars after they had obtained possession of the pillars from the Court and substituted and returned fake pillars to the Court.
The First Information Report and the charge sheet were concerned primarily with the offences of conspiracy to cheat and to misappropriate committed by Malik and Mehra.
At that stage, the investigating agency was not aware of any conspiracy to send the pillars out of the country.
It was not known that the Narang brothers were also parties to the conspiracy to obtain possession of the pillars from the Court.
It was much later that the pillars surfaced in London and were discovered to be in the constructive possession of Narang brothers.
Even then, the precise connection between Malik and Mehra on the one side and 935 Narang brothers on the other was not known.
All that was known was that the pillars which were stolen property within the definition of the expression in Section 410 Indian Penal Code were found to be in the possession of Narang brothers in London.
On the discovery of the genuine pillars in the possession of Narang brothers, without anything further to connect Narang brothers with Malik and Mehra, the police had no option but to register a case under Section 411 Indian Penal Code against Narang brothers.
That was what was done.
No fault could, therefore, be found with the police for registering a First Information Report against the Narang brothers for the offence of conspiracy to commit an offence under Section 411 Indian Penal Code.
In the course of the investigation into this offence, it transpired that the Narang brothers were also parties to the original conspiracy to obtain possession of the pillars from the Court by cheating.
Facts came to light which indicated that the conspiracy, which was the subject matter of the case pending in the Ambala Court was but part of a larger conspiracy.
The fresh facts which came to light resulted in the filing of the second charge sheet.
The several facts and circumstances mentioned by us earlier and a comparison of the two First Information Reports and the two charge sheets show that the conspiracy which was the subject matter of the second case could not be said to be identical with the conspiracy which was the subject matter of the first case.
The conspirators were different.
Malik and Mehra alone were stated to be the conspirators in the first case, while the three Narang brothers were alleged to be the principal conspirators in the second case.
The objects of the two conspiracies were different.
The alleged object of the first conspiracy was to obtain possession of the pillars from the Court by cheating and to misappropriate them.
The alleged object of the second conspiracy was the disposal of the stolen property by exporting the pillars to London.
The offences alleged in the first case was Section 120 B read with Section 420 and Section 406 Indian Penal Code, while the offences alleged in the second case were Section 120 B read with Section 411 Indian Penal Code and Section 25 of the .
It is true that the had not yet come into force on the date when the First Information Report was registered.
It is also true that Omi Narang and Manu Narang were not extradited for the offence under the and, therefore, they could not be tried for that offence in India.
But the question whether any of the accused may be tried for a contravention of the or under the corresponding provision of the earlier Act is really irrelevant in deciding whether the two 936 conspiracies are one and the same.
The trite argument that a Court takes cognizance of offences and not offenders was also advanced.
This argument is again of no relevance in determining the question whether the two conspiracies which were taken cognizance of by the Ambala and the Delhi Courts were the same in substance.
The question is not whether the nature and character of the conspiracy has changed by the mere inclusion of a few more conspirators as accused or by the addition of one more among the objects of the conspiracy.
The question is whether the two conspiracies are in substance and truth the same.
Where the conspiracy discovered later is found to cover a much larger canvas with broader ramifications, it cannot be equated with the earlier conspiracy which covered a smaller field of narrower dimensions.
We are clear, in the present case, that the conspiracies which are the subject matter of the two cases cannot be said to be identical though the conspiracy which is the subject matter of the first case may, perhaps, be said to have turned out to be part of the conspiracy which is the subject matter of the second case.
As we mentioned earlier, when investigation commenced in First Information Report No. R.C. 4 of 1976, apart from the circumstance that the property involved was the same; the link between the conspiracy to cheat and to misappropriate and the conspiracy to dispose of the stolen property was not known.
The further connected questions arising for consideration are, what was the duty of the police on discovering that the conspiracy, which was the subject matter of the earlier case, was part of a larger conspiracy, whether the police acted without jurisdiction in investigating or in continuing to investigate into the case and whether the Delhi Court acted illegally in taking cognizance of the case ? In order to answer these questions, it is necessary to refer to the relevant provisions of the Criminal Procedure Code.
Counsel on both sides argued the questions on the basis that the Old Criminal Procedure Code governed the situation.
We proceed on that assumption without deciding whether the trial in the Delhi Court will be governed by the old Code or the new one.
Under the Criminal Procedure Code, 1898, whenever an officer in charge of the Police Station received information relating to the commission of a cognizable offence, he was required to enter the substance thereof in a book kept by him, for that purpose, in the prescribed form (Section 154 Criminal Procdure Code).
Section 156 Criminal Procedure Code invested the Police with the power to investigate into 937 cognizable offences without the order of a Court.
If, from the information received or otherwise, the officer in charge of a Police Station suspected the commission of a cognizable offence, he was required to send forthwith a report of the same to a Magistrate empowered to take cognizance of such offence upon a police report and than to proceed in person or depute one of his subordinate officers to proceed to the spot, to investigate the facts and circumstances of the case and to take measures for the discovery and arrest of the offender (Section 157 Criminal Procedure Code).
He was required to complete the investigation without unnecessary delay, and, as soon as it was completed, to forward to a Magistrate empowered to take cognizance of the offence upon a police report, a report in the prescribed form, setting forth the names of the parties, the nature of the information and the names of the persons who appeared to be acquainted with the circumstances of the case (Section 173(1) Criminal Procedure Code).
He was also required to state whether the accused had been forwarded in custody or had been released on bail.
Upon receipt of the report submitted under Section 173(1) Criminal Procedure Code by the officer incharge of the Police Station, the Magistrate empowered to take cognizance of an offence upon a police report might take cognizance of the offence (Section 190(1) (b) Criminal Procedure Code).
Thereafter, if, in the opinion of the Magistrate taking cognizance of the offence, there was sufficient ground for proceeding, the Magistrate was required to issue the necessary process to secure the attendance of the accused (Section 204 Criminal Procedure Code).
The scheme of the Code thus was that the First Information Report was followed by investigation, the investigation led to the submission of a report to the Magistrate, the Magistrate took cognizance of the offence on receipt of the police report and, finally, the Magistrate taking cognizance issued process to the accused.
The police thus had the statutory right and duty to 'register ' every information relating to the commission of a cognizable offence.
The police also had the statutory right and duty to investigate the facts and circumstances of the case where the commission of a cognizable offence was suspected and to submit the report of such investigation to the Magistrate having jurisdiction to take cognizance of the offence upon a police report.
These statutory rights and duties of the police were not circumscribed by any power of superintendence or interference in the Magistrate; nor was any sanction required from a Magistrate to empower the Police to investigate into a cognizable offence.
This position in law was well established.
In King Emperor 938 vs Khwaja Nazir Ahmed(1), the Privy Council observed as follows: "Just as it is essential that every one accused of a crime should have free access to a Court of justice, so that he may be duly acquitted if found not guilty of the offence with which he is charged, so it is of the utmost importance that the judiciary should not interfere with the police in matters which are within their province and into which the law imposes on them the duty of inquiry.
In India, as has been shown, there is a statutory right on the part of the police to investigate the circumstances of an alleged cognizable crime without requiring any authority from the judicial authorities, and it would, as their Lordships think, be an unfortunate result if it should be held possible to interfere with those statutory rules by an exercise of the inherent jurisdiction of the Court.
The functions of the judiciary and the police are complementary, not overlapping, and the combination of individual liberty with a due observance of law and order is only to be obtained by leaving each to exercise its own function, always, of course, subject to the right of the Courts, to intervene in an appropriate case when moved under Section 491 of the Criminal Procedure Code to give directions in the nature of Habeas Corpus.
In such a case as the present, however, the Court 's function begin when a charge is preferred before it and not until then. .
In the present case, the police have under Sections 154 and 156 of the Criminal Procedure Code, a statutory right to investigate a cognizable offence without requiring the sanction of the Court. .
Ordinarily, the right and duty of the police would end with the submission of a report under Section 173(1) Criminal Procedure Code upon receipt of which it was up to the Magistrate to take or not to take cognizance of the offence.
There was no provision in the 1898 Code prescribing the procedure to be followed by the police, where, after the submission of a report under Section 173(1) Criminal Procedure Code and after the Magistrate had taken cognizance of the offence, fresh facts came to light which required further investigation.
There was, of course, no express provision prohibiting the police from launching upon an investigation into the fresh facts coming to light after the submission of the report under Section 173(1) or after the Magistrate had taken cognizance of the offence.
As we shall presently point out, it was generally, thought by many High 939 Courts, though doubted by a few, that the police were not barred from further investigation by the circumstance that a report under Section 173(1) had already been submitted and a Magistrate had already taken cognizance of the offence.
The Law Commission in its 41st report recognized the position and recommended that the right of the police to make further investigation should be statutorily affirmed.
The Law Commission said : "14.23.
A report under Section 173 is normally the end of the investigation.
Sometimes, however, the police officer after submitting, the report under Section 173 comes upon evidence bearing on the guilt or innocence of the accused.
We should have thought that the police officer can collect that evidence and send it to the Magistrate concerned.
It appears, however, that Courts have sometimes taken the narrow view that once a final report under Section 173 has been sent, the police cannot touch the case again and cannot re open the investigation.
This view places a hindrance in the way of the investigating agency, which can be very unfair to the prosecution and, for that matter, even to the accused.
It should be made clear in Section 173 that the competent police officer can examine such evidence and send a report to the Magistrate.
Copies concerning the fresh material must of course be furnished to the accused".
Accordingly, in the Criminal Procedure Code, 1973, a new provision, Section 173(8), was introduced and it says: "Nothing in this section shall be deemed to preclude further investigation in respect of an offence after a report under sub section (2) has been forwarded to the Magistrate and, where upon such investigation, the officer in charge of the police Station obtains further evidence, oral or documentary, he shall forward to the Magistrate a further report or reports regarding such evidence in the form prescribed, and the provisions of sub sections (2) to (6) shall, as far as may be, apply in relation to such report or reports as they apply in relation to a report forwarded under sub section (2)".
The right of the police to make repeated investigations under the old Code was recognised by the Madras High Court as early as in 1919 in Divakar Singh vs A. Ramamurthi Naidu (1), where Phillips and Krishnan, JJ., observed as follows: 940 "Another contention is put forward that when a report of investigation has been sent in under Section 173, Criminal P.C., the police has no further powers of investigation, but this argument may be briefly met by the remark that the number of investigations into a crime is not limited by law and that when one has been completed another may be begun on further information received".
In re.
Palaniswami Goundan(1) the Madras High Court held that notwithstanding the filing of a final charge sheet, a police officer could still investigate and lay further charge sheets if he got information and that there was no finality either to the investigation or to the laying of charge sheets.
In Md. Niwaz vs The Crown(2) a Bench of the Lahore High Court consisting of Din Mohammad and Cornelius JJ., cited with approval the decision of the Division Bench of the Madras High Court in Divakar Singh vs A. Ramamurthi Naidu(3) already referred to by us.
In Prosecuting Inspector vs Minaketan Mahato(4), the High Court of Orissa held that the police had the right to reopen investigation even after the submission of the charge sheet under Section 173 Criminal Procedure Code if fresh facts came to light.
In Rama Shanker vs State of U.P.(5) a Division Bench of Allahabad High Court took the view that the submission of a charge sheet not being a judicial act, the submission of a fresh charge sheet after submission of a report under Section 173 Criminal Procedure Code was not illegal.
In re.
State of Kerala vs State Prosecutor(6) a Division Bench of the Kerala High Court thought it was well settled law that the police had the right to reopen the investigation even after the submission of a charge sheet under Section 173 Criminal Procedure Code and that there was no bar for further investigation or for filing of supplementary report.
In H. N. Rishbud vs The State of Delhi(7),this Court contemplated the possibility of further investigation even after a Court had taken cognizance of the case.
While noticing that a police report resulting from an investigation was provided in Section 190 Criminal Procedure Code as the material on which cognizance was taken, it was pointed out that it could not be maintained that a valid and legal police report was the foundation of the jurisdiction of the Court to take cognizance.
941 It was held that where cognizance of the case had, in fact, been taken and the case had proceeded to termination, the invalidity of the precedent investigation did not vitiate the result unless miscarriage of justice had been caused thereby.
It was said that a defect or illegality in investigation, however serious, had no direct bearing on the competence of the procedure relating to cognizance or trial.
However, it was observed: "It does not follow that the invalidity of the investigation is to be completely ignored by a Court during trial.
When the breach of such a mandatory provision is brought to the knowledge of the Court at a sufficiently early stage, the Court, while not declining cognizance, will have to take the necessary steps to get the illegality cured and the defect rectified, by ordering such re investigation as the circumstances of an individual case may call for".
This decision is a clear authority for the view that further investigation is not altogether ruled out merely because cognizance of the case has been taken by the Court; defective investigation coming to light during the course of a trial may be cured by a further investigation, if circumstances permit it.
In Tara Singh vs State(1) the police first submitted a report styled as "an incomplete challan", which, however, contained all the particulars prescribed by Section 173(1).
Later, two supplemental challans were submitted containing the names of certain formal witnesses.
The Magistrate had taken cognizance of the case when the incomplete challan was submitted.
It was urged that the Magistrate had taken cognizance of the case illegally and the statements of witneses examined before submission of the supplemental challans should be excluded from the record.
This Court held that the so called incomplete challan was in fact a complete report of the kind contemplated by Section 173(1) (a), and, therefore, the Magistrate had properly taken cognizance of the case.
The Court declined to express any opinion on the question whether the police could be permitted to send incomplete reports under Section 173(1) Criminal Procedure Code.
This case while neither approving nor disapproving the practice of submitting incomplete challans in the first instance, certainly notices the existence of such practice.
Some High Courts took the view that with the submission of a charge sheet under Section 173 the power of the police to investigate came to an end and the Magistrate 's cognizance of the offence started.
942 It was said that any further investigation by the police would trench upon the magisterial cognizance.
Vide Ram Gopal Neotia vs State of West Bengal(1).
In Hanuman & Anr.
vs Raj.(2) it was held that when a case was pending before a Magistrate, the action of the police in resuming investigation and putting up a new challan against a person not originally an accused as a result of the further investigation was unauthorised and unlawful.
In State vs Mehar Singh & Ors.(3), a Full Bench of the High Court of Punjab and Haryana held that the police became functus officio once the Court took cognizance of an offence on the filing of a charge sheet by the police and thereafter further investigation by the police was not permissible.
The police, it was said, could not 'tinker ' with the proceedings pending in the Court.
It was, however, observed that it would be open to the Magistrate to 'suspend cognizance ' and direct the police to make further investigation into the case and submit a report.
The High Court of Punjab and Haryana acknowledged the existence of the practice of submitting supplemental charge sheets, but was of the view that such practice was not sanctioned by the Code.
Faced with the impracticality of banning all further investigation once cognizance of an offence was taken by the Court, the High Court tried to find a solution to the problem by suggesting the procedure of the Magistrate suspending cognizance and ordering further investigation.
The procedure of 'suspending cognizance ' suggested by the High Court of Punjab and Haryana does not appear to us to be warranted by the provisions of the Criminal Procedure Code.
Anyone acquainted with the day today working of the criminal courts will be alive to the practical necessity of the police possessing the power to make further investigation and submit a supplemental report.
It is in the interests of both the prosecution and the defence that the police should have such power.
It is easy to visualise a case where fresh material may come to light which would implicate persons not previously accused or absolve persons already accused.
When it comes to the notice of the investigating agency that a person already accused of an offence has a good alibi, is it not the duty of that agency to investigate the genuineness of the plea of alibi and submit a report to the Magistrate ? After all the investigating agency has greater resources at its command than a private individual.
Similarly, where the involvement of persons who are not already accused comes to the notice of the investigating agency, the investigating agency cannot keep quiet and refuse to investigate the fresh information.
It is their duty 943 to investigate and submit a report to the Magistrate upon the involvement of the other persons.
In either case, it is for the Magistrate to decide upon his future course of action depending upon the stage at which the case is before him.
If he has already taken cognizance of the offence, but has not proceeded with the enquiry or trial, he may direct the issue of process to persons freshly discovered to be involved and deal with all the accused, in a single enquiry or trial.
If the case of which he has previously taken cognizance has already proceeded to some extent, he may take fresh cognizance of the offence disclosed against the newly involved accused and proceed with the case as a separate case.
What action a Magistrate is to take in accordance with the provisions of the Code of Criminal Procedure in such situations is a matter best left to the discretion of the Magistrate.
The criticism that a further investigation by the police would trench upon the proceedings before the Court is really not of very great substance, since whatever the police may do, the final discretion in regard to further action is with the Magistrate.
That the final word is with the Magistrate is sufficient safeguard against any excessive use or abuse of the power of the police to make further investigation.
We should not, however, be understood to say that the police should ignore the pendency of a proceeding before a Court and investigate every fresh fact that comes to light as if no cognizance had been taken by the Court of any offence.
We think that in the interests of the independence of the magistracy and the judiciary, in the interests of the purity of the administration of criminal justice and in the interests of the comity of the various agencies and institutions entrusted with different stages of such administration, it would ordinarily be desirable that the police should inform the Court and seek formal permission to make further investigation when fresh facts come to light.
As observed by us earlier, there was no provision in the Code of Criminal Procedure, 1898 which, expressly or by necessary implication, barred the right of the police to further investigate after cognizance of the case had been taken by the Magistrate.
Neither Section 173 nor Section 190 lead us to hold that the power of the police to further investigate was exhausted by the Magistrate taking cognizance of the offence.
Practice, convenience and preponderance of authority, permitted repeated investigations on discovery of fresh facts.
In our view, notwithstanding that a Magistrate had taken cognizance of the offence upon a police report submitted under Section 173 of the 1898 Code, the right of the police to further investigate was not exhausted and the police could exercise such right as often as necessary when fresh information came to light.
Where the police desi 944 ed to make a further investigation, the police could express their regard and respect for the Court by seeking its formal permission to make further investigation.
As in the present case, occasions may arise when a second investigation started independently of the first may disclose a wide range of offences including those covered by the first investigation.
Where the report of the second investigation is submitted to a Magistrate other than the Magistrate who has already taken cognizance of the first case, it is up to the prosecuting agency or the accused concerned to take necessary action by moving the appropriate superior Court to have the two cases tried together.
The Magistrates themselves may take action suo motu.
In the present case, there is no problem since the earlier case has since been withdrawn by the prosecuting agency.
It was submitted to us that the submission of a charge sheet to the Delhi Court and the withdrawal of the case in the Ambala Court amounted to an abuse of the process of the Court.
We do not think that the prosecution acted with any oblique motive.
In the charge sheet filed in the Delhi Court, it was expressly mentioned that Mehra was already facing trial in the Ambala Court and he was, therefore, not being sent for trial.
In the application made to the Ambala Court under Section 494 Criminal Procedure Code, it was expressly mentioned that a case had been filed in the Delhi Court against Mehra and others and, therefore, it was not necessary to prosecute Mehra in the Ambala Court.
The Court granted its permission for the withdrawal of the case.
Though the investigating agency would have done better if it had informed the Ambala Magistrate and sought his formal permission for the second investigation, we are satisfied that the investigating agency did not act out of any malice.
We are also satisfied that there has been no illegality.
Both the appeals are, therefore, dismissed.
M.R. Appeals dismissed.
| IN-Abs | A criminal case, arising out of F.I.R. 72 of 1967 against one Sri Bali Ram Sharma and two others for the offence of the theft of two sandstone pillars of great antiquity, beauty and value from the Suraj Kund Temple, in village Amin, Dist.
Karnal, ended in the acquittal of the accused.
During the pendency of this case, on an application made by him one Narinder Nath Malik (N. N. Malik) an alleged research scholar and a friend of H. L. Mehta, the then Chief Judicial Magistrate was given the custody of these two sandstone pillars which had been recovered from the accused.
The pillars remained in the custody of N. N. Malik from 1 3 1968 to 27 5 1968 and on the acquittal of the accused on 16 7 1968, they were handed over to the Lambardar of Village Amin.
Later, it came to light that the pillars returned by Malik were not the original pillars but fakes.
Thereupon, F.I.R. RC 2 71 CIA/SPE/CBI was registered at Delhi against Malik and H. L. Mehta under Section 120 B read with Sections 406 and 420 I.P.C.
After completing the investigation a charge sheet No. RC 2 of 1971 was filed on 30 12 1972, in the Court of Special Magistrate, Ambala against Malik and H. L. Mehra for the aforesaid offences noted in the F.I.R. Though an order was passed on 17 5 1976 directing the framing of charges, no charges were actually framed.
However, on 16 5 77, on an application dated 17 4 77 filed by the Public Prosecutor under Section 494 of the Criminal Procedure Code, 1973, the Special Magistrate permitted the withdrawal of the case and discharged the accused.
During the pendency of the case, the two genuine pillars were traced and found in London in the ware house of Spink & Co. It was suspected that Manohar Lal Narang and Ramlal Narang had engaged Balkishan Rawal and Nathubai Rawal of Delhi to make three sets of fakes and had exported the genuine pillars to London.
This resulted in the registering of F.I.R. RC 4/76 CIU(A)/SPE by the Superintendent of Police, CIV (Antiquities SPE/CBI, New Delhi) against Manohar Lal Narang and others for alleged offences under Section 120B, read with Section 411 I.P.C. and Section 25 (1) of the .
An application under section 306 Cr.
P.C. filed by N. N. Malik on 26 6 1976 before the Chief Metropolitan Magistrate, New Delhi with reference to this F.I.R. RC 4/76, was accepted on 3 7 1976 and Malik was granted pardon, after confessional statement was recorded.
On 19 7 1976 a charge sheet was filed (RC 4 of 1976) before the same Court for offences under Sections 120B, I.P.C. read with Section 420, 411 and 406 I.P.C. and Section 25 of the .
The case was transferred to the Court of Additional Chief Metropolitan Magistrate.
On 20 7 1976 the Magistrate issued process for the appearance of the accused including the three Narang brothers out of whom the appellant in Crl.
Appeal 373 of 1978 was already under detention under MISA and COFEPOSA.
The other two who were in London were extradited and brought 924 to India on 27 7 1977.
An application filed by Ramlal Narang in March 1977 immediately after his release from detention, to drop the proceedings against him, to cancel the extradition warrants against his two brothers and to discharge all the accused on the ground of illegality of the Delhi case in view of the fact that a case on the same facts was already pending in the Ambala Court failed.
Thereafter two applications filed by the three Narang brothers on 21 6 1977 in the Delhi High Court under Section 482 Crl.
P.C. once again challenging the legality of the proceedings arising out of charge sheet RC4 of 1974 were admitted on 22 6 1977, but dismissed on 10 1 1978.
During the pendency of these two appeals Malik died sometime during May 1977 and Mehra was made a co accused in the Delhi case on 1 8 1977 in view of the withdrawal of the Ambala case on 16 5 1977.
Dismissing the appeals by special leave, the Court, ^ HELD: 1.
The police have the statutory right and duty to 'register ' every information relating to the commission of a cognizable offence.
The police also have the statutory right and duty to investigate the facts and circmstances of the case where the commission of a cognizable offence was suspected and to submit the report of such investigation to the Magistrate having jurisdiction to take cognizance of the offence upon a police report.
These statutory rights and duties of the police were not circumscribed by any power of superintendence or interference in the Magistrate; nor was any sanction required from a Magistrate to empower the police to investigate into a cognizable offence.
[937 F H] (a) The scheme of the 1898 Code of Criminal Procedure was that the First Information Report was followed by investigation, the investigation led to the submission of a report to the Magistrate, the Magistrate took cognizance of the offence on receipt of the police report and finally, the Magistrate taking cognizance issued process to the accused.
As such ordinarily the right and duty of the police would end with the submission of a report under Section 173(1) Criminal Procedure Code upon receipt of which it was up to the Magistrate to take or not to take cognizance of the offence.
[937 E F, 938 F] (b) There was no provision in the 1898 Code prescribing the procedure to be followed by the police, where after the submission of a report under Section 173(1) Criminal Procedure Code and after the Magistrate had taken cognizance of the offence, fresh facts came to light which required further investigation.
Similarly, there was no express provision prohibiting the police from launching upon an investigation into the fresh facts coming to light after the submission of the report under Section 173(1) or after the Magistrate had taken cognizance of the offence.
Therefore further investigation was permissible and was not altogether ruled out merely because cognizance of the case has been taken by the Court; defective investigation coming to light during the course of a trial could also be cured by a further investigation, if circumstances permitted it.
[938 F H, 941 C D] King Emperor vs Khwaja Wazir Ahmed, 71 Indian Appeals, PC 203: followed.
Diwakar Singh vs A. Ramamurthy Naidu, AIR 1919 Madras 751.
In re.
Palaniswami Goundan, AIR 1946 Madras 502; Mohd. Niwaj vs The Crown, Lahore; Prosecuting Inspector vs Minaketan 925 Monato, AIR 1952 Orissa 350; Ramashankar vs State of U.P., AIR 1956 All.
525; In re.
State of Kerala vs State Prosecutor, p. 1288 (Kerala) D.B.; approved.
H. N. Rishbud vs State of Delhi, ; ; Tara Singh vs State ; referred to.
(a) Neither Section 173 nor section 190 lead to the conclusion that the power of the police to further investigate was exhausted by the Magistrate taking cognizance of the offence.
Practice, convenience and preponderance of authority, permitted repeated investigations and discovery of fresh facts.
Notwithstanding that a Magistrate had taken cognizance of the offence upon a police report submitted under Section 173 of the 1898 Code, the right of the police to further investigate was not exhausted and the police could exercise such right as often as necessary when fresh information came to light.
Where the police desired to make a further investigation, the police could express their regard and respect for the Court by seeking its formal permission to make further investigation.
[943 G H, 944 A] (b) When it comes to the notice of the investigating agency that a person already an accused of an offence has a good alibi or where the involvement of persons who are not already accused comes to the notice of the investigating agency, the investigating agency cannot keep quiet and refuse to investigate the fresh information.
It is their duty to investigate and submit a report to the Magistrate upon the innocence or involvement of the persons concerned.
In either case, it is for the Magistrate to decide upon his future course of action depending upon the stage at which the case is before him.
If he has already taken cognizance of the offence, but has not proceeded with the enquiry or trial, he may direct the issue of process to persons freshly discovered to be involved and deal with all the accused in a single enquiry or trial.
If the case of which he has previously taken cognizance has already proceeded to some extent, he may take fresh cognizance of the offence disclosed against the newly involved accused and proceed with the case as a separate case.
What action a Magistrate is to take in accordance with the provisions of the Code of Criminal Procedure in such situations is a matter best left to the discretion of the Magistrate.
A further investigation by the police cannot be considered as trenching upon the proceedings before the Court because whatever the police may do, the final discretion in regard to further action is with the Magistrate.
That the final word is with the Magistrate is sufficient safeguard against any excessive use or abuse of the power of the police to make further investigation.
[942 F H, 943 A D] Ram Gopal Neotia vs State of West Bengal, AIR 1969 Cal.
316 Hanuman and Anr.
vs Raj.
AIR ; State vs Mehr Singh and Ors., ILR 2 Cal.
LJ 970; over ruled.
(c) Where the report of the second investigation is submitted to a Magistrate other than the Magistrate who has already taken cognizance of the first case, it is up to the prosecuting agency or the accused concerned to take necessary action by moving the appropriate superior Court to have the two cases tried together.
The Magistrate themselves may take action suo motu.
[944 B] 926 In the instant case; the prosecution did not act with any oblique motive or out of any malice by submitting a charge sheet to the Delhi Court and by withdrawing the case in the Ambala Court.
In the charge sheet filed in the Delhi Court, it was expressly mentioned that a case had been filed in the Delhi Court against Mehra and others and, therefore, it was not necessary to prosecute Mehra in the Ambala Court.
The Court granted its permission for the withdrawal of the case.
[944 C E] 3.
Where the conspiracy discovered later is found to cover a much larger canvas with broader ramifications, it cannot be equated with the earlier conspiracy which covered a smaller field of narrower dimentions.
[936 B C] In the present case, (a) the conspiracies which are the subject matter of the two cases cannot be said to be identical though the conspiracy which is the subject matter of the first case, may perhaps be said to have turned out to be part of the conspiracy which is the subject matter of the second case.
When investigation commenced in First Information Report No. RC4 of 1976, apart from the circumstance that the property involved was the same, the link between the conspiracy to cheat and to misappropriate and the conspiracy to dispose of the stolen property was not known.
[936 C D] (b) A comparison of the two First Information Report coupled with the several facts and circumstances show that the conspiracy which was the subject matter of the second case could not be said to be identical with the conspiracy which was the subject matter of the first case.
The conspirators were different.
Malik and Mehra alone were stated to be the conspirators in the first case, while the three Narang brothers were alleged to be the principal conspirators in the second case.
The objects of the two conspiracies were different.
The alleged object of the first conspiracy was to obtain possession of the pillars from the Court by cheating and to misappropriate them.
The alleged object of the second conspiracy was the disposal of the stolen property by exporting the pillars to London.
The offences alleged in the first case were Section 120B read with Section 420 and 406 Indian Penal Code while the offences alleged in the second case were section 120B read with section 411 IPC and Section 25 of the .
[935 D F] (c) No fault could be found with the police for registering a first information Report against the Narang brothers for the offence of conspiracy to commit an offence under section 411 Indian Penal Code.
In the course of the investigation into this offence, it transpired that the Narang brothers were also parties to the original conspiracy to obtain possession of the pillars from the Court by cheating Facts came to light which indicated that the conspiracy which was the subject matter of the case pending in the Ambala Court was but part of a larger conspiracy.
The fresh facts which came to light resulted in the filing of the second charge sheet.
[935 C D] (d) Neither at the time when the First Information Report pertaining to the Ambala Case was registered nor at the time when the Charge sheet was filed in the Ambala Court, were the Narang brothers known to be in the picture.
The investigating agency was not also aware of what Malik and Mehra had done with the pillars after they had obtained possession of the pillars from the Court and substituted and returned fake pillars to the Court.
The First Information Report and the charge sheet were concerned primarily with the 927 offences of conspiracy to cheat and to misappropriate committed by Malik and Mehra.
At that stage, the investigating agency was not aware of any conspiracy to send the pillars out of the country.
It was not known that Narang brothers were also parties to the conspiracy to obtain possession of the pillars from the Court.
It was much later, that the pillars surfaced in London were discovered to be in the constructive possession of Narang brothers.
Even then, the precise connection between Malik and Mehra on the one side and Narang brothers on the other was not known.
All that was known was that the pillars which were stolen property within the definition of the expression in Section 410 Indian Penal Code were found to be in the possession of Narang brothers in London.
On the discovery of the genuine pillars in the possession of Narang brothers, without anything further to connect Narang brothers with Malik and Mehra, the police had no option but to register a case under Section 411 Indian Penal Code against Narang brothers.
That was what was done.
[934 F H, 935 A B] Observation: In the interests of the independence of the magistracy and the judiciary, in the interests of the purity of the administration of criminal justice and in the interests of the comity of the various agencies and institutions entrusted with different stages of such administration, it would ordinarily be desirable that the police should inform the Court and seek formal permission to make further investigation when fresh facts come to light.
[943 E]
|
Civil Appeal No. 2297 of 1978.
Appeal by Special Leave from the Judgment and Order dated 13 11 78 of the Kerala High Court in O.P. No. 3239/78.
AND WRIT PETITION NO.
4705/78 M. M. Abdul Khader, Adv.
for Kerala, V. J. Francis and Mustafa K. Rowter for the Appellant in C.A. 2297/78 and Respondents in W.P. 4705/78.
P. V. Govindan Nair, N. Sudhakaran and Mrs. Baby Krishnan for the Petitioner in W.P. No. 4705/78 and Respondent No. 1 in CA 2297/78.
Dr. V. A. Sayid Muhammad, section K. Mehta, P. K. Shamshuddin, P. N. Puri and E. M. Sarul for the Interveners.
A. section Nambiar for Respondent No. 3 in CA 2297/78.
The Judgment of the Court was delivered by KRISHNA IYER, J.
The dynamics of the writ jurisdiction and the potential for affirmative court action, as part of remedial jurisprudence, constitute the key thought which animates the ultimate decision and direction we give in this couple of cases which have come up by Special Leave and under article 32 to this Court, aware as we are of a host of like proceedings which pend in the High Court.
The State of Kerala is the appellant in the civil appeal and 1st respondent in the Writ Petition but the collective litigation springs from a traditional type of action and typical kind of relief granted in exercise of its writ jurisdiction by the High Court striking down a transitory scheme of admission to the medical colleges of the State evolved by the Government but invalidated.by the High Court on the ground of discrimination in the distribution of seats among the eligible students drawn from two disparate regions of the State.
Of course, the instant repercussion of the decision is apt to be confusion in the admission to the academic courses which have hardly commenced and this desperate situation has driven the Government to this Court seeking reversal of the Judgment under appeal.
Law promotes order, not anomie.
978 Any incisive study of the exercise of the writ power in India may reveal that it limits its action to quashing or nullifying orders proceeding on a violation of law, but stops short of a reconstruction whereby a valid scheme may replace a void project.
This is no reflection on the High Court 's ruling but is symptomatic of an obsolescent aspect of the judicial process, its remedial shortcomings in practice and the need to innovate the means, to widen the base and to organise the reliefs so that the court actualises social justice even as it inhibits injustice.
This community perspective of the Justice System explains why we have resorted to certain unusual directions and have shaped the ultimate complex of orders in these proceedings in a self acting package.
With this exordium we proceed to narrate briefly the necessary facts and developments revelatory of the course of events and the cause of action, the impact of the High Court 's judgment and the compulsions which have brought the State in appeal to this Court.
The Kerala State, notwithstanding its striking demographic, cultural, linguistic and political integrality and educational advance, has certain historical hangovers of academic disparity and developmental maldistribution which have survived for two decades as this case testifies.
We are not concerned with the etiological enquiry into this malady but recognise it as a reality since the authentic materials from Commission reports and prior rulings of the High Court concurrently so establish.
Broadly speaking, this `composite ' State may be dichotomised as Travancore Cochin and Malabar regions woven into one fabric by the .
Gaping disparities of development cannot be wished away by political fusion into one State and determined efforts at equalisation of human conditions, economic and cultural, alone lend living validity to geo political homogeneity.
Malabar being admittedly laggard in the educational field, the State endeavoured to wipe out this weakness by starting or supporting new colleges in this neglected segment; and one such institution was the medical college at Calicut.
Indeed, the drive to upgrade the educational status of this backward region persuaded the State to set up the Calicut University to which were affiliated all the colleges in that Cindrella area, including the Calicut Medical College.
An adjoining district, Trichur, was also tacked on, for convenience, maybe.
The cynosure of attention in this litigation is the scheme of admission to medical colleges in the State; and so we may adjust the forensic lens to focus on the struggle for seats in the four medical colleges in the State all run by Government but providing for five hundred and odd students, as against several thousands of applicants.
This `musical 979 chair ' situation naturally led to many qualified claimants being rejected and litigative adventures being inaugurated on grounds of discrimination.
One such writ petition having been allowed, the State has, by special leave, come up in appeal.
The points raised in the writ petition under article 32 are identical.
A sensitive appreciation of the grievance successfully ventilated by the writ petitioners in the High Court is possible only if we unfold a fuller conspectus of the facts.
Cognizance of some essential circumstances is necessitous as the first step.
There are three Universities in the State but we are concerned only with two the,Kerala and the Calicut Universities to which the four medical colleges are affiliated, three of which are under the jurisdiction of the first and the fourth under the latter.
Broadly speaking, the latter caters to the academic requirements of the Malabar segment plus a neighbouring district and the former to the rest of the State.
The Malabar area has been regarded as notoriously backward from the point of view of collegiate education so much so, the number of colleges which provide pre degree courses necessary by way of qualification for entrance into the medical colleges, are relatively fewer and, on the contrary, the remaining part of the State thanks to many factors, has been on a higher level, with colleges more numerous and pre degree students more prolific.
Geographic justice, a component of social justice, has to take note of these comparative imbalances.
Rightly, therefore, the State Government, based on certain reports of Commissions, considered the two territorial divisions as separate units and regulated seat allocations to medical colleges in the State on an equitable basis.
The social thrust of the classification, based on geographical dissimilarities, was the core factor in fomulation of that scheme of admissions.
This principle found favour with the High Court in its Full Bench ruling in Rafia Rahim 's(1) case.
While over the years, amelioration produced by State Plans has reduced the degree of backwardness, the fact remains that substantial equalisation of opportunities between the two areas is a "consummation devoutly to be wished.
" We agree with the High Court that "in considering the question of the educational backwardness of a particular class of people or a Particular tract of territory of this State, we cannot forget that the evolution of human society and its march from backwardness to progress must essentially be a slow and gradual process.
It is not as if, by a Government or executive fiat, a class of people or a bit of territory has been condemned to backwardness, and with 980 the lifting of the ban by efflux of time or otherwise, they auto matically spring back into a progressive or forward class of people or tract.
It is useful to recall the observations made by this Court is State of Kerala vs Jacob Mathew "9.
In these regions of human life and values the clear cut .
distinctions of cause and effect merge into each other.
Social backwardness contributes to educational backwardness; educational backwardness perpetuates social backwardness; and both are often no more than the inevitable corollaries of the extremes of poverty and the deadening weight of custom and tradition.
"(1) If we may add, chronic social disability cannot be amenable to instant administrative surgery and law shall not bury its head, ostrich fashion, in the sands of fiction and assume equality where the opposite is the reality.
The rule of law runs close to the rule of life and where societal life, as between one part of the State and another, is the victim of die hard disparities the constitutional mandate of equal justice under the law responds to it pragmatically and permits classification geared to eventual equalisation.
We, therefore, agree with the High Court that current conditions warrant the classification of the student community on the Zonal basis not as a legitimation of endless perpetuation but as a transient panacea for a geo human handicap which the State must actively strive to undo.
In Kerala, as in some other States, reservation policies of Governments and `equal protection ' pronouncements of courts have chased each other.
A happy harmony among the great instrumentalities for accomplishment of constitutional goals by complementary action is the desideratum for developing countries, if we may say so respectfully.
The principle of reservation with weightage for the geographical area of the Malabar District has our approval in endorsement of the view or the High Court.
An earlier decision of the Kerala High Court gave rise to a Commission appointed to recommend which sections of the people required special treatment under article 15(4) of the Constitution, having regard to their social and educational conditions.
That Commission, inter alia accepted the educational backwardness of the Malabar area and recommended equitable allocation of seats on that footing.
Substantially founding itself on these recommendations but modifying them in some measure Government hummered out a formula, a basic feature of which was pooling together the applications for admission to the four medical colleges in the State in one consolidated list 981 and selecting students for medical courses strictly according to the marks secured of course, making allowance for seats reserved for a limited percentage of students from outside and the customary bonus of reservation of seats for Scheduled Castes, Scheduled Tribes and backward classes.
This part of the 'selection calculus ' is beyond cavil before us, as the nation with all its social engineering boasts and all its tumultuous bungling, is distances away from human justice through human law.
The rough and tumble of academic life, based on the Pooling System seemed to run smooth for some years when a new attack was mounted on it in the High Court with constitutional artillery from the inexhaustible armoury of article 14.
A Full Bench hit the scheme fatally this time, not with the familiar but fruitless archery of geographical discrimination but with the weaponry of 'reverse discrimination ' in a different mani festation.
The strategy of attack was neatly expressed by the learned Single Judge whose judgment on this point was endorsed by the Full Bench.
Discrimination was discovered by the Court in attributing parity to the markes of examinees in pre degree and degree courses of the Calicut University with those of the candidates of the Kerala University.
The Full Bench framed the question, tell tale fashion: "The question is not whether one University is superior to the other or maintains higher standards in the matter of syllabus, examination and evaluation than the other, but whether the operation of different Universities with varying standards of their own is productive of inequality. '(1) The descriptive presentation of this discriminatory facet was given by the learned single Judge in the same case: "To compare the marks obtained by students of two different Universities valued by different examiners on answer papers of different patterns may not be the proper mode of determining comparative merit.
Even in the case of candidates appearing for the same examination in the same university there may be a cause for complaint in the matter of marks awarded to the candidates.
Quite often revaluation has shown that at least in some cases there is justification for the plea for such revaluation.
Different examiners value the answer papers and though there is a Chief Examiner his role is quite limited.
But these are inevitable and the marginal errors may have to be ignored.
By and large the comparative merits of the candidates will be reflected in the marks they obtain in the exami 982 nation to which all candidates are uniformly subjected to.
But the same could not be said in the case of examinations conducted by two or more Universities.
It is well known that some times question papers are tough and sometimes valuation is liberal.
Quite often valuation is guided by the percentage of pass expected in an examination.
Moderation is also resorted to.
While all these may work uniformly on all the candidates appearing for the same examination in the same University that could not be the case with regard to the candidates appearing for the same qualifying examination from another University writing different papers, which are valued by a different set of examiners.
When comparison is between two candidates passing out from two Universities taking respective examinations of the Universities the equation of candidates in matters where near accuracy is called for becomes difficult.
May be the examinations are similar and the valuation also is similar, but the other factors cannot be ruled out.
If admissions to courses like medicine and engineering is to be on the basis that the best talent is to be preferred, where students from more than one University passing the qualifying examination have to compete some method other than comparing their marks should be devised to determine their comparative talent.
"(1) The Full Bench agreed with this anathematization of equal treatment of 'unequals ' and voided the Selection Process.
The Court, with helpful realism, concluded by adding a positive guideline to the declaration of nullification:(2) "As a result of our discussion, we are of the opinion, that the scheme of selection for admission to the Medical Colleges on an assessment of merit of students drawn from different Universities with no uniformity of standards is objectionable and violative of article 14 of the Constitution.
We grant a declaration to the writ petitioner to that effect.
We deny effective relief to the writ petitioner on account of non joinder of the selected candidates, and the futility and ineffectiveness of upsetting the selections and directing fresh admission at this stage.
We consider that the best scheme of selection in the circumstances would be the method of selection of candidates by holding a uniform Entrance Examination to secure 983 uniformity of standards, as recommended by the Indian Medical Council vide Exts.
P5 and P8 and as endorsed by the University authorities (vide exhibit P7).
We direct the State Government to forthwith devise a scheme of selection by holding such an Entrance Examination and publish the same within three months from today so that the candidates wishing to apply for selection to the Medical Colleges of this State for the next academic year, have due notice of the scheme of selection.
The object being to secure uniformity of standards for assessment and evaluation of students drawn from different Universities, our direction should not be understood as unalterably and inelastically fixing the limits for Governmental action.
Methods for securing uniformity of syllabus, pattern of examination, and mode of evaluation in the different Universities, would well be within the province of the Government to undertake.
We allow this writ appeal to the limited extent indicated above." In the end, the writ petitioner won the battle but lost the war, for she got an abstract declaration that her exclusion was invalid but was denied the concrete direction to be admitted into the college.
We are not impressed much with the surmise which colours the reasoning of the Full Bench and the learned Single Judge that there is such substantial difference in the pre degree courses and evaluations between the sister universities within the same State that the breach of article 14 by equal treatment of the marks unequally secured by examinees in the two universities may be spelt out.
It is trite law that every inconsequential differentiation between two things does not constitute the vice of discrimination, if law clubs them together ignoring venial variances.
article 14 is not a voodoo which visits with invalidation every executive or legislative fusion of things or categories where there are no pronounced inequalities.
Mathematical equality is not the touchstone of constitutionality.
This Court in Triloki Nath Khosa cautioned: "Mini classifications based on micro distinctions are false to our egalitarian faith and only substantial and straightforward classifications plainly promoting relevant goals can have constitutional validity.
To overdo classification is to undo equality.
" In the same ruling there was a caveat entered by Chandrachud, J (as he then was) against "a charter for making minute and microcosmic 984 classifications.
" What is more, a large latitude is allowed in this area to the State to classify or declassify based on diverse considerations of relevant pragmatism, and the judiciary should not "rush in" where the executive warily treads.
The core question is whether there is such substantial differentiation between the two universities in regard to the pre degree or degree courses and system of examinations as too glaring to imperil the equal protection clause.
The presumption is in favour of the vires of legislative and executive action where article 14 is the basis of challenge.
We see no factual disparities disclosed in the Full Bench ruling to reach the result of substantial difference in the syllabi, in the pattern of examinations, in the marking systems or in the choice of the examiners so as to warrant invalidation on account of equal regard being accorded to the marks secured by the examinees from the two universities.
We cannot forget that many colleges are run by the State or institutional managements where pre degree or degree courses are undertaken.
The teachers move from one university jurisdiction to the other, the teaching material is inevitably of a like nature; the subjects taught must ordinarily be alike.
The examiners are usually drawn from within the State or neighbouring States.
Even the composition of the academic bodies in the two universities may have common members.
The University Acts themselves are substantially similar.
To surmise discrimination from possibilities is alien to the forensic process in the absence of hard facts.
We are aware that there are Universities and Universities, that gross divergences among them exist affecting the quality of the teaching and the marking, the anomalies of grading and the absurdity or equating the end products on the blind assumption that the same marks mean the same excellence.
But not glib surmises but solid facts supply the sinews of discriminatory inequality or equality.
Going by vague reports, some backward universities and colleges have degenerated into degree dealers bringing rapid discredit to Indian academic status.
The has constituted the Medical Council of India as an expert body to control the minimum standards of medical education and to regulate their observance.
Obviously, this high powered Council has power to prescribe the minimum standards of medical education.
It has implicit power to supervise the qualifications or eligibility standards for admission into medical institutions.
Thus there is an overall invigilation by the Medical Council to prevent sub standard entrance qualifications for medical courses.
The vagarious element in marking and moderation of marks may be a fact of life, but too marginal to qualify for substantial difference unless otherwise made out.
Indeed, there may be differences among the 985 colleges under the same University, among the examiners in the same university.
Such fleeting factors or ephemeral differences cannot be the solid foundation for a substantial differentiation which is the necessary pre condition for quashing an executive or legislative act as too discriminatory to satisfy the egalitarian essence of article 14.
The functional validation of the writ jurisdiction is an appropriate examination of the substantiality of the alleged disparity.
We do not, however, proceed finally to pronounce on this point with reference to the two universities since nothing is available before us, or, for that matter, was before the High Court to warrant a fair conclusion on the issue.
We are persuaded to make these observations for future guidance, so that academic schemes may not be struck down as arbitrary or irrational save where some sound basis has been laid.
We get back to where we left off before this divagation into the Full Bench decision 's ratio on discrimination as between the two universities.
The sole question that survives is of allocation of seats on a university wise classification.
Following upon the Full Bench decision which struck down the pool scheme of selection, a constitutionally viable process had to be evolved.
Government, therefore, appointed a fresh expert committee to examine and report the quo modo of admissions to medical colleges in the light of the directives contained in the Full Bench decision.
Two solutions were seriously considered by the Committee, namely (1) a common entrance examination such as is in vogue in many States and has the approval of the Medical Council of India; and (2) the standardization of the syllabi uniformly for the two universities and the elimination of different yardsticks in regard to the setting of question papers, marking systems and the like.
The first one, though the better, was given up as productive of public and student resistance.
However wise a measure may be, its viability depends on its acceptance by the consumers, namely, the student community and the parent community.
Agitational opposition or determined dead locking may make it unwise to inflict it on an unwilling constituency.
Of course, by a gradual process of enlightenment the wisdom of such a measure may dawn.
What is rejected to day may be greeted tomorrow.
The Committee jettisoned the first proposal of a common entrance examination partly scared of its impracticability at the moment.
So it opted for the second, namely uniformity of standards, from the formulation of syllabi upto assignment of marks at the examinations.
Surely either of the proposals is an effective answer to article 14.
Even so, when the Committee 's recommendations were placed before the Government it reflected carefully on the pragmatics of implementation and reached the 986 conclusion that it would take some time to fulfil the pre requisites to give effect to that formula.
Time runs, university applications rush in, admissions must begin, courses must start and administrative paralysis in decision making is no alibi.
Implementational dilatoriness cannot stall the flow of medical education.
Caught in this crisis, caused, in part, by the court ruling, Government fabricated a quick scheme of admission to the four medical colleges, which, again, has now been struck down by the High Court resulting in the appeal before us.
The corner stone of classification adopted for medical admissions by the Government this time was universitywise allocation.
By itself, this approach had constitutional sanction, having regard to the ratio in Chanchala 's case.
The ratio in Chanchala concludes the dispute in this case.
The discriminatory vice, if university wise classification and consequential allocation of seats were resorded to, was pressed but repelled.
Shelat, J. speaking for the Court, formulated the contention thus: "The next contention was that r.9(1), which prescribes university wise distribution of seats results in discrimination for it lays down a classification which is neither based on any intelligible differentia, nor has a rational nexus with the object of the rules.
The argument was that although there is one selection committee for all the Government medical colleges in all the three universities and for the said 59 seats in private colleges, students passing from colleges affiliated to a particular university are first admitted in Government medical colleges affiliated to that university and only seats upto 20% in each of such medical colleges can be allotted to outsiders in the discretion of the committee.
The result is that a student having higher marks than the last admitted student is deprived of a seat only for the reason that he had passed his P.U.C. examination from a college affiliated to another university.
According to counsel such a classification has no rational basis and has no reasonable nexus with and is in fact inconsistent with the very object of establishment of Government medical colleges, namely, to train in medicine the most meritorious amongst the candidates seeking admission.
" The fundamental educational realities and resultant resolution of the legal imbroglio are instructively presented in Chanchala 's case, which 987 have special relevance to our case because the social facts, constitutional confrontations and administrative answers in the Kerala and Karnataka litigations are similar.
Shelat J. observed: "The three universities were set up in three different places presumably for the purpose of catering to the educational and academic needs of those areas.
Obviously one university for the whole of the State could neither have been adequate nor feasible to satisfy those needs.
Since it would not be possible to admit all candidates in the medical colleges run by the Government, some basis for screening the candidates had to be set up.
There can be no manner of doubt, and it is now fairly well settled, that the Government, as also other private agencies, who found such centres for medical training, have the right to frame rules for admission so long as those rules are not inconsistent with the university statutes and regulations and do not suffer from infirmities, constitutional or otherwise.
Since the universities are set up for satisfying the educational needs of different areas where they are set up and medical colleges are established in those areas, it can safely be presumed that they also were so set up to satisfy the needs for medical training of those attached to those universities.
In our view, there is nothing undesirable in ensuring that those attached to such universities have their ambitions to have training in specialised subjects, like medicine satisfied through colleges affiliated to their own universities.
Such a basis for selection has not the disadvantage of districtwise or unitwise selection as any student from any part of the state can pass the qualifying examination in any of the three universities irrespective of the place of his birth or residence.
Further, the rules confer a discretion on the selection committee to admit outsiders upto 20% of the total available seats in any one of these colleges, i.e. those who have passed the equivalent examination held by any other university not only in the State but also elsewhere in India. .
The fact that a candidate having lesser marks might obtain admission at the cost of another having higher marks from another university does not necessarily mean that a less meritorious candidate gets advantage over a more meritorious one.
As is well known, different universities have different standards in the examinations held by them.
A preference to one attached to one university in its own institutions for post graduate or 988 technical training is not uncommon. .
Further, the Government which bears the financial burden of running the Government colleges is entitled to lay down criteria for admission in its own colleges and to decide the sources from which admission would be made, provided of course, such classification is not arbitrary and has a rational bass and a reasonable connection with the object of the rules.
So long as there is no discrimination within each of such sources, the validity of the rules laying down such sources cannot be successfully challenged.
[See Chitra Ghosh vs Union of India] In our view, the rules lay down a valid classification.
Candidates passing through the qualifying examinations held by a university form a class by themselves as distinguished from those passing through such examination from the other two universities.
Such a classification has a reasonable nexus with the object of the rules" namely, to cater to the needs of candidates who would naturally look to their own university to advance their training in technical studies, such as medical studies.
In our opinion, the rules cannot justly be attacked on the ground of hostile discrimination or as being otherwise in breach of article 14: We do not mean to lay down, as an inflexible dogma of universal application, that under utterly different social and educational environs university based grouping of candidates for specialised courses will, willy nilly, be valid.
But the basic identity of pertinent circumstances bearing on the university centred descrimen in Chanchala and here constitutionalize the scheme of selection adopted by Government grouping all eligibles from colleges affiliated to each University as separate units.
The High Court 's perspective in this regard is impeccable.
It is an interesting sidelight that in Chanchala as much as 20% of the total seats were thrown open to 'outsiders ' i.e. 'those who have passed the equivalent examination held by any other university not only in the State but also elsewhere in India.
The underlying unity of syllabus and broad agreement on evaluation are assumed in this pool system, confined to 20% but open to several universities.
Having held in the earlier Full Bench case that university wise categorisation for seats allocation was good the High Court, in the impugned judgment, still struck down the new scheme as discriminatory.
The vice was traced to a certain feature which went beyond mere universitywise allocation and made further modifications governed by the propor 989 tion of the number of students presented by the two universities for the pre degree and B. Sc.
examinations. 'Ay, there 's the rub '.
The Committee 's long range proposal of uniformity between the two universities was unexceptionable and, if adopted, would end apprehensions of injustice stemming from dissimilarities flowing from divergent syllabi and examination methodology.
Indeed Government has accepted it as the long term solution and rightly.
The relevant G.O. dated July 14, 1978, sums up the Committee 's unification solution thus : "As a long teirm solution Government may move the Universities of Kerala and Calicut to unify the curriculum and courses of study for pre degree course and form Inter University Board for the conduct of examination.
When such a scheme is established pre degree will be the only qualifying examination for selection to all courses in the medical colleges.
The Committee has pointed out that unification of the syllabus, course of study and examination in the four disciplines of B.Sc., viz., Physics, Chemistry, Zoology and Botany would be impossible and thus the reservation now given to graduate candidates for selection to Medical and dental colleges will have to be abolished." And the decision of Government is in these terms: "Government. .have accepted the recommendation of the committee to have unified curriculum and course of study and common board for conduct of examinations for the Kerala and Calicut Universities.
But Government consider that unification of syllabus and method of examination should be made also at degree level in respect of the 4 disciplines of Physics Chemistry, Zoology and Botany and that the reservation now given to the graduates for admission to the medical and dental colleges should be continued.
The Universities concerned are being requested to take further action in the matter." But the modus operandi for unification of syllabi and what not are incapable of instant execution by unilateral declaration, since it is the business of the Universities.
And Universities are self consciously autonomous and often politicised, with the result that the writ of Government may not run there.
Moreover, administrative slow motion is the genius of governmental and university processes.
Universities, with plural bodies, many voices and contradictory cerebrations, may meet and debate, appoint sub committees and discuss their reports, await reactions 990 of other organs and hold joint meetings to consider academic issues in all their dimensions and act generally only after leisurely reflect on.
Academies cannot be hustled and often hasten slowly.
Meanwhile, the year rolls on, students stagnate and medical education grinds to a halt.
These painful realities apparently induced the Government to fabricate in its secretariat foundry a transitory strategy for the current year.
This short run project adopted each University as a unit which, as we have earlier explained, was good so far as it went.
But a dubious rider was added which invited the judicial Waterloo.
That is the bone of contention and so we excerpt the relevant portion: "After considering the proposal in all its aspects Government have decided that the seats available for MBBS course after deducting the seats for mandatory admission may be distributed for the students of the two Universities in the ratio of the candidates registered for the pre degree and B.Sc.
course in the two Universities, taking the average of the number of candidates registered for the pre degree and B.Sc.
degree courses with eligibility for admission to Medical Colleges for the last three years as the basis.
" This operated as a cut back on the total 'Calicut ' seats as wholly available for the Calicut University students and, indeed, as urged by counsel for the respondent, subtly subverted the criterion of 'Malabar ' backwardness.
The Calicut Medical College and the Calicut University were created as the purpose oriented mechanisms for progressive elimination of educational backwardness in that territory.
This objective would be fulfilled if the entire number of seats of the Calicut Medical College were exclusively made the entitlement for eligible students from colleges affiliated to that University.
A further slice knifed out of the cake would spell reversal of policy.
We agree with the High Court that the injection of the university wise student strength is drawing the red herring across the trail an irrelevance that invalidates the scheme.
We cannot see the nexus between the registered student strength and the seats to be allotted.
The fewer the colleges the fewer the pre degree or degree students.
And so, the linkage of the division of seats with the registered student strength would make an irrational inroad into the university wise allocation.
Such a formula would be a punishment for backwardness, not a promotion of their advancement.
We cannot uphold the discriminatory paring down based on unreason.
991 Once this premise is reached the calculus is non controversial.
The three medical colleges affiliated to the Kerala University have a total strength of 345 students and the only college affilated to the Calicut University has a student strength of 180.
On these basic figures, the arithmatic worked out on the principles of deduction is beyond controversy.
42 students form the reserved quota and have to be apportioned between the two universities in the ratio of their student strength.
Making available of seats for candidates from other universities is also common ground.
Both sides agree that the net number of seats available to be filled up, if we proceed solely on the principle of university wise allocation, will be 166 for the Calicut University students and 317 for the Kerala University students.
The admissions, even on these agreed figures, will be subject to the die hard rule of Communal reservation.
The further division of seats in the ratio of 60: 40 as between the graduates and pre degree candidates also has to be maintined.
No question of complicating the numbers by any further injection of the population ratio between Malabar and Travancore Cochin arises because the new formula takes care of the backwardness of Malabar and there cannot be double benefits.
Decoding the rules in simplex form, what we get in arithmatical terms is that the Calicut University students who have now been alloted under the Government formula 136 seats will be eintitled to an extra 30 seats.
If we rigidly direct that these additional seats be assigned to the students emerging from the colleges under the Calicut University an equal number may have to be expelled from the students already admitted from out of the Kerala University quota.
This consequence becomes ccmpulsive since the total strength sanctioned for the four medical colleges fixed by the two Universities and approved by the Medical Council of India is 525 seats.
Here comes the play of processual realism in moulding the relief in the given milieu.
The rule of law should not petrify life or be inflexibly mulish.
It is tempered by experience, mellowed by principled compromise, informed by the anxiety to avoid injustice and softens the blow within the marginal limits of legality.
That is the karuna of the law.
Nor is law unimaginative, especially in the writ jurisdiction where responsible justice is the goal.
The court cannot adopt a rigid attitude of negativity and sit back after striking down the scheme of Government, leaving it to the helpless Government caught in a crisis to make do as best as it may, or throwing the situation open to agitational chaos to find a 992 solution by demonstrations in the streets and worse.
We are, therefore, unable to stop with merely declaring that the scheme of admission accepted by Government is ultra vires and granting the relief to the petitioner of admission to the medical college.
The need for controlling its repercussions calls for judicial response.
After all, law is not a brooding omnipresence in the sky but an operational art in society.
The High Court 's ultimate direction is: "We allow this writ petition and quash Exh. P2 G.O. to the extent to which it accepts alternative proposal of the committee referred to in Exh.
The Court also observes: "We think it will be unfair in the circumstances to deny effective relief to the writ petitioner. " The relief claimed was admission to the medical college.
The upshot of the judgment, in terms of student impact, government policy, college admissions and potential for agitation, may be envisioned for a while.
We may also take note of the gregarious trend of one writ petition being followed by many when the grievance is common and the first case is in essence a test case and class action.
What is granted to the petitioner has to be granted to others who follow her.
In terms of numbers several candidates may have to be admitted into the medical colleges.
More than that is the chaotic consequence of the pro tempore project of the Government being struck down with no alternative methodology of selection.
Governments have no magic remedies to tide over sudden crisis.
Their processes are notoriously slow and the temper of the student community is notoriously inflammable.
Thus the negative stroke of voiding the G.O. and granting relief to the petitioner is to throw out a number of students already undergoing their course and to incite unwittingly student unrest of magnitude, apart from leaving the academic algebra for admissions in a state of vacuum.
One thing is certain.
If the syndrome of campus chaos is to be obviated, the court should come to the assistance of the Kerala University students already admitted and undergoing their medical course who might otherwise have to be jettisoned.
We, therefore, do not think it right to force into the medical colleges any students who may be qualified for admission by virtue of our order at the expense of another who has already been admitted and is undergoing the medical course.
This means that 30 students from the colleges affiliated to the Calicut University will have to be provided for ab extra.
But how to find accommodation for 30 more students ? The Universities concerned have the power to increase the streghth ad hoc when gripped by a crisis such as has occurred here.
The Medical Council of India has an overall control in this field, being the statu 993 tory body created under the .
Thus, the concurrence of the Calicut and the Kerala Universities and the Medical Council of India becomes necessary for working out effective reliefs in terms of adding to the strength on a temporary footing, with a sense of equity and anxiety to do justice to the existing entrants.
Unfortunately, neither the Universities concerned nor the students affected are parties.
The presence of the Medical Council of India also has to be secured.
Confronted by this situation, we directed, as a measure of emergency issuance of notice to the two Universities and made them party to the record.
A similar step was taken in the case of the Medical Council of India.
At short notice, all the three parties entered appearance.
Although Shri A. section Nambiar, appearing for the University, expressed inability to consent to any course of addition of strength, he agreed that the concerned academic bodies were likely to meet shortly and the Universities themselves would abide by any directions this Court issued in the interests of Justice.
The learned Advocate General had earlier represented that the Universities were likely to agree to a temporary addition of strength, provided the Medical Council of India would also approve of the course.
We need hardly say that the writ of this Court binds the parties on record and all the three bodies are before us and must abide by the directions we issue necessitated by the exigency of the situation and the need to do justice.
After all, the Court system belongs to the people and must promote constructive justice; and all institutions, including the Governments and Universities, likewise belong,to the people.
This commitment is the whet stone for doing justice in the wider context of social good.
The Universities, as we gather from counsel representing all the parties, may not find it difficult to accommodate 30 students more, apportioned among the four medical colleges of the State.
This addition is compelled by the critical condition set out above.
This need will not survive this academic year and, in that sense, no long term trauma for academic standards will be inflicted by each of the colleges accommodating a few more students for their courses this year.
After all, not much time has passed since the teaching session began.
Compared to their existing strength, the additions are negligible.
The Medical Council of India, through the learned Additional Solicitor General, has expressed that it has no objection to this proposal for a miniscule addition confined to this acadcmic year.
We see no ground for either University to plead inability to help the cause of Justice.
The insistence on standards, measured by marks, is not being relaxed, so much so the quality of the admission of additional students does not suffer.
A marginal strain in the 994 matter of teaching and perhaps extra burden in regard to the practicals may have to be endured.
We are, therefore sure that the Universities, the colleges concerned, the teaching community and the alumni themselves will appreciate the goal and cooperate in the success of the direction we make.
Had we left the Judgment of the High Court in the conventional form of merely quashing the formula of admission the remedy would have aggravated the malady confusion, agitation, paralysis.
The root of the grievance and the fruit of the writ are not individual but collective and while the 'adversary system ' makes the Judge a mere umpire, traditionally speaking, the community orientation of the judicial function, so desirable in the Third World remedial jurisprudence, transforms the court 's power into affirmative structuring of redress so as to make it personally meaningful and socially relevant.
Frustration of invalidity is part of the judicial duty; fulfilment of legality is complementary.
This principle of affirmative action is within our jurisdiction under article 136 and article 32 and we think the present cases deserve its exercise We direct the State Government to admit 30 more willing students who are qualified under the rules and who are students from the colleges affiliated to the Calicut University in order of the marks secured.
They will be distributed by the Selection Committee among the four medical colleges of Government in an equitable way and their decision will be final.
The Kerala and the Calicut Universities will be bound to expand the strength of the medical colleges concerned for this year in obedience to this direction of the Court and the respective bodies under the Universities will act accordingly.
The selection of these 30 students will not be confined to those who have moved this Court or the High Court by way of writ proceedings or appeal.
The measure is academic excellence, not litigative persistence.
It will be thrown open to the first 30, strictly according to merit measured by marks secured.
The apportionment as between graduates and pre degree students and the application of the communal reservation will apply to these 30 to be selected.
The Selection Committee will make its decision on or before the 31st January 1979.
The Universities concerned will convey their approval to the Government for the nceessary addition to the student strength in obedience to the direction of this Court on or before the 27th January 1979.
We direct the State Government for the coming academic year 1979 80, to allot 166 seats for the students from the colleges affiliated 995 to the Calicut University and 317 seats to the students from the colleges affiliated to the Kerala University, the formula regarding every other aspect being as indicated in this Judgment such as for the mandatory admissions, the apportionment between pre degree students and the degree holders and other reservations.
Another imperative step we cast on the two Universities, which are parties before us, and are, therefore, bound by this Order deserves to be clearly expressed.
Having regard to the utter confusion in medical studies that may be produced by keeping the unification of syllabi and methodology of examinations in a flux we think it absolutely essential to fix a time target for the University bodies to act.
Government will issue necessary directions to its representatives on these bodies to accelerate the pace.
We expect both the Universities to implement the proposal made by the Committee and accepted by the Government regardnig the uniform curricula and common examination system and allied matters in such manner that there will be no inequality as between students emerging from one University and the other within the State.
This process shall be completed on or before 31st May 1979.
We are aware that these various directions and orders call for high pressure activisation.
Perhaps, we may emphasise the need for guarding against the slow march of bureaucratic movement embodied in Lord Curzon 's lament respecting the administration of his time, a state of affairs wholly opposed to the dynamic fulfilment of the imperatives cast by the Constitution upon the nation and its institutions.
Said Lord Curzon in a despatch to the Secretary of State: "Your despatch of August 5th arrived.
It goes to Foreign Department.
Thereupon Clerk No 1 paraphrases and comments upon it over 41 folio pages of print of his own composition, dealing solely with the Khyber suggestions in it.
Then comes Clerk No. 2 with 31 more pages upon Clerk No. 1.
Then we get to the region of Assistant Secretaries, Deputy Secretaries and Secretaries.
All these gentlemen state their werthless views at equal length.
Finally we get to the top of the scale and we find the Viceroy and Military Member, with a proper regard for their dignity, expanding themselves over a proportionate space of print.
Then these papers wander about from Department to Department and amid the various Members of Council.
I am grappling with this vile system in my own department, but it has seated itself like the 996 Old Man of the Sea upon the shoulders of the Indian Government and every man accepts, while deploring the burden.
"(1) Hopefully, we part with this case with the thought that there will be no occasion for any party to move for extension of time or to prove that the curse Lord Curzon spelt out still haunts the wheels of administration.
The appeal is allowed; so also the writ petition in the manner and to the extent we have directed.
The parties will bear their costs.
The decisional guidelines herein given will, we dare say, so help dispose of the many Writ Petitions pending in the High Court.
The journey to the Supreme Court is not always necessitous for final justice.
ORDER While there is agreement that thirty seats more have to be added as has been indicated in the judgment making the total number of seats allocable to the students of the Calicut University to 166, there is some dispute regarding the number of seats available for the students belonging to the Kerala University.
We have mentioned in the judgment that it is 317.
It is open to the State Government or to the concerned Universities to bring it to the notice of the court in case there is any clarification necessary.
N. V. K. Appeal & Petition allowed.
| IN-Abs | Articles 32 and 136 When root of the grievance and the fruit of writ are not individual but collective courts power is one of affirmative structuring of redress to make it meaningful and socially relevant Decisional guidelines to be given.
The State of Kerala appointed a Commission to recommend which sections of the people required special treatment under article 15(4) having regard to their social and educational conditions.
That Commission recommended equitable allocation of seats on the bais of education backwardness of the Malabar area.
Substantially founding itself on these recommendations the these recommendations the State Government evolved a formula, which by polling all applications for admission to the four medical colleges in the state one consolidated list was prepared and candidates were selected strictly according to the marks secured by them.
This scheme having been struck down by the High Court, a fresh expert committee was appointed to examine the quo modo of admissions to medical colleges.
The Government on the basis of these recommendations decided that seats available for the medical course might be distributed for the students of the two 1, Universities of Kerala and Calicut in the ratio of the candidates registered for the pre degree and B. Sc.
course in them.
In a writ petition under article 226 the High Court held that the scheme of selection for admission to the medical colleges on an assessment of merits of students drawn from different universities with no uniformity of standards is objectionable and the linkage of the division of seats with the registered student strength of the universities bears no nexus and is violative of article 14 of the Constitution.
On the question of the validity of the scheme of selection for admission to the medical colleges.
^ HELD : 1.
Current conditions warrant the classification of student community on the zonal basis not as a legitimation of endless perpetuation but as a transient panacea for a geo human hadicap which the State must actively strive to undo.[980E] 2.The principal of reservation with weightage for the geographical area of the Malabar district is approved.[980 G] 3 The reasoning of the High Court that there is such substantial difference in the pre degree courses and evaluations between the sister universities within the same State that the breach of article 14 by equal treatment of the marks un 975 equally secured by the examinees in the two Universities may be spelt out.
Every inconsequential differentiation between two things does not constitute the vice of discrimination, if law clubs them together ignoring vanial variances.
Article 14 is not a voodoo which visits.
with invalidation every executive or legislative fusion of things or categories where there are no pronoanced inequalities.
Mathematical equality is not the touchstone of constitutionality.
[983 E F] State of Jammu & Kashmir vs Triloki Nath Khosa & Anr. ; at 42 referred to.
A large latitude is allowed in this area to the State to classify or declassify based on diverse considerations of relevant pragmatism and the judiciary should not "rush in" where the executive varily treads.
[984 A] 5.
Many colleges are run by the State or institutional managements where pre degree or degree courses are undertaken, The teachers move from one university jurisdiction to the other, the teaching material is inevitably of a like nature, the subjects taught must ordinarily be alike.
The examiners are usually drawn from within the State or neighbouring States.
Even the composition of the academic bodies in the two universities may have common members.
The University Act themselves are substantially similar.
To surmise discrimination from possibilities is alien to the forensic process in the absence of hand facts.
Gross divergences exist amoung Universities affecting the quality of the teaching and the inaiking.
the anomalies of grading and the absurdity of equating the end product on the blind assumption that the same marks mean the same excellence.
But not glib surmises but solid facts supply the sinews of discriminatory inequality or equality.
Some backward universities and colleges have degenerated into degree dealers bringing rapid discredit to Indian Academic status.
[984 D F] 6.
The vagarious element in marking and moderation of marks may be a fact of life, but too marginal to qualify for substantial difference unless otherwise made out Indeed.
there may be differences among the colleges under the same University.
among the examiners in the same University.
Such fleeting factors or eohemeral differences cannot be the solid foundation for a substantial differentiation which is the necessary pre condition for quashing an executive or legislative act as too discriminatory to satisfy the egalitarian essence of Art 14.
[984 H 985 A] 7.
The functional validation of the writ jurisdiction is an appropriate examination of the substantiality of the alleged disparity.
[985 B] 8.
The corner stone of classification adopted for medical admission.
by the Government was University wise allocation.
By itself.
this approach had constitutional sanction.
[986 C] D. N. Chanchala vs State of mysore & Ors. etc.
[1971] Supp.
SCR 608; relied on 9.
The discriminatory vice,if University wise classification and consequential allocation of seats were resorted to, was pressed therein but repelled.
The fundamental `educational realities and resultant resolution of the legal imbrogliro are instructively presented therein, which have special relevance to the instant case because the social facts, constitutional confrontations and administrative answers in the Kerala and Karnataka litigations are similar.
[986 D, 986 H 987 A] 976 10.The injection of the University wise student strength is drawing the redherring across the trail an irrelevance that invalidates the scheme.
There is no nexus between the registered student strength and the seats to be allotted.
The fewer the colleges the fewer the pre degree or degree students.
And so, the linkages of the division of seats with the registered student strength would make an irrational inroad into the University wise allocation.
Such a formula would be a punishment for backwardness, not a promotion of the advancement.
The discriminatory paring down based on unreason cannot be upheld.
[990 G H] 11.
Law is not unimaginative, especially in the writ jurisdiction where responsible justice is the goal.
The court cannot adopt a rigid attitude of negativity and sit back after striking down the scheme of Government leaving it to the helpless Government caught in a crisis to make do as best as it may, or throwing the situation open to agitational chaos to find a solution by demonstrations in the streets and worse.
In the instant case unable to stop with merely declaring that the scheme of admission accepted by Government is ultra vice and granting the relief to the petitioner of admission to the medical colleges, the need for controlling its repercussions calls for judicial response.
[991 H 992 A] 12.
An incisive study of the exercise of the writ power in India may reveal that it limits its actions by quashing or nullifying orders proceeding on a violation of law, but stops short of a reconstruction whereby a valid scheme may replace a void project.
This is symptomatic of an obsolescent aspect of the judicial process, its remedial shortcomings in practice and the need to innovate the means, to widen the base and to organise the reliefs so that the Court actualises social justice even as it inhibits injustice.
[978 A B] 13.
This community perspective of the justice system explains why the Court has resorted to certain unusual directions and has shaped the ultimate complex of orders in these proceedings in a self acting package.
Chronic social disability cannot be amenable to instant administrative surgery and law shall not bury its head, ostrich fashion, in the sands of fiction and assume equality where the opposite is the reality.
[978 C, 980 C] 14.
The rule of law runs close to the rule of life and where socieal life, as between one part of the State and another, is the victim of die hard disparties, the constitutional mandate of equal justice under the law responds to it pragmatically and permits classification geared to eventual equalisation.
The writ of this Court binds the parties on record who must abide by the directions issued necessitated by the exigency of the situation and the need to do justice.
[993 D] 16.
The court system belongs to the people and must promote constructive justice; and all institutions, including the Governments and Universities, likewise belong to the people.
This commitment is the whet stone for doing justice in the wider context of social good.
[993 E F] 17.
Leaving the Judgment of the High Court in the conventional form of merely quashing the formula of admission the remedy would have aggravated the malady, confusion, agitation, paralysis.
The root of the grievance and the fruit of the writ are not individual but collective and while the "adversary system" makes the Judge a mere umpire, traditionally speaking, the community orientation of the judicual function, so desirable in the Third World remedial juris 977 prudence, transforms the courts ' power into affirmative structuring of redress so as to make it personally meaningful and socially relevant.
Frustration of invalidity is part of the judicial duty; fulfilment of legality is complementary.
This principle of affirmative action is within the court 's jurisdiction under Art 136 and article 32 and the present cases deserve its exercise.
Decisional guidelines given.[994 B F]
|
Civil Appeal No. 2153 of 1969.
Appeal by Special Leave from the Judgment and Decree dated 12 8 69 of the Punjab and Haryana High Court in R.F.A. No. 357 of 1963.
Hardayal Hardy, P. H. Parekh, C. B. Singh and M. Mudgal for the Appellants.
M. N. Phadke, Mohan Behari Lal for Respondent No. 1.
The Judgment of the Court was delivered by CHINNAPPA REDDY, J.
This appeal is directed against the judgment of the High Court of Punjab and Haryana confirming that of the Subordinate Judge 1st Class, Nabha.
The respondent plaintiff filed a suit for a declaration that he was the Mahant of Dera Baba Khiali Das, Khansura, Tehsil Nabha, District Patiala, that he was entitled to manage the properties of the Dera and that the alienations made by Mahant Krishan Das and Amar Parkash were not 1014 binding on him.
It was alleged by the plaintiff that Amar Parkash who held power of attorney from Mahant Krishan Das, the previous Mahant of the Dera, had mismanaged the properties and had granted leases of lands belonging to the Dera to his mistress and his brother in law.
Mahant Krishan Das came to know about the mismanagement by Amar Parkash and cancelled the power of attorney which he had previously executed in favour of Amar Parkash.
Mahant Krishan Das summoned the general assembly of the Udasi Ghekh and held a meeting, with the help of the Deputy Commissioner, Patiala and the Police, on 23rd July 1961.
The meeting was attended by other Mahants of Udasi Bhekh.
In the general assembly of the Udasi Bhekh, Mahant Krishan Das tendered resignation of office of Mahant on the ground of old age and ill health and appointed the plaintiff as his successor Mahant.
This was accepted by all the Mahants of Udasi Bhekh.
Mahant Krishan Das, treating the plaintiff as his Sadaq Chela, applied Tilak, performed Pagri ceremony with his own hand and duly installed the plaintiff as the Mahant.
The visiting Mahants also performed the Pagri ceremony.
Despite the installation of the plaintiff as Mahant of the Dera, Amar Parkash continued his activities and started obstructing the plaintiff from discharging his obligations as Mahant.
The plaintiff, therefore, filed the suit for a declaration that he was the Mahant of the Dera and for other reliefs.
The defendant Amar Parkash raised the plea that the was the chela of Mahant Krishan Das and that Mahant Krishan Das who died on 30th December, 1961, had executed two Wills on 17th July, 1955 and 24th September, 1961, appointing him as the Mahant to succeed him.
It was alleged that the proceedings which took place on 23rd July 1961 were the result of fraud and undue influence exercised over Mahant Krishan Das.
On the pleadings of the parties the primary question which arose for consideration was whether the plaintiff was validly appointed as Mahant of Dera Baba Khiali Das.
The learned Subordinate Judge.
Nabha framed two principal issues.
Issue No. 1 was: "What was the particular custom or usage prevailing in the Dera in dispute for the appointment of a Mahant on the relevant date ?" Issue No. 1 A was: "whether the plaintiff was validly appointed the Mahant of the Dera in accordance with the prevalent custom ?" The learned Subordinate Judge noticed that neither party pleaded or referred to any particular usage or custom for appointing a Mahant 1015 for the disputed Dera.
He also noticed that the documentary evidence showed that the final appointment of Mahants for Deras in the Nabha State was required to be approved by the Ruler of the State.
Leaving the matter there, the learned Subordinate Judge found that the plaintiff was duly and validly installed as Mahant of the Dera by Mahant Krishan Das in the presence of and with the approval of Udasi Bhekh.
He held that the plea of fraud and undue influence raised by the defendant was not established.
On those findings the suit was decreed.
The first defendant Amar Parkash preferred an appeal to the High Court of Punjab and Haryana.
During the pendency of the appeal the plaintiff sought an amendment of the plaint in order to enable him to expressly plead the particular custom relating to succession to the office of the Mahant of Dera Baba Khiali Das.
The amendment was allowed and the High Court directed the Subordinate Judge to record additional evidence and submit a report giving his finding on the question whether the custom pleaded by the plaintiff was established and if so, whether the plaintiff was appointed in accordance with such custom.
After recording additional evidence the learned Subordinate Judge submitted a report to the effect that the custom alleged by the plaintiff was not established and that upto 1948 the practice was for the Ruler of Nabha State to appoint the Mahant.
After receiving the report of the learned Subordinate Judge, the High Court heard the appeal.
It was conceded by the learned Counsel for the appellant before the High Court that in view of the report of the learned Subordinate Judge, the appeal should be decided on the basis of the evidence adduced before the Trial Court prior to the order of the High Court calling for a report from the Trial Court.
On that basis the learned Counsel for the appellant attacked the finding on issue No. 1 A only and did not assail the findings on the other issues.
The High Court confirmed the finding of the Trial Court that there was no undue influence exercised over Mahant Krishan Das and that the plaintiff was validly appointed and installed as Mahant of the Dera.
In the first instance Shri Hardayal Hardy, learned Counsel for the appellant invited us to explore the evidence and the case law to find out the custom relating to succession to the office of Mahant of Deras in Nabha State in general and Dera Baba Khiali Das in particular.
Ultimately, however, he conceded that if the plaintiff was shown to have been validly appointed and installed as Mahant by late Mahant Krishan Das at the ceremony held on 23rd July 1961, the plaintiff was entitled to succeed.
He argued that late Mahant Krishan Das was covered into appointing and installing the plaintiff 1016 as Mahant and therefore, the appointment of the plaintiff as Mahant of the Dera was invalid.
He also argued that the plaintiff was not a chela of Mahant Krishan Das and, therefore, he could not have been validly appointed as Mahant of the Dera in question.
As pointed out in Mukherjea 's Hindu Law of Religious and Charitable Trusts (Third Edition), succession to the office of Mahant is a matter of some complexity and the custom varies greatly from institution to institution.
Generally speaking, it is pointed out, Mutts may be divided into three classes: Mourasi, Panchayati and Hakimi.
"In the first, the office of the Mohunt is hereditary and devolves upon the chief disciple of the existing Mohunt who moreover usually nominates him as his successor; in the second, the office is dective, the presiding Mohunt being selected by an assembly of Mohunts.
In the third, the appointment of the presiding Mohunt is vested in the ruling power or in the party who has endowed the temple".
It is also said "In various institutions the custom is that in order to entitle a chela to succeed, he must be appointed or nominated by the reigning Mohunt during his life time or shortly before his death and this may be done either by a written declaration or some sort of testamentary document".
It is further said "Even where the Mohunt has the power to appoint his successor, it is customary in various Mutts that such appointment should be confirmed or recognised by the members of the religious fraternity to which the deceased belonged".
In Mahant Satnam Singh vs Bawan Bhagwan Singh(1), the Privy Council while noticing that succession to the office of Mahant was to be regulated by the particular custom of the Math, observed as follows: "In the normal case of the death of a Mahant, the members of the fraternity will be fully aware of the vacancy in the office, and the usual practice will be for the installation of his successor usually nominated by him, to take place on the seventeenth day after the death.
On the other hand, when the Mahant resigns during his life and installs his successor on the gaddi, it is obvious that the fraternity should be made aware of the proposed vacancy in the office and should be given the opportunity of confirming or refusing to confirm the nominee".
It is unnecessary for us to make any further investigation into the custom relating to the appointment of Mahant since, in the light of the submissions made before us, two questions alone arise for consideration namely whether Mahant Krishan Das was coerced into appointing the plaintiff as his successor Mahant and whether the appointment of the plaintiff was invalid on the ground of his not being a Chela of Mahant Krishan Das. 1017 On the question whether late Mahant Krishan Das was subjected to any pressure to appoint the plaintiff as Mahant, both the Courts below have concurrently found that he was subjected to no such pressure.
The finding is one of fact and we are unable to see any ground justifying our interference with a concurrent finding of fact.
Shri Hardyal Hardy submitted that the High Court failed to consider the complaint said to have been made by late Mahant Krishan Das a few days after the installation of the plaintiff as Mahant in which he stated that he had been coerced into appointing the plaintiff as Mahant.
Shri Hardyal Hardy also submitted that the evidence showed that the services of the Police had been requisitioned to pressurise late Mahant Krishan Das.
The submission that the High Court did not consider the complaint said to have been made by late Mahant Krishan Das is without basis since we find that the High Court did refer to the complaint.
The High Court confirmed the finding of the Trial Court that late Mahant Krishan Das who was previously under the influence of Amar Parkash had again come under the influence of Amar Parkash when he made the complaint.
With regard to the presence of the Police at the installation ceremony we are of the view that the presence of the police, at the ceremony, far from advancing the appellant 's case, destroys the case that Mahant Krishan Das acted under coercion.
The question that remains for consideration is whether the plaintiff was the Chela of Mahant Krishan Das and whether he could be validly appointed, if he was not the Chela.
In Exhibit P 7 dated 23rd July 1961 which was executed by Mahant Krishan Das and attested by all visiting Mahants the plaintiff Parkasha Nand was described as 'Sadaq Chela ' of Mahant Krishan Das.
The ceremony which took place on 23rd July 1961 was described by Parkasha Nand in the following words: "The congregation sat on the durries on the first floor of the Dera.
About 25 Mahants and about 30 villagers sat on those durries.
Mahant Krishan Das offered a Tilak on my forehead.
Mahant Bikram Dass collected turbans from the Mahants who were present there and tied five turbans on my head.
Mahant Som Parkash offered me a Doshala and sugar cakes were distributed.
All these proceedings were gone through with the free and voluntary consent of late Mahant Krishan Das and no pressure was brought to bear on him.
Mahant Krishan Das was not confined.
Exhibits P6 to P8 were written at that time and the people who 1018 were present had affixed their signatures and thumbimpressions thereon".
We are satisfied that late Mahant Krishan Das accepted the plaintiff as his Chela and appointed him as his successor Mahant.
We may also mention here that the learned Subordinate Judge in his report mentioned that Pandit Bhagtanand who was previously a Mahant of the Dera was not a Chela of his predecessor Mahant Sunder Das and that Mahant Krishan Das himself was not a Chela of his predecessor Mahant Bhagtanand.
We are unable to see any ground for inteference and the appeal,is accordingly dismissed with costs.
N.V.K. Appeal dismissed.
| IN-Abs | In his suit for declaration that he was the Mahant of a Ders, the plaintiff (respondent) claimed that the late Mahant who had previously executed the power of attorney in favour of the defendant (appellant) cancelled it and summoned the General Assembly of the Udasi Bhekh which was attended by other Mahants of the Udasi Bhekh and tendered his resignation on the ground of old age and ill health, that the late Mahant treated him as Sadaq Chela and that he made him a Mahant by applying Tilak and performing the Pagri ceremony at the Udasi Bhekh.
The defendant on the other hand claimed that it was he who was the chela of the late Mahant who, before his passing away executed two wills appointing him as the successor to the gaddi and that the proceedings making the plaintiff as Mahant were the result of fraud and undue influence exercised by the plaintiff over the late Mahant.
Decreeing the suit the Subordinate Judge held that neither party referred to any particular usage or custom of appointing a Mahant, that upto 1948 the practice was for the Ruler of the erstwhile State of Nabha to appoint a Mahant, but that in this case the plaintiff was duly and validly installed as the Mahant in the presence of and with the approval of the Udasi Bhekh and that no fraud or undue influence alleged by the defendant was established.
The High Court confirmed all the findings of the trial court.
On further appeal to this Court the defendant (appellant) contended that (1) the late Mahant was coerced into appointing the plaintiff as his successor and (2) the appointment of plaintiff was invalid in that he was not a chela of the late Mahant.
Dismissing the appeal, ^ HELD: 1 (a) On the question whether the late Mahant was subjected to any pressure to appoint the plaintiff as Mahant, both the courts have concurrently found that he was subjected to no such pressure.
There is no reason for interference with a concurrent finding of fact by the two courts below.[1017 A B] (b) The submission that the High Court did not consider the complaint said to have been made by the late Mahant that he had been coerced into appointing the plaintiff as Mahant is without basis.
The High Court did refer to the complaint.
It confirmed the finding of the trial court that the late Mahant who was previously under the influence of the appellant had again come under his influence when he made the complaint.
The presence 1013 of the police at the installation ceremony far from advancing the appellant 's case, destroys the case that the Mahant acted under coercion.
[1017 C D] 2(a) In the matter of succession to the office of Mahant the custom prevalent in various institutions is that in order to entitle a chela to succeed, he must be appointed or nominated by the reigning Mahant during his life time or shortly before his death and this may be done either by a written declaration or some sort of testamentary document.
Even where a Mahant has the power to appoint his successor, it is customary in various Mutts that such appointment should be confirmed or recognised by the members of the religious fraternity to which the late Mahant belonged.
When a Mahant resigns during his life time and installs his successor, on the gaddi the fraternity is made aware of the proposed vacancy in the office and is given an opportunity of confirming or refusing to confirm the nominee.
[1016 D, E, G] In the instant case the document executed by the late Mahant on the date of the installation of the plaintiff as Mahant was attested by all the visiting Mahants of the Udasi Bhekh who assembled at the Dera.
The plaintiff was described as Sedaq Chela of the late Mahant.
This document showed that the late Mahant accepted the plaintiff as chela and appointed him as his successor.
[1017 E 1018 A] (b) The Subordinate Judge found that none of the three earlier Mahants of the Dera who succeeded to the gaddi was a chela of each of his predecessors.
[1018 B] Mahant Satnam Singh vs Bawan Bhagwan Singh, AIR 1938 PC 216; referred to.
Mukherjea 's Hindu Law of Religious & Charitable Trusts (Third Edition) referred to.
|
N: Criminal Appeal No. 194 of 1973.
Appeal by Special Leave from the Judgment and Order dated 3 4 1973 of the Andhra Pradesh High Court in Criminal Appeal No. 703/71.
A. N. Mulla and A. Subba Rao for the Appellant.
G. Narayana Rao for the Respondent.
The Judgment of the Court was delivered by FAZAL ALL, J.
In this appeal by special leave the appellant has been convicted under section 161 I.P.C. and section 5(2) read with section 5(1)(d) of the Prevention of Corruption Act and sentenced to rigorous imprisonment for one year and a fine of Rs. 250/ on each count.
1009 The appellant had been convicted by Special Judge but on appeal by the State to the High Court the High Court reversed the judgment of acquittal and convicted the appellant as indicated above.
According to the prosecution the appellant is said to have struck a bargain for taking a bribe of Rs. 125/ which he received on the 15th of July, 1968 in the presence of P.Ws. 1 and 3.
On receiving the signal the raiding party appeared on the scene and the hand of the accused was dipped in water containing phenopthelien solution which showed that he touched the notes.
The defence of the appellant was that he never demanded any bribe and that the notes were thrust into his pocket.
It is not necessary for us to dwell on the merits of the case because, in our opinion, the appeal must succeed on a short point of law, raised by Mr. A. N. Mulla, learned counsel for the appellant.
It was argued that the sanction under section 6 of the Prevention of Corruption Act produced in this case does not reveal the facts constituting the offence and, therefore, there is no evidence to show on what materials the sanctioning authority applied its mind and granted the sanction.
The Resolution of the Standing Committee granting the sanction is Exh.
P 16 and is dated 31 3 1969, and runs as follows: "As per note of the Commissioner, M.C.H. the Standing Committee unanimously accords sanction for prosecution of Sri Mohd. Iqbal Ahmed (in the scale of 110 180) Section Officer of Town Planning Section (Under suspensions) in a competent Court for the offence mentioned in the note of the Commissioner M.C.H., dated 18 1 1969 so as to enable the Commissioner to sign the prosecution order and send it to the Director, Anti Corruption Bureau for taking further action at the earliest".
A perusal of the Resolution of the Sanctioning Authority clearly shows that no facts on the basis of which the prosecution was to be sanctioned against the appellant are mentioned in the sanction nor does this document contain any ground on which the satisfaction of the Sanctioning Authority was based and its mind applied.
This document merely mentions that the sanction has been given on the basis of a note of the Commissioner, Municipal Corporation which appears to have been placed before the Committee.
It is obvious, therefore, that this note, if any, must have come into existence either on 31 3 1969 or at any date prior to this.
The prosecution could have proved the facts constituting the offence which were placed before the Sanctioning Authority by producing the note at 1010 the trial.
But no such thing has been done.
What the prosecution did was merely to examine two witnesses P.Ws. 2 and 7.
P.W. 2 has produced the order implementing the Resolution of the Sanction ing Authority which is Exhibit P 10 and is dated 21st April, 1969, that is to say after the sanction was given.
This document no doubt contains the facts constituting the offence but that does not solve the legal issues that arise in this case.
It is incumbent on the prosecution to prove that a valid sanction has been granted by the Sanctioning Authority after it was satisfied that a case for sanction has been made out constituting the offence.
This should be done in two ways; either (1) by producing the original sanction which itself contains the facts constituting the offence and the grounds of satisfaction and (2) by adducing evidence aliunde to show that the facts placed before the Sanctioning Authority and the satisfaction arrived at by it.
It is well settled that any case instituted without a proper sanction must fail because this being a manifest difficulty in the prosecution, the entire proceedings are rendered void ab initio.
In the instant case no evidence has been led either primary or secondary to prove as to what were the contents of the note mentioned in Exhibit P 16 which was placed before the Sanctioning Authority.
The evidence of P.W. 2 or P.W. 7 is wholly irrelevant because they were not in a position to say as to what were the contents of the note which formed the subject matter of the sanction by the Standing Committee of the Corporation.
The note referred to above was the only primary evidence for this purpose.
Mr. Rao vehemently argued that although the Resolution, Exh.
P 16 does not mention the facts, the Court should presume the facts on the basis of the evidence given by P.W. 2 and the order implementing sanction which mentions these facts.
This argument is wholly untenable because what the Court has to see is whether or not the Sanctioning Authority at the time of giving sanction was aware of the facts constituting the offence and applied its mind for the same and any subsequent fact which may come into existence after the resolution granting sanction has been passed, is wholly irrelevant.
The grant of sanction is not an idle formality or an acrimonious exercise but a solemn and sacrosanct act which affords protection to government servants against frivolous prosecutions and must therefore be strictly complied with before any prosecution can be launched against the public servant concerned.
It was next contended by Mr. Rao that in view of the presumption which is to be drawn under section 4 of the Prevention of Corruption Act, even if, no facts are mentioned in the Resolution of 1011 the Sanctioning Authority it must be presumed that the Sanctioning Authority was satisfied that the prosecution against the appellant should be launched on the basis of the presumpion that the accused had received a bribe.
With due respects to the learned counsel, this argument seems to be wholly mis conceived.
In the first place, there is no question of the presumption being available to the Sanctioning Authority because at that stage the occasion for drawing a presumption never arises since there is no case in the Court.
Secondly, the presumption does not arise automatically but only on proof of certain circumstances, that is to say, where it is proved by evidence in the Court that the money said to have been paid to the accused was actually recovered from his possession.
It is only then that the Court may presume the amount received would be deemed to be an illegal gratification.
So far as the question of sanction is concerned this arises before the proceedings come to the Court and the question of drawing the presumption, therefore, does not arise at this stage.
Lastly, it was submitted by Mr. Rao that he should be given a chance to produce the materials before the Court to satisfy that the Sanctioning Authority had duly applied its mind to the facts constituting the offence.
We are, however, unable to accede to this prayer which has been made at a very late stage.
The prosecution had been afforded a full and complete opportunity at the trial stage to produce whatever material it liked and it had chosen to examine two witnesses but for reasons best known to it did not produce the note which formed the subject matter of the Resolution of the Sanctioning Authority Exh.
It is well settled that in a criminal case this Court or for that matter any court should not ordinarily direct fresh evidence to fill up a lacuna delibrately left by the prosecution.
The liberty of the subject was put in jeopardy and it cannot be allowed to put in jeopardy again at the instance of the prosecution which failed to avail of the opportunity afforded to it.
For these reasons, therefore, we are satisfied that the present prosecution was launched without any valid sanction and, therefore, the cognizance taken by the Special Judge was completely without jurisdiction.
The appeal is accordingly allowed.
The judgment of the High Court is set aside and convictions and sentences passed on the appellant are quashed.
The appellant will now be discharged from his bail bonds.
P.B.R. Appeal allowed.
| IN-Abs | The appellant who was charged with an offence under section 5(2) read with s.5(1)(d) of the Prevention of Corruption Act was acquitted by the Special Judge.
But the High Court on appeal by the State, reversed the judgment of he Special Judge and convicted him.
In appeal to this Court it was contended on behalf of the appellant that there was no evidence to show on what materials the sanctioning authority applied its mind before granting the sanction under s.6 of the Act.
The entire proceedings are void ab initio.
Allowing the appeal.
^ HELD: 1 (a).
The prosecution of the appellant was without valid sanction and, therefore, cognizance taken by the Special Judge was without jurisdiction.
[1011 G] (b) Any case instituted without proper sanction must fail because this being a manifest defect in the prosecution, the entire proceedings are rendered void ab initio.
It is incumbent on the prosecution to prove that a valid sanction had been granted by the sanctioning authority after it was satisfied that a case had been made out constituting the offence.
This should be done in two ways: either (i) by producing the original sanction which itself contains the facts constituting the offence and the grounds of sutisfaction or (ii) by adducing evidence aliunde showing the facts placed before the authority and the satisfaction arrived at by it.
[1010 B D] In the present case no evidence, either primay or secondary, had been led to prove the contents of the note placed before the sanctioning authority nor were the witnesses examined in a position to state the contents of the note.
The grant of sanction is not an idle formality but a solemn and sacrosanct act which affords protection to government servanats against frivolous prosecutions and must therefore be strictly complied with before any prosecution could be launched against public servants.
[1010G] (b) There is no force in the argument of the State that the Court should presume the facts on the basis of evidence given by one of the witnesses and the order implementing the sanction mentioning those facts.
What the Court 1008 has to see is whether or not the sanctioning authority at the time of giving the sanction was aware of the facts constituting the offence and applied its mind for the same.
Any subsequent fact coming into existence after the resolution had been passed is wholly irrelevant.
[1010 F] (c) There is equally no force in the State 's contention that even if no facts were mentioned in the resolution it must be presumed that the sanctioning authority was satisfied that the accused had received a bribe.
There is no question of a presumption being available .o the sactioning authority because at that stage the occasion for drawing a presumption never arises since there is no case in the Court.
[1011 B] (d) The presumption does not arise automatically but only on proof of certain circumstances that is to say, where it is proved by evidence in Court that the money said to have been paid to the accused was actually recovered from his possession.
It is only then that the Court may presume the amount received would be deemed to be an illegal gratification.
The question of sanction arises before the proceedings come to the Court and the question of drawing a presumption does not arise at this stage.
[1011 C] (e) The prosecution cannot be given a chance to produce any material before the court at the appellate stage to satisfy that the sanctioninf authority had duly applied its mind before giving the sanction.
The prosecution had been afforded a full and complete opportunity at the trial stage to produce whatever material it liked and it had chosen to examine two witnesses; but for reasons best known to it, it did not produce the note which formed the subject matter of resolution of the sanctioning authority.
[1011 E] (f) In a criminal case this Court would not ordinarily direct fresh evidence to fill up a lacuna deliberately left by the prosecution.
The liberty of the subject was in jeopardy and it cannot be allowed to put in jeopardy again at the instance of the prosecution which failed to avail of the opportunity afforded to it.
[1011 J]
|
minal Appeal No. 65 of 1954.
Appeal by special leave from the judgment and order dated the 2nd January 1953 of the Judicial Commissioner 's Court at Ajmer in Criminal Appeal No. 3 of 1952 arising out of the judgment and order dated the 4th January, 1952 of the Court of Sessions Judge at Ajmer in Criminal Appeal No. 300 of 1951.
B.P. Berry and B. P. Maheshwari, for the appellant.
C. K. Daphtar Solicitor General of India (Porus A. Mehta and P. G. Gokhale, with him) for the respondent.
March 12.
The Judgment of the Court was delivered by BOSE J.
The appellant, S.N. Mehra, a Camp Clerk 201 Ajmer, has been convicted of offences under section 420 of the Indian Penal Code and section 5(2) of the Prevention of Corruption Act, 1947 (Act II of 1947).
He was sentenced to two years ' rigorous imprisonment and a fine of Rs. 100 on each count.
The substantive sentences are concurrent.
The substance of the offences for which he was convicted lay in obtaining sums to talling Rs. 23 12 0 from Government as T.A. for two journeys, one from Ajmer to Abu Road and the other from Ajmer to Reengus.
The money represents the second class railway fare for these journeys.
The allegation against him is that either he did not travel at all between those places on the relevant dates, or, if he did, that he did not pay the fare.
He appealed to the Sessions Judge at Ajmer and was acquitted.
The State filed an appeal against the acquittal to the Judicial Commissioner of Ajmer ' The learned Judicial Commissioner accepted the appeal and remanded the case for retrial before a Special Judge because, by reason of certain amendments in the law, only a Special Judge could try an offence under section 5(2) of the Prevention of Corruption Act at the date of the remand.
The appeal here raises certain questions about sanction which we do not intend to discuss because, in our opinion, the evidence adduced does not justify a retrial as no conviction for those two offences could be based on it.
It was first alleged that the appellant did not travel at all on the relevant dates and that the burden of proving that he did was on him.
We do not think this issue arises because the charge assumes that he did travel and there is no evidence before us to justify even a prima facie inference that he did not.
The charge runs "That you, on or about etc . cheated the Government by dishonestly inducing the Government to pay you Rs. 62 9 0 on account of T.A. for the journeys performed on the above mentioned days. . " 202 There is no suggestion that the journeys were not performed and only purported to be; and it would be unfair to permit the State to go back on what it said in the charge at this stage, especially after the appellant has entered on his defence and virtually admitted that he did travel on those dates; in any case, he has not denied the fact and that would naturally operate to his disadvantage if the prosecution were to be allowed to change its position in this way.
We must therefore accept the fact that he did travel as alleged on the relevant dates, and the only question that remains is whether he paid the second class fares which he later claimed, and obtained, from Government as T.A. for those journeys.
The only proof that is adduced in support of the allegation that he did not is that no second class tickets were issued at Ajmer on the relevant dates either for Abu Road or for Reengus.
This is proved by the Booking Clerk Ram Dayal, P.W. 4.
But the same witness proves that tickets are not always issued and that passengers can pay the fare on the train; also, if the second class is fully booked no further tickets are issued till the arrival of the train.
In that case, passengers sometimes buy a third class or an inter class ticket and then pay the difference to the conductor or guard of the train if they are able to find second class accommodation when the train arrives.
There is no proof that one or other of these courses was not followed on the dates with which we are concerned.
The railway registers and books would show whether or not any such payments were made on those dates and the State could have proved the absence of such payments as easily as it was able to prove, from the same sort of material, that no second class tickets were issued.
Instead of doing that, the State contented itself with saying that no second class tickets were issued and, then relying on Illustration (b) to section 106 of the Evidence Act, it contended that the burden of proving that the accused did pay the second class fares was on him.
Illustration (b) runs thus: "A is charged with travelling on a railway with 203 out a ticket.
The burden of proving that he had a ticket is on him".
But this is only an illustration and must be read subject to the section itself and cannot travel beyond it.
The section runs "When any fact is especially within the knowledge of any person, the burden of proving that fact is on him".
The stress, in our opinion, is on the word "especially".
Section 106 is an exception to section 101.
Section 101 lays down the general rule about the burden of proof.
"Whoever desires any Court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts, must prove that those facts exist".
Illustration (a) says "A desires a Court to give judgment that B shall be punished for a crime which A says B has committed.
A must prove that B has committed the crime".
This lays down the general rule that in a criminal case the burden of proof is on the prosecution and section 106 is certainly not intended to relieve it of that duty.
On the contrary, it is designed to meet certain exceptional cases in which it would be impossible, or at any rate disproportionately difficult, for the prosecution to establish facts which are "especially" within the knowledge of the accused and which he could prove without difficulty or inconvenience.
The word "especially" stresses that.
It means facts that are preeminently or exceptionally within his knowledge.
If the section were to be interpreted otherwise, it would lead to the very startling conclusion that in a murder case the burden lies on the accused to prove that he did not commit the murder because who could know better than he whether he did or did not.
It is evident that cannot be the intention and the Privy Council has twice refused to construe this section, as reproduced in certain other Acts outside India, to mean that the 204 burden lies on an accused person to show that be did not commit the crime for which he is tried.
These cases are Attygalle vs Emperor(1) and Seneviratne vs R. (2).
Illustration (b) to section 106 has obvious reference to a very special type of case, namely to offences under sections 112 and 113 of the Indian Railways Act for travelling or attempting to travel without a pass or ticket or with an insufficient pass, etc.
Now if a passenger is seen in a railway carriage, or at the ticket barrier, and is unable to produce a ticket or explain his presence, it would obviously be impossible in most cases for the railway to prove, or even with due diligence to find out, where he came from and where he is going and whether or not be purchased a ticket.
On the other band, it would be comparatively simple for the passenger either to produce his pass or ticket or, in the case of loss or of some other valid explanation, to set it out; and so far as proof is concerned, it would be easier for him to prove the substance of his explanation than for the State to establish its falsity.
We recognise that an illustration does not exhaust the full content of the section which it illustrates but equally it can neither curtail nor expand its ambit; and if knowledge of certain facts is as much available to the prosecution, should it choose to exercise due diligence, as to the accused, the facts cannot be said to be "especially" within the knowledge of the accused.
This is a section which must be considered in a commonsense way; and the balance of convenience and the disproportion of the labour that would be involved in finding out and proving certain facts balanced against the triviality of the issue at stake and the ease with which the accused could prove them, are all matters that must be taken into consideration.
The section cannot be used to undermine the well established rule of law that, save in a very exceptional class of case, the burden is on the prosecution and never shifts.
Now what is the position here? These journeys (1) A.I.R. 1936 P.C. 169.
(2) , 49. 205 were performed on 8 9 1948 and 15 9 1948.
The prosecution was launched on 19 4 1950 and the appellant was called upon to answer the charge on 9 3 1951; and now that the case has been remanded we are in the year 1956.
The appellant, very naturally, said on 27 4 1951, two and a half years after the alleged offences: "It is humanly impossible to give accurate explanations for the journeys in question after such a lapse of time".
And what of the prosecution? They have their registers and books, both of the railway and of the department in which the appellant works.
They are in a position to know and prove his official movements on the relevant dates.
They are in a position to show that no vouchers or receipts were issued for a second class journey by the guard or conductor of the trains on those days.
This information was as much within their "especial" knowledge as in that of the appellant; indeed it is difficult to see how with all the relevant books and other material in the possession of the authorities, these facts can be said to be within the "especial" knowledge of the appellant after such a lapse of time however much it may once have been there.
It would, we feel, be wrong to allow these proceedings to continue any longer.
The appellant has been put upon his trial, the prosecution has had full and ample opportunity to prove its case and it can certainly not complain of want of time to search for and prepare its material.
No conviction could validly rest on the material so far produced and it would savour of harassment to allow the continuance of such a trial without the slightest indication that there is additional evidence available which could not have been discovered and produced with the exercise of diligence at the earlier stages.
We set aside the order of the Judicial Commissioner and restore the order of the Sessions Judge acquitting the appellant on both counts of the charge framed against him.
| IN-Abs | The appellant was put up for trial under section 420 of the Indian Penal Code and section 5(2) of the Prevention of Corruption Act of 1947 for obtaining a total sum of Rs. 23 12 0 from the Government as T.A., being second class railway fares for two journeys, one from Ajmer to Abu Road and the other from Ajmer to Reengus, without having actually paid the said fares.
The prosecution proved from the railway books and registers that no such second class tickets were issued at Ajmer on the relevant dates and the same witness who proved this also proved that tickets were not always issued and the passengers could pay the fare in the train and if the second class was fully booked, no further tickets were issued till the train arrived,in which case passengers sometimes bought third class or inter class tickets and thereafter paid the difference to the guard of the train, if they could find second class accommodation on the arrival of the train.
There was no proof that one or other of those courses were not followed by the appellant and the prosecution instead of proving the absence of any such payments, in the same way as it had proved the non issue of second class tickets, relied on Illustration (b) to section 106 of the Evidence Act and contended that it was for the appellant to prove that he had actually paid the second class fares.
200 Held, that Illustration (b) to section 106 of the Evidence Act had no application, the evidence adduced by the prosecution did not warrant a conviction and the accused should, having regard to the long lapse of time, be acquitted.
That section 106 of the Evidence Act does not abrogate the well established rule of criminal law that except in very exceptional classes of cases the burden that lies on the prosecution to prove its case never shifts and s, 106 is not intended to relieve the prosecution of that burden. ' On the contrary, it seeks to meet certain exceptional cases where it is impossible, or disproportionately difficult, for the prosecution to establish facts which are especially within the knowledge of the accused and which can be proved by him without difficulty or inconvenience.
But when knowledge of such facts is equally available to the prosecution if it chooses to exercise due diligence, they cannot be said to be especially within the knowledge of the accused and the section cannot apply.
Attygalle vs Emperor, (A.I.R. and Seneviratne vs
B., ([1936] 3 All E.R. 36), referred to.
That illustrations to a section do not exhaust its full content even as they cannot curtail or expand its ambit, and in applying section 106 the balance of convenience, the comparative labour involved in finding out and proving the facts and the ease with which the accused can prove them must be taken into consideration.
That cases coming under sections 112 and 113 of the Indian Railways Act to which Illustration (b) to section
106 has obvious application stand on a different footing.
|
inal Writ Petition No. 1238 of 1978.
Under Article 32 of the Constitution for grant of a Writ of habeas corpus.
A. K. Sen and Herginder Singh for the Petitioner.
E. C. Agarwal and (Miss) A. Subhashini for Respondent No. 1 M. N. Phadke and M. N. Shroff for Respondent No. 2 The Judgment of the Court was delivered by SARKARIA, J.
This is a petition under Article 32 of the Constitution for the grant of a writ of habeas corpus.
The petitioner has been detained with effect from October 24, 1977 by an order passed by the Secretary to the Government of Maharashtra under Section 3 (1) of the (for short called COFEPOSA).
Reference was made to the Advisory Board on 24 11 1977.
At its sitting held on 23 12 i977, the Board rejected the representation of the detenu and opined that there was sufficient cause for the detention.
The detention has been challenged mainly on the ground that no order under clause (f) of Section 8 of the Act confirming the detention was passed by the appropriate Government within three months of the commencement of the detention and, as such, the continuance of the detention beyond the initial period of three months was violative of the mandate of Article 22(4) of the Constitution.
In support of this contention, Mr. Asoke Sen, appearing for the petitioner, has cited five decisions of this Court Shibapada Mukherjee vs State of West Bengal(1); Ujjal Mondal vs State of West Bengal(2); Deb Sadhan Roy vs State of West Bengal(3); Micki Khan etc.
vs The State of West Bengal (4); and Satyadeo Parshad Gupta vs State of Bihar(5).
As against the above, Mr. Phadke, appearing for the State of Maharashtra, contends that the view taken in the aforesaid decisions of this Court, is not in conformity with the plain language of Article 22(4).
In the counsel 's view, what Article 22(4) requires is that no law providing for preventive detention shall authorise the detention of a person for a longer period than three months, unless an Advisory Board consisting of persons having the qualifications specified therein, reports before the expiration of the said period of three months that there is, in its opinion, sufficient cause for such detention.
This requirement proceeds the argument was fully complied with in (1) A. I. R. (2) A. I. R. (3)[1972] 2 S.C.R. 787 (4)A. I. R. (5) ; 819 the instant case because the Advisory Board had made such a report within three months of the date of detention and within 11 weeks of the receipt of the Reference from the Government.
It is stressed that there is nothing in the language of Article 22(4) or in COFEPOSA which requires that the confirmation of the detention on the basis of the report of the Advisory Board, should also be within three months from the commencement of the detention.
According to Mr. Phadke, COFEPOSA on the other hand clearly indicates that an order of confirmation of the detention can be passed by the appropriate Government within a reasonable time even after the expiry of the initial period of three months ' detention.
In this 'connection, counsel has adverted us to Clause (c) of Section 8, which requires that the Advisory Board shall, on receiving the Reference from the appropriate Government, submit its report as to whether or not there is sufficient cause for the detention, within 11 weeks from the date of the detention; while under the corresponding provisions of the , the period prescribed for the report of the Advisory Board is ten weeks only.
The point sought to be made out is that if the Advisory Board makes a report that there is sufficient cause for the detention, to the appropriate Government just before the expiry of the aforesaid period of 11 weeks, then hardly about 13 or 14 days would be left to the Government to consider whether or not the detention should be confirmed.
This period, it is contended, left to the Government for taking a decision on the report of the Advisory Board is too short from a practical point of view.
On the above premises, Mr. Phadke urges that the aforesaid decisions of this Court none of which was a case of detention under COFEPOSA need reconsideration.
Before dealing with these arguments, it may be noted that the aforesaid ground of challenge has been specifically adumbrated as Ground No. 12 in the petition.
In the counter filed on behalf of the, respondent State, the fact that the order of confirmation of the detention was not passed by the appropriate Government within three months of the date of detention, appears to have been impliedly admitted in these terms : " .
No confirmation is needed on the part of the State Government.
After the advice of the Advisory Board, the detention of the, detenu was continued and the order of the State continuing the detention on the basis of the advice of the Advisory Report was served upon the detenu of 27 2 78.
" Nothing has been placed before us to show that the order of detention was, in fact, passed by the appropriate Government within the requisite period of three months.
We therefore, take it that the order, if any, for confirmation of the detention of the petitioner by the Government, was made beyond three months of the date of the detention.
820 The ground is now clear for considering the legal question raised by Mr. Asoke Sen.
The decisions cited by Mr. Sen, primarily proceed on an interpretation of Article 22(4) of the Constitution, though they also in the context examine the relevant provisions of the detention law, under which the detention in question in those cases was purportedly made.
We can do no better than reiterate what Mathew,.
J. speaking for this Court, said in Ujjal Mondal 's case (supra): "Article 22(4) of the Constitution has specified the maximum limit of initial detention, and detention for a longer period than 3 months can only be made on the basis of the report of the Board.
The Act authorises a possible detention of more than 3 months.
It is because the appropriate Government wants to detain a person for more than 3 months that the matter is referred to the Board and it is only 'when the Board makes its report that the appropriate Government can fix the period of detention under sub section (1) of ' Section 12.
So when the Government receives the report of the Board stating that there is sufficient cause for detention of a person, if the Government wants to detain him for a period beyond 3 months, it has to pass an order or make a decision under section 12(1) to confirm the order of detention.
The confirmation of the detention order without anything more would result in an automatic continuation of the detention, even if there is no; separate decision to continue the detention for any specific period.
as held by this Court in ; When Section 12(1) of the Act speaks of "and continue the detention of the person concerned for such period as it thinks fit", it can only mean continuance of detention from the point of time at which detention would become illegal if the order of detention is no t confirmed, namely, the expiry of 3 months from the date of detention.
It would not be necessary to, confirm the order of detention even after the receipt of the report of the Board by the Government if the Government only wants to continue the detention for the period of three months from the date of detention, as the initial order of detention would authorise the continuance of detention for that period without any confirmation.
Confirmation is necessary only to continue the detention after the expiry of 3 months.
If that be so, it stands to reason to held that the order of detention must be confirmed before the expiry of 3 months.
" The observations extracted above, apply mutatis mutandis to the language of clause (f) of Section 8, which is similar.
This clause runs as follows "8.
For the purposes of sub clause (a) of clause (4), and sub clause (c) of clause (7), of article 22 of the Constitution ."(f) in every case, where the Advisory Board has reported that there is in 821 its opinion sufficient cause for the detention of a person, the appropriate Government may confirm the detention order and continue the detention of the person concerned for such period as it thinks fit and in every case where the Advisory Board has reported that there is in its opinion no sufficient cause for the detention of the person concerned, the appropriate Government shall revoke the detention order and cause the person to be released forthwith." (emphasis supplied) 'The key words in clause (f) are those which have been underlined.
These very words were also, employed in Section 12(1) of the West Bengal Prevention of Violent Activities Act, 1970, the interpretation of which had come, up for consideration in the context of Article 22(4) of the Constitution in Ujjal Mondal 's case.
These words also occurred in Sections 10 and 11 of the , which were in pari materia with Sections 11 and 12 of the .
The expression "may confirm" in clause (f) of Section 8 is significant.
It imports a discretion.
Even where the Advisory Board makes a report that in its opinion there is sufficient cause for the detention of the detenu concerned, the Government may not confirm the detention order.
Read in the light of Article 22(4) of the Constitution and the context of the words "continue the detention", they definitely lead to the conclusion that the sine qua non for continuing the detention made beyond the period of three months, is the confirmation the detention order by the appropriate Government.
Conversely, the non confirmation of the initial order by the appropriate Government before the expiry of the period of three months detention, shall automatically result in revocation and termination of the legal authority for its continuance.
This position is further clear from the language of Section 10, which provides : "The maximum period for which any person may be detained in pursuance of any detention order. which has been confirmed under clause (f) of Section 8, shall be one year from the date of detention.
" The crucial words in the Section are : "which has been confirmed under clause (f) of Section 8.".
They under score the same policy which underlies the constitutional mandate in Article 22(4).
These words put it beyond doubt that if the initial order of detention is not confirmed by the appropriate Government within three months of the date of the detention, the detention after the expiry of that period ipso facto becomes unauthorised and illegal.
We do not find any merit in the contention that since the period prescribed for the Advisory Board to make its report has been increased from 10 weeks (as prescribed under MISA) to 11 weeks in COFEPOSA, leaving only a short period for the Government to take a decision under Section 8(f), the legislative intent was that the order of confirmation of the detention and its continuance could be made after the expiry of three months from the date of the detention.
It is true that in certain situation when the Advisory Board makes its report in favour of the detention just before the expiry of II weeks from the date of the detention, the time left to the Govern 822 ment for taking a decision as to the confirmation of the detention and its continuance would be hardly two weeks.
That only shows the anxiety on the part of the legislature to ensure that the Government continues the preventive detention of a person beyond three months after due application of mind and for that purpose acts with utmost promptitude.
The law does not lend its authority to the continuance of the detention even for a day more than the initial period of three months if the Government does not take a decision for that purpose on the report of the Advisory Board within three months of the commencement of the detention.
There is no reason to doubt the law enunciated by this Court in the aforesaid decisions.
Respectfully following the ratio of those decisions, we hold that since no order of confirmation of the detention was made under clause (f) of Section 8 within three months of the date of detention by the appropriate Government, further detention of the petitioner after the expiry of that period is without the authority of law.
In the result, we allow this petition, quash the detention of the petitioner and direct that he be set at liberty forthwith.
Rule made absolute.
S.R. Petition allowed.
| IN-Abs | The petitioner was detained with effect from October 24, 1977 by an order passed by the Secretary to the Government of Maharashtra under Section 3(1) of COFEPOSA.
The Advisory Board reported on 23 12 77 that there was sufficient cause for the detention but the Government did not pass any order confirming the detention within three months from the date of detention.
The petitioner assailed it as violative of article 22(4) of the Constitution.
Allowing the petition the Court.
HELD : 1.
since no order of confirmation of the detention was made under clause (f) of Section 8 within three months of the date of detention by the appropriate Government, further detention of the petitioner after the expiry of that period is without the authority of law.
[822 C] 2.The law does not lend its authority to the continuance of the detention even for a day more than the initial period of three months if the Government does not take a decision for that purpose on the report of the Advisory Board within three months of the commencement of the detention.
[822 A B] 3.The expression "may confirm" in clause (f) of Section 8 of COFEPOSA, is significant.
It imports a discretion.
Even where the Advisory Board makes a report that in its opinion, there is sufficient cause for the detention of the detenu concerned, the Government may not confirm the detention order.
Read in the light of Article 22(4) of the Constitution and the context of the words "continue the detention", the expression definitely leads to the conclusion that the sine qua non for continuing the detention made beyond the period of three months.
is the confirmation of the detention order by the appropriate Government.
Conversely, non confirmation of the initial order by the appropriate Government before the expiry of the period of three months detention, shall automatically result in revocation and termination of the legal authority for its continuance.
This position is further clear from the language of Section 10, which provides : "The maximum period for which any person may be detained in pursuance of any detention order. which has been confirmed under clause (f) of Section 8, shall be one year from the date of detention.
" The crucial words in the Section are : "which has been confirmed under clause (f) of Section 8." They underscore the same policy which underlies the constitu tional mandate in Article 22(4).
These words put it beyond doubt that if the initial order of detention is not confirmed by the appropriate Government within three months of the date of the detention, the detention after the expiry of that period ipso facto becomes unauthorised and illegal.
[821 C F] Ujjal Mandal vs State of West Bengal, ; reiterated; Shibapada Mukherjee vs State of West Bengal, AIR 1972 SC 1356, Deb Sadhan Roy vs State of West Bengal, ; Micki Khan etc.
vs The State of West Bengal.
AIR 1972 SC 2262; and Satyadeo Parshad Gupta vs State of Bihar, ; referred to. 818
|
Civil Appeal No. 252 of 1969.
Appeal by Special Leave from the Judgment and Order dated 19 8 68 of the Allahabad High Court in Civil Appeal No. 254/65.
G. N. Dikshit and M. V. Goswami for the Appellant.
section C. Manchanda, section C. Patel and Trilok Singh Arora for the Respondent.
The Judgment of the Court was delivered by PATHAK, J.
This appeal by special leave is directed against the judgment and order of the Allahabad High Court dated August 19, 1968 dismissing a second appeal arising out of a suit for declaration.
The respondent was appointed as a Sub Inspector of Police in a temporary post in 1955.
He was discharged from service on July 13, 1957.
A writ petition filed by him in the Allahabad High Court was allowed on August 4, 1959, and accordingly on December 15, 1959 he was reinstated in service.
Thereafter, on January 21, 1960 his services were terminated by the Deputy Inspector General of Police, Agra Range, Agra.
On March 13, 1963 the respondent instituted a suit for a declaration that the order dated January 21, 1960 was illegal and void and that he continued as Sub Inspector of Police in the Uttar Pradesh Police Service.
It was alleged that on a false complaint made against him in respect of the custody and detention of one Smt.
Phoolmati, an enquiry had been made in consequence of which the appellant had been arbitrarily and illegally discharged from service on July 13, 1957.
It was pleaded that although he was reinstated on the success of his writ petition in the High Court, his services were terminated a mere five weeks later although no ground had arisen since for doing so.
It was asserted that the order of January 21, 1960 was passed as a simple order of termination in order to avoid a departmental enquiry under section 7 of the Police Act, which enquiry if held would have enabled him to expose the falsity of the allegations levelled against him.
The suit was contested by the appellant, who maintained that the termination of the respondent 's services was not by way of punishment hor motivated by malice, and that it was a simple termination of the services of a temporary government servant on the ground that they were no longer required by the State.
The suit was decreed by the learned Munsif, Etah and the decree was affirmed in appeal and second appeal.
The High Court, in second appeal, took the view that where an enquiry was instituted by a superior authority into a misconduct alleged against a government 1128 servant, the resulting termination of service was by way of punishment because it attached a stigma or amounted to a reflection on the competence of the government servant and affected his future career.
The High Court held that the findings recorded during the enquiry on the original complaint against the respondent were responsible for the order terminating the respondent 's services, and it affirmed that the order was vitiated by mala fides.
Attacking the findings of the High Court, learned counsel for the appellant contends that in the first place the order terminating the respondent 's services had not been made by way of punishment, but was an order of termination simpliciter passed in accordance with the rules applicable to temporary government servants.
In the second place, it is said, if the order is attributed to the complaint against the respondent concerning his conduct relating to Smt.
Phoolmati it was open to the Deputy Inspector General of Police to take the circumstances of the case into account for the purpose of considering the suitability of the respondent for continuing in service.
Learned counsel for the respondent points out that an enquiry had been originally instituted against the respondent which had resulted in an order terminating his services and, he urges, after the order of the High Court quashing his discharge on the ground of violation of Article 311(2) of the Constitution it was obligatory on the superior authority, in case it proposed to terminate the respondent 's services, to institute a proper and complete departmental enquiry, providing an opportunity to the respondent to lead evidence and be heard in his defence, and only thereafter could it make an order against the respondent.
We are of the opinion that the appellant is right on both counts.
Considered as an order made without reference to the earlier proceeding against the respondent, the impugned order cannot be regarded as one of punishment.
After the original order of discharge was quashed by the High Court, the respondent was reinstated in service.
He was even allowed an increment to his salary.
The Deputy Inspector General of Police made the impugned order subsequently terminating his services on the ground that they were no longer required.
The services were terminated on payment of one month 's salary in lieu of notice under the "general rules for termination of service of temporary government servants".
The Deputy Inspector General of Police was examined as a witness in the suit, and throughout he maintained that he terminated the respondent 's services because they were not required any more and that in making the order he did not intend to punish the respondent.
The evidence also discloses that no personal motive had influenced the order.
It was open to the superior authority to terminate the respondent 's services on the ground on which it did so.
1129 Assuming, however, that the impugned order was made in the background of the allegations against the respondent concerning his behaviour with Smt.
Phoolmati, we see no reason in law why a departmental enquiry should be necessary before the respondent 's services could be terminated.
It appears from the material before us that it was merely a preliminary enquiry which was made by the Superintendent of Police into the allegations made against the respondent 's conduct concerning the woman.
No departmental enquiry by way of disciplinary proceedings was instituted, no charge was framed, and the formal procedure characterising a disciplinary proceeding was never adopted.
The Deputy Inspector General of Police passed the original order dated July 13, 1957 discharging the respondent from the police force on the ground that he had behaved in a reprehensible manner, was not likely to make a useful police officer and was unfit for further retention in a disciplined force.
The original order plainly attached a stigma to the respondent 's record of service, and it is because of the specific grounds set forth in the termination order that the High Court considered the respondent entitled to the benefit of Article 311 (2) of the Constitution, and quashed the order.
Now the order having been quashed, the position reverts to what it was when the Deputy Inspector General of Police received the report of the Superintendent of Police on the Preliminary enquiry made by him.
There was nothing to prevent the Deputy Inspector General from deciding that instead of instituting disciplinary proceedings against the government servant he should consider whether the government servant was suitable for retention in service.
The case law on the point has been considered elaborately by one of us (Jaswant Singh, J.) in State of U.P. vs Ram Chandra Trivedi(1) and reference has been made in this behalf to Champaklal Chimanlal Shah vs The Union of India(2), Jagdish Mitter vs Union of India(3) and State of Punjab & Anr.
vs Shri Sukh Raj Bahadur(4).
It is apparent from the facts of this case that if the impugned order be considered as made in the light of the allegations against the respondent concerning the woman, the conduct of the respondent constituted a motive merely for making the order and was not the foundation of that order.
In this connection what has been stated by this Court in Union of India & Ors.
vs R. section Dhaba.(5) State of Bihar & Ors.
vs Shive Bhikshuk Mishra(6) and R. section Sial vs The State of U.P. & Ors.(7) appers relevant.
That it was not intended 1130 to take punitive action against the respondent for his misbehaviour with Smt.
Phoolmati is evident from the circumstance that thereafter the respondent was allowed an increment to his salary and was regarded as in service for all purposes.
The High Court, it seems to us, did not have regard to all the facts and circumstances of the case, and appears to have assumed that the respondent 's services were terminated as a measure of punishment.
The High Court relied on The State of Bihar vs Gopi Kishore Prasad(1) and Madan Gopal vs The State of Punjab(2).
Both cases are distinguishable.
In the former, the government servant was discharged from service because he was found to be corrupt and the order terminating his services branded him a dishonest and incompetent officer.
In the latter, the government servant had been served with a charge sheet that he had demanded and received illegal gratification and the Court found that the proceeding, consequent to which the termination order was made, was intended for the purpose of taking punitive action.
We are satisfied that the considerations which prevailed with the High Court in reaching its findings on the application of Article 311 (2) of the Constitution and the bona fides of the superior authority in making the impugned order are not warranted in law and on the material before us.
Accordingly, the appeal is allowed, the judgment and decree of the High Court dated August 19, 1968 are set aside and the respondent 's suit is dismissed, but in the circumstances without any order as to costs.
S.R. Appeal allowed.
| IN-Abs | The respondent was appointed as a Sub Inspector of police in a temporary post in 1955.
He was discharged from service on July 13, 1957.
A Writ Petition filed by him in the Allahabad High Court was allowed on August 4, 1959 and consequently he was re instated in service on December 15, 1959.
Thereafter, on January 21, 1960 his services were terminated on the ground that they were no longer required by the State.
A suit for declaration that the said order of termination was null and void was decreed in his favour by the trial court which was affirmed in appeal and also by the High Court in second appeal.
Allowing the State appeal by special leave the Court, ^ HELD: 1.
The considerations which prevailed with the High Court in reaching its findings on the application of Article 311(2) of the Constitution and the bona fides of the superior authority in making the impugned order of termination simpliciter are not warranted in law.
[1130D] 2.
The order terminating the services was order of termination simpliciter passed in accordance with the rules applicable to temporary Government servants.
After the original order of discharge was quashed by the High Court, the respondent was reinstated, allowed increment in pay and one month 's salary in lieu of notice under the 'general rules for termination of services of temporary government servants was also given.
[1128F G] 3.
It was open to the superior authority to terminate the respondent 's services on the ground on which it did so.
And the evidence disclosed no personal motive had influenced the order or that it was passed by way of punishment.
A departmental enquiry is not required under the law.
Instead of instituting disciplinary proceedings against the government servant, the suitability for retention in service could be decided.
[1128H, 1129A, E] State of U.P.v.
Ram Chandra Trivedi; , ; Champaklal Chimanlal Shah vs The Union of India, , Jagdish Mitter vs Union of India, A.I.R. 1964 S.C. 449 and State of Punjab & Anr.
vs Shri Sukh Raj Bahadur, ; ; referred to.
Union of India & Ors.
vs R. section Dhaba, , State of Bihar & Ors.
vs Shiva Bhikshuk Mishra and R. section Sial vs The State of U.P. and Ors., ; applied.
The State of Bihar vs Gopi Kishore Prasad, A.I.R. 1960 SC 689 and Madan Gopal vs The State of Punjab, [1963] 3 SCR 716; distinguished. 1127
|
: Criminal Appeal No. 10 of 1974.
Appeal by Special Leave from the Judgment and Order dated 22 11 1973 of the Karnataka High Court in Criminal Appeal No. 221/73 section section Javali and B. P. Singh for the Appellant.
M. Veerappa and J. R. Dass for the Respondent.
The Judgment of the Court was delivered by FAZAL ALI, J.
In this appeal by Special Leave the appellant has been convicted under section 34 of the Mysore Excise Act and sentenced to three months ' rigorous imprisonment and a fine of Rs. 100/ for being in possession of 48 bottles of liquor which were recovered from a car which was being driven by the appellant.
Mr. Javali appearing for the appellant has raised a short point before us.
He has submitted that the Inspector of Excise who searched the car along with the panchas had no jurisdiction to do so because he did so without complying with 1132 the provisions of section 54 of the Excise Act.
In our opinion, the contention is well founded and must prevail, Section 53 runs thus: "If a Magistrate, upon information and after such inquiry (if any) as he thinks necessary, has reasons to believe that an offence under section 32, section 33, section 34, section 36 or section 37 has been, is being or is likely to be committed, he may issue a warrant (a) for the search of any place in which he has reason to believe, that any intoxicant still, utensil, implement, apparatus or materials which are used for the commission of such offence or in respect of which such has been, is being, or is likely to be, committed, are kept or concealed, and (b) for the arrest of any person whom he has reason to believe to have been, to be, or to be likely to be engaged in the commission of any such offence.
" Thus this section relates to a contingency where the Statute enjoins that any inspector before searching a place must obtain a warrant from the magistrate.
Section 54 is a special provision which arises in urgent cases where it may not be possible for the officer concerned to get a warrant from the Magistrate.
Section 54 runs thus: "Whenever the Excise Commissioner or a Deputy Commissioner or any police officer not below the rank of an officer uncharge of a police station or any Excise Officer not below such rank as may be prescribed has reason to believe that an offence under section 32, section 33, section 34, section 36, or section 37 has been, is being, or is likely to be committed, and that a search warrant cannot be obtained without affording the offender an opportunity of escape or of concealing evidence of the offence, he may after recording the grounds of his belief (a) at any time by day or by night enter and search any place and seize anything found therein which he has reason to believe to be liable to confiscation under this Act, and (b) detain and search and, if he thinks proper, arrest any person found in such place whom he has reason to believe to be guilty of such offence as aforesaid.
" In the instant case, it is admitted that the inspector who searched the car of the appellant had not made any record of any ground on the basis 1133 of which he had a reasonable belief that an offence under the Act, was being committed before proceeding to search the car and thus the provisions of section 54 were not at all complied with.
This, therefore, renders the entire search without jurisdiction and as a logical corollary, vitiates the conviction.
We feel that both sections 53 and 54 contain valuable safeguards for the liberty of the citizen in order to protect them from ill founded or frivolous prosecution or harassment.
The point was taken before the High Court which appears to have brushed aside this legal lacuna without making any real attempt to analyses the effect of the provisions of section 53 and 54.
The High Court observed that these two sections were wholly irrelavant.
With due respect, we are unable to approve of such a cryptic approach to a legal question which is of far reaching consequences.
It was, however, suggested that the word "place" would not include the car, but the definition of the word "place" under the Act clearly includes vehicle which would include a car.
Thus the ground on which the argument of the petitioner has been rejected by the High Court cannot be sustained by us.
We are satisfied that there has been a direct non compliance of the provisions of section 54 which renders the search completely without jurisdiction.
In this view of the matter, the appeal is allowed, the conviction and sentence passed on the appellant is set aside and he is acquitted of the charges framed against him.
M.R Appeal allowed.
| IN-Abs | The appellant was convicted under section 34 of the Mysore Excise Act and sentenced to three months R.I. and a fine of Rs. 100/ for being in possession of 48 bottles of liquor, recovered from the car being driven by him.
It was contended that the provisions of section 54 had not been complied with, and the search was made without jurisdiction.
Allowing the appeal, the Court, ^ HELD: 1.
The Inspector who searched the car of the appellant had not made any record of any ground on the basis of which he had a reasonable belief that an offence under the Act, was being committed, before proceeding to search the car, and thus the provisions of section 54 were not at all complied with, thereby rendering the entire search without jurisdiction and, as a logical corollary, vitiating the conviction.
[1132H, 1133A B] 2.
Both, Sections 53 and 54 contain valuable safeguards for the liberty of the citizen in order to protect them from ill founded or frivolous prosecution or harassment.
[1133B]
|
Civil Appeal No. 1584 of 1969.
Appeal from the Judgment and.
Decree dated 20 2 1969 of the Madras High Court in Appeal No. 104 of 1963.
G. L. Sanghi and Vineet Kumar for the Appellants.
Vepa P. Sarathy and Mrs. section Gopalakrishnan for Respondent No. 1.
1179 K. Jayaram for Respondents 2 5.
The Judgment of the Court was delivered by SHINGHAL, J.
This appeal by a certificate of the Madras High Court is directed against its judgment and decree dated February 20, 1969.
One Manikka Sankaranarayana Iyer, father of defendants 1 and 3 and grandfather of plaintiffs 1 to 5 and defendants 2, 4 and 5 and father in law of plaintiff No. 6 constituted an Annadanam Trust and he and his sons executed a registered deed of settlement for that purpose on June 3, 1908.
By that document Sankaranarayana Iyer became the first trustee for life, and it was provided that after him the senior most member would be the trustee, by turns.
Sankaranarayana died and defendant No. 1 became the managing trustee of the trust.
There was a suit for partition of the family properties including house No. 48A, and it was settled by a compromise under which a preliminary decree dated September 12, 1956 was drawn up for the sale of the properties amongst the members of the family.
Defendant No. 1 purchased the suit property for Rs. 21,500/ for the aforesaid trust on April 19, 1959.
A final decree was drawn up on November 29, 1959 in which house No. 48A was shown as the property of the trust.
Defendant No. 1 however sold that property soon after, to his son defendant No. 2 on July 14, 1960, for Rs. 25,000/ under sale deed exhibit B. 13.
Chithambaram Chettiar (P.W. 2), who was a tenant of that property from 1949 onwards, came to know of the intended sale and sent a registered notice to defendant No. 1 on July 21, 1960, offering to purchase it for Rs. 35,000/ .
Defendant No. 1 however went ahead with the sale of the property to his son and registered the sale deed on July 22, 1960.
The plaintiffs thereupon filed the present suit on September 15, 1960, challenging that sale and asking for its restoration to the trust.
The defendants resisted the claim in the suit on the ground that the sale price was fair and adequate and that the sale had to be made because of the disputes which had arisen between the second defendant as the owner of the adjacent house and the trust in regard to the easementary rights of drainage, light and air etc.
The suit was decreed by the Subordinate Judge of Madurai on September 10, 1962.
The High Court of Madras however allowed the appeal against that judgment and decree and dismissed the suit with costs of both the courts holding that Rs. 25,000/ was "quite adequate and fair" price for the suit property and that defendant No. 1 acted with "perfect bona fides and no ulterior motive can be attributed to him.
" That is why the plaintiffs have come up in appeal to this Court.
1180 It is not indispute before us that the , hereinafter referred to as the Act, applied to the trust in question and that it was necessary for the plaintiffs to prove that defendant No. 1 did not exercise his discretionary power of selling the suit property "reasonably and in good faith" and that he indirectly purchased it for himself, in the name of his son (defendant No. 2), within the meaning of section 49 and 52 of the Act.
There is some controversy on the question whether defendant No. 1 made an outright purchase of the suit property for and on behalf of the trust for Rs. 21,500/ on April 19, 1959, or whether he intended to purchase it for himself and then decided to pass it on to the trust, for defendants have led their evidence to show that the property was allowed to be sold for Rs. 21,500/ , which was less than its market value, as it was meant for use by the trust and that defendant No. 1 was not acting honestly when he palmed of the property to his son soon after by the aforesaid sale deed exhibit B. 13 dated July 14, 1960.
The fact however remains that defendant No. 1 was the trustee of the property, and it was his duty to be faithful to the trust and to execute it with reasonable diligence in the manner an ordinary prudent man of business would conduct his own affairs.
He could not therefore occasion any loss to the trust and it was his duty to sell the property, if at all that was necessary, to best advantage.
It has in fact been well recognised as an inflexible rule that a person in a fiduciary position like a trustee is not entitled to make a profit for himself or a member of his family.
It can also not be gainsaid that he is not allowed to put himself in any such position in which a conflict may arise between his duty and personal interest, and so the control of the trustee 's discretionary power prescribed by section 49 of the Act and the prohibition contained in section 51 that the trustee may not use or deal with the trust property for his own profit or for any other purpose unconnected with the trust, and the equally important prohibition in section 52 that the trustee may not, directly or indirectly, buy the trust property on his own account or as an agent for a third person, cast a heavy responsibility upon him in the matter of discharge of his duties as the trustee.
It does not require much argument to proceed to the inevitable further conclusion that the rule prescribed by the aforesaid sections of the Act cannot be evaded by making a sale in the name of the trustee 's partner or son, for that would.
in fact and substance, indirectly benefit the trustee.
Where therefore a trustee makes the sale of a property belonging to the trust, without any compelling reason, in favour of his son, without obtaining the permission of the court concerned, it is the duty of the court, in which the sale is challenged, to examine whether 1181 the trustee has acted reasonably and in good faith or whether he has committed a breach of the trust by benefitting himself from the transaction in an indirect manner.
The sale in question has therefore to be viewed with suspicion and the High Court committed an error of law in ignoring this important aspect of the law although it had a direct bearing on the controversy before it.
The High Court in fact proceeded to examine the case on the assumption that the plaintiffs had instituted the suit not so much out of a genuine desire to redress any wrong done to the trust, as out of "ulterior motives and ill will against the first and second defendants.
" This shows that instead of examining the case according to the criterian mentioned above, the High Court based its decision on an extraneous consideration and blamed the plaintiffs for raising the suit on account of "personal grouse" and "personal spite".
We have not been referred to any evidence which could justify the High Court 's view that there was any such grouse or spite.
But even if it were assumed for the sake of argument that the plaintiffs had any such motive for raising the suit, the fact remains that their action was eminently one for the advantage of the trust which had been created by their ancestor and in which they had a substantial and a direct interest.
Some important facts stand out from the evidence on the record which are directly in point.
The suit property belonged to the family which had created the trust.
It was purchased by defendant No. 1, in his capacity as the trustee of the Annandanam Trust for Rs. 21,500/ on April 19, 1959, at a family sale.
It appears from the statement of defendant No. 2 that the property was capable of, or could fetch a rent of about Rs. 190/ per mensem, amounting to Rs. 2,280/ per annum.
It has also been admitted that the sum of Rs. 25,000/ was not utilised by the trustee (defendant No. 1) for purchasing any other better property, but was invested in fixed deposit with a bank at 3 1/2 per cent interest per annum.
That could yield an income of only Rs. 875/ per annum.
The trust therefore lost heavily in the bargain.
What is worse, defendant No. 1 has not been able to explain how the sale could be said to be beneficial to the trust and how he could possibly contend that he acted as a man of ordinary prudence in slashing down the income of the trust by making the sale.
The further fact that stands out from the evidence on the record is that when Chithambaram Chettiar (P.W. 2), who was a tenant in the suit property from 1949 onwards, learnt about the intended sale, 1182 he sent a notice to defendants Nos. 1 and 3 offering to purchase it for Rs. 35,000/ .
That notice was issued on July 21, 1960.
The receipt of the notice has been admitted by defendant No. 1 in his statement in the trial court, and he has further admitted that Chithambaram Chettiar offered to purchase the property for Rs. 35,000/ and that he sold it to his son for Rs. 25,000/ without even informing him that he had received the offer of Rs. 35,000/ .
Defendant No. 1 in fact proceeded to register the sale deed of the property in favour of his son, the second defendant, on July 22, 1960.
It is therefore quite clear that he did not care to act in accordance with the law in the discharge of his fiduciary relationship with the trust and executed the sale deed in his son 's favour in disregard of his statutory duty, for no man of ordinary prudence would possibly have sold his property for Rs. 25,000/ when he had an offer of Rs. 35,000/ .
That offer could not be said to be from a man of no substance because Chithambaram Chettiar (P.W. 2) who made it, was known to the defendants and he has stated that he was a man of means and was worth rupees four lakhs.
It may be that the son in law of plaintiff No. 2 was employed in his shop, but that could not detract from the basic fact that a much higher offer had been made by a man of substance.
Instead of examining the appeal with due regard to the above mentioned evidence, the High Court was obsessed by a consideration of the evidence which had been led for the purpose of showing that while defendant No. 1 had purchased the property for himself on April 19, 1959, for Rs. 21,500/ , he gave up that advantage in favour of the trust.
The evidence on the point is not unequivocal, for it may well be that defendant No. 1 did not want to obtain a sale deed in his own name for other reasons, but even if it were assumed that he made a gesture of goodwill in favour of the trust on April 19, 1959, he could not possibly absolve himself from what he did in selling it off, after it had become the property of the trust, to his own son a few months thereafter for Rs. 25,000/ when he had a genuine offer of Rs. 35,000/ .
Another consideration which prevailed with the High Court in setting aside the finding of fact of the trial court was that, according to it, the evidence on the record showed that some difficulties had cropped up after the property had been purchased as his son, defendant No. 2, began to "give trouble" and that he resolved that trouble on the advice of his family lawyer Shri V. Rajagopala Iyengar (D. W. 3) by selling the property to his son.
This view was obviously incorrect, for even it were assumed that there was some 1183 difficulty in respect of some common rights of easement, that could well have been a lever in the hands of the trustee to make a bargain for Rs. 35,000/ or more with his son who was equally interested in those easementary rights.
A man of prudence would not have sold his property for a considerably lesser amount than that offered to him by another person and agreed to sell it just because a co sharer in the easementary right was causing trouble and was offering a far lesser price.
We have gone through the statement of V. Rajagopala Iyengar (D.W. 3) on whose advice defendant No. 1 claims to have sold the property for Rs. 25,000/ .
He has admitted in his statement that he had not even seen the suit property, and he knew nothing about the so called trouble in regard to the easementary rights between defendant No. 1 and his son.
On the other hand, we find that he was indebted to the family of defendants Nos. 1 and 2 and he did not even care to ascertain what rent the suit property was fetching when he advised its sale for Rs. 25,000/ to the son of defendant No. 1.
The High Court therefore did not even read the evidence correctly while placing reliance on his testimony.
For the reasons mentioned above, we have no doubt that the High Court did not examine the controversy in its proper legal perspective and with due regard to the salient facts which had been established by the evidence on the record and it was not therefore justified in setting aside the finding of the trial court.
The appeal is allowed.
The impugned judgment and decree of the High Court are set aside and the decree of the trial court is restored with costs throughout.
P.B.R. Appeal allowed.
| IN-Abs | Plaintiffs and defendants were descendants of a common ancestor who was the founder of a trust.
Defendant No. 1, at the relevant time, was the managing trustee of the trust.
On partition and sale of family properties a house, which was the suit property, was purchased for the trust.
Soon thereafter defendant No. 1 sold it to his son.
Before the sale, however, the tenant of the house who was a man of substance, offered a much higher price than what was paid by the son but the defendant sold it to his son.
In the plaintiffs ' suit challenging sale of the trust property to the managing trustee 's son for a lesser consideration the defendant claimed that the property had to be sold because his son who was the owner of adjacent property raised a dispute claiming easementary rights over the property.
The suit was decreed by the trial court but on appeal the High Court held that the consideration was adequate and fair, that the sale was bona fide and that no ulterior motive could be attributed to the defendant no 1 in the sale.
The High Court, therefore, dismissed the suit.
Allowing appeal, ^ HELD: (a) The sale had to be viewed with suspicion The High Court committed an error of law in ignoring important aspects of law which had direct bearing on the controversy before it.
[1181A] (b) It is well recognised that a person in a fiduciary position like a trustee is not entitled to make a profit for himself or a member of his family.
He is not allowed to put himself in a position in which a conflict may arise between his duty as a trustee and his personal interest.
[1180E] (c) The control of the trustee 's discretionary power prescribed by section 49 of the Trusts Act and the prohibition contained in section 51 that the trustee may not use or deal with the trust property for his own profit or for any other purpose unconnected with the trust and the equally important prohibition in section 52 that the trustee may not directly or indirectly buy the trust property on his own account or as an agent for a third person, cast a heavy responsibility upon him in the matter of discharge of his duties as trustee.
The rule prescribed by these sections cannot be evaded by making a sale in the name of the trustee 's partner or son, for that would, in fact and substance, indirectly benefit the trustee.
[1180F G] (d) Where a trustee makes the sale of a property belonging to the trust, without any compelling reason in favour of his son, without obtaining the 1178 permission of the court concerned, it is the duty of the court to examine whether the trustee has acted reasonably and in good faith or whether he has committed a breach of the trust by benefiting himself from the transaction in an indirect manner.
[1180H] (i) In the instant case defendant No. 1 was the trustee of the property.
It was his duty to be faithful to the trust and execute it with reasonable diligence in the manner in which an ordinary prudent man of business would conduct his own affairs.
He could not occasion any loss to the trust and it was his duty to sell the property, if that was so necessary to sell, to the best advantage of the trust.
[1181D] (ii) The High Court was wrong in blaming the plaintiffs that they had brought the suit on account of personal grouse and spite.
Assuming that they were so actuated, their action was eminently for the advantage of the trust created by their ancestor in which they had a substantial and direct interest.
[1181D] (iii) Defendant No. 1 was not able to explain how the sale was beneficial to the trust.
Income by way of rent which the property was fetching was far more than interest which the sale proceeds fetched when they were invested in fixed deposits in a Bank.
He was therefore unable to explain how he acted as a man of ordinary prudence in slashing down the income of the trust by making the sale.
[1181G] (iv) When defendant No. 1 sold the trust property to his son at a lesser price than was otherwise available, he did not act in accordance with law in the discharge of his fiduciary relationship with the trust.
He sold the property to his son in disregard of his statutory duty which no man of ordinary prudence would have done.
[1182C] (v) Assuming that defendant No. 1 made a gesture of goodwill in favour of the trust when he allowed the sale of the family property to the trust, he could not possibly absolve himself from what he did in selling it off to his son at a lesser price than was offered by another reason.
[1182F] (vi) Assuming that there was some difficulty in respect of rights of easement between the trust and the defendant 's son who was the immediate neighbour of the property, that could have been a lever in the hands of the trustee to make a bargain for higher consideration from his son who was equally interested in the property.
A man of prudence would not have sold his property for a considerably lesser amount than that offered to him by another person and agreed to sell it just because a co sharer was causing trouble and offering a few lesser price.
[1183A B]
|
N: Criminal Appeal No. 255 of 1973.
Appeal by Special Leave from the Judgment and Order dated 16 7 73 of the Rajasthan High Court in S.B. Crl.
No. 309/73.
A. N. Mulla and B. P. Singh for the Appellant.
Sobhag Mal Jain and section K. Jain for the Respsondent.
The Judgment of the Court was delivered by FAZAL ALI, J.
This appeal by special leave is directed against a judgment of the Rajasthan High Court by which the conviction of the appellant under Section 494 I.P.C. and sentence of two years rigorous imprisonment and fine of Rs. 2,000/ have been upheld.
The facts of this case have been detailed in the judgments of the courts below and it is not necessary to repeat them.
Suffice it to say that the accused Gopal Lal married the complainant Kanchan sometime in the year, 1963 and a child was born out of this wedlock.
Soon thereafter the parties appeared to have fallen out and parted company.
While the first marriage was subsisting Gopal Lal contracted a second marriage which according to the custom prevalent amongst Tellis is a valid marriage commonly known as nata marriage.
This marriage was contracted on 20th of March, 1969.
The complainant Kanchan, the first wife having come to know about this marriage filed a complaint on the 22nd March, 1969, on the basis of 1173 which appellant was prosecuted and ultimately convicted as mentioned above.
Mr. A. N. Mulla, learned counsel for the appellant, had submitted two points before us.
In the first place it was contended that in view of the provisions of Section 17 of the , the second marriage being a void marriage, the provisions of Section 494 I.P.C. are not attracted at all.
We have given our anxious consideration to this argument but we are of the opinion that the argument is wholly untenable.
Section 494 runs thus: "Whoever, having a husband or wife living, marries in any case in which such marriage is void by reason of its taking place during the life of such husband or wife, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine.
Exception This section does not extend to any person whose marriage with such husband or wife has been declared void by a court of competent jurisdiction, nor to any person who contracts a marriage during the life of a former husband or wife, if such husband or wife, at the time of the subsequent marriage, shall have been continually absent from such person for the space of seven years, and shall not have been heard of by such person as being alive within that time provided the person contracting such subsequent marriage shall before such marriage takes place, inform the person with whom such marriage is contracted of the real state of facts so far as the same are within his or her knowledge".
The essential ingredients of this offence are: (1) that the accused spouse must have contracted the first marriage.
(2) that while the first marriage was subsisting the spouse concerned must have contracted a second marriage and (3) that both the marriages must be valid in the sense that the necessary ceremonies required by the personal law governing the parties had been duly performed.
It may also be noticed that Section 494 I.P.C. would come into play only if the second marriage becomes void by virtue of the fact 1174 that it had taken place in the life time of one of the spouses.
Thus, it is not possible to accede to the contention of Mr. Mulla that merely because the second marriage was void under Section 17 of the hence Section 494 I.P.C. would not be attracted.
Section 17 of the runs thus: "Any marriage between two Hindus solemnized after the commencement of this Act is void if at the date of such marriage either party had a husband or wife living; and the provisions of sections 494 and 495 of the Indian Penal Code shall apply accordingly".
What Section 17 contemplates is that the second marriage must be according to the ceremonies required by law.
If the marriage is void its voidness would only lead to civil consequences arising from such marriage.
Section 17 makes it absolutely clear that the provision has to be read in harmony and conjunction with the provisions of Section 494 of the Penal Code which has been extracted above.
Section 17 clearly provides that provisions of Sections 494 and 495 of the Penal Code shall apply accordingly.
In other words though the marriage may be void under Section 17, by reason of the fact that it was contracted while the first marriage was subsisting the case squarely falls within the four corners of Section 494 and by contracting the second marriage the accused incurs the penalty imposed by the said statute.
Thus the combined effect of Section 17 of and Section 494 I.P.C. is that when a person contracts a second marriage after the coming into force of the said Act, while the first marriage is subsisting he commits the offence of bigamy.
(Emphasis ours).
This matter no longer res integra as it concluded by a decision of this Court in Bhaurao Shankar Lokhande and Anr.
vs State of Maharashtra & Anr.(1) This Court while considering the question of bigamy qua the provisions of Section 17 observed as follows: "Section 17 provides that any marriage between two Hindus solemnized after the commencement of the Act is void if at the date of such marriage either party had a husband or wife living, and that the provisions of sections 494 and 495 I.P.C. shall apply accordingly.
The marriage between two Hindus is void in view of section 17 if two conditions are satisfied: (i) the marriage is solemnized after the commencement of the Act; 1175 (ii) at the date of such marriage, either party had a spouse living.
If the marriage which took place between the appellant and Kamlabai in February 1962 cannot be said to be 'solemnized ', that marriage will not be void by virtue of section 17 of the Act and section 494 I.P.C. will not apply to such parties to the marriage as had a spouse living".
The word 'solemnize ' means, in connection with a marriage, 'to celebrate the marriage with proper ceremonies and in due form ', according to the Shorter Oxford Dictionary.
It follows, therefore, that unless the marriage is 'celebrated or performed with proper ceremonies and in due form ' it cannot be said to be 'solemnized '.
It is therefore essential, for the purpose of section 17 of the Act that the marriage to which section 494 I.P.C. applies on account of the provisions of the Act should have been celebrated with proper ceremonies and in due form".
It was thus pointed out by this Court that Section 17 of the requires that the marriage must be properly solemnized in the sense that the necessary ceremonies required by law or by custom must be duly performed.
Once these ceremonies are proved to have been performed the marriage become properly solemnized and if contracted while the first marriage is still subsisting the provisions of Section 494 will apply automatically.
In a decision of this Court in Kanwal Ram & Ors.
vs The Himachal Pradesh Administration the earlier case was noticed by the Court and relied upon.
The matter has also been fully discussed in Priya Bala Ghosh vs Suresh Chandra Ghosh.
In view of the authorities of this Court, therefore, the following position emerges: where a spouse contracts a second marriage while the first marriage is still subsisting the spouse would be guilty of bigamy under Section 494 if it is proved that the second marriage was a valid one in the sense that the necessary ceremonies required by law or by custom have been actually performed.
The voidness of the marriage under Section 17 of the is in fact one of the essential ingredients of Section 494 because the second marriage will become void only because of the provisions of Section 17 of the .
In these circumstances, therefore, we are unable to accept the contention of Mr. Mulla that the second marriage being void Section 494 will have no application.
It was next contended by Mr. Mulla that there is no legal evidence to show that the second marriage which is said to 1176 be a nata marriage was actually performed.
We are afraid, we are unable to go into this question because three courts have concurrently found as a fact that the parties were governed by custom of nata marriage and the two essential ceremonies of this marriage are: (1) that the husband should take a pitcher full of water from the head of the prospective wife; (2) that the wife should wear chura by the husband.
There is evidence of P.Ws. 2, 3, 4 and 5 who have proved fact that these ceremonies had been duly performed in their presence.
That there was such a custom which requires these ceremonies was admitted by D.Ws. 3 and 5 who were examined by the appellant.
The evidence led by the prosecution has been accepted by the High Court and the courts below and after perusing the evidence we are not in a position to hold that the finding of facts arrived by the courts below are wrong in law or perverse.
From the evidence led by the prosecution, therefore, it has been clearly established that the second marriage which was performed by the appellant Gopal Lal with Gopi was a valid marriage according to the custom of the nata marriage prevalent in the Telli community to which the appellant belonged.
This being so and the validity of the first marriage not having been disputed, Section 494 I.P.C. applies in terms and the appellant must be held to have committed the offence of bigamy as contemplated by Section 494 I.P.C. Lastly, Mr. Mulla pressed this appeal on the question of sentence.
Bigamy is a serious offence and the maximum punishment under Section 494 is seven years.
Therefore, where the offence of bigamy is proved the Court cannot take a very lenient view.
In the instant case the appellant was sentenced to two years and a fine of Rs. 2,000/ .
It appears that the appellant has already paid a fine of Rs. 2,000/ .
In these circumstances, therefore, we feel that the ends of justice will be met by reducing the sentence of imprisonment from two years to one year but maintaining the sentence of fine.
With this modification the appeal is dismissed.
The appellant will now surrender and serve out the remaining portion of the sentence.
S.R. Appeal dismissed.
| IN-Abs | After having fallen out and parted company with his wife Kanchan in the year 1963, the appellant, belonging to Telli community contracted a second marriage prevalent amongst his community with Gopi on 20th March 1969.
A complaint filed by his first wife ended in his conviction under section 494 I.P.C. and sentence of two years R.I. and a fine of Rs. 2,000/ , the conviction and sentence having been upheld by the Rajasthan High Court.
Dismissing the appeal by special leave, the Court, ^ HELD: 1.
The second marriage was a valid marriage according to the custom of the nata marriage prevalent in the Telli community which requires the following two essential ceremonies: (a) that the husband should take a pitcher full of water from the head of the prospective wife, and (b) that the wife should wear chura by the husband.
The prosecution through PWs.
2, 3, 4 and 5 having proved that these ceremonies have been duly performed, that there was such a custom which requires the said ceremonies having been admitted by the defence witnesses 3 and 5 and the validity of the first marriage not having been disputed, Section 494 I.P.C. applies in terms and the appellant must be held to have committed the offence of Bigamy as contemplated by section 494 I.P.C. [1176A E] 2.
The combined effect of section 17 of the Hindu Marriage Act and section 494 I.P.C. is that when a person contracts a second marriage after the coming into force of the said Act while the first marriage is subsisting, such a person commits the offence of bigamy.
[1174 E] Section 17 of the makes it absolutely clear that the provision has to be read in harmony and conjunction with the provisions of section 494 I.P.C., the essential ingredients of which are: (i) that the accused spouse must have contracted the first marriage (ii) that while the first marriage was subsisting the spouse concerned must have contracted a second marriage, and (iii) that both the marriages must be valid in the sense that the necessary 1172 ceremonies required by the personal law governing the parties had been duly performed and (iv) the second marriage must have become void by virtue of the fact that it had taken place in the life time of one of the spouses.
[1173F H] 3.
Where a spouse contracts a second marriage while the first marriage is still subsisting the spouse would be guilty of bigamy under section 494, I.P.C. if it is proved that the second marriage was a valid one in the sense that the necessary ceremonies required by law or by custom have been actually performed.
The voidness of the marriage under section 17 of the is in fact one of the essential ingredients of section 494 because the second marriage will became void only because of the provisions of section 17 of the .
Therefore, the contention that the second marriage being void section 494 I.P.C. will have no application is not correct.
[1175F G] Bhaurao Shankar Lokhande and Anr.
vs State of Maharashtra and Ors., [1965]2 S.C.R. 837; Kanwal Ram and Ors.
vs The Himachal Pradesh Administration, [1966]1 S.C.R. 539 and Priya Bala Ghosh vs Suresh Chandra Ghosh; [1973]3 S.C.R. 961 applied.
[Bigamy being a serious offence for which the maximum punishment is seven years, the Court while maintaining the conviction reduced the sentence to one year.]
|
N: Criminal Appeal No. 196 of 1973.
Appeal by Special Leave from the Judgment and Order dated 7 8 1973 of the Bombay High Court in Criminal Appeal No. 222 of 1970.
section B. Bhasme, P. G. Gokhale and B. R. Agarwala for the Appellant.
M. K. Ramamurthi, M. N. Shroff, Mrs. Hemanlaika Wahi for the Respondent No. 1.
R. N. Sachthey for Respondent No. 2.
The Judgment of the Court was delivered by KOSHAL, J.
This appeal by special leave is directed against the judgment dated 7th August 1973 of the Bombay High Court upholding the conviction of Sevantilal Karsondas Modi (the sole appellant before us) for an offence under section 120 B of the Indian Penal Code read with clauses (a) and (b) of sub section (1) of section 135 of the , and a sentence of rigorous imprisonment for a year recorded by the Chief Presidency Magistrate, Bombay.
The appellant was one of 30 accused persons against whom the police initiated proceedings in the court of the trial Magistrate.
Out of them, accused Nos.
28 to 30 were not tried as they had absconded and could not be apprehended.
The case against accused Nos. 18 and 19 was allowed to be withdrawn by the learned Magistrate on an application made by the Public Prosecutor under section 1162 494 of the Code of Criminal Procedure.
Accused Nos.
14, 24, 25, 26 and 27 were discharged by the learned Magistrate for want of evidence against them.
Charges were framed by him on 10 counts against the other 20 accused who were tried in consequence.
At the trial, 266 witnesses were examined in support of the prosecution case and 6 in defence.
Accused Nos. 9, 10, 11, 15, 16, 17 and 20 were acquitted as a result of the trial, while 13 of those charged were convicted and sentenced to various terms of imprisonment.
All the 13 last mentioned went up in appeal to the High Court who acquitted accused Nos. 1, 21, 22 and 23.
Accused No. 13 happens to be the appellant before us.
He was convicted and sentenced by the learned Magistrate as aforesaid and also on a separate charge for an offence, under clauses (a) and (b) of sub section (1) of section 135 of the and sentenced to rigorous imprisonment for six months in consequence.
His conviction on that charge, however, was set aside by the High Court, against whose judgment, as already stated, special leave to appeal was granted to him by this Court.
The prosecution case in so far as it is relevant for the purpose of this appeal may be briefly stated.
V. K. Asthana, (P.W. 228) who was then the Deputy Director in the Directorate of Revenue Intelligence in the Department of Customs at Bombay and is hereinafter referred to as 'Asthana ', received information in the first half of September 1966 to the effect that flat No. 2 forming part of the building known as Sagar Mandir and situated in that locality of Bombay which is called 'Shivaji Park ' was being used for storage of smuggled gold and disbursement thereof to its purchasers.
After the flat had been kept under watch for a few days by some officials of the Department, a decision was taken by Asthana to raid the premises.
The raiding party which consisted of senior Customs officers, took positions in the vicinity of Sagar Mandir on the morning of 14th September 1966.
They included B.M. Sevalia, Preventive Officer, Bombay Customs (P.W. 7 and hereinafter referred to as 'Sevalia '), G. N. Alreja, Preventive Officer, Bombay Customs (P.W. 34 and hereinafter mentioned as 'Alreja), P. G. N. Ayengar, Appraiser in the Directorate of Revenue Intelligence (P.W. 144 and hereinafter called 'Ayengar ') and D.G. Mugwe, Principal Appraiser in the said Directorate (P.W. 152 and hereinafter referred to as 'Mugwe ').
Sevalia was deputed to watch the movements of persons entering the flat and to give a signal on the arrival of the suspects.
At about 8.50 A.M., accused No. 12 was seen entering the flat and Sevlalia alerted the other members of the raiding party by giving the agreed signal.
Half an hour later, a car stopped at the entrance to the compound of the building and 1163 accused Nos. 5, 6 and 7 alighted therefrom.
Accused No. 5 went towards the concerned flat but got suspicious on noticing the presence of strangers near the entrance.
He turned back and so did his two companions.
All three of them took to their heels but were caught by the raiding party on a direction by Mugwe.
Accused No. 12 was found inside the flat.
The person of each one of accused Nos.
5, 6 and 7 was searched and yielded 200 slabs of gold weighing 10 tolas each.
All the slabs bore foreign markings and were contained in jackets having long pockets and worn by each of the captives.
Bunches of keys exhibits K 4, K 5 and K 6 and a diary containing accounts exhibit 'O ' were found lying in the passage forming part of the flat.
Bandi exhibit J 2 was secured from a room of the flat.
A search of the person of accused No. 12 yielded keys exhibit K 2, which fitted the locks used in the flat, and sheets of accounts exhibit 'S '.
While the search was going on, accused No. 13 was found peeping from outside through a grille forming part of the flat but started running away on seeing what was happening inside.
He was chased and captured and two keys were seized from his person.
One of them was found to fit the lock on the outer door of the flat and the other to fit the latch therein.
He was also found wearing a bandi similar to bandi exhibit J 2.
At his instance four slabs of gold and 10 gold bangles, each weighing 10 tolas, were recovered from underneath the mattress lying on a bed in the flat.
Accused Nos.
5 to 7 and 13 were interrogated by the Customs officials.
The statement of accused No. 13 exhibit Z 383 was recorded by Ayengar on the 15th of September 1966.
In that statement, the appellant gave an exhaustive account of the circumstances in which he happened to come to Bombay and made his services available to the principal accused named J. K. Shah.
The long and short of the statement may be summarised thus: One day J. K. Shah called accused No. 13, gave him some cloth and sent him in the company of one Goverdhan Das to have the cloth tailored into bandis of a special type having two wide and long pockets in the front.
The cloth supplied was thick and strong.
A few days after the bandis were ready, accused No. 13 was taken to the flat in question by his sister 's husband, named Natwarlal (accused No. 12) or by accused No. 15.
Thereafter accused No. 13 visited the flat several times when he would receive bandis containing gold brought from outside and store them in the flat or would remove such bandis from the flat to other 1164 places in town.
J. K. Shah had given him keys of the flat.
Whatever gold was removed by him from the flat, was either deposited by him in a room on the second floor of a building situated in Modi Street or delivered to J. K. Shah in the latter 's office on the 3rd floor of building No. 111 situated in Tambakanta.
The room in Modi Street had a telephone the number whereof was 262283 and a key of this room was supplied to him by J. K. Shah.
He used to receive orders either from J. K. Shah or from accused No. 15 to go to the flat in Sagar Mandir and receive the gold there.
He received gold in this way on the 12th and 13th of September 1966.
On the day of his capture he was in the room in Modi Street when he received a telephone call from J. K. Shah at 11 or 11.15 A.M. requiring him to visit the flat in Sagar Mandir and find out if any trouble was brewing and that if that was so, J. K. Shah was to be informed on the telephone.
Accused No. 13 rushed to Sagar Mandir in a taxi and tried to find out from outside if there was anything wrong.
For that purpose he looked through a broken ventilator.
While he was coming towards the road on the beach nearby he was detained and was taken inside the building.
While the above statement was being recorded, accused Nos. 4, 5, 6, 7 and 8 were identified by accused No. 13 as the persons from whom he used to receive gold at Sagar Mandir.
The evidence relied upon by the prosecution against accused No. 13 may be split up under the following heads: (a) He was seen visiting the flat in Sagar Mandir on the 8th, 9th and 13th September 1966 by the Customs officials who were watching the premises under the orders of Mugwe.
(b) He was peeping into flat No. 13 between 11 A.M. and 12 noon on the 14th of September 1966.
(c) When he found that the flat was under search by officers belonging to the Customs Department, he tried to run away.
(d) He was found in possession of keys fitting the locks of the flat.
(e) He was wearing a bandi similar to bandi exhibit J 2 which is a special type of bandi suitable for carrying gold slabs secretly.
1165 (f) 4 slabs of gold and 10 gold bangles were recovered from underneath the mattress at his instance.
(g) The confession made by him and contained in statement exhibit Z 383.
The learned trial Magistrate found all the above heads to have been established and that is why he convicted and sentenced accused No. 13 on two counts.
The High Court took a different view in relation to heads (a) and (f).
It was of the opinion that the identification of accused No. 13 by the Customs officials on the 8th, 9th and 13th of September 1966 could not safely be relied upon as they had seen people coming into and going out the Sagar Mandir only from a distance and for very short periods of time so that their view of such people could possibly be mere "fleeting glances".
It further held the alleged recovery of four gold slabs and 10 gold bangles to be unreliable as the marginal witness to the recovery memo who was produced in court by the prosecution did not support it and stated that he had not seen accused No. 13 pointing out the slabs and the bangles.
The High Court concluded therefore that the charge under clauses (a) and (b) of sub section (1) of section 135 of the was not sustainable.
However it found the other heads of evidence proved and on the basis thereof upheld the conviction and sentence in relation to the charge of conspiracy to commit the other offences just above described.
After hearing learned counsel for the parties at length we find ourselves unable to uphold the impugned judgment in so far as accused No. 13 is concerned.
The circumstances that he was found peeping into the flat, that he tried to run away on seeing the Customs officials searching the premises, that he was in possession of duplicate keys of the flat and that he was found wearing a bandi similar to bandi exhibit J 2 are not incompatible with his innocence.
He was a close relation of accused No. 12 who has been found to the person really incharge of the flat and it would thus be natural for him (accused No. 13) to share the flat with the permission of accused No. 12.
In so living with his brother in law he may have been given to wear the bandi found on his person not for the purpose of carrying gold but just for use as ordinary raiment.
Again, in a city like Bombay it is not unusual for persons sharing a particular accommodation to be provided with separate sets of keys for each in order to facilitate ingress or egress at will.
Further, an innocent man finding his premises being watched by persons in authority may well feel funky at the prospect of a false implication on the basis of a mere 1166 suspicion (which may or may not be well founded and may try to make himself scarce.
Without more, the circumstances covered by heads (b), (c), (d), and (e), therefore, cannot be regarded as incriminating circumstances.
So the conviction really rests on the confession attributed to the appellant.
If it is found to be voluntary and true it may receive some support from the four heads of evidence just above described.
If, on the other hand, the confession appears to be either untrue in any material particular or having been caused by any inducement, threat or promise such as is described in section 24 of the Evidence Act, it must fall and with it fall the other heads of evidence, leaving no material to support the conviction.
As it is, we find that the appellant has been able to prove the existence of circumstances which make it highly probable that his confession is hit by the mandate in section 24 above mentioned.
Our reasons for coming to this conclusion follow.
The case set up by accused No. 13 in so far as his confession is concerned, mainly consists of a plea that it was the result of an assault on him by the Customs officers including Ayengar and Sevalia and that the latter had forced him into making an endorsement in his own hand writing under the confessional statement to the effect that statement was voluntary and had been explained to him by Sevalia.
Naturally, the story of the assault has been stoutly denied by Ayengar and Sevalia; but then the circumstances prevailing at the relevant time in the Customs House where the statement was recorded definitely indicate that all was not well with the manner in which the interrogation of various accused was being carried on.
In this connection the outstanding feature of the situation is the fact that accused No. 15 when examined by Dr. section R. Joglekar (D.W.I.) on the 16th September 1966 at 6.15 P.M. was found to have on his person seven injuries which the doctor has described thus: "(1) Ecchymosis below right eye, outer part, 1/2"x1/3".
blackish colour.
(2) Ecchymosis below left eye, middle, 1/4"X1/4" blackish colour.
(3) diffused contused area, 21/2"X3", on right thigh, upper part.
(4) Contused area on right buttock, 3" x 2", lower part, wheal (?) marks seen.
(5) diffused contused area on left thigh, back and outer part, 5" X 2", wheal (?) marks seen transverse.
1167 (6) Transverse wheal (?) marks on back of left knee.
(7) Contused area on back of left leg, 2" X 1".
According to the doctor, these injuries appeared to have been caused two to four days earlier.
Admittedly accused No. 15 was apprehended by the Customs staff on the 14th September 1966.
No explanation whatsoever is offered for his injuries by the prosecution but the stand taken by accused No. 15 himself in this behalf may be stated in his own words "At that time, there were six Customs Officers around me.
In the gallery, I was again shown the 4 keys.
I was again asked about the said keys and I had again given the same reply.
The said officers on hearing this, get enraged and began to say that I was stating falsehoods.
One of the officers then asked me to take out my clothes.
I had then worn one under wear and a pant and one bush coat and a ganji.
I was then asked to remove my pant as well as my underwear by the said officer and I did so accordingly against my will.
That officer then ordered me to sit in the position of "a chair".
I was so asked to sit like a chair without the support of a wall even to my back.
The six officers were then standing around me at that time.
After making me to sit in that chair position they began to ask me about the said keys.
I had again given the same reply about the said keys.
If I moved a little from the position of a chair given to me, I was kicked by all the officers immediately.
I was able to sit in that position for 4 5 minutes.
I used to fall down thereafter.
I used to be kicked therefor, made to stand again and asked to resume the same position.
In this way, I had fallen and had been assaulted again and again by the said officers for about an hour or so.
While I was so being questioned and made to sit in that position again and again, one of the officers had gone out and had returned with a ruler in hand having a round shape.
As I was made to sit in that position of a chair, I often used to move therefrom, the officers immediately used to assault me and I used to get up thereby.
Out of the Custom Officers the officer who had the ruler in his hand used to assault me therewith, and the other officers used to assault me with kicks.
I had been assaulted with that ruler on my left buttock, on my right buttock, on the back portion of the calf of my left, leg, on my right thigh, on the backside of my both legs etc.
1168 I had received injuries at all these places stated by me above and as a result of this assault on me, I could not even stand up.
Throughout the assault; I was being questioned again and again about the said keys by all the said officers and at every time I was stating that I did not know anything more about the same.
Thereafter I had fallen down on the ground with my face towards the ground.
All the said six officers then went away.
" This stand may not be devoid of exaggeration and embellishment but it receives great support from the testimony of Dr. Joglekar (D.W.I.) so that the probability appears to be that accused No. 15 received his injuries at the hands of the Customs staff and there being no explanation on the part of prosecution as to the situation in which he was beaten, it is reasonable to presume that the stand taken by him is correct and that the injuries were inflicted on him as a measure of coercion adopted to secure his confession.
In coming to a contrary conclusion, the High Court was mainly influenced by the fact that although accused No. 15 had filed a complaint in court against the concerned officers of the Department of Customs, he did not prosecute it but had it dismissed for default.
The High Court observed in this connection: "The only explanation for this unusual attitude offered by him to the Court is that he was afraid of vindicative attitude from the officers.
We have not been able to conceive how officers could have adopted any vindicative attitude, when accused No. 15 was not concerned with any offence.
Be that as it may, the fact remains that the complaint was not prosecuted and the evidence was recorded behind the back of the officers.
It is not possible to hold on the present material that assaulting by the officers was for the purposes of extorting some confession and such assault alone was the cause of the injuries received by him.
Beyond, therefore, creating a fog of suspicion, the injuries proved to have been caused to accused No. 15, cannot indicate that all the accused were subjected to torture, assault and pressure for giving statements to the liking of officers or compelling them to sign the prepared statements.
" We do not appreciate this approach to the determination of the voluntary nature of the confession of accused No. 15.
As we have already pointed out, the time of infliction of injuries coincided with the day on which accused No. 15 was apprehended and his confession was recorded.
In this situation it was the imperative duty of the 1169 prosecution to explain the circumstances in which it became necessary for force to be used by the Customs staff on the person of accused No. 15 and in the absence of any such explanation there is no reason why his plea should not be taken at its face value.
We are of course not directly concerned with the voluntary nature of the confession of accused No. 15 in this appeal but the circumstances discussed in the last paragraph indicate that the Custom of officials did not stick to ethical standards in the performance of their duties and, on the other hand, exhibited such a zeal in bringing the captives to book as transgressed the limits set thereon by law.
We have already alluded to the fact that the High Court itself did not regard the recovery of four gold slabs and 10 gold bangles alleged to have been made at the instance of accused No. 13 to be trustworthy.
Besides, the plea of accused No. 13 that he was coerced into making the confession was taken at the earliest opportunity, i.e., on the 20th of September 1966 which was the day next to that of his release from custody on bail.
That plea is contained in letter exhibit 29 addressed by him on that date to the Additional Collector of Customs, Bombay, which contained the following averments: "From the 14th instant at 12 noon till about 3 p.m. I was locked up along in one room with some Customs Officers who continuously interrogated me, threatened and physically assaulted me to make and sign a statement prepared by them after ascertaining a few personal questions from me pertaining to my family and myself.
I was not allowed to sleep during the entire night of the 14th/15th and was not allowed to see any person.
The statement was written out by the officers themselves in English language and it was not explained to me and my signature was obtained which I have signed in Gujarathi.
As a result of this threat, coercion and complete exhaustion, I had no alternative but to sign the statement after which only I was allowed to rest.
" Taking note of these circumstances we would consider it extremely unsafe to regard the confession exhibit Z 383 signed by the appellant as having been made by him voluntarily and therefore trustworthy.
The appellant, in our opinion, has shown the existence of circumstances which make it appear to the Court that the confession may well have been obtained in a manner which would bring it within the ambit 1170 of section 24 of the Evidence Act, it being undisputed that the concerned officers of the Department of Customs were "persons in authority" within the meaning of that expression as used in the section.
In the result the appeal succeeds and is accepted.
The judgment of the High Court is reversed, the conviction recorded against and the sentence imposed upon the appellant by the learned trial Magistrate and upheld by the High Court are set aside and he is acquitted of the charge in its entirety.
N.V.K. Appeal allowed.
| IN-Abs | On receipt of information that smuggled gold was stored in it, a large number of senior officials of the Customs Department surrounded the flat belonging to the brother in law of the appellant and started searching it.
According to the prosecution, while the search was on, the appellant was found peeping from outside through the grille forming part of the flat, and started running away, on seeing that the search was being carried on in the flat.
He was chased by the Customs Staff and caught.
Later his confession was recorded.
Along with the appellant several other persons had also been tried for the same offence.
The trial court convicted and sentenced the appellant of an offence under section 120B IPC read with section 135(1)(a) of the Customs Act.
On appeal the High Court found that the charge under section 135(1)(a) and (b) of the Customs Act was not sustainable but holding that the offence under other heads was proved, it upheld the appellant 's conviction and sentence.
It was contended on behalf of the appellant that the confession was the result of an assault on him by the Customs Officials, which not being voluntary was inadmissible in evidence under section 24 of the Evidence Act.
Allowing the appeal.
^ HELD: 1.
(i) It is unsafe to regard the appellant 's confession as voluntary and therefore trustworthy.
The concerned Customs Officials were "persons in authority" within the meaning of that expression used in section 24 of the Evidence Act.
The confession may well have been obtained in a manner which would bring it within the ambit of section 24 of the Evidence Act.
The appellant has been able to prove the existence of circumstances which make it highly probable that his confession is hit by the mandate in section 24.
[1169H 1170A, 1166C] (ii) Although there is no direct evidence that force was used on the appellant to extract a confession the surrounding circumstances prevalent at the relevant time in the Customs House where the statement was recorded indicate that all was not well with the manner in which the interrogation of various accused was being carried on.
They indicate that the Customs Officials did not stick to ethical standards in the performance of their duties and exhibited much zeal in bringing the captives to book and had transgressed the limit set by law.
[1166E, 1169B] (iii) One of the accused in this case was found to have seven injuries on his person.
The stand of that accused that he was coerced into making a confession, received support from the testimony of the doctor who examined 1161 him so that the probability appears to be that the accused received his injuries on the hands of the Customs staff.
In the absence of an explanation of the prosecution as to the situation in which he was beaten, it is reasonable to presume that the stand taken by him was correct and that the injuries were inflicted as a measure of coercion adopted to secure his confession.
Taking these circumstances into consideration, it is unsafe to regard the appellants confession too as voluntary.[1166F, 1168C, 1169G] Besides, the plea that he had been coerced into making the confession was taken at the earliest opportunity i.e. on the day following his release from custody on bail.
[1169D] 2.
Being a close relation of the owner of the flat, the appellant was perhaps sharing the flat with him and so had duplicate set of keys; his brother in law might have given the Bandi found on the appellant not for the purpose of carrying the gold but just for use as an ordinary raiment.
It is also possible that the appellant became nervous, that he thought that he would be implicated in the crime and therefore, might have started running away on seeing the Customs Officers in the house.
Therefore, these factors on which the High Court relied for sustaining his conviction cannot be regarded as incriminating circumstances.
[1165F 1166A]
|
N: Criminal Appeal No. 264 of 1978.
Appeal from the Judgment and Order dated 31 3 1978 of the Allahabad High Court in Criminal Appeal No. 597/76.
A.N. Mulla and S.K. Jain for the Appellant.
O.P. Rana for the Respondent.
The Judgment of V.R. Krishna Iyer, P.N. Shinghal and D. A. Desai JJ. was delivered by Krishna Iyer, J.P.S. Kailasam, J. gave a dissenting opinion on behalf of himself and A. D. Koshal, J. 1091 KRISHNA IYER, J. Exordially speaking, the point for decision is short but its legal import and human portent are deep, sounding in constitutional values and meriting incisive examination.
Where the question wears a simple look but its answer strikes at life and liberty we must proceed on the inarticulate major premise of human law as the solemn delivery system of human justice.
In formal terms, the problem to be resolved is the vires of Order XXI, Rule 15(1) (c) of the Supreme Court Rules (the Rules, for short), but in juristic terms it turns on the inflexible stages as against its facultative facets of an appellate hearing when it is a first appear against a death sentence or life imprisonment.
More particularly, is an appeal to the Supreme Court falling within the scope of article 134(1) or the enlarged jurisdiction permitted by article 134(2) liable to shorthand hearing and peril of summary dismissal? Brevi manu, the appellant urges that article 134 of the Constitution compels this Court to hear and dispose of criminal appeals of the grave categories covered by it, not exparte as Order XXI Rule 15(1) (c) of the Rules permits but in extenso, and only after notice to the State and with the record of the case before it.
Therefore, the Rule is bad.
Any legal issue of profound impact, if regarded by Judges literally and not creatively, may be given short shrift, especially if counsel is more assertive than explorative, produces more heat than light and the text to be interpreted lends itself to one sense on the surface and another in the deeper layers.
But when the consequences of the construction can be calamitous and the subject matter involves the right to life and long loss of liberty, a final court, like ours, must reflect on the meaning of meanings, the human values which illumine our legal system and the ends of justice the means of law must serve.
The heart and the head interact and interpret.
A thumb nail sketch of the sequence of facts may be necessary to get a hang of the constitutional core of the case.
Several persons, including the appellants, were accused of murder and other violent offences but were acquitted by the Sessions Judge.
The State carried an appeal to the High Court against the acquittal of all the 18 accused persons.
In an elaborate judgment the `High Court found the case of the prosecution proved although it confirmed the acquittal of quite a few.
The convicted accused, 12 in number, were awarded life imprisonment under section 302 read with section 149, I.P.C. and lesser terms of imprisonment for other offences.
Thereupon the convicted appellants preferred an appeal to this Court under section 2(a) of the , 1092 (for short the Enlargement Act).
This appeal was listed for preliminary hearing ex parte under Rule 15(1)(c) of the Rules (as amended in 1978).
When the case was opened at the preliminary hearing counsel for the appellants contended that, as an inalienable incident of a statutory appeal, his clients were entitled to a full fledged hearing after notice to the State and not an abbreviated disposal in the shape of a preliminary hearing, however long that hearing might be.
Thereupon, the court passed the following order: "The appellants have challenged the constitutional validity of clause (c) of sub rule (1) of rule 15 of order XXI of the Supreme Court Rules, which enables an appeal of the kind with which we are concerned, to be placed for hearing exparte before the Court for ad mission.
In that view of the matter, we think that unless the question of the constitutional validity of the rule is 1 decided, we cannot have a preliminary hearing of this appeal for admission.
Let the records, therefore, be placed before the Hon 'ble the Chief Justice for giving such directions as he may deem fit and proper." This Bench has come to be seized of the case in the constitutional setting.
Such is the scenario, the last and most crucial stage of ' which is the hearing before this Constitution Bench.
A little elucidation of the legal matrix which has given rise to the contentions may be useful.
This Court has jurisdiction over a wide range and long reach of litigation under article 136 of the Constitution which includes the power to grant leave to appeal in criminal matters.
But this is a discretionary jurisdiction with drastic self imposed limitations rarely realised by the gambling litigant and has hardly any semblance of an absolute right of appeal necessarily fol lowed by a full debate after notice to the adversary.
But a segment of criminal cases, standing out as a deadly category is, however, dealt with separately by article 134.
In a short hand form, sub clause (1) clothes an accused person, who has been acquitted by the trial court but sentenced to death at the appellate level, or has been tried by the High Court by withdrawal of the case from any other court subordinate to it and in such trial has been visited with death sentence, or has secured a certificate that his case is of such great moment as to qualify for pronouncement by the Supreme Court, with a right shall we say, a constitutional right of appeal to this Court.
More over, under clause (2) of this Article, Parliament may make law 1093 for conferring a statutory right of appeal on other classes of convicts.
A Pursuant to this power Parliament has enacted the , whereby persons acquitted by the trial court but awarded imprisonment l`or life, or for ten years and more, enjoy a statutory right of appeal.
The proviso to Article 134(1) enables this Court to make provisions subject to which appeals under sub clause (c) of Article 134 shall lie.
These provisions are to be made under clause (1) (d) of Article 145 which, in specific terms, deals with rules as to the entertainment of appeals under sub clause (c) of clause (1) of Article 134.
We are not concerned with these rules which relate to the entertainment of appeals or provisions subject to which the appeal may be instituted and do not trench upon the right of appeal or the manner of hearing.
But Article 145(1) (b) enables the Supreme Court to make, rules, inter alia, as to the procedure for hearing appeals.
One such rule is Order XXI Rule 15 which warrants preliminary hearing and disposal of all categories of appeals covered by Article 134(2).
The fate of the present appeal hung in the balance at such a preliminary hearing and counsel challenged the vires of the rule itself.
In its wake has come the present hearing.
This sets the stage for a more comprehensive approach to the constitutional problems arising in the case.
We must make i clear that we are not concerned with the merits of the appeal at all but are confined to a consideration of the validity of the impugned rule.
If we hold that the said rule is ultra vires and further hold that there shall be a regular, full dress hearing of the appeal a preliminary hearing will be obviated and notice in the appeal will have to go to the State.
It requires to be specifically mentioned, although there is no hint about its advertence at the earlier preliminary hearing that the Criminal Procedure Code, 1973 has a fasciculus of provisions relating to appeals, the manner of their hearing and the procedure for their disposal, which is comprehensive enough to cover the present category embraced by Order XXI Rule 15(l)(c).
Therefore, the effect of the Sections in the Code hearing on the issue under discussion may also have to be studied before we finally pronounce on the legality Or a preliminary hearing in a criminal appeal filed in exercise of a constitutional or statutory right.
Our consideration falls into two chapters as it were, the first and more important turning on the constitutional provisions vis a vis Order XXI Rule (l)(c) and the second turning on the construction and impact of section 384, Cr.
P.C. Taking up the constitutional 1094 aspects first, we may proceed to state, right away, the complex of provisions relevant to the discussion and the perspective in which we must read their message.
article 134 of the Constitution confers criminal appellate jurisdiction on this Court: 134.
Appellate jurisdiction of Supreme Court in regard to criminal matters. (1) An appeal shall lie to the Supreme Court from any judgment, final order or sentence in a criminal proceeding of a High Court in the territory of India if the High Court (a) has on appeal reversed an order of acquittal of an accused person and sentenced him to death; or (b) has withdrawn for trial before itself any case from any court subordinate to its authority and has in such trial convicted the accused person and sentenced him to death: or (c) certifies that the case is a fit one for appeal to the Supreme Court: Provided that an appeal under sub clause (c) shall lie subject to such provisions as may be made in that behalf under clause (1) of Article 145 and to such conditions as the High Court may establish or require.
(2 ) Parliament may by law confer on the Supreme Court any further powers to entertain and hear appeals from any judgment, final order or sentence in a criminal proceeding of a High Court in the territory of India subject to such conditions and limitations as may be specified in such law No argument is needed to realise the gravity of the subject cover ed by the first two clauses of the article death sentence for the first time or in reversal of an acquittal.
Human life is too dear to be deprived of by a death sentence without so much as a single appeal after its award.
Our founding faith in human rights is the only warrant for the entrustment of this appellate jurisdiction on the Supreme Court which is far removed from the trial court and is intercepted by the High Court, an elevated tribunal manned by judges of proven calibre.
The symbolic meaning is obvious.
Life is no matter for easy despatch even by the judicial process and a serious second 1095 look is the minimum that the State owes to the citizen before his gallowed farewell.
To truncate the fullness of appellate scrutiny into ex parte disposals despite the deliberate insertion by the framers of the Constitution of an express provision, by a procedural knife, may often frustrate their profound concern.
Judicial professionalism, at higher level, is particularly conscientious and careful; but all professionalism suffers, by custom, from scelerosis in practice.
And so, n full scale hearing in a first appeal is the fair insistence of the Constitution when the risk is to precious life.
We are aware that the disposal of appeals involving death penalty receives anxious concern and deep reflection on the part of judges.
We are conscious that the grave stakes forbid judges from dismissing appeals without satisfying themselves against error.
But human limitations, perfunctoriness of counsel, oversight of some material hardly highlighted in the judgment under appeal and the misfortune that ex parte examination dulls attention while debate at the bar sparks mental plugs these too are realities.
Likewise, article 134 (1) (c) spells a measure of seriousness because the High Court which has heard the case certifies solemnly that it involves questions of such moment that the Supreme Court itself must resolve them.
To dispose of such a matter by a preliminary hearing is to cast a reflection on the High Court 's capacity to understand the seriousness of a certification.
Now it is relevant to read article 136(1).
Special leave to appeal by the Supreme Court (1) Notwithstanding anything in this Chapter, the Supreme Court may, in its discretion grant special leave to appeal from any judgment, decree, determination, sentence or order in any cause or matter passed or made by any court or tribunal in the territory of India.
A plenary discretion vests in the Supreme Court to deign or decline to grant leave to appeal against any conviction or sentence.
Before deciding to grant or reject such leave the court accords an oral hearing after perusing all the papers produced.
Once leave is granted, is heard, after notice to the State, in full panoply.
After leave, the appeal is born.
Then it ripens into fullness and is disposed of when both sides are present.
No appeal, after leave, is dismissed summarily or ex parte.
The relevance (If article 136 in an examination of article 134 is this.
If article 136 gives a discretionary power to grant 1096 leave to appeal or to dismiss in limine, after an ex parte hearing (or after issue of notice if the court so chooses), article 134, which gives a constitutional right to appeal, as it were, must stand on a higher footing lest the Constitution makers be held to have essayed in supererogation.
Surely, there is much more 'hearing ' content in an absolute appellate right than in a precarious 'special leave ' motion.
Jurisprudentially, a right is larger than a permission.
What is irresistible is that article 134 puts the momentous class of cases covered by it beyond the discretionary compass of article 136 and within the compulsory area of full hearing such as would follow upon leave being granted under article 136(1).
But this is not the end of the journey.
For, a full hearing may not obligate dragging the opposite side to court involving expense and delay.
Fullness of hearing of the proponent is not incompatible with non hearing of the opponent where after appreciating all that could be urged in support of the cause there is no need felt to call upon the other side, as where the proposition is groundless, frivolous or not prima facie statable.
The ambit of appellate hearing may have to be explored in the constitutional context to which we will advert later.
The next step necessitates setting out, as an integral part of the comprehensive picture, article 145: 145.
Rules of Court, etc. (1) Subject to the provisions of any law made by Parliament, the Supreme Court may from time to time, with the approval of the President, make rules for regulating generally the practice and procedure of the Court including: (a) . . (b) rules as to the procedure for hearing appeals and other matters pertaining to appeals including the time within which appeals to the Court are to l e entered; (c) . . (cc) . . (d) rules as to the entertainment of appeals under s clause (c) or clause (l) of article 134; (e) . . (i) . . (g) . . 1097 (h) . . (i) rules providing for the summary determination of appeal which appears to the Court to be frivolous or vexatious or brought for the purpose of delay; (j) . .
This Court has framed rules under this article.
The pertinent rule, which is impugned as ultra vires is Order XXI Rule 15(1) (c) which may usefully be read here: 15.
The petition of appeal shall be registered and numbered as soon as it is lodged.
Each of the following categories of appeals, on being registered, shall be put up for hearing ex parte before the Court which may either dismiss it summarily or direct issue of notice to all necessary parties or may make such orders, as the circumstances of the case may require, namely: (a) . . (b) . . (c) an appeal under sub clause (a) or sub clause (b) of clause (1) of article 134 of the Constitution, or under the (28 of 1970) or under section 379 of the Code of Criminal Procedure, 1973 (2 of 1974).
Plainly, this rule clothes the court with power to shorten the life of an appeal even under Article 134 by dismissing it ex parte, summarily.
Is this abbreviatory power absonent with the appellate scheme envisaged in article 134 and, therefor, excessive or offensive and void ? Or is the rule valid because it does not bear upon the substantive right of appeal but relates to the procedure for hearing and fall squarely within article 145(1)(b) ? This is the main crux of the debate.
It would be noticed that article 134(2) empowers Parliament to expand the jurisdiction of the Supreme Court to entertain criminal appeals.
Parliament, in exercise of this power, enacted the (for short, the Enlargement Act).
The relevant section (sec. 2) states: H 2.
Enlarged appellate jurisdiction of Supreme Court in regard to criminal matters.
Without prejudice to the powers 1098 conferred on the Supreme Court by clause (1) of Act 134 of the Constitution, an appeal shall lie to the Supreme Court from any judgment, final order or sentence in a criminal proceeding of a High Court in the territory of India if the High Court (a) has on appeal reversed an order of acquittal of an accused person and sentenced him to imprisonment for life or to imprisonment for a period of not less than tell years; (b) has withdrawn for trial before itself any case from any Court subordinate to its authority and has in such trial convicted the accused person and sentenced him to imprisonment for life or to imprisonment for a period of not less than ten years.
Thus a right to appeal to the Supreme Court is given to convicts whom the High Court has, for the first time sentenced to life imprisonment or to a term of or above ten years of rigorous imprisonment.
There is no doubt that Parliament, in its grave concern for long incarceration being subject to great scrutiny at the highest level if first inflicted by the High Court, granted a right of appeal in such cases and equated it with that granted under article 134(1)(a) and (b).
So what applies to death sentence cases applies to life term cases too and this must be borne in mind in the interpretative process.
This emphatic import is clear once we excerpt the relevant part of the Objects and Reasons: "While sub clauses (a) and (b) of article 134(1) of the Constitution confer upon the accused an absolute right of appeal, clause (c) confers upon the High Court a discretion to grant, a certificate to the accused to appeal in cases not falling under sub clauses (a) and (b).
The grant of certificate under article 134(1) (c) is not a matter of course.
The certificate is granted only where there has been an infringement of the essential principles of justice or there is substantial question of law or principle involved; in short the certificate, would not be granted unless there are exceptional and special circumstances.
The Supreme Court has also held that the conditions pre requisite for the exercise af the discretionary power to grant a certificate under article 134 (1) (c) cannot be precisely formulated but it should be exercised sparingly and not to convert the Supreme Court into an ordinary court of criminal appeal.
1099 An accused person has no absolute right of appeal even A in circumstances mentioned in clauses (a) and (b) of article 134(1) if the High Court sentences him to life imprisonment or imprisonment of 10 or more years.
In such a case his appeal would be admitted in special and exceptional cir cumstances only either under article 134(1) (c) or article 136 of the Constitution.
* * * * It is therefore proposed to enlarge the appellate jurisdiction of the Supreme Court empowering it to entertain and hear appeals also in cases mentioned in sub clauses (a) and (b) of clause (2) of the Bill.
" What is created is an unconditional right of appeal, nothing less and wider than is enjoyed under article 136.
We have stated at the outset that for satisfactory understanding of the problem and its solution, certain provisions of the Criminal Procedure Code which cover the same ground need to be dealt with.
We will advert to them briefly here conscious that the crucial issue is constitutional.
The Code cannot control or contradict the Constitution as the stream cannot rise higher than the source.
The provisions of the Code, invaluable as canalising the exercise of the appellate power, must be informed by and be subservient to the normative import of the Supreme Lex lest they run aground and be wrecked.
Chapter XXIX deals with appeals.
Taking cognizance of the Enlargement Act the Code has enacted Sec. 374(1) and Sec. 379 which, perhaps, are redundant save for completeness.
These are new provisions not found in the Code of 1898 and may be reproduced: 374(1).
Any person convicted on a trial held by a High Court in its extra ordinary original criminal jurisdiction may appeal to the Supreme Court.
Where the High Court has, on appeal, reversed an order of acquittal of an accused person and convicted him and sentenced him to death or to imprisonment for life or to imprisonment for a term of ten years or more.
he may appeal to the Supreme Court.
Section 384 is significant because it has a decisive bearing on the State of appeals like the present.
This Section is in part a mechanical or meaningful?) reproduction of the corresponding provision(s. 421) in the vintage Code.
1100 A casual persual discloses that section 384 is an omnibus provision embracing all appeals, big and small, grave and goofy, involving a petty fine or inflicting, for the first time, a hanging sentence.
And regardless of the stakes, the appellate court is given the pervasive power to dismiss the appeal summarily, and worse, even without calling for the record of the case and without recording its reasons if the Court is higher than the Court of Session.
At first blush, a blanket power to dismiss summarily, ex parte, sans record of the case, sans record of reasons, even where an acquitted accused is sentenced to death for the first time by the High Court, is neither human law nor human justice if our jurisprudence is sensitized by the humanity of the Preamble to the Constitution or responsive to the vibrant commitment to civilized values.
Petrified print processed through the legislative mint becomes living law when, and only when, its text is tuned to the humane note of the Constitution.
We will dwell on the harmonics of the Constitution first since the fundamental note must emanate from it.
I) The question then is whether a statutory right of appeal necessarily spells the full unfoldment of notice to the respondent, sending for the records and record of reasons by a speaking judgment.
If the answer is in the affirmative the survival of Order XXI Rule 15(1) (c) is perilous.
Reaching the same result by resort to artificial respiration from section 384 may have to be considered.
But anticipating our conclusion to avoid suspense, we sustain both the provisions by reading down their scope, substance and intendment.
The appellants have an undeniable right of appeal; but what are the necessary components of a hearing when such a right is exercised ? Counsel for the appellant insisted that an absolute right of appeal, as he described it, casts an inflexible obligation on the court to send For the record of the case, to hear both parties, and to make a reasoned judgment.
Therefore, to scuttle the appeal by a summary hearing on a preliminary posting, absent record, ex parte and absolved from giving reasons is to be; absolutist a position absonant with the mandate of the Enlargement Act and, indeed, of the Constitution in Article 134 (1) .
Counsel 's ipse dixit did not convince us but we have pondered over the issue in depth" being disinclined summarily to dismiss.
At the threshold, we have to delineate the amplitude of an appeal, not in abstract terms but in the concrete context of Article 134 read with Article 145 and order XXI Rule 15 and section 384 of the Criminal Procedure Code, 1973.
The nature of the appeal process cannot be cast in 1101 a rigid mould as it varies with jurisdictions and systems of jurisprudence.
This point has been brought out sharply in "Final Appeal.
"The learned authors ask : "But what does 'appeal ' really mean : indeed, is it a meaningful term at all in any universal sense ? The word is in fact merely a term of convenient usage, part of a system of linguistic shorthand which accepts the need for a penumbra of uncertainty in order to achieve universal comprehensibility at a very low level of exactitude.
Thus, while 'appeal ' is a generic term broadly meaningful to all lawyers in describing a feature common to a wide range of legal systems, it would be misleading to impute a precise meaning to the term, or to assume, on the grounds that the word (or its translated equivalent) has international currency, that the concept of an appeal means the same thing in a wide range of systems.
On any orthodox definition, an appeal includes three basic elements: a decision (usually the judgment of a court or the ruling of an administrative body) from which an appeal is made; a person or persons aggrieved by the decision (who is often, though by no means necessarily party to the original proceedings) and a reviewing body ready and willing to entertain the appeal.
" The elasticity of the idea is illumined by yet another passage which bears quotation: " 'Appeals ' can be arranged along a continuum of increasingly formalised procedure, ranging from a concerned man in supplication before his tribal chief to something as jurisprudentially sophisticated as appeal by certiorari to the Supreme Court of the United States.
Like Aneurin Bevan 's elephant an appeal can only be described when it walks through the court room door. .
The nature of a particular appellate process indeed the character of an entire legal system depends upon a multiplicity of interrelated though largely imponderable) factors operating within the system.
The structure of the courts; the status and rule (both objectively and subjectively perceived) of judges and lawyers, the form of law itself whether, for example it is derived from a code or 1102 from judicial precedent modified by statute; the attitude of the courts to the authority of decided cases; the political and administrative structure of the country concerned whether for example its internal sovereignty is limited by its allegience to a colonizing power.
The list of possible factors is endless, and their weight and function in the social equation defy precise analysis." In short, we agree in principle with the sum up of the concept made by the author: "Appeal, as we have stressed, covers a multitude of jurisprudential ideas.
The layman 's expectation of an appeal is very often quite different from that of the lawyer and many an aggrieved plaintiff denied his 'just ' remedy by judge or jury has come upon the disturbing reality that in England a finding of fact can seldom, if ever, form the basis of an appeal.
Similarly, a Frenchman accustomed to a narrowly legalistic appeal in cessation, subject to subsequent reargument in a court below, would find little familiarity in the ponderous finality of the judgment of the House of Lords.
And a seventeenth century lawyer accustomed to a painstaking search for trivial mistakes in the court record, which formed the basis of the appeal by writ of error, would be bewildered by the great flexibility and increased sophistication of a jurisprudential ' argument which characterize a modern appeal.
" Whatever the protean forms the appellate process may take, the goal is justice so that a disgruntled litigant cannot convert his right of appeal into a bull in a china shop breaking down the court system by sufferance of interminable submissions after several tribunals have screened his case and found it fruitless.
This throws us back to a definitional evaluation of the precise content of 'appeal ' in the specific constitutional perspective and statutory setting.
Once we accept the liquidity of the appellate concept we are logically led into a study of the imperatives of 'appeal ' within the meaning of article 134.
Since the right conferred by the Enlargement Act has its source in article 134(2) it is fair to attribute common features to the constitutional and statutory rights of appeal in the criminal specialities covered by Order XXI Rule 15(1) (c).
The key question is whether a right of appeal casts an inexorable obligation on the Supreme Court not merely to hear the appellant at a preliminary stage but proceed invariably to issue notice to the opposite side and hear him too.
Another bone of contention turns on the compulsion to consider the appeal only 1103 after receiving the records in the case from the court below.
The core controversy involves a third element, namely, the inevitable necessity to state reasons for the conclusions, as distinguished from the extinguishment of the proceedings with the utmost verbal economy by the use of a single word 'dismissed '.
These triune facets cannot be judged in vacuo but informed by the grim realities surrounding the disposal.
Human jurisprudence is not a brooding omnipotence in the sky, but a normative science and technology dealing with the work, wealth and happiness of mankind as well as its blood, toils, tears and sweat.
The higher the consciousness of the law, especially constitutional law, the deeper the concern for the worth of the human person that our legal culture, since Independence, has manifested; and the gravity of the consequences of the decision in appeal on life itself invests the concept with some essential features.
It is just as well that we remind ourselves of a value setter here.
Life and liberty have been the cynosure of special constitutional attention in article 21, the fuller implications whereof have been unrevelled in Maneka Gandhi 's case(1).
When we read the signification of the right of appeal under article 134 we must remember that it is a part of the procedure established by law for the protection of life and personal liberty.
Surely, law, in this setting, is a pregnant expression.
Bhagwati, J. in Maneka Gandhi (supra) stated the position emphatically and since then this Court has followed that prescription and even developed it in humane directions a striking example of which is the recent judgment in Presidention Reference No. 1 of 1978.(2) "Is the prescription of some sort of procedure enough or must the procedure comply with any particular requirements ?" asks Bhagwati, J. in the leading opinion, and answers: "Obviously, the procedure cannot be arbitrary, unfair or unreasonable". "The principle of reasonableness, which legally as well as philosophically, is an essential element of equality or non arbitrariness 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.
" Holding that natural justice was part of Indian Constitutional jurisprudence the learned Judge quoted Lord Morris of Borth y Gest in Wiseman vs Barneman : (3) 1104 ". that the conception of natural justice should at all stages guide those who discharge judicial functions is not merely an acceptable but is an essential part of the philosophy of the law.
" Bhagwati, J, brought out the essence of the concept of natural justice as part of reasonable procedure when he observed: "The core of it must, however, remain, namely, that the person affected must have a reasonable opportunity of being heard and the hearing must be a genuine hearing and not an empty public relations exercise.
That is why Tucker.
L.J., emphasised in Russel vs Duke of Norfolk(1) that "whatever standard of natural justice is adopted, one essential is that the person concerned should have a reasonable opportunity of presenting his case.
" What opportunity may be regarded as reasonable would necessarily depend on the practical necessities of the situation.
It may be a sophisticated full fledged hearing or it may be a hearing which is very brief and minimal.
" One of us (Krishna Iyer, J) emphasised the fundamental fairness required by Article 21 in every law that abridges life or liberty: "Procedure established by law, with its lethal potentiality, will reduce life and liberty to a precarious plaything if we do not ex necessiate import into those weighty words an adjectival rule of law, civilised in its soul, fair in its heart and fixing those imperatives of procedural protection absent which the processual tail will wag the substantive head .
An enacted apparition is a constitutional illusion.
Processual justice is writ patently on article 21.
" We have set out the sweep of Article 21 because the rule framed by this Court, namely Order XXI Rule 15(1)(c), cannot transcend this obligation, nor indeed can section 384 of the Code.
On the contrary, as Bhagwati, J. has observed in Maneka Gandhi 's case: (supra) "It is a basic constitutional assumption underlying every statutory grant of power that the authority on which the power is conferred should act constitutionally and not in violation of any fundamental rights.
" We have made these general remarks to set the interpretative tone when translating the sense of the expression "appeal shall lie to the Supreme Court".
Nothing which will render this right illusory or 1105 its fortune chancy can square with the mandate of Article 21.
What applies to the right of appeal under section 2(a) of the Enlargement Act must apply to an appeal under article 134(1)(a) and (b) and therefore, it is wiser to be assured of what comports with reasonableness and fairplay in cases covered by the latter category.
When an accused is acquitted by the trial court, the initial presumption of innocence in his favour is reinforced by the factum of acquittal.
If this reinforced innocence is not only reversed in appeal but the extreme penalty of death is imposed on him by the High Court, it stands to reason that it requires thorough examination by the Supreme Court.
A similar reasoning applies to cases falling under article 134(1)(b).
When the High Court trying a case sentences a man to death a higher court must examine the merits to satisfy that a human life shall not be haltered without an appellate review.
The next step is whether 3 hearing that is to be extended or the review that has to be made by the Supreme Court in such circumstances can be narrowed down to a consideration, in a summary fashion, of the necessarily limited record then available before the Court and total dismissal of the appeal if on such a prima facie examination nothing flawsome is brought out by the appellant to the satisfaction of the Court.
A single right of appeal is more or less a universal requirement of the guarantee of life and liberty rooted in the conception that men are fallible, that Judges are men and that making assurance doubly sure, before irrevocable deprivation of life or liberty comes to pass, a full scale re examination of the facts and the law is made an integral part of fundamental fairness or procedure.
A logical follow up takes us to the reasonable insistence on the full record being made available for the activist play of the appellate judicial mind.
The life of the law is not perfection of theory but realisation of justice in the concrete situation of a given system.
Considered this way, it is common knowledge that a jail appeal or an appeal filed through an advocate does not contain an exhaustive accompaniment of all the evidentiary material or record of proceedings laying bare legal errors in the judicial steps.
It is not unusual in the history of this or other countries that a fatal flaw has been discovered by appellate judges leading to a total acquittal, although even counsel might not have suspected any lurking lethal illegality.
Such a high jurisdiction as is vested by Article 134 calls for an active examination by the judges and such a process will be an ineffectual essay in the absence of the whole record.
We, therefore, think that a preliminary hearing is hardly of any use bearing in mind that what is being dealt with is an affirmation of death sentence for the first time.
In this connection, we may notice that section 366 of the Code 1106 requires the Court of Session which passes a sentence of death to submit the proceedings to the High Court and rulings insist on an independent appellate consideration of the matter and an examination of all relevant material evidence.
The Supreme Court 's position is analogous, and independent examination of the materials is impossible without the entire records being available.
So it is reasonable to hold that before hearing the appeal under Rule 15(1)(c) of Order XXI, ordinarily the records are sent for and are available.
Counsel 's assistance apart, the court itself must apply its mind, the stakes being grave enough.
The next ingredient contended for is the hearing of the opposite party and notice to him in that behalf.
That is to say, the appeal shall not be dismissed summarily or after a mere preliminary hearing even with the records on hand but only after notice and debate at the bar.
Speaking generally, our adversary system finds fulfilment when both sides present rival points of view, unearth embedded infirmities and activate the proceeding with the sparks emanating from the clash of arms.
Such considerations may not loom large but for the fact that it is a first appeal we are dealing with and the risk is to life itself.
Therefore, we hold that in the common run of cases the Court must issue notice to the opposite party, namely, the State and afford a hearing in the presence of both and with the records on hand.
The vital aspects of natural justice have been carefully incorporated in our criminal jurisprudence.
The recording of reasons is usually regarded as a necessary requirement of fair decision.
The obligation to give reasons for decision when consequence of wrong judgment is forfeiture of life or personal liberty for long periods needs no emphasis, especially when it is a first appeal following upon a heavy sentence imposed for the first time.
The constraint to record reasons secures in black and white what the Judge has in mind and given satisfaction to him who is condemned that what he had had to say has not only been 'heard ' but considered and recorded.
article 21 is a binding mandate against blind justice.
It is interesting that in Maneka Gandhi 's case (supra) which dealt with a matter of much less significance the denial or impounding of a passport affecting freedom of movement was required to be decided after recording of reasons save in exceptional cases.
Far more serious and indeed fatal is the outcome of an appeal under Article 134(1)(a) and (b) of the Constitution and the insistence on recording of reasons is a funadmental requisite of fairness.
In this view, in the narrow category of cases covered by Article 134(1)(a) and (b) and s.2(a) of the Enlargement Act, the subject matter is of sufficient gravity as to justify the 1107 recording of reasons in the ultimate order.
The inscrutable face of the sphinx and the unspeaking rejection by the judge are incompatible with fundamental fairness in the critical circumstances of death sentence and life sentence cases for the first time imposed by the court next below.
It is true that Judges of the Supreme Court act with utmost caution, consideration and consciousness and with full realisation that life and personal liberty cannot be forfeited without at least the trial tribunal and one higher have fully applied their minds.
It is unusual for judges at the highest level to be tempted into affirmance of the judgment under appeal merely because, on the surface, there is copious evidence attractive reasoning and absence of injustice.
There is often more than meets the eye which is best left unsaid.
All in all, the necessity to put down reasons for decisions, in the special situations we are considering, is interlaced with the element of reasonableness emphasised in Maneka Gandhi 's case (supra).
We hasten to obviate a misapprehension.
Where the subject matter is less momentous, where two courts have already assessed the evidence and given reasoned decisions, pragmatism and humanism legitimate, in appropriate cases, the passing of judgment at the third tier without giving reasons where the conclusion is one of affirmance.
Natural justice cannot be fixed on a rigid frame and fundamental fairness is not unresponsive to circumstances.
The very fact that the subject matter is not fraught with loss of life or long incarceration and that the appellate or revisionary authority is a high tribunal which has examined the materials are an assurance of competent and conscientious consideration of the facts and the law.
Further protection at the third deck by calling for the records or launching on long ratiocination is a waste of judicial time.
Our rules of criminal proceedure and those of other countries with mature systems of justice provide for dismissal at the third level without assigning written reasons, not because there are no reasons, but because the tardy need to document them hampers the hearing of the many cases in the queue that press upon the time of the court at that level.
We uphold Order XXI, Rule 15(1) (c) of the Rules because it does not have play in certain situations.
It must be noted that that provision does not make it obligatory to dispose of all cases summarily or at a preliminary hearing.
It is an enabling provision, not a compulsive one.
The question is whether there is any situation where it can apply at all in the context of article 134(1) (a) and (b) and section 2(a) of the Enlargement Act.
If there is a room for operation, the provision can be sustained although confined to such limited situations as a rule of prudence ripening into a rule of law.
1108 Before discussing the categories where the rule will apply, let us get out of our way the view that the rule is valid because article 145(1) (b) authorises Procedural invasion of substantive rights is impermissible, article 145 authorises only rules of procedure and procedure is ". that which regulates the formal steps in an action or other judicial proceeding; a form, manner, and order of conducting suits or prosecutions. " "This term is commonly opposed to the sum of legal principles constituting the substance of the law, and denotes the body of rules, whether of practice or of pleading, whereby rights are effectuated through the successful application of the proper remedies.
"(1) To go beyond and cut into the flesh of the right itself is ultra vires article 145.
Likewise, harmonious construction of article 134 and article 145 also leads to the conclusion that the contemplated rules are mere machinery provisions, not manacles on the right handcuffing its exercise.
Going to the basics, an appeal "is the right of entering a superior court and invoking its aid and interposition to redress the error of the court below.
An appeal, strictly so called, is one "in which the question is, whether the order of the court from which the appeal is brought was right on the materials which that court had before it" (per Lord Davey, Ponnamma vs Arumogam, (1905) A.C. at p.390) .
A right of appeal, where it exists, is a matter of substance, and not of procedure (Colonial Sugar Refining Co. vs Irving, ; Newman vs Klausner, Thus, the right of appeal is para mount, the procedure for hearing canalises so that extravagant prolixity or abuse of process can be avoided and a fair workability provided.
Amputation is not procedure while pruning may be.
Of course, procedure is within the Court 's power but where it pares down prejudicially the very right, carving the kernal out, it violates the provision creating the right.
Appeal is a remedial right and if the remedy is reduced to a husk by procedural excess, the right became a casualty.
That cannot be.
So we cannot out down but may canalise the basic right by invoking Article 145(1)(b).
1109 Harmoniously read, the sequence is simple.
The formalities for entertaining certain types of appeal are covered by article 145(1) (d), the manner of hearing and disposal is governed by article 145 (1) (b) and the substantive sweep of the appeal as a method of redressal is found in article 134.
Amputation of this anatomy by procedural surgery is doing violence to the constitutional scheme.
An appeal is a re hearing, and as Viscount Cave laid down, "It was the duty of a court of appeal in an appeal from a judge sitting alone to make up its own mind, not disregarding the judgment appealed from and giving special weight to that judgment where the credibility of witnesses comes into question, but with full liberty to draw its own inferences from the facts proved or admitted, and to decide accordingly.
"(1) Prof. A. L. Goodhart, dealing with appeals on questions of fact in the English Law, wrote: ". it may be suggested, with all respect, that when the appellate judges are in agreement with the trial judge, they take the view that they are bound by his conclusions of fact, but when they disagree with his conclusions then they do not hesitate to overrule them. if an appellate court has full liberty to draw its own inferences from the facts proved, then appeals on so called questions of fact will have a far greater chance of success.
The most highly trained judges may differ concerning the evaluation of facts, just as ordinary persons may.
It is here that conflict of opinion is most frequently found.
What is regarded as reasonable by one man, whether judge or layman, may be regarded as unreasonable by another.
If, therefore, an appeal can be taken on the evaluation of facts, then there is always a chance that the appellant may succeed, even though the initial duty of showing that the judge below was in error may fall on him.
"(2) Ridding ourselves of finer nuances and philosophic speculations and taking a realistic approach to a problem beset with human variables, it is daily experience to see judges on the high bench differ, and a fortiori so, in the field of sentence.
We project this reality in the context of full freedom for the first appellate decider of facts to reach his own finding on offence and sentence, only to highlight how momentous it is to be or not to be for the appellant to have his case considered by 1110 the highest court when the Constitution and Parliament have conferred a full right of appeal.
Summary dismissal, save in glaring cases, may spell grave jeopardy to life giving justice.
That is why Order XXI Rule 15(1)(c) while it survives to weed out worthless appeals, shall remain sheathed in extra ordinary cases where facts on guilt or the wider range of considerations on sentence are involved.
We must clarify that very right of appeal does not carry with it all the length of getting the record, hearing both sides and giving full reasons for decisions.
Then the institutions of justice will come to a grinding halt.
Those who feel otherwise may read with profit, et al, Order 41, Rule 11, Civil Procedure Code and the practice of so august a tribunal as the Supreme Court of the United States.
Henry J. Abraham writes: "Appeal.
In the instance of a writ of appeal, the aggrieved party has an absolute, statutorily granted right to carry a case to the United States Supreme Court, which in theory must review it.
However, the High Tribunal retains the very considerable loophole of being empowered to reject such an appeal on the grounds that the federal question, otherwise validly raised, is "substantial".
This highly significant discretionary element in the area of the Court 's so called compulsory appellate jurisdiction caused it to dismiss 70 appeals in the 1955 56 term, for example.
Of these 40 were rejected "for want of a substantial federal question", the balance on other jurisdictional grounds.
In the 59 60 term, 63 of a total of 113 appeals were dismissed on the insubostalltiality ground ! As a rule, fully 50 to 60 per cent of the writs of appeal are thus dismissed or the judgment below affirmed without printing the record or oral argument .
In effect, the appeel is hence used but sparingly to date in approximately 9 per cent of all cases or controversies presented to the Court.
"(1) Nor are we charmed by some counsel sometimes asscrting the importance of Oral Arguments Unlimited forgetting that prolixity is counter productive and expensive and obstructive of case flow.(2) We 1111 never deny the brightening of obscure points and the cross pollination of creative views promoted by an active process of oral argument.
The decision we make is confined to the criminal jurisdiction covered by article 134 and article 145(1)(b) and section 384 Criminal Procedure Code.
The compelling thought which has pressured our judgment in a matter of life and death in a first appeal to a final court is best expressed by Edmund Cahn: "For what gives justice its special savor of nobility ? Only the divine wrath that arises in us, girds us, and drives us to action whenever an instance of injustice affronts our sight.
"(1) Having stressed the appellant 's right at great length, we still sustain rule 15(1)(c) of Order XXI.
This provision is general and covers all conceivable cases under article 134(1).
It enables, not obligates.
It operates in certain situations, not in every appeal.
It merely removes an apprehended disability of the court in summarily dismissing a glaring case where its compulsive continuance, dragging the opposite party, calling up prolix records and expanding on the reasons for the decision, will stall the work of the court (which is an institutional injury to social justice) with no gain to anyone, including the appellant to keep whom in agonising suspense for long is itself an injustice.
What are those cases where a preliminary hearing is a worthwhile exercise ? Without being exhaustive, we may instance some.
Where the only ground urged is a point of law which has been squarely covered by a ruling of this Court to keep the appeal lingering longer is survival after death.
Where the accused has pleaded guilty of murder and the High Court, on the evidence, is satisfied with the pleas and has awarded the lesser penalty a mere appeal ex misericordin is an exercise in futility.
Where a minor procedural irregularity, clearly curable under the Code, is all that the appellant has to urge the full panoply of an appellate bearing is an act of supererogation.
Where the grounds, taken at their face value, are frivolous, vexatious, malicious wholly dilatory or blatantly mendacious, the prolongation of an appeal is a premium on abuse of the process of court.
Maybe, other cases can be conceived of but we merely illustrate the functional relevance of Order XXI Rule 15(1)(c).
Ordinarily, save where nothing is served by fuller hearing notice must go.
If every appeal under Art.134(1)(a) and (b) or s.2(a) 1112 of the Enlargement Act, where questions of law or fact are raised, is set down for preliminary hearing and summary disposal, the meaningful difference between article 134 and article 136 may be judicially eroded and Parliament stultified.
Maybe, many of the appeals after fuller examination by this Court may fail.
But the minimum processual price of deprivation of precious life or prolonged loss of liberty is a single comprehensive appeal.
To be peeved by this need is to offend against the fair play of the Constitution.
The horizon of human rights jurisprudence after Maneka Gandhi 's case (supra) has many hues.
The relevant provision of the Criminal Procedure Code have already been quoted.
Counsel for the appellant had obvious difficulty in overcoming the obstacle of section 384.
That section is sweeping.
Any appellate court (which includes the Supreme Court under article 134) may hear and dispose of an appeal summarily, without the records and recording no reasons for dismissal if it is the High Court or the Supreme Court.
Literally read, it sounds arbitrary, where death sentence, at the first appeal is involved.
Article 21, in its expansive incarnation, may fatally knock down any summary power of fatally knocking down an appellant facing death penalty in first appeal by an unspeaking order.
But the generality of the provision if read down, may well be valid and rightly so.
If the appeal is at the second or third tier, there is no reason to grumble.
If the punishment is not of the dreadful species, there can be no constitutional consternation.
After all, to have a giant 's strength is not wrong 'but it is tyrannous to use it like a giant ' and judges do know this judicious caution.
So we hold that the restrictions already indicated in applying Order XXI rule 15(1) (c) may legitimately be read into section 384 of the Code.
Words of wide import and expressions of expansionist potential may always be canalised and constitutionalised a proposition too well established to be propped by precedents.
The common embankments applicable to Order XXI Rule 15(1) (c) and section 384 of the Code to prevent unconstitutional overflow may now be concretised, not as rigid manacles but as guidelines for safe exercise.
We are hopeful that the Supreme Court will, if found necessary, make clarificatory rules in this behalf.
To conclude, we uphold the vires of Order XXI Rule 15(1)(c) of the Supreme Court Rules and also section 384 of the Criminal Procedure Code but hold that in their application both the provisions shall be restricted by certain criteria as a permissible exercise in constitutionalisation.
1113 Order XXI Rule 15(1)(c) in action does not mean that all appeals falling within its fold shall be routinely disposed of, as far as possible, on a preliminary hearing.
Such a course, as earlier mentioned, obliterates the difference between Articles 134 and 136, between right and leave.
The rule, in cases of appeals under article 134 (1) (a) and (b) and section 2(a) is notice, records and reasons, but the exception is preliminary hearing on all such materials as may be placed by the appellant and brief grounds for dismissal.
This exceptional category is where, in all conscience, there is no point at all.
In cases of real doubt the benefit of doubt goes to the appellant and notice goes to the adversary even if the chances of allowance of the appeal be not bright.
We think it proper to suggest that with a view to invest clarity and avoid ambiguity, Order XXI Rule 15(1)(c) may be suitably modified in conformity with this ruling.
Before we part with this case, it is right to register our view that too many appeals and revisions are a bane of the Indian Judicial System, involving as it does sterile expense and delay and fruitless chase of perfection.
The Evershed Committee, a quarter of a century ago, expressed dissatisfaction with the system of multiple appeals what with the social cost of litigative prolongation, burden of precedents and heavy outlay a luxury which a Third World country can illafford.
Too many appeals are counter productive as A.P. Herbert in 'Uncommon Law ' has wittily driven home: "The people may be taught to believe in one court of appeal; but where there are two they cannot be blamed if they believe in neither.
When a man keeps two clocks which tell the time differently, his fellows will receive with suspicion his weightiest pronouncements upon the hour of the day, even if one of them happens to be right.
" Way back in 1832 it has been pointed out that "The only ground upon which a suitor ought to be allowed to bring the judgment of one court for examination before the members of another is the certainty or extreme probability of finding in the latter tribunal more wisdom and learning, more maturity of deliberation, and a greater capacity of sound decisions than existed in the court from which the appeal is to proceed.
But as every appeal is of necessity attended with the two great and positive evils of expense and delay, it is the bounden duty of every wise and good government to take all possible care that the court of appellate jurisdiction shall possess those advantages, and that superior capacity for wise and impartial adjudication, 1114 upon the presumption of possessing which, the public support and the confidence of individual suitors is given to the institution." (1) What is important is the choice of mature minds for dispensation of justice according to law and not wasteful multiplication of hierarchical tribunals.
KAILASAM, J.
I had the benefit of perusing the judgment prepared by Krishna Iyer J.
I regret I am unable to agree with it.
This appeal is preferred by the 12 appellants under section 379 of the Code of Criminal Procedure, 1973 read with section 1 of the against the judgment dated 31st March, 1978 of the High Court of Judicature at Allahabad, at Lucknow Bench in Criminal Appeal No. 597 of 1976.
The appellants were acquitted by the 1st Temporary Sessions Judge, Pratapgarh in Sessions Case No. 16 of 1969 of all the charges and on an appeal preferred by the State, the order of acquittal was set aside by the High Court and the appellants found guilty and convicted under section 302 read with section 149, I.P.C., and sentenced to life imprisonment.
The appeal was listed for preliminary hearing under Rule 15 (1) (c) of Order XXI of the Supreme Court Rules, 1966.
The appellants filed an application for adducing additional grounds in Crl.
Petition No. 1862 of 1978 wherein it was pleaded that the provision under clause (c) of sub rule (1) of Rule 15 of Order XXI of the Supreme Court Rules empowering the Court to dismiss the appeal summarily is ultra vires being inconsistent with the provisions of the .
It was submitted that the power of the Supreme Court to frame rules under article 145 of the Constitution canot be extended to annul the rights conferred under an Act of Parliament.
It was further pleaded that an appeal under the , cannot be dismissed summarily without calling for the records ordering notice to the State and without giving reasons.
When the Crl.
Petition No. 1862 of 1978 came up before this Court it was ordered: "The appellants have challenged the constitutional validity of cl.
(c) of sub rule (1) of rule 15 of O. XXI of the Supreme Court Rules, which enables an appeal of the 1115 kind with which we are concerned, to be placed for hearing ex parte before the Court for admission.
In that view of the matter, we think that unless the question of the constitutional validity of the rule is decided, we cannot have a preliminary hearing of this appeal for admission.
Let the records, therefore, be placed before the Hon 'ble the Chief Justice for giving such directions as he may deem fit and proper." As the constitutional validity of cl.
(c) of rule 15(1) of Order XXI of the Supreme Court Rules was challenged, the matter was placed before the Full Bench by the Chief Justice.
Rule 15 of Order XXI of the Supreme Court Rules 1966 runs as follows: "15.
(1) The petition of appeal shall be registered and numbered as soon as it is lodged.
Each of the following categories of appeals, on being registered, shall be put up for hearing ex parte before the Court which may either dismiss it summarily or direct issue of notice to all necessary parties, or may make such orders, as the circumstances of the case may require, namely: (a) an appeal from any judgment, final order or sentence in a criminal proceeding of a High Court summarily dismissing the appeal or the matter, as the case may be before it; (b) an appeal on a certificate granted by the High Court under Article 132 (1) and/or 134(1) (c) of the Constitution, or under any other provision of law if the High Court has not recorded the reasons or the grounds for granting the certificate.
(c) an appeal under sub clause (a) or sub clause (b) of clause (1) of Article 134 of the Constitution, or under the (28 of 1970) or under section 379 of the Code of Criminal Procedure, 1973 (2 of 1974); (d) an appeal under section 476 B of the Code of Criminal Procedure, 1898 (5 of 1898).
(e) an appeal under clause (b) of sub section (1) of section 19 of the (70 of 1971).
" 1116 We are concerned with sub rule (c) in rule 15(1).
The Supreme Court Rules were framed in exercise of the powers conferred under article 145 of the Constitution and all other powers enabling the Supreme Court to make rules.
article 145 of the Constitution empowers the Supreme Court subject to the provisions of any law made by Parliament with the approval of the President to make rules from time to time for regulating generally the practice and procedure of the Court.
Two sub articles are relevant and they are sub articles (b) and (d).
While sub article (b) empowers the Supreme Court to make rules as to the procedure for hearing appeals and other matters pertaining to appeals including the time within which appeals to the Court are to be entered, Sub article (d) enables the Supreme Court to frame rules as to the entertainment of appeals under sub clause (c) of clause (1) of article 134.
Article 134 confers appellate jurisdiction on the Supreme Court in regard to criminal matters: "134.
(1) An appeal shall lie to the Supreme Court from any judgment, final order or sentence in a criminal proceeding of a High Court in the territory of India if the High Court (a) has on appeal reversed an order of acquittal of an accused person and sentenced him to death; or (b) has withdrawn for trial before itself any case from any court subordinate to its authority and has in such trial convicted the accused person and sentenced him to death; or (c) certifies that the case is a fit one for appeal to the Supreme Court.
Provided that an appeal under sub clause (c) shall lie subject to such provisions as may be made in that behalf under clause (1) of article 145 and to such conditions as the High Court may establish or require.
(2) Parliament may by law confer on the Supreme Court any further powers to entertain an hear appeals from any judgment, final order of sentence in a criminal proceeding of a High Court in the territory of India subject to such conditions and limitations as may be specified in such law.
" While an unrestricted right of appeal is provided to the Supreme Court under clauses (a) and (b) i.e. where on appeal an order of acquittal is reversed by the High Court and an accused person is sentenced to death or when the High Court has withdrawn for trial 1117 before itself any case from any court subordinate to its authority and has in such trial convicted the accused person and sentenced him to death, an appeal under article 134(1) (c) is subject to certain restrictions.
An appeal under sub clause (c) is provided only when the case is certified by the High Court as a fit one for appeal to the Supreme Court.
Further an appeal under sub clause (c) shall lie subject to such provisions as may be made in that behalf under clause (1) of article 145 and to such conditions as the High Court may establish or require.
The Supreme Court is empowered to prescribe rules regarding entertainment of appeals under article 134(1) (c) by article 145 (1), sub article (d).
So far as procedure for hearing appeals generally rules can be framed by the Supreme Court under sub article (b) of article 145(1).
The has conferred on the Supreme Court further power to entertain and hear appeals than conferred on it under Art 134(1) (a) and (b) as provided for in Art 134(2) of the Constitution.
As article 145(1) (b) enables the Supreme Court to frame rules as to procedure for hearing appeals the procedure thus prescribed will apply to appeals under the .
Rule 15 of Order XXI is framed under article 145(1), sub article (b).
The rules can provide for the procedure for hearing appeals.
Mr. Mulla, the learned counsel, submitted that the rule making power of the Supreme Court is confined only to the rules as to entertainment of appeals under sub clause (c) of clause (1) of article 134 and would not enable the Supreme Court to frame rules regarding appeals under any other provision.
The , confers right of appeal to the Supreme Court from any judgment, final order of sentence in a criminal proceeding of a High Court in the territory of India if the High Court: (a) has on appeal reversed an order of acquittal of an accused person and sentenced him to imprisonment for life or to imprisonment for a period of not less than ten years; (b) has withdrawn for trial before itself any case from any court subordinate to its authority and has in such trial convicted the accused person and sentenced him to imprisonment for life or to imprisonment for a period of not less than ten years.
1118 The result is that in addition to the right of appeal under Article 134 (1) (a) and (b) an appellant under the has also a right to appeal unrestricted by any of the provisions of Article 134 (1) (c) or the rules framed by the Supreme Court under article 145 (1) (d).
The submission of learned counsel fails to take note of Article 145 (1) (b) which empowers the Supreme Court to frame rules as to the procedure for hearing appeals which would include hearing of appeals under article 134 (1) (a) and (b) of the Constitution as well as appeals under the .
The rules therefore are properly made under article 145 (1) (b) and would be valid so far as to the procedure for hearing appeals.
The submission of the learned counsel is that when a right of appeal is conferred on a person the appeal can only be disposed of by the Supreme Court after full hearing i.e. after calling for the records, issuing notice to the other side and hearing both the parties and giving reasons for its conclusion.
It was submitted that a summary dismissal affects the substantive right of appeal and is not confined to procedure and is contrary to the provisions of the law made by Parliament and as such beyond the rule making powers conferred under article 145 (1) (b).
As the , conferred a right of appeal any provision under the Supreme Court Rules restricting such appeal is submitted to be outside the scope of the rule making powers of the Supreme Court.
The confers a right of appeal but the procedure as to the hearing of appeal is not prescribed under the .
Before referring to the provisions of the Supreme Court Rules relating to the procedure as to hearing of appeals it is useful to refer to the provisions of the law made by Parliament regulating the hearing of the appeal by all courts including the Supreme Court.
Chapter XXIX of the Code of Criminal Procedure, of 1974, deals with appeals.
Section 374 (1) provides that any person convicted on a trial held by a High Court in its extraordinary original criminal jurisdiction may appeal to the Supreme Court.
This section confers a right of appeal against all convictions whatever the sentence may be on a trial held by the High Court in its extraordinary original criminal jurisdiction, and is thus wider than the right of appeal conferred under article 134(1) (a) and (b) or under the Supreme Court (Enlargement of Criminal 1119 Appellate Jurisdiction) Act, 1970.
Section 375 provides that there will be no appeal where an accused person has pleaded guilty and convicted on such plea by the High Court.
This section thus excludes the appeal obviously to the Supreme Court against the conviction on a trial held by the High Court in its extraordinary original criminal jurisdiction if the accused has pleaded gulity.
Section 376 excludes appeals in petty cases, where the High Court passes only a sentence of imprisonment for a term not exceeding six months or a fine not exceeding one thousand rupees.
Thus though section 374 confers a right of appeal on any person convicted on a trial held by the High Court in its extraordinary original criminal jurisdiction to the Supreme Court, this right is restricted under sections 375 and 376 in that a person who pleads guilty and has been convicted on such plea by the High Court is barred from preferring an appeal to the Supreme Court.
So also an appeal against a sentence of imprisonment for a term not exceeding six months or of fine not exceeding one thousand rupees or of both is taken away under section 376.
Section 379 confers a right of appeal to the Supreme Court where the High Court has, on appeal, reversed an order of acquittal of an accused person and convicted him and sentenced him to death or to imprisonment for life or to imprisonment for a term of ten years or more.
Section 379 gives effect to the provision of article 134 (1) (a) and (b) of the Constitution and section 2 of the .
The result of the passing of the and section 379 of the Criminal Procedure Code is that they provide an appeal to the Supreme Court in addition to the right of appeal conferred under Article 134 (1) (a) and (b) of the Constitution.
The contention of Mr. Mulla, the learned counsel for the appellant, is that rule 15 (1) (c) of Order XXI not merely relates to the procedure but also deprives the substantive right of appeal conferred on the accused under article 134 (1) (a) and (b) and the Supreme Court (Enlargement of Criminal Appellate Jurisdiction) Act,1970 and under section 379 of the Code of Criminal Procedure.
By the impugned rule the appeal on being registered is put up for hearing ex parte before the court and the court is empowered either to dismiss it summarily or direct issue of notice to all necessary parties or make such orders as the circumstances may require.
Section 384 of the Code of Crl.
Procedure 1973 confers a right on the appellate court to dismiss the appeal summarily when it considers that there is no sufficient ground for interfering.
The proviso to the section requires that no appeal presented under section 382 by the appellant or his pleader 1120 shall be dismissed unless the appellant or his pleader has had a reasonable opportunity of being heard in support of his case.
An appeal from the appellant from jail cannot be dismissed except after giving the appellant a reasonable opportunity of being heard in support of the same, unless the Appellate Court considers that the appeal is frivolous or that the production of the accused in custody before the Court would involve such inconvenience as would be disproportionate in the circumstances of the case.
Section 384 (2) provides that before dismissing an appeal under this section, the Court may call for the record of the case.
Under sub section (3) where the Appellate Court dismissing an appeal under sec.
384 is a Court of Sessions or of the Chief Judicial Magistrate, it shall record its reasons for doing so.
385 prescribes the procedure for hearing appeals not dismissed summarily.
While sec.
374 confers a right of appeal, sec.
375 and sec.
376 restricts such a right.
Section 384 prescribes the procedure for hearing appeals enabling the Court to dismiss certain appeals summarily and to deal with others under sec.
385 if they are not summarily dismissed.
The right of appeal conferred can be curtailed by procedure as envisaged in sec.
384 Crl.
Procedure Code or rule 15 Order XXI of the Supreme Court Rules.
We are unable to accept the contention that a right of appeal would mean that before an appeal is disposed of the records should be called for, notice ordered to the other side, the other side heard and reasons given for the disposal of the appeal.
The provisions of the Criminal Procedure Code which have been referred to show that all appeal to the Supreme Court under section 374 of the Criminal Procedure Code is restricted by the provisions of sec.
375 and sec.
376 and could be dealt with summarily under sec.
384 of the Criminal Procedure Code.
Mr. Mulla, the learned counsel submitted that the provisions of the Criminal Procedure Code are not applicable to the Supreme Court.
But this plea does not bear scrutiny in view of the specific provisions making the procedure applicable to the Supreme Court.
An appeal to the Supreme Court is subject to the several provisions of the Crl.
Procedure Code, including the provisions relating to summary disposal of the appeals.
The plea of the learned counsel that the provisions of the impugned rule are contrary to any law made by Parliament is not maintainable.
The impugned rule 15 (1) (c), Order XXI, more or less incorporates the provisions found in the Crl.
Procedure Code.
The contention of the learned counsel that the right conferred on him under article 134 (1) (a) and (b) of the Constitution and under the , is curtailed is therefore without substance.
1121 In the result, we find that the contention of the learned counsel, namely that the impugned rule is beyond the rule making power of the Supreme Court under article 145 of the Constitution cannot be accepted as article 145(1) (b) specifically enables the Supreme Court to frame rules as to the procedure for hearing appeals.
The contention, that the Rule is opposed to the provisions of laws made by Parliament and is thus beyond the scope of rule making powers under article 145 cannot also be upheld for the reasons stated.
Neither in the Memorandum of Grounds nor in his arguments the learned counsel contended that a summary dismissal of an appeal under the provisions of the Crl.
Procedure Code would offend the provisions of Article 21 of the Constitution.
In the course of arguments it was submitted that if the impugned rule is construed as empowering the Court to dismiss an appeal summarily, it would offend article 21 of the Constitution.
When the provisions in the Criminal Procedure Code enabling the Court to dismiss an appeal summarily is not challenged the impugned rule is equally unassailable.
We will now consider whether the impugned rule would in any way offend Article 21 of the Constitution.
Article 21 of the Constitution reads as follows: "No person shall be deprived of his right or personal liberty except according to the procedure established by law.
" The words 'Procedure established by law ' have been construed by various decisions of this Court.
In A. K. Gopalan 's case (1950 SCR page 88) it has been held by a majority that the word 'law ' in Article 21 had been used in the sense of 'State made ' law and not in the sense of law embodying the principles of natural justice.
Procedure established by law means "a law made by Union Parliament or Legislature or State.
" According to Patanjali Sastri J, law in Article 21 did not mean jus naturale but means positive or state made law.
Procedure established by law, according to the learned Judge, did not however mean any procedure which may be prescribed by a competent legislature, but the ordinary well established criminal procedure that is, those settled usages and normal modes of procedure sanctioned by the Criminal Procedure Code which are the general law of criminal procedure in our country.
If this test is applied, the procedure, that is challeged, being the procedure prescribed under the Criminal Procedure Code cannot be assailed.
Later decisions have pointed out that even though the procedure is prescribed by a competent legislature, it may fail to satisfy the requirements of the article if the proce 1122 dure prescribed is no procedure at all.
We cannot accept the plea that the procedure prescribed by the Criminal Procedure Code is no procedure at all.
The main objection to the invoking of Article 21 for challenging the validity of the impugned rule is that a person convicted of an offence has no right of appeal unless such a right is conferred by the statute.
If the statute does not confer a right of appeal the person has no remedy.
If P. K. Mittra vs State of West Bengal.
(1) this Court held that a right of appeal is a statutory right which has got to be recognised by the Courts, and the right of appeal, where one exists, cannot be denied in exercise of the discretionary power even of the High Court.
An appeal is a creature of the statute and the powers and the jurisdiction of the appellate court must be circumscribed by the words of the statute vide Shankar Kerba Yadhav vs State of Maharashtra.(2) A right of appeal must be given by statute or by some authority equivalent to a statute or rules framed under a statute vide Minakshi vs Subramanya.(3) The powers and the jurisdiction of the appellate Court as prescribed by the Criminal Procedure Code and the rule cannot be said to deny a right of hearing to the appellant.
The plea that audialteram partem has been violated has also no substance.
The right to be heard in an appeal is regulated by statute.
In the appeal with which we are concerned, the accused persons had the benefit of a full trial before a Sessions Court at the first instance or before the High Court After a full trial the judgment is rendered by a High Judicial Officer such as a Session Judge or a High Court Judge.
The appellate court has before it the judgment of the lower court and the petition for appeal.
At the preliminary hearing the appellant or his pleader is heard before the court decides to dismiss the appeal summarily.
The impugned rule prescribes the procedure for hearing of the appeals.
The Criminal Procedure Code provides that there shall be no right of appeal in cases where the accused is convicted by the High Court on a plea of guilty or when the High Court passed a sentence of imprisonment for a term not exceeding six months.
The appellate court is empowered to dismiss the appeal summarily when there are no sufficient grounds for interfering.
The power to summarily dismiss an appeal is conferred under the Criminal Procedure Code when the court is satisfied that there are no sufficient grounds for interfering with the judgment appealed against.
This decision is taken by the appellate court being the Chief Judicial Magistrate, Court 1123 of Session, the High Court or the Supreme Court.
In the case of the Chief Judicial Magistrate and Court of Session, reasons should be recorded for summary dismissal.
The High Court and the Supreme Court need not record reasons for summarily dismissing the appeal.
It is necessary that the Supreme Court or the High Court should be satisfied that there are no sufficient grounds for interfering.
The conclusion that there are no sufficient grounds for interfering is arrived by the High Court or the Supreme Court after hearing the appellant, examining the judgment and the petition for appeal.
There can be no doubt that the appellate court is discharging an onerous duty in dismissing a case summarily.
It may be noted that the Code provides for calling for the records before dismissing an appeal.
In cases where the appellant is sentenced to death, imprisonment for life or long term of imprisonment, it is the bounden duty of the appellate court to hear the appellant, examine the petition of appeal and copy of the judgment appealed against.
If it feels necessary to call for the records of the case, it is its duty to call for the records and examine them, before coming to the conclusion that there are no sufficient grounds for interfering.
It is the responsibility of the appellate authority to order notice and hear the other side if it is not satisfied that there are no sufficient grounds for interfering.
Equally it is the duty of the appellate court to dismiss the appeal summarily if it satisfied that there are no sufficient grounds for interefering.
This duty is imposed for regulating the work of the courts for otherwise judicial time would be unnecessarily spent.
Taking into account the fact that the duty to decide the question where there are not sufficient grounds for interfering is placed on highly placed judicial officers after affording a due hearing, it cannot be stated that the very right of appeal has been taken away.
It is not possible to accept the contention that the procedure prescribed is not in accordance with the law as the Criminal Procedure Code and the impugned rules are laws properly made.
It cannot also be said that the law is violative of the right conferred under Article 21.
The decision of the Supreme Court rendered under sec.
421 of the Crl.
Procedure Code of 1898 which is similar to section 384 of the Code of Criminal Procedure of 1973 may be referred to.
In Govinda Kadam vs State of Maharashtra(1) the Supreme Court held that the appellate Court has full power under section 421 of the Crl.
Procedure Code to dismiss an appeal in limine even without sending for the records if on perusal of the impugned order and 1124 the petition of appeal it is satisfied with the correctness of the order appealed against.
It may be emphasised that the power of summary dismissal has to be exercised after perusing the petition of appeal and the copy of the order appealed against and after affording the appellant and his pleader a reasonable opportunity of being heard in support of the appeal.
The order summarily dismissing an appeal by the, High Court by the word 'rejected ' is not violative of any statutory provision.
While holding that a summary rejection of the appeal by the High Court is not violative of any statutory provision, this Court pointed out that it is desirable that reasons are recorded by the High Court when prima facie arguable issues have been raised as that would enable the Supreme Court to appreciate the reasons for rejection of the appeal by the High Court.
These observations are not applicable to the Supreme Court because the order of this Court is final.
Rule 15 (1) of the Supreme Court Rules enables the Supreme Court after putting up the appeal for hearing ex parte to dismiss it summarily or direct issue of notice to all necessary parties or may make such orders as the circumstances of the case may require.
Rule 13 prescribes that a memorandum of appeal shall be in the form of a petition stating succinctly and briefly as far as possible in chronological order, the principal steps in the proceedings from its commencement till its conclusion in the High Court.
Sub rule 2 of rule 13 prescribes that the petition of appeal shall be accompanied by a certified copy of the judgment or order appealed from, and in the case of an appeal on a certificate also of the certificate granted by the High Court, and of the order granting the said certificate.
Rule 14 prescribes that when the appellant is in jail, he may present his petition of appeal and the documents mentioned in rule 13 including any written argument which he may desire to advance to the Officer in charge of the jail, who shall forthwith forward the same to the Registrar of this Court.
The petition of appeal thus received under rule 13 and 14 is put up for hearing ex parte before the Court which is empowered either to dismiss it summarily or to direct issue notice to the necessary parties.
Thus it is to be seen that the procedure contemplated in rules 13, 14 and 15 is almost similar to the provisions of the Code of Criminal Procedure referred to above.
In an appeal sent by the appellant from jail he is entitled to and any written arguments which he may desire to advance in support of his appeal.
The Court in proper cases in which it considers it desirable would engage an advocate to present the case of the appellant in jail.
The mere fact that the appellant in jail is not being heard in person or through an advocate would not mean that the appeal of the appellant in jail is not being heard.
The Court peruses the judgment, petition of appeal 1125 and the written arguments, if any, before proceeding to take action under rule 15.
This Court being the highest Court is not required to give reasons but is expected to bestow the greatest care in exercising the power of summary dismissal under Rule 15.
On a consideration of the provisions of the Criminal Procedure Code and the impugned rules, we are unable to accept any of the contentions raised by the learned counsel.
In passing a reference was made by the learned counsel to the decision of this Court reported in [1978] 2 S.C.R. 621 (Maneka Gandhi vs Union of India) in support of his contention that the rights conferred under article 21 are also available to the appellants before the Supreme Court.
We are unable to accept the contention for the case referred to is one wherein an opportunity was not provided to a person before the passport was impounded.
It has no application to an appeal as in the present case the appellant is properly heard in a trial and is also heard by the appellate court.
We feel that Maneka Gandhi 's case has no application to the facts of the present case.
In the result we reject all the contentions put forward by the learned counsel and hold that the impugned Rule is within the rule making power of the Supreme Court and answer the reference accordingly.
ORDER In the light of the majority judgment, we uphold the vires of Order XXI Rule 15(1)(c) of the Supreme Court Rules and also section 384 of the Criminal Procedure Code but hold that in their application both the provisions shall be governed by the criteria laid down in the majority Judgment.
In the appeal, above mentioned, we direct notice to the respondent.
| IN-Abs | Rule 15(1)(c) of Order XXI of the Supreme Court Rules, 1966 envisages that the petition of appeal under sub clause (a) or sub clause (b) of clause (1) of article 134 of the Constitution or under the or under section 379 of the Code of Criminal Procedure 1973, on being Registered shall be put up for hearing ex parte before the court which may either dismiss it summarily or direct issue of notice to all necessary parties or make such orders, as the circumstances of the case may require.
The appellants in the appeal who were acquitted by the Sessions Court had been convicted and sentenced by the High Court and awarded life imprisonment under section 302 read with section 149 IPC.
When their appeal under the was listed for preliminary hearing under Rule 15(1)(c) of Order XXI of the Supreme Court Rules, 1966 it was contended (1) that the said provision empowering the court to dismiss the appeal summarily was ultra vires the Enlargement Act, 1970, (2) the power of the Supreme Court to frame rules under article 145 of the Constitution can not be extended to annul the rights conferred under an Act of Parliament and (3) that an appeal under the Enlargement Act, 1970 cannot be dismissed summarily without calling for the records, ordering notice to the State and without giving reasons.
^ HELD: (Per Krishna Iyer, Shinghal & Desai, JJ.) 1.
Article 134(1)(c) spells a measure of seriousness because the High Court which has heard the case certifies that it involves questions of such moment that the Supreme Court itself must resolve them.
To dispose of such a matter by a preliminary healing is to cast a reflection on the High Court 's capacity to understand the seriousness of a certification.
[1095 D E] 2.
Article 136 vests a plenary discretion in the Supreme Court to deign or decline to grant leave to appeal against any conviction or sentence.
Before deciding to grant or reject such Leave the court accords an oral hearing after 1086 perusing all the papers produced.
Once leave is granted, the appeal is heard, after notice to the state, in full panoply.
After leave, the appeal is born.
Then it ripens into fullness and is disposed of when both sides are present.
No appeal after leave, is dismissed summarily or ex parte.
If article 136 gives a discretionary power to grant leave to appeal or to dismiss in limine, after an ex parte hearing (or after issue of notice if the court so chooses), article 134 which gives a constitutional right to appeal as it were, must stand on a higher footing lest the Constitution makers be held to have essayed in supererogation.
[1095G 1096A] 3.
There is much more 'hearing ' content in an absolute appellate right than in a precarious 'special leave ' motion.
Jurisprudentially, a right is large than a permission.
Art 134 puts the momentous class of cases covered by it beyond the discretionary compass of article 136 and within the compulsory area of full hearing such as would follow upon leave being granted under article 136(1).
A full hearing may not obligate dragging the opposite side to court involving expense and delay.
Fullness of hearing of the proponent is not incompatible with non hearing of the opponent when after appreciating all that could be urged in support of the cause there is no need felt to call upon the other side, as where the proposition is groundless, frivolous or not prima facie statable.
[1096B D] 4.
Article 134(2) empowers Parliament to expand the jurisdiction of the Supreme Court to entertain criminal appeals.
In exercise of this power, Parliament enacted the in its grave concern for long incarceration being subject to great scrutiny at the highest level if first inflicted, by the High Court.
A right of appeal to the Supreme Court was granted when the High Court has, for the first time sentenced an accused to life imprisonment or to a term of or above ten years of rigorous imprisonment and equated it with that granted under article 134(1)(a) and (b).
[1097G 1098D] 5.
The nature of the appeal process cannot be cast in a rigid mould as it varies with jurisdiction and systems of jurisprudence.
Whatever the protean forms the appellate process may take, the goal is justice so that a disgruntled litigant cannot convert his right of appeal into breaking down the court system by sufferance of interminable submission after several tribunals have screened his case and found it fruitless.
The signification of the right of appeal under article 134 is a part of the procedure established by law for the protection of life and personal liberty.
Nothing which will render this right illusory or its fortune chancy can square with the mandate of article 21.
[ 1100H 1101A, 1102F, 1103D, 1104H 1105A] 6.
When the High Court trying a case sentences a man to death a higher court must examine the merits to satisfy that human life shall not be haltered without an appellate review.
A single right of appeal is more or less a universal requirement of the guarantee of life and liberty rooted in the conception that men are fallible, that Judges are men and that making assurance doubly sure before irrevocable deprivation of life or liberty comes to pass, full scale re examination of the facts and the law is made an integral part of fundamental! fairness or procedure.
[1105C, E] 7.
The life of the law is not perfection of theory but realisation of justice in the concrete situation of a given system.
It is common knowledge that 1087 a jail appeal or an appeal filed through an advocate does not contain an exhaustive accompaniment of all the evidentiary material or record of proceedings laying bare legal errors in the judicial steps.
It is not unusual that a fatal flaw has been discovered by the appellate judges leading to a total acquittal.
Such a high jurisdiction as is vested by article 134 calls for an active examination by the judges and such a process will be an ineffectual essay in the absence of the whole record.
A preliminary hearing is hardly of any use bearing in mind that what is being dealt with is an affirmation of death sentence for the first time.
Section 366 of the Code requires the Court of Session which passes a sentence of death to submit the proceedings to the High Court and rulings insist on an independent appellate consideration of the matter and an examination of all relevant material evidence.
The Supreme Court 's position is analogous, and independent examination of materials is impossible without the entire records being available.
So it is reasonable that before hearing the appeal under Rule 15(1 ) (c) of Order XXI, ordinarily the records are sent for and are available.
Counsel 's assistance apart, the court it self must apply its mind, the stakes being grave enough.
[1105F 1106B] 8.
The recording of reasons is usually regarded as a necessary requirement of fair decision.
The obligation to give reasons for decision when consequence of wrong Judgment is forfeiture of life or personal liberty for long periods needs no emphasis, especially when it is a first appeal following upon a heavy sentence imposed for the first time.
The constraint to record reasons secures in black and white what the Judge has in mind and gives satisfaction to him who is condemned that what he has had to say has not only been 'heard ' but considered and recorded.
article 21 is a binding mandate against blind justice.
In the narrow categories of cases covered by article 134(1)(a) and (b) and section 2(a) of the Enlargement Act, the subject matter is of sufficient gravity as to justify the recording of reasons in the ultimate order.
[1160F G, 1106H 1107A] 9.
Protection at the third deck by calling for the records or launching on long ratiocination is a waste of judicial time.
Our Rules of Criminal Procedure provide for dismissal at the third level without assigning written reasons, not because there are no reasons, but because the tardy need to document them hampers the hearing of the many cases in the queue that press upon the time of the court at that level.
[1107F] 10.
Order XXI, Rule 15(1)(c) of the Rules in an enabling provision not a compulsive one.
Harmonious construction of article 134 and article 145 'leads to the conclusion that the contemplated rules are mere machinery provisions.
The sequence is simple.
The formalities for entertaining certain types of appeal ale covered by article 145(1)(d) the manner of hearing and disposal is governed by article 145(1)(b) and the substantive sweep of the appeal as a method of redressal is found in article 134.
[1107G H, 1108D, 1109A].
It is daily experience to see judges on the high bench differ, and a fortiori so in the field of sentence, This reality is projected in the context of full freedom for the first appellate decider of facts to reach his own finding on offence and sentence, only to highlight how momentous it is for the appellant to have his case considered by the highest court when the Constitution and Parliament have conferred a full right of appeal Summary dismissal, save in glaring cases, may spell grave jeopardy to life giving justice 1088 That is why Order XXI Rule 15(1)(c) while it survives to weed out worthless appeals, shall remain sheathed in extra ordinary cases where facts on guilt or the wider range of considerations on sentence are involved.
[1109G 1110B] 12.
Rule 15(1)(c) of Order XXI is general and covers all conceivable cases under article 134(1).
It operates in certain situations, not in every appeal.
It merely removes an apprehended disability of the court in summarily dismissing a glaring case where its compulsive continuance, dragging the opposite party, calling up prolix records and expanding on the reasons for the decision, will stall the work of the court (which is an institutional injury to social justice) with no gain to anyone, including the appellant to keep whom in agonising suspense for long is itself an injustice.
[1111C D] 13.
If every appeal under article 134(1) (a) and (b) or section 2(a) of the enlargement Act, where questions of law or fact are raised, is set down for preliminary hearing and summary disposal, the meaningful difference between article 134 and article 136 may be judicially eroded and Parliament stultified.
The minimum processual price of deprivation of precious life or prolonged loss of liberty is a single comprehensive appeal.
To be peevel by this need is to offend against the fair play of the constitution.
[1111H 1112B] 14.
Upholding the vires of Order XXI Rule 15(1)(c) of the Supreme Court Rules and also section 384 of the Criminal Procedure Code the majority however held that in their application both the provisions shall be restricted by the criteria set out hereunder ns a permissible exercise in constitutionalisation of the provisions.
[1112H] 15.
Order XXI Rules 15(1)(c) in action does not mean that all appeals falling within its fold shall be routinely disposed of.
Such a course obliterates the difference between Articles 134 and 136, between right and leave.
The rule in cases of appeals under article 134(1)(a) and (b) and section 2(a) is notice, records and reasons, but the exception is preliminary hearing on all such materials as may be placed by the appellant and brief grounds for dismissal.
This exceptional category is where, in all conscience, there is no point at all.
In cases of real doubt the benefit of doubt goes to the appellant and notice goes to the adversary even if the chances of allowance of the appeal be not bright.
[113A C] [With a view to invest clarity and avoid ambiguity, Order XXI Rule 15(1)(c) may be suitably modified.] Maneka Gandhi vs Union of India, [1978] 1 SCC 248; Presidential Ref.
No. 1 of 1978 ; Wiseman vs Barneman, ; Russel vs Duke of Norfolk, 11949] 1 All.
ER 109, Ponnamma vs Arumogam, [1905] AC at p. 390; Colonial Sugar Refining Co. vs Irving, ; Newman vs Klausner, ; referred to.
Black 's Law Dictionary 4th Edn.
p. 1368, Stroud 's Judicial Dictionary, 3rd Edn.
Vol. 1, pp.
11 p. 194, Law Quarterly Review Vol.
71, 1955 p. 410 11.
The Judicial Process by Henry J. Abraham, 1962 pp. 159 160; referred to.
1089 Per Kailasam & Koshal, JJ.
(dissenting) 1.
Article 145 of the Constitution empowers the Supreme Court subject to the provisions of any law made by Parliament with the approval of the President to make rules from time to time for regulating generally the practice and procedure of the court.
[1116B] 2.
Article 134 confers appellate jurisdiction on the Supreme Court in regard to criminal matters, and while an unrestricted right of appeal is provided to the Supreme Court under clauses (a) and (b) an appeal under such clause (c) is provided only when the case is certified by the High Court as a fit one for appeal.
Further, an appeal under sub clause (c) shall lie subject to such provisions as may be made in that behalf under clause (1) of article 145 and to such conditions as the High Court may establish or require [1116D 1117B] 3.
The Supreme Court (Enlargement of Criminal Appellate Jurisdiction) .
Act, 1970 has conferred on the Supreme Court further power to entertain and hear appeals than conferred on it under article 134(1)(a) and (b) as provided for in article 134(2) of the Constitution.
[1117C] 4.
Article 145(1)(b) enables the Supreme Court to frame rules as to procedure for hearing appeals.
Rule 15 of under XXI provides for the procedure for hearing appeals and is valid so far as to the procedure of hearing appeals.
[1117D E, 1118C] 5.
While section 374 confers a right of appeal, section 375 and section 376 restrict such a right.
Section 384 prescribes the procedure for hearing appeals enabling the court to dismiss certain appeals summarily and to deal with others under section 385 if they are not summarily dismissed.
The right of appeal conferred can be curtailed by procedure as envisaged in section 384 Cr.
P.C. Or Rule 15 order XXI of the Supreme Court Rules.
[1120D] 6.
An appeal to the Supreme Court under section 374 Cr.
P.C. is restricted by the provisions of section 375 and section 376 and could be dealt with summarily under section 384 Cr.
P.C. An appeal to the Supreme Court is subject to the several provisions of the Cr.
P.C. including the provisions relating to summary disposal of the appeals.
[1120E F, G] 7.
The powers and the jurisdiction of the appellate court as prescribed by the Criminal Procedure Code and the rule cannot be said to deny a right of hearing to the appellant.
The right to be heard in an appeal is regulated be statute.
After a full trial the judgment is rendered by a High Judicial Officer such as a Sessions Judge or a High Court Judge.
The appellate court has before it the Judgment of the lower court and the petition for appeal.
At the preliminary hearing the appellant or his pleader is heard before the court decides to dismiss the appeal summarily.
The power to summarily dismiss an appeal is conferred under the Criminal Procedure Code when the court is satisfied that there are no sufficient grounds for interfering with the judgment appealed against.
This decision is taken by the appellate court being the Chief Judicial Magistrate, Court of Sessions, the High Court or the Supreme Court.
In the case of the Chief Judicial Magistrate and Court of Sessions, reasons should be recorded for summarily dismissal.
The High Court and the Supreme Court need not record reasons for summarily dismissing the appeal.
It is necessary that the Supreme Court or the High Court should be satisfied that there are not sufficient ground for interfering.
The conclusion is arrived at after hear 1090 ing the appellant, examining the judgment and the petition for appeal.
The appellate court is discharging an onerous duty in dismissing a case summarily.
The Code provides for calling for the records before dismissing an appeal.
In cases where an appellant is sentenced to death, imprisonment for life or long term of imprisonment, it is the bounden duty of the appellate court to hear the appellant, examine the petition of appeal and copy of the judgment appealed against.
If it feels necessary to call for the records of the case, it is duty to call for the records and examine them, before coming to the conclusion that there are not sufficient grounds for interfering.
It is the responsibility of the appellate authority to order notice and hear the other side if it is not satisfied that there be no sufficient grounds for interfering.
Equally it is the duty of the appellate court to dismiss the appeal summarily if it i.e satisfied that there are no sufficient grounds for interfering is duty is imposed for regulating the work of the courts for otherwise judicial time would be unnecessarily spent.
Taking into account the fact that the duty to decide the question where there are no sufficient grounds for interfering is placed on highly placed judicial officers after affording a due hearing, it cannot be stated that the very right of appeal bas been taken away.
[1122E F, 1122H 1123F] 8.
The procedure contemplated in Rules 13, 14 and 15 of the Supreme Court Rules are almost similar to the provisions of the Code of Criminal Procedure relating to appeal.
In an appeal sent by the appellant from jail he is entitled to send any written arguments which he may desire to advance in support of his appeal.
The Court in proper cases in which it considers it desirable would engage an advocate to present the case of the appellant in jail.
The mere fact that the appellant in jail is not being heard in person or through an advocate would not mean that the appeal is not being heard.
The court peruses the judgment, petition of appeal and the written arguments, if any, before proceeding to take action under Rule 15.
This Court being the highest court is not required to give reasons but is expected to bestow the greatest care in exercising the power of summary dismissal under Rule 15.
[1124G 1125A] P.K. Mittra vs State of West Bengal, [1959] SUPPL.
I SCR 63; Shankar Kerba Yadhav vs State of Maharashtra, ; ; Minakshi vs Subramanya, 14 IA 168; Govinda Kadtuji Kadam vs State of Maharashtra, ; ; referred to.
Maneka Gandhi vs Union of India, [1978] 2 SCR 621; distinguished.
|
ivil Appeal Nos.
483 and 1769 of 1969.
Appeal from the Judgment and Order dated 9/10 9 1968 of the Bombay High Court in First Appeal Nos.
844 of 1961 and 245 of 1962.
M. C. Bhandare, J. section Sinha and K. J. John for the Appellants.
R. H. Dhebar, B. V. Desai and M. N. Shroff for the Respondent.
The Judgment of the Court was delivered by TULZAPURKAR J.
These appeals by certificate of fitness granted by the High Court of Judicature at Bombay are directed against that Court 's common judgment and decree dated September 9/10, 1968, passed in two cross appeals being First Appeal Nos.
245 of 1962 and 844 of 1961.
1149 A contract for the construction of an aqueduct across the Alandi River at Mile No. 2 of the Nasik Left Bank Canal of the total value of Rs. 1,07,000/ was granted to the appellant plaintiff (originally a partnership but later a proprietary firm of contractors) by the respondent defendant (the State of Maharashtra) after the former 's tender was accepted on June 17, 1955.
On July 2, 1955 the Executive Engineer issued the work order to the appellant plaintiff directing him to commence the work by July 5, 1955 intimating in clear terms that the stipulated date for starting the work would be reckoned from July 5, 1955.
The formal regular Contract in prescribed From B 2/1 of 1955 56 (exhibit 34) containing the terms and conditions as well as the Schedules, specifications etc.
was executed by the parties on July 12, 1955.
A security deposit of Rs. 4,936/ was kept by the appellant plaintiff with the respondent defendant.
The period for completion of work was fixed as 12 months from the date stipulated for commencement of the work, that is to say, it was expected to be completed on or before July 4, 1956.
It appears that on the ground that the appellant plaintiff had not completed the work as expected within the stipulated time the Executive Engineer by his letter dated August 27, 1956 (exhibit 78) rescinded the said contract with effect from August 16, 1956.
After serving a notice under section 80 of the Civil Procedure Code the appellant plaintiff filed a suit (being Special Civil Suit No. 23 of 1959) on August 28, 1959 in the Court of the Joint Civil Judge, Senior Division, Nasik making a claim for Rs. 65,000/ in the aggregate against the respondent defendant alleging wrongful and illegal recision of the contract on the part of the respondent defendant.
The appellant plaintiff 's case was that the initial fixation of July 5, 1955 as the date for commencement of the work was nominal, that the area where the work was to be done had usually heavy rainfall rendering it impossible to carry out any work from July to November and that, therefore, it was the practice of the Public Works Department to deduct the period of monsoon in case of such type of works and that the appellant plaintiff had been orally informed that this period would be deducted or not taken into account for calculating the period of 12 months under the contract and that on this assurance he had commenced the work towards the end of December 1955.
His case further was that in any event time was not of the essence of the contract, that on account of several difficulties, such as excessive rains, lack of proper road and means of approach to the site, rejection of materials on improper grounds by Government Officers, etc., over which he had no control, the completion of the work was delayed and that the extension of the time which was permissible under the contract had been wrongfully refused by the officers of the respondent defendant.
Ac 1150 cording to him none of these factors had been taken into account by the Government while refusing the extension and the contract was wrongfully rescinded and, therefore, the respondent defendant was liable in damages.
The total claim of Rs. 65,000/ comprised six items (1) Rs. 4,936/ being the amount of security deposit wrongfully forfeited by the respondent defendant, (2) Rs. 10,254/ being the amount due to him for the actual work done by him under Bill No. 1253 dated September 20, 1956 and which had not been paid for, (3) Rs. 7,375/ being the value of the material collected by him on the site for work but which had been rendered useless on account of wrongful recision, the 4th and 5th items sounded in damages, while the last item was interest from date of recision to the date of the suit.
The State of Maharashtra resisted the claim contending that time was of the essence of the contract, that the date fixed for commencement was real and not nominal and the 12 months period was fixed after all aspects of the matter had been taken into account, it was further contended that the appellant plaintiff knew the situation of the site and the so called difficulties, that there was no excuse for him for not doing the work during the months of July to November, that the appellant plaintiff failed to carry out the proportionate work during the periods fixed in the contract and that since the appellant plaintiff had rendered himself incompetent to complete the work in proper time it had to rescind the contract and the recision was proper and for adequate reasons; it was further contended that the State was entitled to forfeit the security deposit which it did on the date when the contract was rescinded.
The several items claimed by the appellant plaintiff were denied by the State.
It was denied that the material of the value of Rs. 7,375/ remained on the site or that it was responsible for its non removal from the site.
Regarding items 4 and 5 the State denied its liability to pay the same as it was the appellant plaintiff who had committed the breach of the contract.
As regards the amount due under Bill No. 1253 dated September 20, 1956 for the actual work done, it was contended that the State had to deduct the amount of penalty leviable under the contract and for the actual cement supplied to the appellant plaintiff and after making deductions in that behalf only a sum of Rs. 700/ would be due to the appellant plaintiff.
On a consideration of the documentary evidence including the terms and conditions of the contract (exhibit 34) and the oral evidence led by the parties, the learned trial Judge held that the date July 5, 1955 fixed as the date for commencement of the work was not nominal but that time was not of the essence of the contract between the 1151 parties, that the respondent defendant (State Government) had wrongfully rescinded the contract, that the appellant plaintiff was entitled to damages but that he had not established the two items claimed as damages and he was entitled to a nominal sum of Rs. 120/ as damages.
He further held that since the recision of the contract was wrongful the State was not entitled to forfeit the security deposit nor levy any penalty.
He accordingly decreed the appellant plaintiff 's claim in respect of refund of security deposits and as regards the amount of Bill No. 1253 dated September 20, 1956 for actual work done he held that a sum of Rs. 5,845/ only would be due to him after giving credit for Rs. 4,409/ due from the appellant plaintiff to the State.
He accordingly decreed the appellant plaintiff 's suit to the extent of Rs. 10,901/ with interest thereon at 6% per annum from the date of recision till date of suit and allowed proportionate costs to him.
Two appeals were preferred against the aforesaid decree of the trial court, one by the appellant plaintiff in respect of the claims that had been disallowed (First Appeal No. 245 of 1962) and the other by the State in respect of the claims allowed against it (First Appeal No. 844 of 1961).
Curiously enough the High Court did not decide the main issue that arose between the parties, namely, whether time was of the essence of the contract, as it took the view that a decision on that question was really unnecessary for disposal of the appeals.
It proceeded to decide the appeals on the assumption that time was not of the essence of the contract by considering the question whether the recision of the contract by the State could be regarded as mala fide or so unreasonable that it must in the place of the judgment of the officers concerned substitute its own judgment and hold that the recision was wrongful.
The High Court observed that even the appellant plaintiff had not alleged any mala fide on the part of any of the officers of the State but had pressed into service five or six factors the non consideration whereof by the respondent defendant rendered the recision of the contract arbitrary, unreasonable and, therefore, unjustified.
After discussing each one of those five or six factors the High Court held that some of them had not been proved by the appellant plaintiff while others did not head to the inference that the recision of the contract was arbitrary, unreasonable or unjustified.
It found that by about July 21, 1956 (vide exhibit Engineer 's letter exhibit 74) the appellant plaintiff had done only 1/3rd of the contract work and that in the circumstances the appellant plaintiff could not have completed the work even within the next three months and, therefore, the respondent 's officers had rightly rescinded the contract and, therefore, it was the appellant plaintiff and not the respondent defendant who had committed a breach of the contract.
However, the High Court took the 1152 view that for such breach on the part of the appellant plaintiff, the respondent defendant, on a reading of the cls.
2 and 3 of the Conditions of Contract, was not entitled both to levy compensation and also to forfeit the security deposit.
Accordingly, the High Court upheld the forfeiture of the security deposit made by the respondent defendant and while modifying the trial court 's decree it confirmed it only to the extent of Rs. 5,845/ , being the amount due to the appellant plaintiff for the work actually done by him under Bill No. 1253 and which had not been paid.
In the result, the appellant plaintiff 's appeal was dismissed and that of the State was partly allowed with appropriate order of proportionate costs.
In support of the present appeal counsel for the appellant plaintiff raised two or three contentions.
In the first place he contended that the High Court was in error in not deciding the main issue whether the time was of the essence of the contract or not ? He urged that the said issue could not be avoided in the manner done by the High Court, for, if time was not of the essence of the contract then just before the expiry of the 12 months ' period or immediately after its expiry it was up to the respondent defendant to grant some reasonable time to the appellant plaintiff for completing the work undertaken and make the same the essence of the contract and only if the work was not completed by the appellant plaintiff within that time the contract could have been rescinded on the ground that the appellant plaintiff had committed a breach of a contract.
According to him such course of action on the part of the respondent defendant was obligatory, when the initial period of 12 months was not of the essence, especially when the request of the appellant plaintiff for extension of time was pending before the concerned officers of the Government since before the expiry of the initial period.
He contended that instead of adopting the aforesaid course the respondent defendant had without making time of the essence of the contract rescinded the same with effect from August 16, 1956 by a letter dated August 27, 1956 (exhibit 78), which recision must be regarded as wrongful and illegal.
Secondly counsel contended that the High Court further erred in considering the question whether the recision of the contract by the State was either mala fide or wholly unreasonable and, therefore, unjustified.
He pointed out it was not the appellant plaintiff 's case that the recision was mala fide and, according to him, the question was not whether the recision of the contract on the part of the respondent defendant was unreasonable, and, therefore, unjustified but whether the respondent defendant was entitled in law to rescind the contract in the manner done when time was not of the essence of the contract.
He further urged that the High Court had clearly erred in assuming that the appellant plaintiff 1153 could not have completed the work even within the next three months and, therefore, the contract was rightly rescinded by the respondent defendant.
He, however, fairly stated that even if this Court held in his favour that the recision was wrongful and, therefore, the respondent defendant had committed a breach he would merely press for the restoration of the decree passed by the trial Court and not press any other item forming the subject matter of the original claim in the suit.
On the other hand, counsel for the respondant defendant sought to support the judgment and decree of the High Court on both the grounds first that time was of the essence of the contract having regard to the express provision contained in cl.
(2) of the "Conditions of Contract" and, therefore, on appellant plaintiff 's failure to complete the same within the stipulated time the recision of the contract was legal and justified and secondly, that even if time was not of the essence of the contract, having regard to the circumstances the High Court rightly came to the conclusion that the recision of the contract by the respondent defendant could not be regarded as unreasonable or unjustified and that, therefore, the appellant plaintiff being in breach the security deposit had been rightly forfeited.
The first question that arises for our consideration, therefore, is whether time was of the essence of the contract that was executed between the parties on July 12, 1955 (exhibit 34).
It cannot be disputed that question whether or not time was of the essence of the contract would essentially be a question of the intention of the parties to be gathered from the terms of the contract.
The contract in the instant case is for the construction of an aqueduct across the Alandi River at Mile No. 2 of the Nasik Left Bank Canal and unquestionably 12 months ' period commencing from the date of the commencement of the work had been specified within which the construction had to be completed by the appellant plaintiff.
Indisputably, in the work order dated July 2, 1955 the Executive Engineer had directed the appellant plaintiff to commence the work by July 5, 1955 intimating in clear terms that the stipulated date for starting the work would be reckoned from July 5, 1955.
Both the trial court as well as the High Court have found that mentioning of July 5, 1955 as the date for starting the work was not nominal but was real date intended to be acted upon by the parties.
It is, therefore, clear that 12 months ' period mentioned for the completion of the work was to expire on July 4, 1956.
The question is whether this period of 12 months so specified in the contract was of the essence of the contract or not ? On the one hand, counsel for the appellant plaintiff contended that the contract being analogous to a building contract the period of 12 months would not 1154 ordinarily be of the essence of the contract as the subject matter there of was not such as to make completion to time essential, that an agreement to complete it within reasonable time would be implied and that reasonable time for completion would be allowed.
On the other hand counsel for the respondent defendant contended that time had been expressly made of the essence of the contract and in that behalf reliance was placed upon cl.
(2) of the "Conditions of Contract" where not only time was stated to be of the essence of the contract on the part of the contractor but even for completion of proportionate works specific periods had been specified and, therefore, the appellant plaintiff 's failure to complete the work within the stipulated period entitled the respondent defendant to rescind it.
In the latest 4th edn. of Halsbury 's Laws of England in regard to building and engineering contracts the statement of law is to be found in Vol. 4, Para 1179, which runs thus: "1179.
Where time is of the essence of the contract.
The expression time is of the essence means that a breach of the condition as to the time for performance will entitle the innocent party to consider the breach as a repudiation of the contract.
Exceptionally, the completion of the work by a specified date may be a condition precedent to the contractor 's right to claim payment.
The parties may expressly provide that time is of the essence of the contract and where there is power to determine the contract on a failure to complete by the specified date, the stipulation as to time will be fundamental.
Other provisions of the contract may, on the construction of the contract, exclude an inference that the completion of the works by a particular date is fundamental, time is not of the essence where a sum is payable for each week that the work remains incomplete after the date fixed, nor where the parties contemplate a postponement of completion.
Where time has not been made of the essence of the contract or, by reason of waiver, the time fixed has ceased to be applicable, the employer may by notice fix a reasonable time for the completion of the work and dismiss the contractor on a failure to complete by the date so fixed." (Emphasis supplied) It will be clear from the aforesaid statement of law that even where the parties have expressly provided that time is of the essence of the contract such a stipulation will have to be read along with other 1155 provisions of the contract and such other provisions may, on construction of the contract, exclude the inference that the completion of the work by a particular date was intended to be fundamental, for instance, if the contract were to include causes providing for extension of time in certain contingencies or for payment of fine or penalty for every day or week the work undertaken remains unfinished on the expiry of the time provided in the contract such clauses would be construed as rendering ineffective the express provision relating to the time being of the essence of contract.
The emphasised portion of the aforesaid statement of law is based on Lamprell vs Billericay Union, Webb vs Hughes and Charles Rickards Ltd. vs Oppenheim.
It is in light of the aforesaid position in law that we will have to consider the several clauses of the contract exhibit 34 in the case.
The material clauses in this behalf are cls.
2 and 6 of the "Conditions of Contract" which run as follows: "Clause 2: The time allowed for carrying out the work as entered in the tender shall be strictly observed by the contractor and shall be reckoned from the date on which the order to commence work is given to the contractor.
The work shall throughout the stipulated period of the contract be proceeded with, with all due diligence (time being deemed to be of the essence of the contract on the part of the contractor) and the contractor shall pay as compensation an amount equal to one per cent or such smaller amount as the Superintending Engineer (whose decision in writing shall be final) may decide, of the amount of the estimated cost of the whole work as shown by the tender for every day that the work remains uncommenced, or unfinished, after the proper dates.
And further to ensure good progress during the execution of the work, the contractor shall be bound, in all cases in which the time allowed for any work exceeds one month, to complete.
1/4 of the work in 1/4 of the time 1/2 of the work in 1/2 of the time 3/4 of the work in 3/4 of the time".
"Clause 6: If the contractor shall desire an extension of the time for completion of the work on the ground of his having been unavoidably hindered in its execution or 1156 on any other ground, he shall apply in writing to the Executive Engineer before the expiry of period stipulated in the tender or before expiry of 30 days from the date on which he was hindered as aforesaid or on which the cause for asking for extension occurred, whichever is earlier and the Executive Engineer, may if in his opinion there are reasonable grounds for granting an extension, grant such extension as he thinks necessary or proper.
The decision of the Executive Engineer in this matter shall be final.
" Two aspects emerge very clearly from the aforesaid two clause.
In the first place under cl.
6 power was conferred upon the Executive Engineer to grant extension of time for completion of the work on reasonable grounds on an application being made by the contractor (appellant plaintiff) in that behalf; in other words, in certain contingencies parties had contemplated that extension of time would be available to the contractor.
Such a provision would clearly be inconsistent with parties intending to treat the stipulated period of 12 months in cl. 2 as fundamental.
Similarly, in cl. 2 itself provision was made for levying and recovering penalty/compensation from the appellant plaintiff at specified rates during the period the work shall remain unfinished after the expiry of the fixed date.
Such provision also excludes the inference that time (12 months period) was intended to be of the essence of the contract.
Further with regard to the provision that is to be found in cl.
2 whereunder a time schedule for proportionate work had been set out (namely, 1/4 of the work in 1/4 of the time, 1/2 of the work in 1/2 of the time and 3/4 of the work in 3/4 of the time), the evidence of the Superintending Engineer Pandit (D.W. 1) is very eloquent.
In para 13 of his deposition this is what he has stated: "In the agreement (exhibit 3.1) the rate of work is based on the valuation 1/4th time mentioned means 1/4th in 12 months.
The suit contract is for Rs. 1,07,000/ .
1/4th work means the work of about Rs. 27,000/ .
It is not possible to do the work of Rs. 27,000/ in 1/4th time as the days were rainy.
This was not reasonable.
" The witness in para 12 of his deposition has also given the following admission: "It is not specifically mentioned in the agreement (exhibit 34), that the suit work was urgent and that it was to be completed within 12 months.
In this agreement (exhibit 34) 1157 there are the clauses of imposing a penalty and extension of time." Having regard to the aforesaid material on record, particularly the clauses in the agreement pertaining to imposition of penalty and extension of time it seems to us clear that time (12 months period) was never intended by the parties to be of the essence of the contract.
Further from the correspondence on the record, particularly, the letter (exhibit 78) by which the contract was rescinded it does appear that the stipulation of 12 months ' period was waived, the contractor having been allowed to do some more work after the expiry of the period, albeit at his risk, by making the recision effective from August 16, 1956.
Once either of the aforesaid conclusions is reached it would be difficult to accept the High Court 's finding that the recision of the contract on the part of the respondent defendant was proper and justified on the basis that the same was neither shown to be mala fide nor unreasonable.
It must be observed that it was never the case of the appellant plaintiff that the recision of the contract on the part of the respondent defendant was mala fide.
Counsel for the appellant plaintiff further pointed out and, in our view, rightly that the five or six factors, namely, (1) the contract having been given at the thresh old of monsoon, the period of monsoon (4 months) ought not to have been reckoned, (2) absence of proper road and approach to the work site during the rainy season and a couple of months thereafter, (3) unreasonable rejection by the Government Officers of material brought on the site, which material was later on allowed to be used, (4) difficulty in procuring labour due to malarious climate at the site, (5) delay in issuing quarry permit and (6) extra time taken for doing extra work that was entrusted ought to have been taken into account were put forward by the appellant plaintiff merely for the purpose of showing that the refusal to extend the time by the Superintending Engineer although recommended by the S.D.O. and Executive Engineer was unreasonable and not for showing that the recision of the contract was unreasonable or unjustified.
In our view, the question would not be whether the recision of the contract was unreasonable and, therefore, unjustified but whether the recision of the contract in the circumstances of the case was wrongful and illegal.
If time was not of the essence of the contract or if the stipulation as to the time fixed for completion had, by reason of waiver, ceased to be applicable then the only course open to the respondent defendant was to fix some time making it the essence and if within the time so fixed the appellant plaintiff had failed to complete the 1158 work the respondent defendant could have rescinded the contract.
The High Court has taken the view that the contract was rightly rescinded by the respondent defendant because by about July 21, 1956 (vide letter exhibit 74) the appellant plaintiff had done work of the value of Rs. 35,000/ as against the tender value of Rs. 1,07,000/ , that is to say, only 1/3rd of the total work had been completed and, therefore, even though time was not of the essence of the contract, the appellant plaintiff, in the circumstances, could not have completed the work even within the next three months.
In our view, this approach adopted by the respondent defendant and upheld by the High Court is not correct.
Long before the expiry of the period of 12 months the appellant plaintiff had by his letter dated June 6, 1956 (exhibit 68) requested for extension of period of completion up to the end of December, 1956; this request was repeated by another letter dated June 23, 1956 (exhibit 69).
May be the reasons or grounds on which the request was made may not have appealed to the Superintending Engineer but some reasonable time making it the essence ought to have been granted.
In this behalf it may be stated that the S.D.O. by his letter (exhibit 69) had recommended extension upto December 1956 as sought while by his letter dated June 23, 1956 (exhibit 70) addressed to the Superintending Engineer, the Executive Engineer had recommended that extension of time up to October 30, 1956 may be granted to the appellant plaintiff with clear intimation that if he failed to complete the work by then, the maximum penalty allowable under cl. 2, namely, 10% of the cost of the work will be inflicted on him, but the recommendation did not receive approval of the Superintending Engineer.
It appears that the appellant plaintiff had an interview with the Superintending Engineer on August 24, 1956 when a written representation (exhibit 99) was handed over and the whole position was sought to be explained to the Superintending Engineer but within three days of the interview by the letter dated August 27, 1956 (exhibit 78) the contract was rescinded and the full security deposit was forfeited to Government.
It will thus appear clear that though time was not of the essence of the contract, the respondent defendant did not fix any further period making time the essence directing the appellant plaintiff to complete the work within such period; instead it rescinded the contract straightaway by letter dated August 27, 1956.
Such recision on the part of the respondent defendant was clearly illegal and wrongful and thereby the respondent defendant committed a breach of contract, with the result that there could be no forfeiture of the security deposit.
In our view, therefore, the trial court was right in coming to the conclusion that the appellant plaintiff was entitled to a refund of their full security deposit of Rs. 4,936/ as also 1159 to Rs. 5845/ being the balance of their Bill No. 1253 dated September 20, 1956 for work actually done by them and not paid for and nominal damages of Rs. 120/ .
The appellant plaintiff was also entitled to interest on the aforesaid sums and costs of suit as directed by the trial court.
In the result we allow the appeal, set aside the common judgment and decree in F.A. No. 844 of 1961 passed by the High Court and restore that of the trial court.
The appellant plaintiff will get costs of this appeal as also costs of F.A. No. 844 of 1961.
The High Court 's decree dismissing F.A. No. 245 of 1962 is confirmed.
P.B.R. Appeal allowed.
| IN-Abs | The appellant entered into a contract with the respondent for the execution of a work the essential term of which was that the contract should be completed in 12 months from the commencement of the work.
On the ground that the appellant had not completed the work within the stipulated time the respondent rescinded the contract.
In his suit for damages for illegal and wrongful recision of the contract the appellant claimed that the date for commencement of the work was merely nominal and that in any case time was not of the essence of the contract.
The appellant also alleged that on account of several difficulties such as excessive rains in the area, lack of proper road and means of approach to the site, rejection of materials on improper grounds by the Government officers, completion of the work was delayed, extension of time was wrongfully refused by the officers of the Government, and that none of these factors had been taken into account by the Government while refusing to give extension of time, and in ultimately rescinding the contract.
Holding that time was not of the essence of the contract the trial Court decreed the suit, but disallowed certain claims of the appellant.
On appeal by both sides the High Court, without deciding the question whether time was of the essence of the contract, held that the recision of the contract was not arbitrary and unreasonable or unjustified.
On further appeal to this Court it was contended on behalf of the appellant that (i) the High Court was in error in not deciding the main question whether or not time was essence of the contract; and (ii) it was not the appellant 's case that the recision was mala fide and that, therefore, the High Court erred in considering that question.
Allowing the appeal, ^ HELD: The question whether or not time was of the essence of the contract would essentially be a question of the intention of the parties to be gathered from the terms of the contract.
Even where the parties have expressly provided that time is of the essence of the contract such stipulation would have to be read alongwith other provisions of the contract and such other provisions may, on construction of the contract, exclude the inference that the completion of the work by a particular date was intended to be fundamental.
For instance if the contract were to include clauses providing 1148 for extension of time in certain contingencies or for payment of fine or penalty for every day or week the work undertaken remains unfinished on the expiry of the time provided in the contract such clause would be construed as rendering ineffective the express provision relating to the time being of the essence of the contract.
[1155A B] Halsbury 's Laws of England, Vol.
4 p. 1174 referred to.
(i) In the instant case, having regard to the terms of the contract particularly the clauses pertaining to the imposition of penalty and extension of time, time was never intended by the parties to be of the essence of the contract.
The letter by which the contract was rescinded clearly waived the stipulation of 12 months ' period, the contractor having been allowed to do some more work after the expiry of the period.
[1157B] (ii) The approach adopted by the respondent and upheld by the High Court was not correct.
Long before the expiry of the period of 12 months the appellant had requested for extention of the period of completion.
Even if the grounds made out by the appellant were not agreeable to the Superintending Engineer some reasonable time making it the essence of the contract ought to have been granted.
Instead of making time of the essence at some stage or the other, the respondent rescinded the contract which was clearly illegal and wrongful.
[1158C] (iii) It was never the case of the appellant that the recision of the contract was mala fide.
The various reasons given by the appellant for delay in executing the work were put forward merely for showing that the refusal to extend time by the Superintending Engineer was unreasonable or unjustified.
The question was not whether the recision of the contract was unreasonable and, therefore, unjustified but whether the recision was wrongful and illegal.
If time was not of the essence or if the stipulation as to the time fixed for completion had, by reason of the waiver, ceased to be applicable then the only course open to the respondent was to fix some time making it the essence and if within the time so fixed the appellant had failed to complete the work, the respondent could have rescinded the contract.
[1157D G]
|
Civil Appeal No. 1217 of 1976.
Appeal by Special Leave from the Judgment and Order dated 16 7 1976 of the Delhi High Court in Company Appeal No. 15/76.
Y. section Chitale, K. R. Khaitan, B. Mohan, and Praveen Kumar for the Appellants.
P. R. Mridul, R. L. Roshan, H. K. Puri and Vijai K. Bahl for Respondent No. 1.
Pramod Dayal and section K. Gupta for Respondent No. 2.
R. M. Gupta and K. N. Bhat for Intervener/Dena Bank.
A few facts will put the problem raised in this appeal in focus and proper perspective.
M/s. Delhi Flour Mills Ltd. ( 'DFM ' for short) was the holding company of which IHI was the subsidiary.
Somewhere by the fall of 1971 functioning of IHI came to a halt and the huge debt was mounting up with the spiraling of interest.
1189 As the shares of DFM were closely held by relations of respondent No. 1 referred to as 'Jain group ' and as there were fratricidal disputes in Jain family culminating into a litigation in the High Court of Delhi, IHI languished for want of attention.
In the meantime M/s. Indian Smelting & Refining Co. Ltd. ( 'petitioning creditor ' for short) filed a winding up petition against IHI in 1975 alleging that IHI was heavily indebted and was unable to pay its debts as and when they became due.
After the dispute in the Jain family was resolved somewhere in 1974, a situation emerged in which one R. P. Jain and the members of his family acquired controlling interest in the holding company DFM.
Once R. P. Jain came into saddle, the DFM as holding company proposed a scheme of compromise/arrangement between IHI and its unsecured creditors and after the scheme was approved, the proponent of the scheme submitted Company Petition No. 86/74 to the Company Court for according sanction to the scheme and by Order dated 15th October 1975 the scheme was sanctioned.
Sometime after the scheme was sanctioned, DFM transferred its 44,000 shares of IHI and its claim to the tune of Rs. 23 lacs recoverable from IHI, to the present appellants section K. Gupta and Mrs. Dropadi Gupta (referred to as 'appellants ' hereafter).
Thereafter the appellants filed Company Application No. 193/76 requesting the Court to make appropriate modification and/or granting further direction for effectively implementing the scheme sanctioned by the Court in respect of IHI by substituting the appellants in place of DFM as proponents of the scheme and imposing upon them the liability to implement the scheme under the supervision of the Court.
A little while before this application was moved, respondent K. P. Jain filed Company Application No. 190/76 purporting to be under section 392 of the , inviting the Court for the reasons mentioned in the application to hold that the scheme sanctioned by the Court cannot be worked satisfactorily with or without modification and therefore an order winding up the Company should be made.
The Company Judge by his two orders in the two aforementioned applications dated 26th April 1976 granted the application of the appellants and modified the scheme by substituting the appellants as proponents of the scheme and simultaneously rejected the application of the respondent K. P. Jain for winding up the Company.
Respondent Jain preferred two appeals being Company Appeals Nos. 15 and 15/76 under section 483 of the .
Both these appeals came up before a Division Bench of the Delhi High Court, and they were disposed of by a common judgment.
The Division 1190 Bench was of the opinion that substitution of a new propounder in a scheme already sanctioned by the Court in place of the original propounder of the scheme was a change of a basic nature which would not be comprehended in the expression 'modification ' as under section 392 and, therefore, the Company Judge could not have granted such a substitution of the propounder of the scheme without referring back the proposed modified scheme to the creditors who had approved the original scheme.
It was further of the opinion that though the transfer of 44,000 shares of IHI held by DFM in favour of the appellants may be complete as between the transferor and the transferee, the same would not clothe the appellants with the right of a member unless their names were put on the register of members maintained by IHI and that the same having not been done, the appellants were not members of IHI.
It was further of the opinion that the debt owed by IHI to DFM was not assigned according to law in favour of the appellants and, therefore, they were not creditors, and in view of the language of section 391 of the , the appellants being neither members nor creditors of IHI, had no locus standi to move an application under section 392 for modification of the scheme because in the opinion of the Court section 391 controls section 392 and either a member or a creditor or in the case of a company being wound up, a liquidator alone can file an application for modification.
In accordance with this opinion, the appeal preferred by respondent No. 1 being Company Appeal No. 15/76 challenging the order of the Company Judge which granted modification/substitution of appellants as proponents was allowed and the application of the appellants for substitution was rejected.
The Division Bench dismissed Company Appeal No. 16/76 preferred by respondent Jain against the order of the Company Judge refusing to make an order for winding up of the Company observing that even while dismissing the application for substitution of the present appellants, the Court was not in a position to come to an affirmative finding that the scheme cannot be satisfactorily worked with or without modification and the matter should be left to the Company Judge as to what future course of action should be taken in the matter.
The appellants preferred the present appeal by special leave against the decision of the Division Bench in Company Appeal No. 15/76 by which their application for substitution/modification was rejected.
Mr. section section Ray, learned counsel for the appellants urged that the Court committed a basic error in holding that the application for 1191 substitution/modification was not maintainable because the appellants were neither members nor creditors of the Company, IHI, thereby importing a narrower concept in respect of the locus standi of the present appellants to move the Court under section 392 which restrictive approach would run counter to the power of widest amplitude conferred on the Court, namely, even to make modification suo motu or on the application of a person interested in the affairs of the Company.
He further urged that the appellate Court clearly misdirected itself when it went in search of the meaning of the expression 'modification ' in section 392 by ransacking dictionaries completely overlooking the fact that in section 2(29) of the the words 'modify ' and 'modification ' have been defined and it is a well known canon of construction that unless the context otherwise requires, the definition of an expression given in a statute shall govern the meaning of the expression wherever used in the same statute.
It was urged that the words "modify ' and 'modification ' for the purpose of section 392 would include the making of additions and omissions and according to him additions and omissions in the context of section 392 would and could only mean additions and omissions to the sanctioned scheme because section 392 operates at a stage subsequent to the sanctioning of the scheme under section 391(2).
It was further urged that if the words 'modify ' and 'modification ' would include additions and omissions, the Court would have plenary power to substitute one proponent for the other if in the opinion of the Court the scheme cannot be worked satisfactorily without the necessary modification and in all such cases it would be imprudent to hold that the Court will have to fall back to the cumbersome procedure of section 391 over again delaying for a considerable period the vital requirement of restarting a sick unit.
It was submitted that the Court committed a fallacy in importing the concept of Constitution while interpreting a provision of the .
Mr. Lal Narain Sinha on the other hand on behalf of the respondents, while conceding that in an emergency the Court can act on the application of any person, ordinarily the Court would act on the application of a member or creditor of the Company and in this blurred area some light is shed by the provision contained in Rule 87 of the Companies (Court) Rules, 1959.
Proceeding further, it was urged that sections 391 and 392 constitute a code and, therefore, if there was a qualification for proposing a scheme under section 391, the same qualification should be read in section 392 and any other approach would be self defeating.
It was submitted that viewed from this angle, only a member or a creditor can maintain an application under section 392 and as the appellants are neither members nor 1192 creditors of the Company, they have no locus standi to maintain the petition.
He further urged that putting too wide a construction on the expression 'modification ' in section 392(2) would lead to such a startling result as could not have been within the contemplation of the legislature and that, therefore, in order to arrive at a true meaning of word 'modification ', the Court should bear in mind the purpose and object behind using the expression or enacting the provision in which the expression is found.
It was also contended that substitution of the original sponsor amounts to repudiation of the contract which the scheme represents between the proponent of the scheme and the Company and another person cannot be substituted in place of the original contracting party without the consent or affirmance of the second party to the contract and hence such a thing cannot be brought about by way of a modification under section 392.
The word 'modification ' or 'modify ', therefore, should be given a restricted meaning looking to the context in which it is used in section 392 as has been done by the High Court.
Principal contentions advanced on either side turn upon the right to make an application and the power of the Court to grant an application under section 392 of the .
Section 392 finds its place in Chapter V of the bearing fascicules 'Arbitration, Compromise, Arrangements and Reconstructions '.
Section 391 enables a member or a creditor of the Company or a Company which is being wound up, its liquidator, to make an application to the Court proposing a compromise or arrangement between the company and its creditors or any class of them or between the Company and its members or any class of them and seeking directions of the Court to convene a meeting of each class of creditors and/or each class of members to whom the compromise or arrangement is offered.
On the Court 's giving the directions, the meeting would be convened in which the proposed scheme of compromise and/or arrangement would be submitted for consideration and each class will have to vote upon it and if the scheme is accepted by a majority in number representing three fourths in value of the creditors or members or class of members as the case may be, present and voting either in person or where proxy is allowed, by proxy, such approved scheme has to be placed before the Court for sanction of the Court as envisaged in section 391(2).
Then comes section 392 which may be reproduced in extenso: "392.
Power of High Court to enforce compromises and arrangements (1) Where a High Court makes an order under section 391 sanctioning a compromise or an arrangement in respect of a company, it 1193 (a) shall have power to supervise the carrying out of the compromise or arrangement; and (b) may, at any time of making such order or at any time thereafter, give such directions in regard to any matter or make such modifications in the compromise or arrangement as it may consider necessary for the proper working of the compromise or arrangement.
(2) If the Court aforesaid is satisfied that a compromise or arrangement sanctioned under section 391 cannot be worked satisfactorily with or without modifications it may, either on its own motion or on the application of any person interested in the affairs of the company, make an order winding up the company, and such an order shall be deemed to be an order made under section 433 of this Act".
At the outset it may be mentioned that though a large number of provisions of the , are in pari materia with the provisions of Companies Act, 1948, of the U.K. ( 'U.K. Act ' for short), there is no provision analogous to section 392 in the U.K. Act.
The Court under the U.K. Act has no power to modify the scheme either at the time when it is offered for its sanction or at any time subsequent thereto.
The Parliament has in its wisdom, conferred a power of wide amplitude on the High Court in India to provide for its continuous supervision of the carrying out of compromise and/or arrangement and also the consequential power to make the supervision effective by removing the hitches, obstacles or impediments in the working of compromise or arrangement by conferring power to give such direction in regard to any matter or for making such modification in the compromise or arrangement as it may consider necessary for the proper working of the compromise and/or arrangement.
Sub section
(2) confers power on the Court to act under section 392 either on its own motion or on the application of any person interested in the affairs of the company.
What falls for consideration is the true meaning of the expression 'on the application of any person interested in the affairs of the company '.
The High Court was of the opinion that the appellants have no locus standi to maintain an application for modification/substitution of themselves as proponents of the scheme with a liability to implement the scheme as they were neither members nor creditors of the Company and according to the High Court, if a scheme of compromise or arrangement cannot be proposed by any one except a member or creditor, ipso facto, an application for modification of such scheme sanctioned by the Court under section 391(2) could not be made by any one other than a member or a creditor.
1194 Section 391 envisages a compromise or arrangement being proposed for consideration by members and/or creditors of a Company liable to be wound up under the .
Compromise or arrangement has to be between creditors and/or members of the Company and the Company, as the case may be.
It was always open to the Company to offer a compromise to any of the creditors or enter into arrangement with each of the members.
The scheme in this case is essentially a compromise between the company and its unsecured creditors.
The scheme when sanctioned does not merely operate as an agreement between the parties but has statutory force and is binding not only on the company but even dissenting creditors or members, as the case may be.
The effect of the sanctioned scheme is "to supply by recourse to the procedure thereby prescribed the absence of that individual agreement by every member of the class to be bound by the scheme which would otherwise be necessary to give it validity" (see J. K. (Bombay) Pvt.
Ltd., vs New Kaiser I Hind Spg.
& Wvg.
Co. Ltd. & Ors.
etc.(1).
Further section 391(1) itself by a specific and positive provision prescribes who can move an application under it.
Only the creditor or member of that company or a liquidator in the case of a company being wound up is entitled to move an application proposing a compromise or arrangement.
By necessary implication any one other than those specified in the section would not be entitled to move such an application.
When a scheme is being considered by the Court, in all its ramifications, for according its sanction, it would not be possible to com prehend all situations, eventualities and exigencies that may arise while implementing the scheme.
When a detailed compromise and/or arrangement is worked out, hitches and impediments may arise and if there was no provision like the one in section 392, the only obvious alternative would be to follow the cumbersome procedure as provided in section 391(1), viz., again by approaching the class of creditors or members to whom the compromise and/or arrangement was offered to accord their sanction to the steps to be taken for removing such hitches and impediments.
This would be unduly cumbersome and time consuming and, therefore, the legislature in its wisdom conferred power of widest amplitude on the High Court under section 392 not only to give directions but to make such modification in the compromise and/or arrangement as the Court may consider necessary, the only limit on the power of the Court being that such directions can be given and modifications can be made for the proper working of the compromise and/or arrangement.
The purpose underlying section 392 is to provide for effective working of the compromise and/or arrangement once sanctioned and 1195 over which the Court must exercise continuous supervision[see section 392(1)], and if over a period there may arise obstacles, difficulties or impediments, to remove them, again, not for any other purpose but for the proper working of the compromise and/or arrangement.
This power either to give directions to overcome the difficulties or if the provisions of the scheme themselves create an impediment, to modify the provision to the extent necessary, can only be exercised so as to provide for smooth working of the compromise and/or arrangement.
To effectuate this purpose the power of widest amplitude has been conferred on the High Court and this is a basic departure from the scheme of the U.K. Act in which provision analogous to section 392 is absent.
The sponsors of the scheme under section 206 of the U.K. Act have tried to get over the difficulty by taking power in the scheme of compromise or arrangement to make alterations and modifications as proposed by the Court.
But the Legislature foreseeing that a complex or complicated scheme of compromise or arrangement spread over a long period may face unforeseen and unanticipated obstacles, has conferred power of widest amplitude on the Court to give directions and if necessary, to modify the scheme for the proper working of the compromise or arrangement.
The only limitation on the power of the Court, as already mentioned, is that all such directions that the Court may consider appropriate to give or make such modifications in the scheme, must be for the proper working of the compromise and/or arrangement.
Sub section (2) provides the legislative exposition as to who can move the Court for taking action under section 392.
Reference to section 391 in sub section
(2) of section 392 merely indicates which compromise or arrangement can be brought before the Court for taking action under section 392.
The reference to section 391 does not mean that all the limitations or restrictions on the right of an individual to move the Court while proposing a scheme of compromise or arrangement have to be read in sub section
(2) merely because section 391 is referred to therein.
Unlike section 391, section 392 does not specify that a member or creditor or in the case of a company being wound up, its liquidator, can move the Court under section 392.
On the other hand, the legislature uses the expression 'any person interested in the affairs of the company ' which has wider denotation than a member or creditor or liquidator of a company.
In fact, the ambit of the power to act under section 392(2) can be gauged from the fact that the Court can suo motu act to take action as contemplated by section 392(1) or it may act on an application of any person interested in the affairs of the Company.
1196 In this context the observations of the Gujarat High Court, extracted hereunder, in Mansukhlal vs M. V. Shah,(1) can be referred to with advantage as it precisely lays bare the ambit and width of Court 's power under section 392: "The framers of the company law in India have conferred statutory powers on the High Court to make such modifications in the compromise or arrangement as the Court may consider necessary for the proper working of the compromise and arrangement.
The power of the widest amplitude has been conferred on the court under section 392(1) (b) and the width and the magnitude of the power can be gauged from the language employed in section 392 (1) (a) which confers a sort of a supervisory role on the court during the period the scheme of compromise or arrangement is being implemented.
Reading clauses (a) and (b) of sub section (1) of section 392, it appears that Parliament did not want the court to be functus officio as soon as the scheme of compromise and arrangement is sanctioned by it.
The Court has a continuing supervision over the implementation of compromise and arrangement.
Unenvisaged, unanticipated, unforeseen or even unimaginable hitches, obstruction and impediments may arise in the course of implementation of a scheme of compromise and arrangement and if on every such occasion, sponsors have to go back to the parties concerned for seeking their approval for a modification and then seek the approval of the court, it would be a long drawn out, protracted, time consuming process with no guarantee of result and the whole scheme of compromise and arrangement may be mutilated in the process.
Parliament has, therefore thought it fit to trust the wisdom of the court rather than go back to the interested parties.
If the parties have several times to decide the modification with the democratic process, the good part of an election machinery apart, the dirt may step in, the conflicting interests may be bought and sold, and, in the process, the whole scheme of compromise and arrangement may be jettisoned.
In order, therefore, to guard against this eventuality and situation, which is clearly envisageable, Parliament has conferred power on the court, not only to make modifications even at the time of sanctioning the scheme, but at any time thereafter during the period the scheme is being implemented.
Conceding that, before the Court sanctions the scheme, it partakes the character of an emerging contract between the 1197 company and the creditors and members; once the court approves it, it becomes a statutorily enforceable contract even on dissidents, with power in the court to modify, amend or correct or revise the contract the outer periphery or the limit on the power being that, after testing it on this anvil of probabilities, surrounding circumstances and the prevalent state of affairs, it can be done for the proper working of the compromise and arrangement, and subject to this limit on the Court 's power, the power seems to be absolute and of the widest amplitude and it would be unwise to curtail it by process of interpretation".
If the Court can suo motu act, it is immaterial as to who drew the attention of the Court to a situation which necessitated Court 's intervention.
Where the power is conferred on the Court to take action on its own motion the information emanating from whatever source which calls for Court 's attention can as well be obtained from any person without questioning his credentials, moving an application drawing attention of the Court to a situation where it must act.
Undoubtedly, the Court may decline to act at the instance of a busy body but if the action proposed to be taken is justified, valid, legal or called for, the capacity or credentials of the person who brought the situation calling for Court 's intervention is hardly relevant nor would it invalidate the resultant action only on that ground.
Therefore, when sub section
(2) confers power on the Court to act on its own motion, the question of locus standi hardly arises.
The High Court while examining the question of locus standi, after combing the provision contained in sub section
(2), wholly overlooked the important provision therein contained that the High Court can act on its own motion.
It was, however, said in passing that sub section
(2) enables the Court to wind up the Company and, therefore, the Court may act on its own motion or on the application of any person interested in the affairs of the company not for modifying the scheme or for any directions but for winding up the company.
But when the Court is required to act under section 392(1), the limitations and restrictions imposed upon the Court under section 391(1) must be read in section 392(1) because the sections are complimentary to each other.
This submission overlooks the two different stages at which sections 391 and 392 operate though they may be complimentary to each other.
Two sub sections of section 392 have to be harmoniously read and sub section
(2) clearly indicates the power of Court to take action suo motu while taking action under sub section
Again this approach is inconsistent with the language employed in section 392(2) in that the Court can wind up the company 1198 under section 392(2) if and only it is satisfied that the compromise and/or arrangement sanctioned by it cannot be satisfactorily worked with or without modifications.
The Court has to reach an affirmative conclusion before acting under section 392(2) that the compromise and/or arrangement cannot be worked satisfactorily with or without modification (see J. K. Bombay P. Ltd.) (supra).
It follows as a corollary that if the compromise or arrangement can be worked as it is or by making modifications, the Court will have no power to wind up the Company under section 392(2).
Now, if the arrangement or compromise can be worked with or without modification, the Court must undertake the exercise to find out what modifications are necessary to make the compromise or arrangement workable and that it can do so on its own motion or on the application of any person interested in the affairs of the Company.
If such be the power conferred on the Court, it is difficult to entertain the submission that an application for directions or modification cannot be entertained except when made by a member or creditor.
It would whittle down the power of the Court in that it cannot do so on its own motion.
Mr. Sinha referred to Rule 87 of Companies (Court) Rules and urged that it throws some light on the question as to at whose instance the Court can act under section 392.
The rule is procedural in character and at any rate the rule cannot circumscribe the power conferred by the section.
Hence rule 87 is of no assistance.
Assuming that the Court would not act on its own, the next question is: could it act under section 392(1) on the application of any person interested in the affairs of the Company ? Now, if the Court under section 392(2) can order winding up of the company on the application of any person interested in the affairs of the company who need not be a member or a creditor, we fail to see how the Court cannot act on the application of such a person interested in the affairs of the Company either to give directions or to make modifications so as to make the compromise or arrangement workable.
Winding up meaning civil death of a company, must be the ultimate resort of the Court.
A living workable scheme infusing life into a sick unit is generally to be preferred to civil death of the company.
There is, therefore, no warrant for circumscribing the expression 'on the application of any person interested in the affairs of the company ' as to limit it to member or creditor.
If the legislature used the expression 'member or creditor ' in section 391(1) and yet used an expression of wider denotation 'any person interested in the affairs of the company ', the legislative intention is clearly exposed in that any such person interested in the affairs of the company need not be limited or restricted to refer to a 1199 member or creditor.
It would, therefore, be necessary to ascertain whether the appellants would be comprehended in the expression 'any person interested in the affairs of the company '.
At one stage there was a threatened long argument to ascertain whether the appellants have become the members of the company or are the creditors of the company.
The appellants contended that they and their friends have purchased 44,000 equity shares of IHI from its former holder DFM and they have also taken an assignment of the debt in the amount of Rs. 23 lacs owned by IHI to DFM from DFM.
Respondent Jain contended that the assignment is not valid as it fails to comply with section 130 of the Transfer of Property Act and as the names of the appellants are not put on the register of IHI, they have not acquired the status of member of IHI and, therefore, they being neither creditors nor members of IHI, they have no locus standi, to maintain the application under section 392.
The stand taken by respondent Jain in this behalf is wholly ambivalent.
Sometime after the scheme was sanctioned on 15th October 1975, the appellants assert that they purchased the 44,000 equity shares of IHI from DFM and they simultaneously took assignment of the debt.
Thereafter respondent Jain filed Company Application No. 190/76 in which he sought a direction under section 392(2) for winding up the Company.
In inviting the Court to grant his prayer for winding up the Company, the averment made is that since the sanction of the scheme by the Court, DFM has sold its interest to Shri section K. Gupta and others who wanted to operate the scheme as if they were the substitutes for DFM.
Another averment is that DFM was not entitled to sell its shares because it was the propounder of the scheme.
Therefore, the raison d 'etre for moving the application under section 392(2) was the sale of shares of IHI held by DFM to the appellants.
When the appellants filed Company Application No. 193/76 under section 392(1), in order to show their newly acquired or subsisting interest in the scheme so as to enable them to move the application under section 392, it was averred that the appellants have purchased 41,800 shares of IHI from DFM and the balance of holding of DFM to the tune of 2200 equity shares have been purchased by the nominee of the appellants.
It is further averred that the amount standing in the name of DFM in the books of IHI also been taken over by the appellants.
While replying to these averments in the application, respondent K. P. Jain in para 16 of his counter affidavit dated 29th March 1976 has stated that 'there is some understanding or agreement between the Delhi Flour Mills Co. Ltd. and Shri section K. Gupta for the sale of the shares held by Delhi Flour Mills Co. Ltd., in the IHI and I have referred to 1200 it in my application CA.
190/76 '.
If the very alleged sale of the shares by DFM to the appellants gave cause of action to respondent Jain to maintain an application under section 392(2) praying for an order for winding up of the company, what greater ambivalence could it disclose when it was contended on his behalf that the sale has not taken place ? There is enough evidence on record as is evident from the affidavit filed by DFM that as between DFM and the appellants the sale is complete.
Similarly, there is evidence in the affidavit that the debt owned by IHI to DFM has been assigned by DFM to the appellants.
In the face of this express position adopted by Jain, would it not clothe the appellants with necessary interest both in the company IHI and the scheme in respect of it, so as to enable them to maintain an application under section 392(2) ? Appellants are certainly persons interested in the affairs of the company.
For this additional reason the application for modification by them is certainly maintainable.
In the aforementioned circumstances we are not inclined to examine a very serious contention raised by Mr. Mridul who appeared at a later stage of hearing for the respondent Jain that unless names of the appellants are put on the register of IHI they do not become members and as the assignment on which the appellants rely does not comply with the requirements of section 130 of the Transfer of Property Act, the assignee 's title to the debt assigned has not become complete, and, therefore, the appellants are not creditors of IHI.
We may in passing say that the factum of assignment or the sale of shares was never seriously questioned but we are prepared to proceed on the assumption that even if it be so, in the circumstances herein discussed and the ambivalence of respondent Jain the appellants could certainly be said to be persons sufficiently interested both in the company IHI and the scheme in respect of it so as to be able to maintain an application under section 392(1).
Lastly in this connection it must be remembered that if DFM whose scheme was sanctioned and not challenged by respondent Jain, started implementing the scheme and after getting into the saddle by constituting the Board of Directors as desired by it, it could have transferred its shares to appellants and appellants could have as well taken over management and implemented the scheme and no one, at any rate, Respondent Jain holding only 1000 equity shares, i.e. 1.25% of the issued capital, could have objected to it.
The objection at this stage is equally futile.
Therefore, with respect, the High Court was in error in holding that the appellants had no locus standi to maintain an application under section 392(1).
The next important contention is that the sponsor or propounder of a scheme is such an integral part of the whole scheme or an impor 1201 tant element of the 'basic structure ' of the scheme that its substitution changes, alters or amends the scheme in almost its entirety and such a thing cannot be done by way of modification under section 392.
The word 'modification ' must be given, according to the respondent and according to the High Court, a restricted and narrow meaning.
The High Court, after reaching the conclusion that propounder of a scheme is 'the very life blood and soul of the scheme and on his going out the scheme itself becomes lifeless and inert ', proceeded to examine the connotation of the word 'modification ' as used in section 392 and after referring to various dictionary meanings, reached a conclusion that the context and setting in which the word is used, it would only means a "small adjustment a minor or slight change, a qualification or limitation, alteration of a subordinate character", and substitution of a sponsor of a scheme is of such a vital nature altering, in the opinion of the High Court, the 'basic structure ' of the scheme that such a three dimensional change would not be comprehended in the word 'modification ' as used in section 392.
In reaching this conclusion the High Court referred to the meaning assigned to the word 'modify ' in various dictionaries such as Webster, Black 's Law Dictionary, et el.
Unfortunately the High Court completely overlooked the obvious that the words 'modify ' and 'modification ' have been defined in section 2(29) of the as under: "2.
Definitions In this Act, unless the context otherwise requires (29) "Modify" and "modification" shall include the making of additions and omissions".
It may also be mentioned that section 2(1) defines 'altered ' and 'alteration ' to include making of additions and omissions, while 'variation ' is defined in section 2(31) to include 'abrogation '.
The definition of cognate words is noted by us to arrive at a true meaning of the word 'modification '.
The High Court nowhere refers in its judgment to the definition of 'modify ' and 'modification ' given in the very statute and proceeded to examine the content and meaning of the word used in a provision in the same statute which, unless the context otherwise requires, must bear the same meaning as set out in the definition section.
The noticeable feature of this definition is that it is inclusive definition and where in a definition clause the word 'include ' is used it is 1202 so done in order to enlarge the meaning of the words or phrases occurring in the body of the statute and when it is so used, these words or phrases must be construed as comprehending not only such things which they signify according to their natural import, but also those things which the interpretation clause declares that they shall include (see Dilworth vs Commissioner of Stamps).
Where in a definition section of a statute a word is defined to mean a certain thing, wherever that word is used in that statute, it shall mean what is stated in the definition unless the context otherwise requires.
But where the definition is an inclusive definition, the word not only bears its ordinary, popular and natural sense whenever that would be applicable but it also bears its extended statutory meaning.
At any rate, such expansive definition should be so construed as not cutting down the enacting provisions of an Act unless the phrase is absolutely clear in having opposite effect (see Jobbins vs Middlesex County Council).
where the definition of an expression in a definition clause is preceded by the words 'unless the context otherwise requires ', normally the definition given in the section should be applied and given effect to but this normal rule may, however, be departed from if there be something in the context to show that the definition should not be applied (see Khanna, J. in Indira Nehru Gandhi vs Raj Narain).
It would thus appear that ordinarily one has to adhere to the definition and if it is an expansive definition the same should be adhered to.
The frame of any definition more often than not is capable of being made flexible but the precision and certainty in law requires that it should not be made loose and kept tight as far as possible (see Kalva Singh vs Genda Lal).
Is there anything in the context and setting in which the word 'modification ' is used in section 392 to indicate that the legislature has not used the expression assigning the meaning to the word as set out in the definition clause? At least nothing was pointed out to us.
Undoubtedly, as pointed out by Lord Hershell in Cox vs Hakes, that for the purpose of construing any enactment it is right to look, not only at the provision immediately under construction, but at any others found in connection with it which may throw light upon it, and afford an indication that general words employed in it were not intended to 1203 be applied without some limitation.
Even with this caution we find nothing in section 392 or reading s.392 with section 391, to cut down and restrict the meaning as has been attempted by the High Court completely ignoring the definition section.
According to the definition 'modify ' and 'modification ' would include the making of additions and omissions.
In the context of section 392 'modification ' would mean addition to the scheme of compromise and/or arrangement or omission therefrom solely for the purpose of making it workable.
Reading section 392 by substituting the definition of the word 'modification ' in its place, if something can be omitted or something can be added to a scheme of compromise by the Court on its own motion or on the application of a person interested in the affairs of the company for the proper working of the compromise and/or arrangement, we see no justification for cutting down its meaning by a process of interpretation and thereby whittle down the power of the Court to deal with the scheme of a compromise and/or arrangement for the purpose of making it workable in course of its continued supervision as ordained by section 392 (1).
Strictly speaking, omission of the original sponsor and substituting another one would not change the 'basic fabric ' of the scheme.
The scheme in this case is one by which a compromise is offered to the unsecured creditors of the company and whoever comes in as sponsor would be bound by it.
Undoubtedly a sponsor of the scheme enjoys an important place in the scheme of compromise and/or arrangement but basically the scheme is between the company and its creditors or any class of them, or the company and its members or any class of them, and not between the sponsor of the scheme and the creditor or member.
The scheme represents a contract sanctified by Court 's approval between the company and the creditors and/or members of the company.
The company may as well be in charge of directors and the implementation of the scheme may come through the agency of directors but that would not lead to the conclusion that during the working of the scheme the directors cannot be changed.
If the scheme has to be ultimately implemented by the company as part of its contract and yet its directors can be changed according to its Articles of Association, we see no difference in the situation where a sponsor is required to be changed in the facts and circumstances of a case.
Therefore, it is not possible to accept the submission that as and by way of modification one sponsor of a scheme cannot be substituted for another sponsor.
1204 We may not be understood to say for a moment that the Court can appoint any one as sponsor.
The Court on which a duty is cast by section 392(1) to exercise continuous supervision over the working of the compromise and/or arrangement must, in order to effectively discharge its duty, examine the bona fides of the person applying to be substituted as sponsor, his capacity, his ability, his interest qua the company and other relevant considerations before substituting one sponsor for another.
In a given case an application may be rejected as the Court is of the opinion that the sponsor is not one who can be trusted with the implementation of the scheme but that is entirely a different thing from saying that the Court has no power to make such a substitution as and by way of modification of a compromise or arrangement.
Now to the facts of the case.
The appellants have applied for substituting them as sponsors of the scheme in place of DFM.
They claim to have purchased 44,000 shares out of 80,000 issued and subscribed equity shares of the company.
As stated earlier, between the transferor and transferee of the shares, the transfer of the shares is complete and not even seriously objected to by the respondent as pointed out hereinbefore.
The sponsor has taken an assignment of a debt of Rs. 23 lacs which IHI owed to DFM from the creditor DFM.
A gain, as between the transferor and transferee the assignment is complete.
The only objector is respondent holding 1,000 equity shares representing 1.25 per cent of the issued and subscribed capital.
An advertisement was directed to be inserted by the order of the Court in newspapers in respect of the application for substitution modification made by the appellants inviting every one interested in the company or in the scheme of compromise and/or arrangement to come and lodge objection, if it was so desired, against substitution/modification prayed by the appellants.
None including the petitioning creditor except the respondent Jain has lodged such an objection.
This procedure was also followed by the Gujarat High Court in Mansukhlal 's (supra) case and by referring to that part of the judgment, the High Court held that judgment itself is an authority for the proposition that substitution of the sponsor is a vital change of a basic nature and cannot be ordered by the Court acting under section 392 and must be referred to a meeting of the creditors or members.
With respect, this is not a fair reading of the judgment.
At pages 290 291, the scope and ambit of the power of the Court under section 392 has been precisely set out and it is concluded that the power to modify would comprehend the power to substitute one sponsor for the other if he is found otherwise fit and competent.
As an additional string to the bow, it was observed, as it 1205 is being done here also, that no one has come forward to object to the substitution and that would further strengthen the hands of the Court.
Such observation cannot be construed to mean that the Court lacks the power to make such a modification without reference back to the creditors and/or members, as the case may be.
In the background of these unimpeachable facts the conclusion is inescapable that the appellants have a subsisting and vital interest in the fate and future of IHI and they are the appropriate persons who could and should be substituted in place of the original sponsor.
In passing it was said that the fate of the company should not be placed in the hands of the appellants and the lack of bona fides of the appellants becomes discernible from the fact that they tooth and nail opposed the very scheme which they now seek to implement.
This is hardly a relevant consideration.
A creditor may come and oppose a scheme being implemented by some person and yet may be interested in taking over the affairs of the company.
This could hardly be treated as a disqualification of the appellants.
Lastly it may be mentioned that the appellants agree to implement the scheme.
They undertake to bring Rs. 3 lacs as liquid finance for implementing the scheme.
The question of the know how was examined by the company Judge who has accepted their fitness to run the business and nothing was pointed out to us to depart from the same.
Therefore, viewed from any angle, we see no objection to granting the application of the appellants for substitution/modification as sponsors of the scheme.
Accordingly, the judgment of the Division Bench dated 16th July 1976 in Company Appeal No. 15/76 is set aside and the order of the Company Judge dated 26th April 1976 in Company Application No. 193/76 is restored with costs throghout.
N.V.K. Appeal allowed.
| IN-Abs | The by section 391 enables a member or a creditor of the company or a company which is being wound up, its liquidator, to make an application to the court proposing a compromise or arrangement between the company and its creditors or any class of them or between the company and its members or any class of them and seeking directions of the court to convene a meeting of each class of creditors and/or each class of members to whom the compromise or arrangement is offered.
On the court giving the directions, the meeting would be convened in which the proposed scheme of compromise and/or arrangement would be submitted for consideration and each class will have to vote upon it and if the scheme is accepted by a majority in number representing three fourths in value of the creditors or members or class of members as the case may be, present and voting either in person or where proxy is allowed by proxy, such approved scheme has to be placed before the court for sanction of the court as envisaged in section 391(2).
Under section 392 of the Act, the High Court which has sanctioned the scheme has the power to supervise the carrying out of it and to give directions in regard to any matter or to make modifications in it as it may consider necessary for its proper working.
But if the court is satisfied that the scheme cannot work satisfactorily with or without modifications, it can either suo motu or on an application of any person interested in the company 's affairs order its winding up.
The holding company proposed a scheme of compromise/arrangement between its subsidiary and the unsecured creditors of the subsidiary company.
After obtaining the approval of the shareholders the holding company obtained the sanction of the company court.
A large number of shares in the subsidiary company held by it and its claim for a sum of Rs. 23 lacs recoverable from the subsidiary company were transferred by the holding company to the appellants.
The appellants then applied to the court to make an appropriate modification and/or grant further direction for implementing the scheme sanctioned by the court in respect of the subsidiary company by substituting them (the appellants) in place of the holding company as proponents of the scheme.
The respondent in the mean while made an application to the company court under section 392 of the to hold that the scheme sanctioned by the court could not work satisfactorily with or without modification and that, therefore, the court should 1185 make an order of winding up.
The company judge allowed substitution of the appellants as proponents of the scheme and rejected the respondents ' application for winding up of the subsidiary company.
On appeal by the respondents under section 483 of the a Division Bench held: (1) that since the substitution of a new propounder in a scheme sanctioned by the court in place of the original propounder was a change of a basic nature which would not be comprehended within the meaning of the expression "modification" in section 392 and, therefore, the company judge could not have granted substitution of the propounder of the scheme without referring the proposed modified scheme to the creditors who approved the original scheme, (2) that since the transfer of the shares in favour of the appellants had not been effected in the company 's registers, the appellants were not members of the subsidiary, (3) that the debt owed by the subsidiary to the holding company was not assigned according to law in favour of the appellants and, therefore, they were not creditors and (4) that not being either members or creditors of the subsidiary, the appellants had no locus standi to move an application under section 392 for the modification of the scheme.
On the question whether the court had power to grant an application under section 392 of the Act.
Allowing the appeal, ^ HELD: 1.
Though a large number of provisions of the are in pari materia with the provisions of Companies Act, 1948 of the U.K. there is no provision analogous to section 392 in the U.K. Act.
The court under the U.K. Act has no power to modify the scheme either at the time when it is offered for its sanction or at any time subsequent thereto.
The Parliament has in its wisdom, conferred a power of wide amplitude on the High Court in India to provide for its continuous supervision of the carrying out of compromise and/or arrangement and also the consequential power to make the supervision effective by removing the hitches, obstacles or impediments in the working of compromise or arrangement by conferring power to give such directions for the proper working of the compromise and/or arrangement.
[1193 D F] This power of widest amplitude being conferred on the High Court is a basic departure from the scheme of the U.K. Act in which provision analogous to section 392 is absent.
The sponsors of the scheme under section 206 of the U.K. Act have tried to get over the difficulty by taking power in the scheme of compromise or arrangement to make alterations and modifications as proposed by the court.
[1195 C] In the instant case the scheme is essentially a compromise between the company and its unsecured creditors.
The scheme when sanctioned does not merely operate as an agreement between the parties but has statutory force and is binding not only on the company but even dissenting creditors or members, as the cause may be.
[1194 B C] J.K. (Bombay) Pvt. Ltd. vs New Kaiser I Hind Spg.
& Wvg.
Co Ltd. & Ors.
, at 891; referred to.
1186 2.
Section 391(1) by a specific and positive provision prescribes who can move an application under it.
Only the creditor or member of that company or a liquidator in the case of a company being wound up is entitled to move an application proposing a compromise or arrangement.
By necessary implication any one other than those specified in the section would not be entitled to move such an application.
[1194 D] 3.
Sub section (2) of section 392 provides the legislative exposition as to who can move the court for taking action under section 392.
Reference to section 391 in sub section (2) of section 392 merely indicates which compromise or arrangement can be brought before the court for taking action under section 392.
The reference to section 391 in sub section (2) of section 392 does not mean that all the limitations or restrictions on the right of an individual to move the court while proposing a scheme of compromise or arrangement have to be read in sub section
(2) merely because section 391 is referred to therein.
Unlike section 391, section 392 does not specify that a member or a creditor or in the case of a company being wound up, its liquidator, alone can move the court under section 392.
The legislature uses the expression 'any person, interested in the affairs of the company ' which has wider denotation than a member or creditor or liquidator of a company.
The ambit of the power to act under section 392(2) is demonstrated by the provision that the court can suo motu act to take action as contemplated by section 392(1) or it may act on an application of any person interested in the affairs of the company.
[1195 F H] Mansukhlal vs M. V. Shah, [1976] 46 Company cases 279 at 290 291; referred to.
If the court can suo motu act, it is immaterial as to who drew the attention of the court to a situation which necessitated court 's intervention.
Where the power is conferred on the court to take action on its own motion, the information emanating from whatever source which calls for court 's attention can as well be obtained from any person without questioning his credentials, moving an application drawing attention of the court to a situation where it must act.
The court may decline to act at the instance of a busy body but if the action proposed to be taken is justified, valid, legal or called for the capacity or credentials of the person who brought the situation calling for court 's intervention is hardly relevant nor would it invalidate the resultant action only on that ground.
When sub section
(2) confers power on the court to act on its own motion, the question of locus standi hardly arises.
[1197 C E] In the instant case while examining the question of locus standi after considering the provisions contained in sub section
(2) the High Court wholly over looked the important provision therein contained, that the High Court can act on its own motion.
[1197 F] 5.
Even though section 391 and 392 are complementary they operate at different stages and have to be harmoniously read.
[1197 G H] 6.
Winding up meaning civil death of a company, must be the ultimate resort of the court.
A living workable scheme infusing life into a sick unit is generally to be preferred to civil death of the company.
There is no warrant for circumscribing the expression 'on the application of any person interested in the affairs of the company as to limit it to a member or a 1187 creditor.
If the legislature used the expression 'member or creditor ' in section 391(1) and yet used an expression of wider denotation 'any person interested in the affairs of the company, ' in section 392(2), the legislative intention is clearly exposed in that any such person interested in the affairs of the company need not be limited or restricted to refer to a member or creditor.
[1198 G 1199 A] In the instant case, there is enough evidence on record that as between the holding company and the appellants the sale of shares is complete, and that the debt owed by the subsidiary to holding company has been assigned by the holding company to the appellants.
The appellants therefore have requisite interest both in the subsidiary company and the scheme in respect of it, so as to enable them to maintain an application under section 392(2), as being persons interested in the affairs of the company, and therefore the application for modification by them is maintainable.
[1200 B C] 7.
The High Court was in error in holding that the appellants had no locus standi to maintain an application under section 392(1).
The words 'modify ' and 'modification ' have been defined in section 2(29) of the Act to include the making of additions and omissions.
Section 2(1) defines 'altered ' and 'alteration ' to include 'making of additions and omissions ', while 'variation ' is defined in section 2(31) to include 'abrogation '.
The definition of cognate words is noted to arrive at a true meaning of the word 'modification '.
The noticeable feature is that it is an inclusive definition, and where in a definition clause he word 'include ' is used, it is so done in order to enlarge the meaning of the words or phrases occurring in the body of the statute and when it is so used, these words or phrases must be construed as comprehending not only such things which they signify according to their natural import, but also those things which the interpretation clause declares that they shall include.
[1200 H, 1201 D G, H 1202 B] Dilworth vs Commissioner of Stamps, [1899] AC 99 at 105; Jobbins vs Middlesex County Council, ; Indira Nehru Gandhi vs Raj Narain at 97; Kalva Singh vs Genda Lal, ; at 309; Cox vs Hakes, ; referred to.
According to the definition 'modify ' and 'modification ' would include the making of additions and omissions.
In the context of section 392 'modification ' would mean addition to the scheme of compromise and/or arrangement or omission therefrom solely for the purpose of making it workable.
[1203 B] 9.
The High Court misdirected itself when it resorted to dictionaries for the meaning of the expression 'modification ' in section 392 when the said term was defined in section 2(29) of the Act itself.
[1203 A] In the instant case, the scheme is one by which a compromise is offered to the unsecured creditors of the company and whoever comes in as sponsor would be bound by it.
Omission of the original sponsor and substituting another one would not therefore, change the 'basic fubric ' of the scheme.
[1203 E] 10.
The court on which a duty is cast by section 392(1) to supervise the working of compromise/arrangement must examine the bona fides of the person applying to be substituted as sponsor, his capacity, his ability, his interest qua the company and other relevant considerations before substituting one sponsor for another.
In a given case an application may be rejected if the 1188 court is of the opinion that the sponsor is not one who can be trusted with the implementation of the scheme.
[1204 A C] In the instant case the appellants have applied for substituting them as sponsors of the scheme in place of the holding company.
They claim to have purchased 44,000 shares out of 80,000 issued and subscribed equity shares of the company.
The sponsor has taken an assignment of a debt of Rs. 23 lacs which the subsidiary company owed to the holding company from the holding company.
The only objector is respondent holding 1,000 equity shares representing 1.25 per cent of the issued and subscribed capital.
In pursuance to the court 's order notice in the newspaper was inserted calling for objection to the application for substitution/modification.
None including the petitioning creditor except the respondent lodged such an objection.
The appellants agreed to implement the scheme and undertook to provide Rs. 3 lacs as liquid finance for implementation.
The appellants therefore have a subsisting and vital interest in the fate and future of the subsidiary company and they are the appropriate persons who could and should be substituted in place of the original sponsor and there is no objection to granting their application.
[1204 D F, 1205 E, B]
|
Civil Appeal No. 2047 of 1969.
A Appeal by Special Leave from the Judgment and Order dated 25 6 1969 of the Andhra Pradesh High Court in Civil Revision Petition No. 346/67.
Y. section Chitaley, section K. Mehta, P. N. Puri and E. M. Sarul Anam for the Appellant.
A. T. M. Sampath and P. N. Ramalingam for the Respondent.
The Judgment of the Court was delivered by CHlNNAPPA REDDY, J.
The short question for consideration in this appeal is whether the practice of the legal profession is 'business ' within the meaning of Section 10(3) (a) (iii) of the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960.
The question arises this way.
The respondent, an Advocate filed an application before the Rent Controller seeking eviction of the appellant, his tenant, from the premises in question on the ground that he required the premises for the purpose of carrying on his profession as an Advocate.
The application was contested by the appellant who was carrying on the business of manufacturing art jewellery in the premises.
We are not concerned in this appeal with the several defences which were raised by the appellant.
Nor are we concerned with the vicissitudes which the case underwent.
For the purposes of this appeal it is sufficient to say that the final Court of fact, namely the Chief Judge of the Court of Small causes, Hyderabad, found that the respondent bona fide required the premises for the purpose of carrying on his profession as an Advocate and that the tenancy was not such as could be split up.
The Appellate authorities passed an order of eviction against the appellant.
Before the High Court, in revision, it was contended by the appellant that the practice of the profession of an Advocate was not business within the meaning of Section 10(3) (a) (iii) and, therefore, the respondent could not seek the eviction of the appellant on the ground that he required the premises for the purpose of carrying on his profession as an Advocate.
It was contended that Section 10(3) (a) (iii) used the expression 'business ' only and not the expression 'profession. ' The contention was negatived by a Division Bench of the High Court of Andhra Pradesh consisting of Gopalrao Ekbote and Ramachandra Rao, JJ.
The tenant has appealed by special leave to this Court.
Dr. Chitaley learned counsel for the appellant argued that there was a clear distinction between 'business ' and 'profession ' and that the practice of a liberal profession like that of an Advocate or a Doctor which 14 had nothing commercial about it was not business within the meaning of Section 10 (3) (a) (iii) of the Andhra Pradesh Buildings ( Lease, Rent and Eviction) control Act 1960.
He argued that though the Andhra Pradesh Act broadly classified buildings into residential and non residential buildings, the landlord of a non residential building could not seek to evict his tenant on the ground of his requirement unless it was for the purpose of carrying on a business.
According to the learned Counsel this indicated that the expression business was to be given a narrow meaning and was to be confined to activities of a commercial nature.
The learned Counsel also urged that the Court should favour a construction which would be beneficient to the tenant.
Dr. Chitaley relied on M. P. Sethurama Menon vs Thaiparambath Kunhukutty Amma 's daughter, Meenakshi Amma and Ors.
(1) Bangalore Water Supply & Sewerage Board etc.
vs R. Rajappa & Ors.
(2) and Stuchbery & Ors.
vs General Accident Fire and Life Insurance Corporation Ltd.(3) The expression business has not been defined in the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960.
It is a common expression which is sometimes used by itself and sometimes in a collocation of words as in "business, trade or profession".
It is a word of large and wide import,, capable of a variety of meanings.
It is needless to refer to the meanings given to that term in the various Dictionaries except to say that everyone of them notices a large number of meanings of the word.
In a broad sense it is taken to mean everything that occupies the time attention and labour of men for the purpose of livlihood or profit '.
In a narrow sense it is confined to commercial activity.
It is obvious that the meaning of the word must be gleaned from the context in which it is used.
Reference to the provisions of the Constitution or other statutes where! the expression is used cannot be of any assistance in determining its meaning in Section 10(3) (a) (iii) of the Andhra Pradesh Building (Lease, Rent and Eviction) Control Act, 1960.
It is not a sound principle of construction tn interpret expressions used in one Act with reference to their use in another Act; more so, if the two Acts in which the same word is used are not cognate Acts.
Neither the meaning, nor the definition of the term in one statute affords a guide to the construction of the same term in another statute and the sense in which the term has been understood in the several statutes does not necessarily throw any light on the manner in which the term should be understood generally.
On the other hand it is a (1) A.I.R. 1967 Kerala 88.
(2) ; (3) [1949] 2 K. B. D. 256.
15 sound, and, indeed, a well known principle of construction that meaning of words and expressions used in an Act must take their colour from the content in which they appear.
Dr. Chitaley very frankly and fairly conceded as much.
Now the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960, is an 'Act to consolidate, and amend the law relating to the regulation of leasing of buildings, the control of rent thereof an(l the prevention of unreasonable eviction of tenants therefrom in the State of Andhra Pradesh.
It applies to the cities of Hyderabad and Secunderabad and to all municipalities in the State of Andhra Pradesh.
The provisions of the Act, however, do not apply to buildings owned by the Government and to buildings constructed on or after 26th August, 1957.
Building is broadly defined as meaning any house or hut or a part of a house or hut, let or to be let separately for residential or nonresidential purposes.
Landlord is defined as the owner of a building, including a person who is receiving or is entitled to receive the rent of a building, on his own account or on behalf of another person etc.
Tenant is defined as a person by whom or on whose account rent is payable for a building.
Section 4 provides for the determination of a fair rent of a building on the application of the tenant or landlord.
Section 10(1) provides that a tenant shall not be evicted whether in execution of a decree or otherwise except in accordance with the provisions of Sections 10, 12 and 13.
Section 10(2) mentions several grounds on which a landlord may seek to evict a tenant.
The grounds are default of payment of rent, sub letting of premises, used for a purpose other than that for which it was leased, commission of acts of waste, conduct amounting to nuisance to the occupiers of the other portions in the same building, securing of alternative accommodation by the tenant and denial of the title of the landlord.
The grounds mentioned in Section 10(2) apply both to residential and non residential buildings.
Section 10(3) (a) (i) provides for the eviction of a tenant where the landlord of a residential building requires it for his own occupation.
Section 10(3)(a)(iii) provides for the eviction of a tenant from a non residential building where "the landlord is not occupying a non residential building in a city town or village concerned which is his own or to the possession of which he is entitled whether under the Act or otherwise (a) for the purpose of a business which he is carrying on on the date of the application, or (b) for the purpose of a business which in the opinion of the Controller, the landlord bona fide proposes to commence".
Section 12 and 13 contain special provisions relating to recovery of buildings by landlord for the purpose of effecting repairs, alterations or additions or for reconstruction.
The scheme of the Act is to prevent unreasonable eviction of 16 tenants by landlords and to provide for eviction on specified grounds.
The Act is of general application and its protection not confined to any classes of tenants nor is the right to evict under the Act limited to any class of landlords.
There is no reason why a landlord who is a member of the legal or medical professions and who requires the premises for carrying on the practice of his profession should be wholly debarred from obtaining possession of the premises.
It is impossible to discover any reason for so making a discrimination against the liberal professions.
But, that would be the result if the expression 'business ' is given a narrow meaning which the appellant wants us to give to that expression.
It would indeed be anamolous to hold that all the provisions of the Act including Section 4 which provides for the determination of fair rent and Section 10(1) which bars the eviction of tenants apply to nonresidential buildings owned by an Advocate but not Section 10 (3) (a) (iii) only.
In our view the expression business occurring in Section 10(3)(a)(iii) is used in a wide sense so as to include the practice of the profession of an Advocate.
The Kerala High Court in M.P. Sethurama Menon vs Meenakshi Amma & Ors.
, (supra) construed the expression 'trade or business ' as connoting commercial activity and as not including the practice of the legal profession.
The learned Judges referred to Article 19(1)(g) of the Constitution, Section 49 of the , the Madras Shops and Establishments Act, 1947 and drew a distinction between the words 'business ' and 'profession. ' As mentioned by us earlier, we do not think that it is right to ascribe to the word 'business ' occurring in the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960, the same meaning that the word may have when it occurs in other statutory provisions.
The word must be interpreted in the context of the statute in which it occurs and not in the context of other statutes or in a manner alien to the context of the statute concerned.
In Bangalore Water Supply & Sewerage Board etc.
vs R. Rajappa Ors., (supra) Chandrachud, J. (as he then was) observed ".
I find myself unable to accept the broad formulation that a Solicitor 's establishment cannot be an industry.
A Solicitor, undoubtedly, does not carry on trade or business when he acts for his client or advises him or pleads for him, if and when pleading is permissible to him.
He pursues a profession which is variously and justifiably described as learned, liberal or noble.
" The observations of the Learned Judge were made in the context of the question whether a Solicitor 's establishment would fall within the definition of 'industry ' under the 17 Industrial Disputes Act.
It would be most unwise to apply this A observation to determine whether the practice of the liberal professions is within the meaning of the expression 'business ' in Rent Control legislation.
In Stuchbery & Ors.
vs General Accident Fire and Life Assurance Corporation Ltd., (supra) it was observed that the carrying on of a Solicitor 's business was the carrying on of a profession and was not the carrying on of a trade or business within the meaning of that phrase in the Landlord and Tenant Act, 1927.
The observation was made in the context of that Act which made a distinction between 'trade or business ' and 'profession '.
In fact sub section 3(a) of Section 17 of the Act expressly said: "for the purposes of this Section premises shall not be deemed to be premises used for carrying on there at a trade or business by reason of their being used for the purpose of carrying on there at any profession".
The question in that case was about the right to compensation for the goodwill attached to the premises where the "business" or "profession" was being carried on.
We do not think 1 that the case is of any help to the appellant.
We may refer here to the decision of Danckwerts, J., in Re Williams ' Will Trusts, Chartered Bank of India, Australia and China and Another vs Williams and Others.(1) where the question was whether the bequest to a son for the purpose of starting him in 'business ' was affective to start the son in medical practice.
The learned Judge held that it did, observing that the word 'business ' was capable of including the practice of a profession and that it plainly included the profession of a Doctor.
We may refer to just one more case i.e. Taramal vs Laxman Sewak Surey Ors(2) where this very question whether the practice of law was a 'business ' within the meaning of the Madhya Pradesh Accommodation Control Act came for consideration before A. P. Sen, J.
The learned Judge held that in the context of the Madhya Pradesh Act, the word 'business ' had to be given a wide meaning so as to include any profession.
We, therefore, agree with the High Court that the practice of law is 'business ' within the meaning of that expression in Section 10(3) (a) (iii) of the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 196().
The appeal is, therefore, dismissed with costs.
M. R. Appeal dismissed.
| IN-Abs | The respondent, an advocate, sought to evict his tenant, the appellant, under section 10(3) (a) (iii) of the Andhra Pradesh Building (Lease, Rent and Eviction) Control Act, 1960, on the ground that he required the disputed premises for carrying on his profession.
The court of small causes, Hyderabad, finding that the requirement was bona fide, passed an eviction order against the appellant.
In revision, the High Court negatived the contention that the expression "business" used in section 10(3)(a)(iii), did not include the 'profession ' of an advocate.
Dismissing the appeal, the Court, ^ HELD: 1.
"Business" is a word of large and wide import, capable of a variety of meanings.
In a broad sense it is taken to mean 'everything that occupies the time, attention and labour of men, for the purpose of livlihood or profit '.
The practice of law is 'business ' within the meaning of that expression in section 10(3)(a)(iii).
The Act is of general application, and its protection is not confined to any classes of tenants, nor is the right to evict under the Act, limited to any class of landlords.
There is no reason why a landlord who is a member of the legal or medical professions and who requires the premises for carrying on the practice of his profession, should be wholly debarred from obtaining possession of the premises.
It would be anamolous to hold that all the provisions of the Act apply to non residential buildings owned by an Advocate, excepting section 10(3)(a)(iii).
[14D, E, 16A B, C D] Williams ' Will Trusts, Chartered Bank of India, Australia and China and Anr.
vs Williams and Ors.
, [1953] 1 All.
ELR 536; Taramal vs Laxman Sewak Surey & Ors. , approved.
M. P. Sethurama Menon vs Thaiparambath Kunhukutty Amma 's daughter, Meenakshi Amma & Ors., AIR 1967 Kerala 88; Bangalore Water Supply Sewerage Board, etc.
vs R. Rajappa & Ors., ; ; Stuchbery & Ors.
vs General Accident Fire and Life Assurance Corp. Ltd., [1949] 2 KBD 256; distinguished.
It is a sound principle of construction that, meaning of words and expressions used in an Act, must take their colour from the context in which they appear.
Neither the meaning, nor the definition of a term in one statute, affords a guide to the construction of the same term in another statute, more so, if the two Acts in which the same word is used, are not cognate Acts and the sense in which a term has been understood in several statutes, does not necessarily throw any light on the manner in which it should be under stood generally.
[14G H & 15A] 13
|
minal Appeal No. 24 of 1956.
On appeal by special leave from the judgment and order dated the, 26th September 1955 of the Allahabad High Court (Lucknow Bench) in Criminal Appeal No. 195 of 1955 and Capital Sentence No. 17 of 1955 arising out of the judgment and order dated the 11th April 1955 of the Court of the Sessions Judge at Bahraich in Criminal S.T. No. 9 of 1955.
D. R. Prem, for the appellant.
K. B. Asthana and C. P. Lal, for the respondent.
March 12.
The Judgment of the Court was delivered by IMAM J.
The appellant 'was sentenced to death for the murder of one Ram Dularey.
He was also sentenced to seven years ' rigorous imprisonment for having robbed the murdered man of his goods.
He was tried along with two other persons, who were ' acquitted, by the Sessions Judge of Bahraich.
All the four assessors,, who attended the trial, were of the opinion that the appellant was guilty.
The High Court of Allahabad affirmed the conviction and the sentence and this appeal is by special leave, 193 Certain facts have been proved beyond all doubt.
Indeed, the most important of them are admitted by the appellant in his statement under section 342 of the Code of Criminal Procedure when examined in the Court of Sessions.
It has been established by the evidence in the case that the deceased Ram Dularey, a shop keeper of Jarwal, had gone to Lucknow to purchase goods for his shop.
On his return journey, he got down from the train at Jarwal Road Station on the 2nd of July, 1954, at about 9 30 p.m.
He had with him articles consisting of a box, a balti, a gunny bag, jholas and other things.
Shortly thereafter, he engaged the appellant 's cart to take him and his goods to his village.
Two other persons also got on to the cart.
The appellant was driving the cart.
Neither the deceased nor the articles, which were with him, nor the cart ever reached Jarwal.
In the morning, Ram Dularey 's body was found near a bridge in close vicinity of Jarwal. 'Information was sent to the police who commenced investigation and their enquiriesed them to the appellant, who was arrested on the 6th of July, 1954.
The appellant gave the key of his kothri to the police with which it was opened.
From the kothri numerous articles were recovered, including a big knife exhibit 20 with blood stains, a dhoti exhibit 3, a box exhibit 9, a balti exhibit I,, a chadar exhibit 2, a gunny bag exhibit 13 and a jhola exhibit 24.
It is not necessary to give the details of the other articles recovered.
The knife was sent to the Chemical Examiner along with the dhoti.
Although minute blood stains were detected on the knife, they were not sufficient to enable a comparison in a blood group test.
No blood was discovered on the dhoti.
The dhoti exhibit 3, the box exhibit 9, the balti exhibit 1, the chadar exhibit 2, the gunny bag exhibit 13 and the jhola exhibit 24 have been identified as belonging to the deceased Ram Dularey.
When examined under section 342 of the Code of Criminal Procedure by the Sessions Judge, the appellant stated that the deceased Ram Dularey bad asked him to take his goods in his cart and it was agreed that Rs. 2 would be paid as the fare.
The appellant 194 took the deceased on his cart with his goods including the box exhibit 9.
Two other men were also in the cart who got down at the Sugar Mill gate at the Railway Station.
At the Raduayan Bridge three men enquired if Ram Dularey was in the cart.
Ram Dularey responded and got down from the cart asking the appellant to halt his cart at Jarwal Bazar Bridge, where he waited for the deceased until 4 a.m., but the deceased did not turn up.
As the appellant did not know the house of the deceased in Jarwal Bazar, he took the dead man 's goods in his cart to his own house as his buffaloes were very hungry.
To the question as to whether any article of the deceased was recovered from his house by the police, the appellant stated that he handed over to the police all the property of the deceased which be had looked in the kothri.
He asserted that he had told the people in his village as well as the Mukhia that he would hand over the property to its owner when he came to take it.
Concerning the knife, he disowned its ownership and could not say how it came to be found in his house.
So far as the dhoti exhibit 3 is concerned, the appellant claimed it as his.
On behalf of the appellant, it was urged that the evidence in the case was insufficient to establish any of the charges framed against him.
In the alternative, it was suggested, that as the co accused of the appellant had been acquitted the latter could not be convicted of the offence of murder by the application of the provisions of section 34 of the Indian Penal Code in the absence of proof that any act of his caused the death of Ram Dularey.
It was also submitted that no question was put by the Sessions Judge to the appellant when he was examined under section 342 of the Code of Criminal Procedure concerning the act of murder or robbery.
We have examined the statement of the appellant recorded under section 342 of the Code of Criminal Procedure by the Sessions Judge.
At the very commencemeilt of the record of that statement, the Sessions Judge readout the appellant 's statement under section 342 of the Code of Criminal Procedure before 195 the Committing Magistrate and enquired 'Whether it was correct.
, to which the 'appellant replied in the affirmative.
The statement of the appellant before the Magistrate is admissible under section 287 of the Code of Criminal Procedure.
The Magistrate pointedly asked the appellant as to whether he along with the other accused murdered Ram Dularey and had taken his property to which the appellant replied in the negative.
It was not necessary for the Sessions Judge to specifically repeat the same when the appellant admitted his statement before the Committing Magistrate as correct when read out to him.
Apart from this, when the statement of the appellant to the Sessions Judge is read as a whole, it clearly shows that the appellant knew what the accusation against him was and he offered an explanation for the disappearance of Ram Dularey from his cart and for his possession of the deceased 's goods.
There is no justification for supposing that there had been any prejudice caused to the appellant on account of improper or insufficient recording of his statement by the Sessions Judge under section 342 of the Code of Criminal Procedure.
On the facts proved beyond question it is clear that the last time the deceased was seen alive was in the company of the appellant and two other persons when the cart started for Jarwal and his goods were ' on that cart.
There is, however, no evidence as to what happened in the course of the journey.
Concerning that we have only the statement of the accused.
The evidence next establishes that after the cart started, next morning, the 3rd of July, the dead body of Ram Dularey was found not far from Jarwal.
His goods had disappeared and some of them at any rate were found in the possession of the appellant on the 6th of July.
The real question is whether the evidence in the case establishes that the appellant murdered and robbed Ram Dularey.
The evidence is circumstantial.
Before we deal with that evidence, it is necessary to consider how far recent possession of property of a deceased, in circumstances clearly indicating that he 196 had been murdered and robbed, would suggest that not only the possessor of the property was a thief or a receiver of stolen property, but that it also indicated that he was guilty of a more aggravated crime which had connection with the theft.
In the case of The Emperor vs Sheikh Neamatulla(1) Sir Lawrence Jenkins had the occasion to examine this question.
After referring to section 114 of the Evidence Act, be quoted the following passage from Wills on Circumstantial Evidence: "the possession of stolen goods recently after the loss of them, may be indicative not merely of the offence of larceny, or of receiving with guilty knowledge, but of any other more aggravated crime which has been connected with theft.
This particular fact of presumption commonly forms also a material element of evidence in cases of murder; which special application of it has often been emphatically recognized".
In the case of Queen Empress vs Sami and Another(2) at page 432, the learned Judges of the High Court observed, "Under these circumstances, and in the absence of any explanation, the presumption arises that any one who took part in the robbery also took part in the murder.
In cases in which murder and robbery have been shown to form parts of one transaction, it has been held that recent and unexplained possession of the stolen property while it would be presumptive evidence against a prisoner on the charge of robbery would similarly be evidence against him on the charge of murder.
All the facts which tell against the appellant, especially his conduct indicating a consciousness of guilt, point equally to the conclusion that he was guilty as well of the murder as of the robbery. . . . .
In the case of Emperor vs Chintamoni Shahu(3), the opinion was expressed that "the possession of stolen goods recently after the loss of them may be indicative not merely of the offence of larceny or of receiving with guilty knowledge but of any other more aggravated Crime which has been (1) [1913]17 C.W.N. 1077.
(2) Mad.
(a) A.I.R. 1930 Cal.
379. 197 connected with the theft; this particular fact of pre sumption forms also a material element of evidence in the case of murder".
A similar view seems to have been taken in the case of In re Guli Venkataswamy(1) as well as in the case of Ramprashad Makundram Rajput vs The Crown(2).
In the present case it is established beyond doubt that the deceased travelled with his goods with the appellant on his bullock cart.
He should have reached his destination Jarwal in the course of the night.
He never got there.
Obviously, he was murdered on his way home.
On the appellant 's own statement, he and the deceased were alone in the cart after the other two persons had got off the cart at the Sugar Mill gate.
Thereafter the deceased was never seen alive by any one.
He was found murdered.
The appellant was found in possession of the deceased 's goods three days afterwards.
The appellant made no effort to trace the whereabouts of the deceased or lodge information of his disappearance from the bullock cart.
The appellant has told the court that some people called the deceased while the cart was on its journey and the deceased told him to wait for him at a certain place.
He waited until 4 a.m. but the deceased never turned up.
This should have aroused his suspicions and he should have informed the police or someone in authority about it.
He says he informed the Mukhia and all the people about it.
Neither the Mukhia nor anyone has been examined by the appellant to support his story.
Reliance was placed on the statement of Iftikhar Ahmad P.W. 7) who spoke of a rumour in the village that the appellant had brought the property of a man on his cart who had gone away and that this rumour had been spread by the appellant.
It is clear, however, that the witness was not speaking of this from his personal knowledge and his statement is not legal evidence.
On the other hand, if really the appellant had spread such a rumour there is no adequate explanation for his failure to inform the authorities.
He (1) A.I.R. 1950 Mad. 309.
(2) A.I.R. 1949 Nag.
26 198 knew he was in possession of a large number of articles belonging to the man who had hired his cart but had disappeared in very strange circumstances.
In addition, there is no explanation for his possession of a big blood stained knife, a weapon which if used against the deceased, could have caused the injuries found on him.
It is true that the blood stains were minute and have not been established to be of human blood.
The appellant, however, denied that the knife belonged to him, and has not explained as to how it came to be in his possession.
It is impossible to believe his story that he waited until 4 a.m. for the deceased to return.
The cart had started from Jarwal Road Station at about 10 p.m.
It could not have been more than a couple of hours later that the deceased left the cart.
To wait from that time until 4 a.m. at a place not far from Jarwal itself appears to be a fantastic story.
It is true that none of the clothes of the appellant were found to be bloodstained, as they should have been, if he bad parti cipated in the murder, having regard to the nature of the injuries on the deceased.
These clothes were not seized until the 6th July, some three days later, and the appellant could have removed all traces of blood stains from his clothing in that time.
The appellant was convicted of the offences of murder and robbery by the Sessions Judge by the application of section 34 of the Indian Penal Code.
The charge framed, however, was one of murder and robbery and there was no mention of these offences having been committed in the furtherance of a common intention.
The High Court, however, found that the appellant along with two others committed these offences and they shared in the goods robbed.
On this finding, even if the co accused of the appellant were acquitted, the appellant could be convicted by the application of the provisions of section 34 of the Indian Penal Code.
The charge framed against the appellant was for murder and robbery and the only question to be decided was whether the evidence was sufficient to support such a charge or did it merely establish offences less grave in nature.
We think it 199 was and are satisfied that it establishes the offences of murder and robbery against the appellant and not merely the minor offence of robbery or theft.
It is impossible to accept the submission that the evidence does not establish any offence having been committed by the appellant.
Having regard to what is established in the case and the principles deducible from the cases cited, we are satisfied that the appellant has been rightly convicted of the offences of murder and robbery.
The appeal is accordingly dismissed.
| IN-Abs | The appellant was sentenced to death for the murder of one and also sentenced to seven years rigorous imprisonment for having robbed the murdered man of his goods, It was established by the evidence on the record that the deceased, a shop keeper of village Jarwal had gone to Lucknow to purchase goods for his shop.
On his return journey he got down from the train at about 10 p.m.
He had with him a box, a balti, a gunni bag and a jhola and other things.
He engaged the appellant 's cart to take him and his goods to his village.
Two other persons also got on to the cart.
Neither the deceased, nor the articles which were with him nor the cart reached Jarwal.
In the morning the body of the deceased was found near a bridge in the vicinity of Jarwal.
During investigation on the fourth day after the occurrence the appellant gave the key of his kothri to the police and from the kothri, a dhoti, a box, a balti, a chadar, a gunny bag and a jhola were recovered which were identified as belonging to the deceased.
A big knife was also recovered from the kothri which the appellant disowned but could not explain how it was found in his home.
The appellant on examination before the Sessions Judge under section 342 of the Code of Criminal Procedure stated that the deceased asked him to take his goods 'in the cart at about 10 p.m. when he got down at the Railway Station.
Two other men were also in the cart who got down at the Sugar Mill gate near the Railway Station.
At Raduayan Bridge three men enquired if the deceased was in the cart.
The deceased responded and got down from the cart asking the appellant to halt his cart near Jarwal Bazar Bridge where he waited for the deceased up to 192 4 a.m. but he did not turn up.
Not knowing the house of the deceased he took the dead man 's goods to his own house as his buffaloes were very hungry.
He stated further that he had handed over all the articles of the deceased person to the police which he had locked in the kothri.
Held, that recent and unexplained possession of the stolen property while it would be presumptive evidence against a prisoner on the charge of robbery would similarly be evidence against him on the charge of murder.
All the facts which tell against the appellants especially his conduct indicating consciousness of guilt, point equally to the conclusion that he was guilty as well of the murder as of the robbery.
The Emperor vs Sheikh Neamatulla ([1913] , Queen Empress vs Sami and Another ([1890] I.L.R. 13 Mad. 426), Emperor vs Chintamoni Shahu (A.I.R. , In re Guli Venkataswami (A.I.R. 1950 Mad. 309), and Bamprashad Mukundram Rajput vs The Crown (A.I.R. , referred to.
|
N: Criminal Appeal No. 166 Of 1976.
Appeal by Special Leave from the Judgment and Order dated 21 4 75 of the Allahabad High Court in Criminal Appeal No. 2776 74 and Referred No. 76/74.
D. P. Uniyal, and M. V. Goswami for the Appellant.
D. Mookherjee, O. P. Tewari, section section Srivastava and K. C. Jain, for Respondent No. 1.
R. K. Garg, V. J. Francis and D. K. Garg for Respondent No. 2.
The Judgment of the Court was delivered by FAZAL ALI J.
The respondents had been convicted by the Additional Sessions Judge, Banda under section 302 of Indian Penal Code and sentenced to imprisonment for life.
The respondents thereafter filed an appeal to the High Court of Allahabad which after a full and complete consideration of the evidence came to a finding of fact that the prosecution has not proved its case and accordingly acquitted the respondents.
The High Court rejected the prosecution case mainly on two grounds.
In the first place, it held that having regard to the circumstances and the distance from which the witnesses saw the accused, it was difficult for them to identify the accused.
Secondly, the High Court found that in view of the medical evidence which showed that the large intestines of the stomach were absolutely empty, the evidence of the eye witnesses could not be believed.
Against the order of acquittal passed by the High Court the State came up to this Court by special leave and after obtaining the same the case has been placed before us for hearing.
The facts of the case have been set out in the judgment of the High Court and it is not necessary for us to repeat them again.
It is well settled that this Court would not normally interfere with an order of acquittal in special leave unless there are cogent reasons for doing so or unless there is a gross violation of any procedure of law which results in serious miscarriage of justice.
We have heard 3 counsel for the parties and have gone through the judgment of the Sessions Judge and of the High Court.
It is true that High Court has not made an attempt to discuss the intrinsic merits of the evidence of the eye witnesses but having regard to the glaring defects appearing in the prosecution case we are in agreement with the ultimate view taken by the High Court.
According to the prosecution the deceased along with P.Ws. 1 & 2 had gone to Atarra to witness a drama in the Ramlila Grounds.
The party reached Atarra at about 9 o 'clock and the drama finished at about 12 o 'clock.
Baura and Chanada P.Ws. 2 and 5 were also with the deceased Budhi Bilas when he was returning from the Natak.
It is alleged that at about 12.30 a.m. the respondent Ashok Kumar fired a few shots which hit the deceased as a result of which he died instantaneously.
The two eye witnesses P.Ws. 1 and 2 admittedly saw the firing from a distance of about 150 yards, as would appear from an examination of the site plan Ka 23 and which is endorsed by P.W. 1 who stated in his evidence that he has given the detail of the place from where they saw the occurrence to the Investigating Officer at the spot.
The first question which falls for consideration is as to whether or not the witnesses would be in a position to identify the respondents from such a large distance at night.
It is true that it was a moon lit night but from a reference to the almanac it would appear that the moon had covered 3/4th distance on the night of occurrence and was to set at 3.23 a.m. Even though there may be some moon light at that night, it is difficult for the witnesses to identify the respondents or even if they did the possibility of mistake in identification cannot be completely excluded.
In this connection, we may refer with advantage to the following passage appearing in Dr. Hans Gross 's Criminal Investigation at page 185: "By moonlight one can recognise, when the moon is at the quarter, persons at a distance of from 21 feet, in bright moonlight at from 23 to 33 feet; and at the very brightest period of the full moon, at a distance of from 33 to 36 feet.
In tropical countries the distances for moonlight may be increased.
" The opinion of Gross referred to above fully fortifies our conclusions that it was not possible for the witnesses to have identified the respondents even in moonlight from a distance of about 150 yards.
In these circumstances, therefore, the High Court was fully justified in holding that it was not possible for the eye witnesses to identify the respondents from such a long distance on the night of the 4 occurrence.
The prosecution suggested that the witnesses had lighted their torches and it was in the light of torches coupled with moon light that identification was possible.
In the first place, we find it difficult to believe that after Ashok Kumar had given a call and fired, the witnesses would dare to flash the torch light and expose themselves to the risk of being shot themselves.
Secondly, even if torches were lighted, in view of the large distance, it would not be possible for the witnesses to identify the respondents with absolute certainty.
Another important circumstance which appears to clinch the issue is the medical evidence in the case.
It appears from the evidence of Dr. Pillay, P. W. 7 who performed the post mortem that the small intestines were distended with gas and in the end of the small intestines liquid faeces was present.
The doctor further says that large intestines were empty.
Doctor also found the stomach to be empty.
These facts are also mentioned in the post mortem report.
This clearly shows that the deceased must have been shot at a time when he had either not taken any food at all or the entire food if taken was fully digested and left the stomach.
P.W.1 had stated in his evidence that he along with his uncles and the deceased took tea and ate samosas.
The deceased had taken two samosas.
This meal was taken by the deceased and the witnesses after the Natak ended, that is to say, at about 12 O 'clock in the night, because the evidence of P.W.1 is that the Natak started at 9 p.m. and continued for three hours.
If the evidence of this witness is believed, then it is completely falsified by the medical evidence which shows that the stomach was empty.
In other words, if the witness is believed, the position would be that the deceased would have been shot only a few minutes after he had taken two samosas and a cup of tea.
In that case the stomach would not be empty.
Perhaps realising this difficulty the prosecution through the mouth of P. Ws. 2 and 3 tried to effect a deliberate embellishment in their evidence by making them depose that the deceased Budhi Bilas had taken only milk when he started.
P.W. 3 goes to the extent of saying that deceased Budhi Bilas was suffering from stomach ulcers and he never took any food at night.
The story of the deceased having taken samosas is given a complete go back by other eye witness, P.W. 2.
Indeed, if these witnesses were present at the time when the deceased has taken something we should not have expected any discrepancy of this kind on this important aspect of the matter.
Either deceased took food or he did not take any food.
This fact would be known to his son, P.W. 1 and also to P.W. 2.
We cannot understand what is the explanation for the two different versions given by P.Ws. 1 & 2 unless the idea 5 was to bring the evidence, at least, of P.W. 2 in tune with the medical evidence.
Until the deposition of P.W. 1 was complete, the prosecution did not realise the gravity of the statement made by P.W. 1 that the deceased has taken two samosas and a cup of tea shortly before the occurrence.
This deliberate attempt to introduce a change on a vital issue is by itself a very important circumstance which throws doubt on the prosecution case.
It is manifest that whereas witness may lie circumstances never lie.
The evidence of the doctor is based on conclusive circumstantial evidence which cannot be belied, and therefore an attempt has been made by the prosecution to introduce improvements in explaining the lacuna present in the case.
Apart from this we have gone through the evidence of P.Ws.
I & 2 and their evidence also is full of discrepancies as pointed out by the High Court.
Taking therefore an overall view of the picture, we hold that this is not a case in which we should interfere with the order of acquittal passed by the High Court.
For the reasons given above, we confirm the order of the High Court and dismiss this appeal.
The respondent No. 1 who is in jail is directed to be released forthwith and respondent No. 2 will be discharged from his bail bonds.
P.B.R. Appeal dismissed.
| IN-Abs | The respondents were charged with an offence under section 302, I.P.C. The prosecution case was that on the night of occurrence (which was a moonlight night) the deceased and the prosecution witnesses attended a drama in the Ramlila Grounds of the village and when the deceased, after taking two samosas and tea, was returning home some time past midnight, the respondents shot him dead and that this was seen by them from a distance of 150 yards from the scene of occurrence.
The trial court, believing the prosecution version, convicted the respondents.
On appeal the High Court rejected the prosecution story and acquitted both the respondents.
The State came in appeal to this Court by special leave.
Dismissing the appeal, ^ HELD: It is well settled that this Court, in special leave, would not normally interfere with an order of acquittal unless there are cogent reasons for doing so or unless there is a gross violation of any procedure of law which results in serious miscarriage of justice.
[2H] Having regard to the glaring defects in the prosecution story this is not a case in which this Court should interefere with the order of acquittal.
[3B] In the present case, though it was a moon lit night according to the almanac the moon would have covered three fourths distance on the night of occurrence.
Even in the moonlight it would have been difficult for the witnesses to identify the assailants; even if they did, the possibility of mistake in identification could not be completely excluded.
According to an authority, when the moon is at the quarter, it is possible to recognise persons at a distance of from 21 ft; in bright moonlight at from a distance of 23 to 33 ft. and at the very brightest period of the full moon at a distance of from 33 to 36 ft.
In tropical countries the distance for moonlight may be increased.
Therefore, it would not have been possible for the eye witnesses to identify the assailants from a distance of 150 yards.
[3E G] After the assailants had given a call and fired at the deceased the witnesses would not have flashed the torch light, as suggested by the prosecution, and exposed themselves to the risk of being shot at.
Even if the torches were lighted, in view of the distance, it would not have been possible for the witnesses to identify the assailants with certainty.
[4B] Secondly, the medical evidence had shown that the stomach of the deceased was empty and the large intestines too were empty.
Therefore, the evidence 2 of the witnesses that the deceased took two samosas after the drama at midnight and before the attack is completely falsified by medical evidence.
Another prosecution witness stated that the deceased having had stomach ulcers never took any food at night.
Apparently until the deposition of the first witness was complete the prosecution did not realise the gravity of the statement made by him and deliberately introduced a change on a vital issue which by itself is an important circumstance throwing doubt on the prosecution case.
While witnesses may lie, circumstances would never.
Tho evidence of the doctor, based on conclusive evidence cannot be belied.
[4F H]
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Civil Appeal Nos.
1992 1997 and 2219 of 1969.
Appeals by Special Leave from order dated 16 1 69 and 19 3 69 of the Govt.
of India, Min. of Finance Dept. of Revenue in Orders Nos. 8637 8642/68 and 1408/69.
Y. section Chitale, J. B. Dadachanji and D. N. Misra for the Appellant in all appeals.
section Markandeya and Girish Chandra for the Respondents in all the appeals.
The Judgment of the Court was delivered by SHINGHAL J.
These appeals by special leave arise out of an order of the Central Government dated January 16, 1969 by which six revisional applications of the appellants were dismissed, and a similar order dated March 19, 1969, in the remaining case.
As the basic facts and the law governing them are quite similar, it will be sufficient to deal with the common point in controversy before us on the basis of the admitted facts, and to dispose of the appeals together.
The appellants obtainted licences for the import of 102 cases of 3,000 Kgs.
of nylon yarn.
The yarn was shipped to Bombay on the basis of a letter of credit in favour of the foreign suppliers.
When the shipment arrived, the appellants received the bill of lading and other documents of title from the bankers on or about August 23, 1965, and paid for the same.
They lodged the bill of entry the same day, and it has been claimed that the goods were assessed for duty by the customs authorities at a certain figure.
The appellants stored the goods in the warehouse on December 22, 1965.
They cleared 32 cases for "home" consumption on May 10, 1966, and there is no controversy in regard to it.
The currency was devalued on June 6, 1966, and the Customs (Amendment) Ordinance, 1966, was promulgated on July 7, 1966, by which sections 14 and 15 of the , hereinafter referred to as the Act, were amended.
The Ordinance was replaced by the Customs (Amendment) Act, 1966.
The appellants cleared 12 cases of the aforesaid consignment on or about September 1, 1966.
Another 12 cases were cleared on October 10, 1966, and 46 cases were cleared in two lots on or about December 30, 1966 and February 20, 1967.
Their grievance was that the cases were allowed to be cleared on payment of "enchanced" duty 1144 according to the amended provisions of the Act.
They paid the duty under protest and applied for refund of the excess payment on the ground that the amended law was not applicable as the consignments had been received, stored and assessed to duty before the promulgation of the Ordinance.
The applications of the appellants for refund were rejected by the customs authorities, and their appeals were dismissed by the Appellate Collector of Customs on the ground that the amended sections 14 and 15 of the Act were applicable to the consignments in question.
The appellants filed revision applications before the Central Government, but they were dismissed by the aforesaid common impugned order dated January 16, 1969.
They have therefore approached this Court for a redress of their grievance.
The facts relating to Civil Appeal No. 2219 of 1969, are quite similar, except that the consignment in that case was of 63 cases of nylon yarn, which were stored in the warehouse on December 14, 1965, and were cleared on May 25, 1967.
In that case also the appellants paid the duty under the provisions of the amended sections under protest, and unsuccessfully applied for refund of the socalled excess duty.
They failed in their appeals to the Appellate Collector of Customs and their application for revision was rejected by the Central Government on March 19, 1969.
It will thus appear that the controversy in these two sets of cases relates to the short question whether the customs authorities were justified in applying the rate of duty (to the imported goods in question) according to the rate prevalent on the date of their actual removal from the warehouse.
It will be recalled that the Customs (Amendment) Ordinance, 1966, was promulgated and came into force on July 7, 1966, and was replaced by the Customs (Amendment) Act, 1966.
The amendments in question were by way of substitution of sections 14 and 15 of the Act by the new sections.
It has been argued by Mr. Chitale for the appellants that the material change was that made in subsection (1) of section 15 of the Act by substituting the words "The rate of duty, rate of exchange" for the words "The rate of duty".
He has therefore argued that the customs authorities were not entitled to take the new "rate of exchange", at the depreciated value of the currency, into consideration in respect of the consignments in question as they had been shipped to Bombay and stored in the warehouse before the amended section 15 came into force.
The learned counsel tried to argue that the orders of assessment of the customs duty were also made before the amendment Ordinance 1145 was promulgated on July 7, 1966, but he did not pursue that line of argument because he was not in a position to produce the so called assessment orders.
But, as we shall show, even if it were assumed that any such order or orders had been made before July 7, 1966, that could not possibly affect the correct rate of duty applicable to the imported goods.
A reference to sections 14 and 15 of the Act will show that while section 14 deals with the valuation of goods for purposes of assessment, it is section 15 which specifies the date for determination of the rate of duty and tariff valuation of imported goods.
The amended section reads as follows, "15(1) The rate of duty, rate of exchange and tariff valuation, if any, applicable to any imported goods, shall be the rate and valuation in force, (a) in the case of goods entered for home consumption under section 46, on the date on which a bill of entry in respect of such goods is presented under that section; (b) in the case of goods cleared from a warehouse under section 68, on the date on which the goods are actually removed from the warehouse; (c) in the case of any other goods, on the date of payment of duty: Provided that if a bill of entry has been presented before the date of entry inwards of the vessel by which the goods are imported, the bill of entry shall be deemed to have been presented on the date of such entry inwards.
(2) The provisions of this section shall not apply to baggage and goods imported by post.
(3) For the purposes of section 14 and this section (a) "rate of exchange" means the rate of exchange determined by the Central Government for the conversion of Indian currency into foreign currency or foreign currency into Indian currency; (b) "foreign currency" and "Indian currency" have the meanings respectively assigned to them in the Foreign Exchange Regulation Act, 1947.
" It is thus the clear requirement of clause (b) of sub section (1) of section 15 of the Act that the rate of duty, rate of exchange and tariff 1146 valuation applicable to any imported goods shall be the rate and valuation in force on the date on which the warehoused goods are actually removed from the warehouse.
A cross reference to section 49 of the Act shows that an importer may apply to the Assistant Collector of Customs for permission to store the imported goods in a warehouse pending their clearance, and he may be permitted to do so.
The other relevant provision is that contained in section 68 of the Act which provides that the importer of any warehoused goods may clear them for "home consumption" if, inter alia, the import duty leviable on them has been paid.
That is why clause (b) of sub section (1) of section 15 of the Act makes a reference to section 68.
It is therefore quite clear that the rate of duty, rate of exchange and tariff valuation shall be those in force on the date of actual removal of the warehoused goods from the warehouse.
As it is not in dispute before us that the goods, which are the subject matter of the appeals before us, were removed from the warehouse after the amending Ordinance had come into force on July 7, 1966, the customs authorities and the Central Government were quite right in taking the view that the rate of duty applicable to the imported goods had to be determined according to the law which was prevalent on the date they were actually removed from the warehouse, namely, the amended sections 14 and 15 of the Act.
There is therefore no force in the argument that the requirement of the amended section 15 should have been ignored simply because the goods were imported before it came into force, or that their bills of lading or bills of entry were lodged before that date.
As we find no force in these appeals, they are dismissed with costs.
N.V.K. Appeals dismissed.
| IN-Abs | As a result of devaluation of Indian Currency in June, 1966, Ss. 14 & 15 of the were amended by the Customs (Amendment) Ordinance, 1966 which was later replaced by an Act with effect from July 7, 1966.
Section 15(1) provides that the rate of duty, rate of exchange and tariff valuation applicable to any imported goods shall be the rate and valuation in force. . (b) in the case of goods cleared from a warehouse under section 68, on the date on which the goods were actually removed from the warehouse.
The appellant stored on December 22, 1965 in the Customs warehouse, goods imported by him under a licence, and cleared them on various dates between September 1, 1966 and February 20, 1967.
Under protest, they paid customs duty at the enhanced rates in accordance with the amended provisions.
Later, they claimed rebate alleging that since the consignments had been received, stored and assessed to duty much before the promulgation of the Ordinance, they were liable to pay duty at the rate prevailing on the date of ware housing.
Their appeals and revision were unsuccessful.
In appeal to this Court it was contended that the material change in section 15 being only the substitution of the words "the rate of duty, rate of exchange" for the words "the rate of duty" the customs authorities were not entitled to take into account the new rate of exchange at the appreciated value of currency in respect of the consignments stored in the warehouse prior to the coming into force of the Ordinance.
Dismissing the appeal, ^ HELD: The customs authorities were right in taking the view that the rate of duty applicable to the imported goods should be determined according to the law prevalent on the date they were actually removed from the warehouse.
Section 15(1)(b) clearly requires that the rate of duty, rate of exchange and tariff valuation applicable to any imported goods shall be the rate and valuation in force on the date on which goods are actually removed from the warehouse.
Under section 49 an importer may apply to the Assistant Collector of Customs for permission to store the imported goods in a warehouse pending their clearance and he may be permitted to do so; and section 68 provides that an importer of any warehoused goods may clear them if the import duty leviable on them has been paid.
That is why clause (b) of sub section (1) of section 15 makes a reference to section 68.
[1146D, 1145H 1146C] 1143 In the instant case the goods were removed from the warehouse after the Ordinance came into force on July 7, 1966.
[1146D]
|
Civil Appeal No. 2008 of 1969.
From the Judgment and Order dated 7 4 1965 of the Rajasthan High Court in D. B. Civil Regular Appeal No. 67/53.
section M. Jain for the Appellant.
B. D. Sharma, Ramesh Chandra and B. P. Maheshwari for the Respondent.
The Judgment of the Court was delivered by CHINNAPPA REDDY, J.
The State of Rajasthan, defendant in Civil Suit No. 9 of 1963 in the Court of the Senior Civil Judge, Udaipur, is the appellant in this appeal filed pursuant to a certificate granted under Article 133(1) (a) of the Constitution of India (as it stood prior to the 30th amendment).
The plaintiff respondent took a building work on contract from the erstwhile Government of the State of Udaipur.
He completed the work on 6th June, 1950.
Despite demands and notices issued by the plaintiff a considerable amount due to him remained unpaid.
He, therefore, filed the suit out of which the appeal arises to recover a sum of Rs. 3,19,458/11/ together with interest at the rate of 12%.
The suit was contested by the State of Rajasthan.
An interim decree for a sum of Rs. 66,517/ was passed on 7th November, 1955.
After full trial a decree for Rs. 1,67,619/ (including the sum of Rs. 66,517/ for which a preliminary decree had already been passed) was passed on 11 6 1958/30 6 1958.
The decree also awarded interest at the rate of 4 1/2% on the amount decreed from the date of suit till the date of realisation.
The plaintiff and the defendant preferred appeals to the High Court of Rajasthan.
The High Court reduced the decreetal amount by a sum of Rs. 9,991/ .
The High Court, however, held that the plaintiff was entitled to interest from 1st January, 1951, and not merely from the date of suit.
The High Court also enhanced the rate of interest pendente lite from 4 1/2 to 6%.
The High Court having varied the decree of the Trial Court, the State of Rajasthan 8 sought and obtained a certificate under Article 133(1)(a) of the Constitution and has filed this appeal.
The controversy in the High Court related primarily to (i) conveyance and lift charges; (ii) alleged double benefit in regard to bond stones, lintels and sills; (iii) use of Jodhpur slabs and their high cost; (iv) charge for C. P. Teak wood at the same rates as for Burma Teak.
In regard to conveyance and lift charges the High Court pointed out that no question was raised in the Memorandum of grounds of appeal and there was, therefore, no justification for permitting the learned Counsel for the State to assail the finding of the Trial Court relating to those charges.
We do not see any reason either why the learned Counsel should be permitted to agitate this question in this appeal.
Regarding double charge for bond stone, lintels and sills, the complaint of the appellant was that while separate payment was being made for them, they had also been included in the measurements of the walls in which they happened to be fixed.
From the office circular issued by the Chief Engineer of the Public Works Department of the United State of Rajasthan on 12th July, 1948, it appears that it was the practice uptill then to allow payment for bond stones, lintels and sills separately without deducting their cubic contents from the general wall masonry.
This had always been the practice and this was never objected to by the Accountant General.
In view of the practice obtaining till then it could not be said that the contractor had wrongfully claimed double payment for bond stones, lintels and sills.
The use of Jodhpur slabs was not questioned in the written statement.
All that was said was that the rate was high but at the trial there was no evidence worth the name, as observed by the High Court to show that the charge was excessive.
Again there was no objection to the use of C.P.Teak wood instead of Burma teak wood as the latter was not available.
According to the letter of the Superintending Engineer dated 6th February, 1950, where Burma teak wood was not available and C. P. Teak wood was used, the rates specified for Burma teak wood should be taken for C.P. Teak wood.
It could not, therefore, be said that the contractor had charged more than what he should for C.P. Teak wood.
The last question which was argued before us by Shri Jain, learned Counsel for the State of Rajasthan was that no interest should have been awarded for the period before the filing of the suit and that the rate of interest should not have been enhanced by the High Court for the period subsequent to the filing of the suit.
It was 9 submitted that the Interest Act, 1839, was not applicable as no sum A certain was payable and there was no demand for payment of interest.
It was argued that what was demanded by the plaintiff was damages and not interest.
It was also contended that the Trial Court having, in exercise of its discretion, awarded interest at the rate of 4 1/2 % pendente lite, the High Court ought not to have interfered with the discretion of the Trial Court.
Reliance was placed upon the decision in Mahabir Prasad Rungta vs Durga Datt(1) and Union of India vs A. L. Rallia Ram(2).
We are unable to agree with the submission of the learned Counsel for the appellant.
Under the Interest Act, 1839, "upon all debts or sums certain payable at a certain time or otherwise, the Court before which such debts or sums may be recovered may, if it shall think fit, allow interest to the creditor at a rate not exceeding the current rate of interest from the time when such debts or sums certain were payable, if such debts or sums be payable by virtue of some written instrument at a certain time; or if payable otherwise, then D from the time when demand of payment shall have been made in writing, so as such demand shall give notice to the debtor that interest will be claimed from the date of such demand until the term of payment: provided that interest shall be payable in all cases in which it is now payable by law".
The claim of the present plaintiff was not for the payment of any unliquidated damages or for the payment of any amount arising out of an inchoate or contingent obligation.
It was for the payment of a sum which was ascertainable on a calculation made in accordance with the terms of the agreement.
It was clearly a "sum certain" within the meaning of the Interest Act.
In any case it would be a debt, i.e., "a sum of money which is now payable or will become payable in the future by reason of a present obligation".
The further question for consideration is whether the plaintiff had made a demand of payment, "so as such demand shall give notice that interest will be claimed from the date of such demand until the term of payment".
The plaintiff issued two notices to the defendant demanding payment.
The first was on 21st December, 1950, and the second was on 5th April, 1953.
There is no dispute that in the second notice of demand of payment of definite claim for interest had been made.
In the first notice it was said "by with holding payment of his bills absolutely, the Government has put my client to enormous loss by way of interest also .
I intimate to you (1)[1961] 3 S.C.R. 639.
(2)[1964] 3 S.C.R. 164.
2 196SCI/79 10 through this notice that the said Shri Ramsingh claims a sum of Rs. 2,50,519/ from the Rajasthan State as under: 1.
Unpaid bills for work done: Rs. 1,37,177/ 2.
lnterest on the above.
11,511/ 3. . . . 4. . . 5. . . . 6. . .
Total: Rs. 2,50,519/ The learned counsel submitted that what was claimed by the plaintiff in this notice was damages and not interest and that too for the past, without any indication that future interest was also being claimed.
It is true that the plaintiff mentioned "loss by way of interest", suggesting that what he was claiming was compensation for the damage suffered by him.
We are, however, not prepared to construe the notice so literally or technically.
The mention of loss was only explanatory.
The plaintiff was, without any manner of doubt claiming interest as such.
Nor are we impressed with the argument that there was no claim for future interest.
In our opinion a claim for past interest would necessarily imply a claim for future interest, vide Kuppuswami Pillai vs Madras Electric Tramway Co. Ltd.(1) and Sita Ram & Ors.
vs Mrs. section Sullivan(2).
In Mahabir Prasad Rungta vs Durga Datt(3) interest was disallow ed on the ground that the notice which was given did not specify the sum which was demanded and therefore, the Interest Act did not apply.
On the question whether interest could be awarded on grounds of equity it was held that what was claimed by Durga Datt was interest as damages and that it could not, therefore, be awarded.
The suit itself was one for damages for breach of contract.
We do not think that this case is of any assistance to the appellant.
In Union of India vs A. L. Rallia Ram, (supra) the Arbitrator had awarded interest by way of compensation since the party had to borrow a large amount of money from its banker to meet its obligation under the contract.
The Supreme Court pointed out that interest could not be awarded by way of damages.
The Supreme Court also noticed that an Arbitrator was not a Court within the meaning of the Interest Act.
No question arose before the Supreme Court whether interest could not be awarded under the Interest Act merely because the notice demanding payment (1) I.L.R. (2) (3) ; 11 mentioned that the plaintiff had suffered loss of interest also.
In our view the condition prescribed by the Interest Act that such demand shall give notice to the debtor that interest shall be claimed is fulfilled if interest is claimed, notwithstanding the fact that the notice of demand explains that loss by way of loss of interest has been suffered.
Ta take any other view would be to be over technical in the construction of pleadings, including notices preceeding the action.
We must notice here an argument advanced by the learned counsel for the appellant that the contract prohibited the award of interest.
He relied upon the following sentence occurring in paragraph 16 of the Contract dated 11th May, 1947: "Neither the earnest money deposit nor the with held amount shall bear any interest".
This sentence far from supporting the case of the appellant appears to support the case of the plaintiff.
The reference to "the with held amounts" is to the amounts represening five per cent of the running bills which are required to be with held at the time of payment of the running bills.
The provision that the contractor is not entitled to interest on these with held amounts appears to imply that interest is claimable on other amounts due to the contractor.
While awarding interest pendente lite the Trial Court adopted the rate of 4 ' % but the Trial Court gave no reasons for so doing.
The High Court considered the matter in some detail and having regard to the various continuous defaults committed by the defendant and its Officers, the High Court enhanced the rate of interest to 6%.
The High Court was justified in doing sol and we see no reason to interfere with the discretion exercised by the High Court.
In the result the appeal is dismissed with costs.
N.V.K. Appeal dismissed.
| IN-Abs | The Interest Act, 1839 (32 of 1839) empowers the Court to allow interest to the plaintiff if the amount claimed is a sum certain which is payable at a certain time by virtue of a written instrument at la rate not exceeding the current rate of interest from the time when such amounts were payable and if the amount is payable otherwise, then from the time when the demand of payment shall have been made in writing.
As the amounts due in respect of a building works contract remained unpaid despite demands and notices, the respondent (plaintiff) filed a suit for its recovery together with interest.
Decreeing the suit, the trial court award ed interest at 4 1/2 per cent.
But in appeal, the High Court enhanced the rate of interest pendente life from 4 1/2 per cent to 6 per cent.
In the further appeal to this Court it was contended that the Interest Act 1839, was not applicable as no sum certain was payable and there was no demand for payment of interest.
Dismissing the appeal, ^ HELD: 1.
The claim was for a "sum certain" within the meaning of the Act.
[9F] The claim was ascertainable on a calculation made in terms of the agreement and was therefore a sum certain within the meaning of the Act.
It is "a sum of money which is now playable or will become payable in the future by reason of a present obligation" and in any case it was not for the payment of any unliquidated damages or for the payment of any amount arising out of an inchoate obligation.
[9E F] 2.
The respondent issued two notices.
In the second notice a definite claim of interest had been made by them.
The term "loss by way of interest" mentioned in the first notice suggested that what was being claimed was compensation for the damages suffered by them.
The notice should not be construed literally or technically.
The mention of loss was only explanatory.
Without any manner of doubt the respondents were claiming interest as such.
[9G 10D] 3.
Nor again can it be said that there was no claim for future interest.
A claim for past interest would necessarily imply a claim for future interest.
[10E] 7 Kuppusami Pillai vs Madras Electric Tramway Co. Ltd., ILR ; Sita Ram & Ors.
vs Mrs. section Sullivan, [1901] 2 Punjab Law Reporter 464; referred to.
Mahabir Prashad Rungta vs Durga Datt, ; and Union of India vs A. L. Rallia Ram, ; ; distinguished.
Having regard to the various continuous defaults committed by the appellant and its officers the High court was justified in enhancing the rate of interest to 6 per cent.
|
ION: Civil Appeal No. 860 of 1978.
From the Judgment and Order dated 28 2 1978 of the Monopolies and Restrictive Trade Practices Commission in R.T.P. Enquiry No. 91 of 1975.
Ashok H. Desai, B.H. Wani, Ravinder Narain, Talat Ansari, A.N. Haksar and Shri Narain for the Appellant.
Soli J. Sorabjee, Addl.
Genl., R.B. Datar and Girish Chandra for Respondent No. 2.
The judgment of the Court was delivered by BHAGWATI, J.
This appeal under section 55 of the (hereinafter referred to as the Act) raises interesting questions of law relating to the interpretation and application of certain provisions of the Act.
The facts giving rise to the appeal are for the most part undisputed and they may be briefly stated as follows: The appellant is a public limited company engaged in manufacture and sale of jeep motor vehicles and their Spare parts and accessories.
Since 1947 the appellant was marketing and distri 1046 buting jeep motor vehicles and it had set up a large and complex net work of dealers, who were described as distributors, for marketing and after sale service of such vehicles.
In or about 1956 the appellant started manufacturing its own jeep motor vehicles and since then it has been manufacturing such vehicles and distributing and marketing the same through its net work of distributors.
The appellant has appointed these distributors for marketing and sale of jeep motor vehicles on certain terms and conditions contained in a standard distributorship agreement.
The material clauses of this agreement read as follows: "Section (3): TERRITORY OF DISTRIBUTOR: ` The Company grants to Distributor the non exclusive privilege (except as hereinafter provided) of selling at re tail and the right (except hereinafter provided) to appoint in writing by forms of agreements approved by the Company, Dealers to sell at retail the products enumerated in Section 2 of this agreement, within the following territory and also demarcated in the map attached hereto and which forms a part of this agreement.
Distributor accepts the above retail setting privileges and agrees to develop with diligence the sales of sale products in said territory in accordance with this agreement and undertakes to achieve the quantum of sales in the territory as may be fixed by the Company from time to time.
Section (4): LIMITATIONS ON TERRITORIAL RIGHTS: (i) Distributor agrees not to solicit outside of the territory described in Section 3 the purchase of any products.
* * * * Section (6): PRICE AND PAYMENT : Distributor will pay for products the Company 's established Distributor net prices in effect on date on despatch.
Price lists will be furnished to Distributor by the Company, but the Company reserves the right to change prices at any time without notice.
* * * * Section (11): PRICE CHANGES : If the Company reduces its published suggested retail list price, for any current model of 'Jeep ' motor vehicles, the company will 1047 make an allowance to Distributor as hereinafter provided.
The allowance shall be made in respect of new and unused 'Jeep ' Motor Vehicles of the then current model in respect of which the price change has been made which `have been purchased by Distributor from the Company within a period of 30 (thirty) days prior to the effective date of such decrease in suggested list price, and which distributor shall have in his unsold stock on such effective date.
The allowance shall be equal to the difference between the net amount paid to the Company for such 'Jeep ' Motor Vehicle (less all allowance thereto granted), and the net amount which would have been paid had such 'Jeep ' motor vehicles been purchased at the reduced price.
No allowance, how ever, shall be made unless there is a reduction in the RETAIL list price and increases in discounts, bonuses and the like shall in no event be considered as a reduction in price.
* * * * Section (17): CARE OF OWNER AND CUSTOMER RELATIONS : Distributor agrees * * * * (a) To refrain from selling or offering for sale any competing product.
The Company shall be the sole judge as to whether a product is competing or not" The appellant by its letter dated 27th January, 1971 submitted to the Registrar of Restrictive Trade Agreement (hereinafter referred to as the Registrar) certified copies of agreements entered into by the appellant with the Distributors for registration, since in the opinion of the appellant, they were registrable under the provisions of Ch.
V of the Act.
The appellant also submitted to the Registrar along with its letter dated 19th May, 1972 four copies of the standard distributorship agreement for registration in terms of cl.
(ii) of Rule 12 of the Monopolies Restrictive Trade Practices Rules, 1970 (hereinafter referred to as the Rules) and the standard distributorship agreement was registered by the Registrar under section 35 of the Act.
On 17th December, 1975 the Registrar made an application to 11 the Monopolies and Restrictive Trade Practices Commission (hereinafter referred to as the Commission) under section 10(a) (iii) of 1048 the Act pointing out to the Commission that the standard distributorship agreement entered into by the appellant with the distributors was filed by the appellant for registration in the office of the Registrar and the same had been duly registered under section 35 of the Act.
The Registrar drew the attention of the Commission to clauses (3), (4), (5), (6), (11), (13), (14), (17) and (20) of the standard distributorship agreement and claimed that the provisions contained in these clauses related "to restrictive trade practices relating to imposing restrictions on persons and classes of persons to whom goods are sold and from whom goods are bought tie up sales/full line forcing; exclusive dealing; granting or allowing concessions; discounts, over riding commission, etc.
in connection with or by reason of dealings; resale price maintenance; and allocation of area/market for disposal of products covered under the agreement, respectively attracting clauses (a), (b), (c), (e), (f) and (g) of section 33(1) and/or section 2(o) of the Act" and that these restrictive trade practices had and might have the effect of preventing, distorting and restricting competition and tended to bring about monopolisation of prices and conditions of delivery and to affect the flow of supplies in the market relating to goods covered under the standard distributorship agreement in such manner as to impose on the consumers unjustified costs and restrictions and the same were prejudicial to public interest.
The Registrar prayed on the basis of these allegations that the Commission be pleased to inquire into the restrictive trade practices indulged in by the appellant, under section 37 of the Act and pass such orders as it might deem fit and proper.
The Commission, on receipt of this application, decided, in exercise of the powers conferred upon it under sections 10(a) and 37 of the Act, to hold inquiry into the restrictive trade practices complained of by the Registrar and issued notice dated 2nd January, 1976 under Regulation 53 of the Monopolies and Restrictive Trade Practices Commission Regulations, 1974 (hereinafter referred to as the Regulations) to the appellant that if the appellant wished to be heard in the proceedings before the Commission, it should comply with the requirements of Regulations 65 and 67 failing which the Commission would proceed with the inquiry in the absence of respondent.
The appellant, by its letter dated 3rd February, 1976, acknowledged receipt of the notice and intimated to the Commission that it did not wish to be heard in the proceedings before the Commission but put forward its submissions in regard to the restrictive trade practices alleged by the Registrar in his application.
The appellant pointed out that the clauses of the standard distributionship agreement complained of by the Registrar did not constitute restrictive trade practices for the reasons explained in the letter 1049 and requested the Deputy Secretary to place their submissions before the Commission at the enquiry to be held by it.
The letter was purported to be submitted in terms of Regulations 36(3), but the reference to this Regulation was obviously under some misapprehension because this Regulation occurred in Chapter V which provided the procedure for reference under Chapter III and IV and it had no application in case of an inquiry under section 37 of the Act.
The Joint Secretary (Legal) of the Commission pointed out to the appellant by his letter dated 11th February, 1976 that if the appellant wished to be heard in the proceedings, the appellant should comply with the requirements of Regulations 65 and 67 and it is only if the appellant did so, that it could file a reply in answer to the application of the Registrar and moreover, the reply had to be properly drawn and duly verified and declared as provided in those Regulations.
The Joint Secretary.
(Legal) made it clear that in view of this legal position obtaining under Regulations 65 and 67, it was not possible to take note of contents of the letter addressed by the appellant setting out the explanation for the various clauses impugned in the application of the Registrar.
Though this position, in law was specifically pointed out by the Joint Secretary (Legal) on behalf of the Commission, the appellant did not comply with the procedure set out in Regulations 65 and 67 with the result that the Commission decided to proceed exparte against the appellant.
The Registrar filed an affidavit of the Assistant Registrar dated 10th May, 1976 in support of the allegations contained in the application but this affidavit surprisingly did not contain any further or other material than that set out in the application.
No other evidence, oral or documentary, was produced by the Registrar and the Commission proceeded to decide the issues arising in the enquiry on the basis of the application supported by the affidavit of the Assistant Registrar.
The Commission, after going through the application and the affidavit of the Assistant Registrar and hearing the Registrar, made an order dated 14th May, 1976, the operative part of which was in the following terms: "(1) The Respondent is hereby restrained and prohibited by any agreement with any distributor to restrict by any method the persons or classes or persons to whom the goods are sold whether such person be retail purchaser or a dealer.
(2) The Respondent is hereby restrained and prohibited from restricting in any manner, any purchaser whether a dealer or otherwise in the course of its trade from acquir 1050 ing or otherwise dealing in any goods other than those of the Respondent or the goods of any other person.
(3) The Respondent is hereby restrained and prohibited from selling any goods to any distributor, dealer or other wise on the condition that the prices to be charged on resale by the purchaser shall be the prices stipulated by the respondent unless it is clearly stated that prices lower than those prices may be charged.
The Respondent is hereby directed that in all future price lists it must state on the cover or on the front page that the prices if any indicated therein as resale prices are maximum prices and that the prices lower than those price may be charged.
(4) The Respondent is hereby restrained and prohibited from allocating any area or market to any distributor or dealer for the disposal of the Respondent 's goods.
(5) The Respondent is hereby restrained and prohibited from preventing any distributor from appointing any dealer of its own choice on such terms and conditions as may be mutually agreed upon between distributors and dealers in cases where the Respondent does not undertake any obligation, liability or responsibility in respect of the dealers.
(6) The clauses in the agreements relating to the above restrictive trade practices are hereby declared to be void.
The practices arising therefore, shall be discontinued and shall not be repeated.
(7) The Respondent shall within 3 months from the date of service of this order on it make and file an affidavit before the Commission setting out the manner in which this order has been given effect to.
A copy of the said affidavit shall simultaneously be furnished to the Registrar.
(8) There will be no order as to costs." Since the appellant was required to file an affidavit of compliance within three months as directed by cl.
(7) of the Order, the appellant filed an affidavit dated 10th September, 1976 stating that the appellant had fully implemented in practice the directions contained in Paragraphs (1) and (5) of the Order and refrained from enforcing against the distributors any of the clauses which had been declared void by the Commission.
The appellant also pointed out that a draft of a 1051 new distributorship agreement was being finalised by the appellant with a view to giving effect to the "restrictions and prohibitions" contained in the Order.
The Registrar filed an affidavit of the Deputy Registrar dated 27th September, 1976 seeking particulars from the appellant showing how the appellant had implemented the directions contained in the Order.
The appellant by its reply dated 11th November, 1976 pointed out that since the date of receipt of the Order, the appellant had not given effect to the trade practices covered by paragraphs (1) to (5) of the Order nor required any of the distributors to abide by the clauses of the standard distributorship agreement relating to those trade practices and on the contrary, intimated to the distributors that the old distributorship agreement would have to be substituted by a new revised agreement.
The appellant submitted that since the clauses of the standard distributorship agreement declared void by the Commission were not enforceable in law by the appellant, it did not make any difference whether or not they were deleted from the existing distributorship agreement and in view of the fact that a new revised agreement was being prepared which would comply with the directions contained in the Order, it was not necessary, to effect any amendments in the existing distributorship agreement.
It seems that there was a hearing before the Commission on this issue as regards compliance with the directions contained in the Order and the draft of the revised distributorship agreement prepared by the appellant was considered and pursuant to the suggestion made by the Commission, the appellant agreed to amend two clauses in the draft and the Commission by its Order dated 7th December, 1976 directed that the revised distributorship agreement should be filed by the appellant by 31st March, 1977.
Now, it appears that subsequent to the Order of the Commission dated 7th December, 1976 an important decision was given by this Court in Tata Engineering & Locomotive Co. Ltd., Bombay vs The Registrar of the Restrictive Trade Agreement, New Delhi( ') relating to the interpretation of some of the relevant provisions of the Act bearing on restrictive trade practices.
This decision was given in all appeal preferred by Tata Engineering Locomotive Co. Ltd. (herein after referred to as the Telco against an order made by the Commission in an enquiry under section 37 and it reversed the view taken by the Commission in several important respects.
Though this decision was given on 21st January, 1977, it was not fully reported until March 1977 and on reading it, the appellant felt that the order of the Commission dated 14th May, 1976 required reconsideration, as it was 1052 contrary to the law laid down in this decision.
The appellant accordingly made an application to the Commission on 31st March.
1977 where, besides asking for extension of time for filing a copy of the revised distributorship agreement on the ground that the dealers were spread out all over India and it would take considerable time for execution of the revised distributorship agreement by them, the appellant pointed out that it had not contested the enquiry proceedings under section 37 in the first instance because the decision given by the Commission in the Telco case was directly applicable, but since that decision of the Commission was reversed by this Court in appeal, the appellant was advised to move a suitable application for amendment and/or modification of the Order dated 14th May, 1976 and that was also an additional reason why the time for filing the revised distributorship agreement should be extended, so that the revised distributorship agreement could be in accordance with the directions, if any.
which might be given by the Commission on the proposed application.
The Commission acceded to the request contained in this application and extended the time for filing the revised distributorship agreement upto 4th June, 1977.
The appellant thereafter made an application dated 30th May, 1977 under section 13(2) of the Act read with Regulation 85 for revocation, amendment or modification of the Order of the Commission dated 14th May, 1976.
The appellant set out in this application various facts and features relating to its trade of manufacture and sale of Jeep motor vehicles and their spare parts and accessories and enumerated a number of grounds on which the order of the Commission dated 14th May, 1976 deserved to be revised, revoked, amended or otherwise modified.
The application was opposed by the Registrar by filing a reply dated.
17th August, 1977.
The parties were thereafter heard by the Commission on 26th August, 1977 and pursuant to the directions given by the Commission.
affidavits of documents were filed and evidence was recorded on both sides.
It appears that in the course of the evidence the appellant came to know that in November 1977 Hindustan Motors Ltd. had introduced in the 6 market diesel trekker which was clearly a competing vehicle and the appellant thereupon applied to the Commission on 30th January.
1978 for amendment of the application by adding a plea that the fact that since November 1977 Hindustan Motor Ltd. had started manufacturing and selling diesel trekker which was a highly competitive product was another material change in the relevant circumstances which justified the revocation, amendment or modification of the Order dated 14th May, 1976.
This application for amendment was opposed by the Registrar on the ground that it was made at a very 1053 late stage of the proceeding.
The Commission did not pass any order on this application for amendment and kept it pending and proceeded to dispose of the main application by an Order dated 28th February, 1978 by which it rejected the main application with costs and added a short order On the same day stating that in view of the order on the main application, there would be no order on the application for amendment.
The appellant thereupon preferred the present appeal in this Court under section 55 challenging the validity of the order made by the Commission rejecting the application of the appellant.
Before we set out the rival contentions of the parties in the appeal, it would be convenient at this state to refer to the relevant provisions of the Act and the Regulations.
Section 2 is the definition section and clause (u) of this section defines 'trade practice ' to mean "any practice relating to the carrying on of any trade, and includes (i) anything done by any person which controls or affects the price charged by, or the method of trading of, any trader or any class of traders (ii) a single or isolated action of any person in relation to any trade". 'Restrictive trade practice ' is defiled in section 2, clause (o) to mean "a grade practice which has, or may have, the effect of preventing distorting or restricting, competition in any manner and in particular, (i) which tends to obstruct the flow of capital or resources into the stream of production, or (ii) which tends to bring about manipulation of prices, or conditions of delivery or to affect the flow of supplies in.
the market relating to goods or services in such manner as to impose on the consumers unjustified costs or restrictions.
" Section 5, subsection (1) provides for the establishment of the Commission which is to consist of a Chairman and not less than two and not more than eight other members to be appointed by the Central Government and sub section (2) of section 5 lays down that the Chairman shall be a person who is or has been or is qualified to be a judge of the Supreme Court or of a High Court.
It is obvious from these two sub sections of section 5 that the Legislature clearly contemplated that the Commission must have a Chairman who would provide the judicial element and there must be at least two other members who would provide expertise in subjects like economics, law, commerce.
accountancy, industry, public affairs or administration.
so that there could be a really high powered expert commission competent and adequate to deal with the various problems which come before it.
It, however, appears that the Central Government paid scant regard to this` legislative requirement and though the office of Chairman fell vacant as far back as 9th August, 1976, it failed to make appointment of Chairman until 1054 24th February, 1978.
Of the two other members of the Commission one had already resigned earlier and his vacancy was also not filled with the result that the Commission continued with only one member for a period of about 18 months.
This was a most unfortunate state of affairs, for it betrayed total lack of concern for the proper constitution and functioning of the Commission and complete neglect of its statutory obligation by the Central Government.
We fail to see any reason why the Central Government could not make the necessary appointments and properly constitute the Commission in accordance with the requirements of the Act.
It is difficult to believe that legal and judicial talent in the country had become so impoverished that the Central Government could not find a suitable person to fill the vacancy of Chairman for a year and a half.
Moreover it must be remembered that the appointments, after all, have to be made from whatever legal and judicial talent is available and the situation is not going to improve by waiting for a year or two: a new star is not going to appear in the legal firmament within such a short time and the appointments cannot be held up indefinitely.
Indeed, it is highly undesirable that important quasi judicial or administrative posts should remain vacant for long periods of time, because apart from impairing the efficiency of the functioning of the statutory authority of the administration.
inexplicable delay may shake the confidence of the public in the integrity of the appointments when made.
Turning back to the provisions of the Act, we find that section 10(a) (iii) empowers the Commission to inquire into any restrictive trade practice upon an application made to it by the Registrar.
The powers of the Commission while holding an enquiry under the Act are enumerated in section 12 and section 13, sub section (2) provides that "any order made by the Commission may be amended or revoked at any time in the manner in which it was made".
Then follow sections 14 to 19 which deal inter alia with the procedure to be followed by the Commission.
We are not concerned with Sections 20 to 32 which occur in Chapters III and IV because they deal with topics other than restrictive trade practices.
Chapter V relates to registration of agreements relating to restrictive trade practices and it consists of sections 33 to 36 of which only sections 33 and 35 are material.
Sub section (1) of section 33 provides that any agreement relating to a restrictive trade practice falling within one or more of the categories specified there shall be subject to registration in accordance with the provisions of Ch.
V and proceeds to enumerate the categories of restrictive trade practices covered by that provision and section 35 lays down the time within which an agreement falling within section 33, sub section (1) shall be registered and the procedure to be followed for effectuating such registration.
Sections 37 1055 and 38 are the next important sections and they occur in Ch.
V headed A "control of certain restrictive trade practices".
Sub section (1) of section 37 provides that "the Commission may inquire into any restrictive trade practice, whether the agreement, if any, relating thereto has been registered under section 35 or not, which may come before it for inquiry and, if after such inquiry it is of opinion that the practice is prejudicial to the public interest, the Commission may, by order, direct that (a) the practice shall be discontinued or shall not be repeated, (b) the agreement relating there to shall be void in respect of such restrictive trade practice or shall stand modified in respect thereof in such manner as may be specified in the order".
Section 38, sub section (1) enacts that for the purposes of any proceedings before the Commission under section 37, a restrictive trade practice shall be deemed to be prejudicial to the public interest unless the Commission is satisfied of any one or more of the circumstances set out in that subsection and is further satisfied, after balancing the competing considerations, that the restriction is not unreasonable.
These circumstances specified in sub section (1) of section 38 render a trade practice permissible even though it is restrictive and provide what have been picturesquely described in the English law as "gateways" out of the prohibition of restrictive trade practices.
Section 55 is the next relevant section and it provides that any person aggrieved by any order made by the Central Government under Ch.
III or Ch.
IV or as the case may be, of the Commission under section 13 or section 37 may, within 60 days from the date of the order, prefer an appeal to the Supreme Court on "one or more of the grounds specified in section 100 of the Code of Civil Procedure 1908".
This is the section under which the present appeal has been preferred by the appellant.
The last section to which we must refer is section 66 which confers power on the Commission to make Regulations for the efficient performance of its functions under the Act.
The Commission has, in exercise of the power conferred by this section, made the Regulations of which three arc material.
namely, Regulations 65, 67 and 85.
These Regulations, in so far as material, read as follows "Section 65: APPEARANCE OF PARTIES : Every respondent who wishes to be heard in the proceedings shall within 14 days of the service upon him of the copy of the notice of enquiry, enter an appearance in the office of the Commission by delivering to the Secretary six copies of a memorandum stating that the respondent wishes to be heard in the proceedings and containing the name of his advocate having an office in Delhi or New Delhi and duly authorised to accept service of processes and the Secretary 1056 shall send one copy of the memorandum to the Registrar in case where proceedings are initiated under sub clause (iii) of clause (a) of section 10, and in all other cases to the Director of Investigation." "Section 67: REPLY TO THE NOTICE: Every respondent who has entered an appearance shall within four weeks of his entering appearance deliver to the Secretary a reply to the notice (5 copies) which shall include: (a) particulars of each of the provisions of section 38 of Act on which he intends to rely; and (b) particulars of the facts and matters alleged by him to entitle him to rely on such provisions." "Section 85: AMENDMENT OR REVOCATION OF ORDER ETC.: An application under sub section (2) of section 13 of the Act for amendment or revocation of any order made by the Commission in any proceedings shall be supported by evidence on affidavit of the material change in the relevant circumstances or any other fact or circumstances on which the applicant relies.
Unless the Commission otherwise directs notice of the application together with copies of the affidavits in support thereof, shall be served on every party who appeared at the hearing of the previous proceedings and every such party shall be entitled to be heard on the application and the provisions of section 114 and Order XLVII of the Code of Civil Procedure, '908 (5 of 1908), shall as far as may, be applied to these proceedings.
" It is against the background of these provisions of the Act and the Regulations that we have to determine the question arising for consideration in the appeal.
The contention of the appellant in support of the appeal was that the Order dated 14th May, 1976 suffered from various infirmities and was liable to be revoked or in any event modified under section 13(2) of the Act.
It was said that the application of the Registrar on which the Order dated 14th May, 1976 was made did not set out any facts or features showing how the trade practices referred to in the application were restrictive of competition so as to constitute restrictive trade practices and merely contained a bald recital of the impugned clause and mechanical reproduction of the language of the relevant 1057 sections without anything more.
The application of the Registrar was thus not in accordance with the law laid down in the decision of this Court in the Telco case and no order could be made upon it by the Commission.
It was also urged that there was no material placed before the Commission by the Registrar on the basis of which the Commission could possibly come to the conclusion that the trade practices referred to in the application were restrictive trade practices.
Even if the Commission was justified in proceeding exparte against the appellant, the highest that could be assumed in favour of the Registrar was that the facts set out in the application and the supporting affidavit of the Assistant Registrar would be deemed to be admitted, but, apart from the impugned clauses, no other facts were set out either in the application or in the affidavit of the Assistant Registrar and there was accordingly no evidence on which the order dated 14th May, 1976 could be made by the Commission.
It was also contended that the Order dated 14th May, 1976 did not set out any facts peculiar to the trade of the appellant or the conditions before and after the imposition of the restraint or the actual or probable effect of the restraint nor did it indicate as to how the trade practices referred to in the impugned clauses constituted restrictive trade practices; it was a non speaking order which did not give any reasons at all for holding that the trade practices complained of were restrictive trade practices and hence it was vitiated by a legal infirmity.
The appellant further urged that the Order dated 14th May, 1976 was a continuing order as it required the appellant not merely to cease but also to desist from the restrictive trade practices set out in the order and it was, therefore, required to be continually justifiable and since the facts and features of the trade set out in the application of the appellant clearly established that the trade practices referred to in the impugned clauses did not constitute restrictive trade practices, the Order dated 14th May, 1976 was not justified and in any event could not be continued and it was accordingly liable to be revoked or amended under section 13(2).
It was submitted that in any event the Order dated 14th May, l 976 was contrary to the law declared by this Court in the Telco case and since the decision in the Telco case was a fact or circumstance subsequent to the making of the Order, it justified the invocation of the power under section 13(2) for revoking or modifying the Order.
Lastly, it was contended that in any view of the matter there was a material change in the relevant circumstances subsequent to the making of the Order dated 14th May, 1976 in that Hindustan Motor Ltd. started manufacturing and marketing competing utility vehicles since June 1976 and this was sufficient to warrant reconsideration of the Order under section 13 (2) .
The respondents raised a preliminary 1058 objection against the maintainability of the appeal on the ground that under section 55 read with the newly substituted section 100 of the Code of Civil Procedure, 1908, an appeal could lie to this Court only on a substantial question of law and since the contentions raised on behalf of the appellant did not raise any substantial question of law, the appeal was not maintainable.
The respondents also urged that on a proper construction of section 13(2) read with Regulation 85, the Commission could revoke or amend the Order dated 14th May, 1976 only if there was a material change in the relevant circumstances since the making of the Order or any of the grounds specified in Order XLVlI rule 1 of the Code of Civil Procedure, 1908 was available to the appellant.
The second and third grounds specified in Order XLVII, rule 1 obviously did not exist in the present case and the claim of the appellant for exercise of the power under section 13(2) could, if at all, rest only on the first ground, namely error of law apparent on the face of the record.
But, said the respondents, there was no error of law apparent on the face of the record so far as the Order dated 14th May, 1976 was concerned, nor was there any material change in the relevant circumstances subsequent to the making of the order and hence section 13(2) was not attracted.
The respondents contended that what the appellant was seeking to achieve by the application under section 13(2) was reconsideration of the Order dated 14th May, 1976 which was clearly impermissible, since section 13(2) could not be used as a substitute, for section 55 and that too, without the restrictive condition of that section.
It was also urged on behalf of the respondents that, in any event the appellant was precluded from challenging the Order dated 14th May, 1976 by an application under Section 13(2) by reason of its subsequent conduct in acquiescing in the Order and unconditionally accepting the same.
The appellant clearly waived the defects or infirmities if any in the Order dated 14th May, 1976 and was precluded from raising any contention against the validity of that Order.
The respondents disputed validity of the contentions raised on behalf of the appellant and urged that in any event even if any of these defects or infirmities were present, they did not render the Order void as being without jurisdiction and hence the validity of the Order could not be challenged in the collateral proceedings under section 13(2).
The respondents also contended that in any view of the matter the Order dated 14th May, 1976 was justified inasmuch as the trade practices complained of by the Registrar were restrictive trade practices.
These were the rival contentions 1059 urged on behalf of the parties and we shall now proceed to examine The first question that arises for consideration in the preliminary objection of the respondents is as to what is the true scope and admit of an appeal under section 55.
That section provides inter alia that any person aggrieved by an order made by the Commission under section 13 may prefer an appeal to this Court on "one or more of the grounds specified in section 100 of the Code of Civil Procedure, 1908".
Now at the date when section 55 was enacted, namely, 27th December, 1969, being the date of coming into force of the Act, section 100 of the Code of Civil Procedure specified three grounds on which a second appeal could be brought to the High Court and one of these grounds was that the decision appealed against was contrary to law.
It was sufficient under section 100 as it stood then that there should be a question of law in order to attract the jurisdiction of the High Court in second appeal and, therefore, if the reference in section 55 were to the grounds set out in the then existing section 100, there can be no doubt that an appeal would lie to this Court under section 55 on a question of law.
But subsequent to the enactment of section 55 section 100 of the Code of Civil Procedure was substituted by a new section by section 37 of the Code of Civil Procedure (Amendment) Act, 1976 with effect from 1st February, 1977 and the new section 100 provided that a second appeal shall lie to the High Court only if the High Court is satisfied that the case involves a substantial question of law.
The three grounds on which a second appeal could lie under the former section 100 were abrogated and in their place only one ground was substituted which was a highly stringent ground, namely, that there should be a substantial question of law.
This was the new section 100 which was in force on the date when the present appeal was preferred by the appellant and the argument of the respondents was that the maintainability of the appeal was, therefore, required to be judged by reference to the ground specified in the new section 100 and the appeal could be entertained only if there was a substantial question of law.
The respondents leaned heavily on section 8(1) of the which provides: "8(1) Where this Act, or any Central Act or Regulation made after the commencement of this Act, repeals and re enacts, with or without modification, any provision of a former enactment, then references in any other enactment or in any instrument to the provision so repealed shall, un 1060 less a different intention appears, be construed as references to the provision so re enacted." and contended that the substitution of the new section 100 amounted to repeal and re enactment of the former section 100 and, therefore, on an application of the rule of interpretation enacted in section 8(1), the reference in section 55 to section 100 must be construed as reference to the new section 100 and the appeal could be maintained only on the ground specified in the new section 100, that is, on a substantial question of law.
We do not think this contention is well founded.
It ignores the distinction between a mere reference to or citation of one statute in another and an incorporation which in effect means bodily lefting a provision of one enactment and making it a part of another.
Where there is mere reference to or citation of one enactment in another without incorporation, section 8(1) applies and the repeal and re enactment of the provision referred to or cited has the effect set out in that section and the reference to the provision repealed is required to be construed as reference to the provision as re enacted.
Such was the case in the Collector of Customs, Madras vs Nathella Sampathu Chetty & Anr.
and the New Central Jute Mills Co. Ltd. vs The Assistant Collector of Central Excise, Allahabad & Ors.
But where a provision of one statute is incorporated in another, the repeal or amendment of the former does not affect the latter.
The effect of incorporation is as if the provision were written out in the incorporating statute and were a part of it.
Legislation by incorporation is a common legislative device employed by the legislature, where the legislature for convenience of drafting incorporates provisions from an existing statute by reference to that statute instead of setting out for itself at length the provisions which it desires to adopt.
Once the incorporation is made, the provision incorporated becomes an integral part of the statute in which it is transposed and thereafter there is no need to refer to the statute from which the incorporation is made and any subsequent amendment made in it has no effect on the incorporating statute.
Lord Esher, M.R., while dealing with legislation in incorporation in In re.
Wood 's Estate pointed out at page 615: "If a subsequent Act brings into itself by reference some of the clauses of a former Act, the legal effect of that, as has often been held, is to write those sections into the new Act.
1061 just as if they had been actually written in it with the pen, or printed in it, and, the moment you have those clauses in the later Act, you have no occasion to refer to the former Act at all." Lord Justice Brett, also observed to the same effect in Clark vs Bradlaugh at 69 : ". . there is a rule of construction that, where a statute is incorporated by reference into a second statute, the repeal of the first statute by a third statute does no affect the second.
" This was the rule applied by the Judicial Committee of the Privy Council in Secretary of State for India in Council vs Hindustan Cooperative Insurance Society Ltd. The Judicial Committee pointed out in this case that the provisions of the Land Acquisition Act, 1894 having been incorporated in the Calcutta Improvement Trust Act, 1911 and become an integral part of it, the subsequent amendment of the Land Acquisition Act, 1894 by the addition of sub section (2) in section 26 had no effect on the Calcutta Land Improvement Trust Act, 1911 and could not be read into it.
Sir George Lowndes delivering the opinion of the Judicial Committee observed at page 267 : "In this country it is accepted that where a statute is incorporated by reference into a second statute, the repeal of the first statute does not affect the second: see the cases collected in Craies on Statute Law, 3rd edn.
349, 350.
x x x x x x x The independent existence of the two Acts is, therefore, recognized; despite the death of the parent Act, its offspring survives in the incorporating Act.
x x x It seems to be no less logical to hold that where certain provisions from an existing Act have been incorporated into a subsequent Act, no addition to the former Act, which is not expressly made applicable to the subsequent Act, can be deemed to be incorporated in it, at all events if it is possible for the subsequent Act to function effectually without the addition." So also in Ramswarup vs Munshi & Ors.
, it was held by this Court that since the definition of "agricultural land ' in the Punjab Alienation of Land Act, 1900 was bodily incorporated in the Punjab 1062 Pre emption Act, 1913, the repeal of the former Act had no effect on the continued operation of the latter.
Rajagopala Ayyangar, J., speaking for the Court observed at pages 868 869 of the Report: "Where the provisions of an Act are incorporated by reference in a later Act the repeal of the earlier Act has, in general, no effect upon the construction or effect of the Act in which its provisions have been incorporated.
x x x x In the circumstances, therefore, the repeal of the Punjab Alienation of Land Act of 1900 has no effect on the continued operation of the Pre emption Act and the expression 'agricultural land ' in the latter Act has to be read as if the definition in the Alienation of Land Act had been bodily transposed into it.
" The decision of this Court in Bolani Ores Ltd. vs State of Orissa also proceeded on the same principle.
There the question arose in regard to the interpretation of section 2(c) of the Bihar and Orissa Motor Vehicles Taxation Act, 1930 (hereinafter referred to as the Taxation Act).
This section when enacted adopted the definition of 'motor vehicle ' contained in section 2(18) of the .
Subsequently, section 2(18) was amended by Act 100 of 1956 but no corresponding amendment was made in the definition contained in section 2(c) Or the Taxation Act.
The argument advanced before the Court was that the definition in section 2(c) of the Taxation Act was not a definition by incorporation but only a definition by reference and the meaning of 'motor vehicle ' in section 2(c) must, therefore, be taken to be the same as defined from time to time in section 2(18) of the .
This argument was negatived by the Court and it was held that this was a case of incorporation and not reference and the definition in section 2 (18) of the as then existing was incorporation in section 2(c) of the Taxation Act and neither repeal of the nor any amendment in it would affect the definition of 'motor vehicle ' in section 2(c) of the Taxation Act.
It is, therefore, clear that if there is mere reference to a provision of one statute in another without incorporation, then, unless a different intention clearly appears, section 8(1) would apply and the reference would be construed as a reference to the provision as may be in force from time to time in the former statute.
But if a provision of one statute is incorporated in another, any subsequent amendment in the former 1063 statute or even its total repeal would not effect the provision as incorporated in the latter statute.
The question is to which category the present case belongs.
We have no doubt that section 55 is all instance of legislation by incorporation and not legislation by reference.
Section 55 provides for an appeal to this Court on "one or more or the grounds specified in section 100".
It is obvious that the legislature did not want to confer an unlimited right of appeal, but wanted to restrict it and turning to section 100, it found that the grounds there set out were appropriate for restricting the right of appeal and hence it incorporated then in Section 55.
The right of appeal was clearly intended to be limited to the grounds set out in the existing section 100.
Those were the grounds which were before the Legislature and to which the Legislature could have applied its mind and it is reasonable to assume that it was with reference to those specific and known grounds that the legislature intended to restrict the right of appeal.
The Legislature could never have intended to limit the right of appeal to any ground or grounds which might from time to time find place in section 100 without knowing what those grounds were.
The grounds specified in section 100 might be changed from time to time having regard to the legislative policy relating to second appeals and it is difficult to see any valid reason why the Legislature should have thought it necessary that these changes should also be reflected in section 55 which deals with the right of appeal in a totally different context.
We fail to appreciate what relevance the legislative policy in regard to second appeals has to the right of appeal under section 55 so that section 55 should be inseparably linked or yoked to section 100 and whatever changes take place in section 100 must be automatically read into section 55.
It must be remembered that the Act is a self contained Code dealing with monopolies and restrictive trade practices and it is not possible to believe that the Legislature could have made the right of appeal under such a code dependent on the vicissitudes through which a section in another statute might pass from time to time.
The scope and ambit of the appeal could not have been intended to fluctuate or vary with every change in the grounds set out in section 100.
Apart from the absence of any rational justification for doing so, such an indissolubleing of section 55 with section 100 could conceivably lead to a rather absurd and starting result.
Take for example a situation where section 100 might be repealed altogether by the Legislature a situation which cannot be regarded as wholly unthinkable.
It the construction contended for on behalf of the respondents were accepted.
1064 section 55 would in such a case be reduced to futility and the right of appeal would be wholly gone, because then there would be no grounds on which an appeal could lie.
Could such a consequence ever have been contemplated by the Legislature? The Legislature clearly intended that there should be a right of appeal, though on limited grounds, and it would be absurd to place on the language of section 55 an interpretation which might, in a given situation, result in denial of the right of appeal altogether and thus defeat the plain object and purpose of the section.
We must, therefore, hold that on a proper interpretation the grounds specified in the then existing section 100 were incorporated in section 55 and the substitution of the new section 100 did not affect or restrict the grounds as incorporated and since the present appeal admittedly raises questions of law, it is clearly maintainable under section 55.
We may point out that even if the right of appeal under section 55 were restricted to the ground specified in the new section 100, the present appeal would still be maintainable, since it involves a substantial question of law relating to the interpretation of section 13(2).
What should be the test for determining whether a question of law raised in an appeal is substantial has been laid down by this Court in Sir Chunilal V. Mehta and Sons Ltd. vs The Century Spinning and Manufacturing Co. Ltd. and it has been held that the proper test would be whether the "question of law is of general public importance or whether it directly or substantially affects the rights of the parties, and if so, whether it is either an open question in the sense that it is not finally settled by this Court or by the Privy Council or by the Federal Court or is not free from difficulty or calls for discussion of alternative views".
The question of interpretation of section 13(2) which arises in the present appeal, directly and substantially affects the rights of the parties and it is an open question in the sense that it is not finally settled by this Court and it is, therefore, clearly a substantial question of law within the meaning of this test.
We must, therefore, reject the preliminary objection raised on behalf of the respondents against the maintainability of the present appeal.
That takes us to a consideration of the merits of the appeal and the first question that arises on the merits is as to the true scope and magnitude of the curial power conferred on the Commission under section 13(2).
That section provides that "any order made by the Commission may be amended or revoked at any time in the manner in which it was made".
The words "in the manner in which it was made" merely indicate the procedure to be followed by the Commission 1065 in amending or revoking an order.
They have no bearing on the content of the power granted under section 13(2) or on its scope and ambit.
That has to be determined on an interpretation of section 13(2) in the light of the context or setting in which it occurs and having regard to the object and purpose of its enactment.
Now, one thing is clear that the power conferred under section 13(2) is a corrective or rectificatory power and it is conferred in terms of widest amplitude.
There are no fetters placed by the Legislature to inhibit the width and amplitude of the power and in this respect it is unlike section 22 of the English Restrictive Trade Practices Act, 1956 which limits the power of the Court under that section to discharge a previous order made by it by providing in terms clear and explicit that leave to make an application for discharging the previous order shall not be granted except on prima facie evidence of material change in the relevant circumstances.
This provision is markedly absent in section 13(2) and not express limitation is placed on the power conferred under that section.
It is left to the discretion of the Commission whether the power should be exercised in a given case and if so, to what extent.
But it must be remembered that this discretion being a judicial or in any event a quasi judicial discretion, cannot be 'arbitrary, vague or fanciful ', it must be guided by relevant considerations.
It is not possible to enumerate exhaustively, the various relevant considerations which may legitimately weigh with the Commission in exercising its discretion, nor would it be prudent or wise to do so, since the teeming multiplicity of circumstances and situations which may arise from time to time in this kalisdozoopic world cannot be cast in any definite or rigid mould or be imprisoned in any straight jacket formula.
Every case of an application under section 13(2) would have to be decided on its own distinctive facts and the Commission would have to find whether it is a proper case in which, having regard to the relevant consideration, the order made by it should be amended or revoked.
The fact that an appeal lies against the order under section 55 but has not been preferred, would be no ground for refusing to exercise the power under section 13(2).
The power conferred on the Commission under section 13(2) is an independent power which has nothing to do with the appellate power under section 55.
It is not correct to say that the power under section 13(2) cannot be exercised to correct an order which could have been set right in appeal under section 55.
The argument of the respondents that, if such a view is taken, it would permit section 13(2) to be used as a substitute for section 55 and that too, without its restrictive condition has no force and does not appeal to us.
There is no question of using section 13(2) as a substitute for section 55.
1066 Both are distinct and independent powers and one cannot be read as subject to the other.
The scope and applicability of section 13(2) is not cut down by the provision for appeal under section 55.
It is perhaps because the right of appeal given under section 55 is limited to a question of law that a wide and unfettered power is conferred on the Commission to amend or revoke an order in appropriate cases.
An order under section 37 or for the matter of that, under any other provision of the Act, is not an order made in a mere interparties proceeding having effect limited only to the parties to the proceeding.
Not only in its radiating potencies, but also by its express terms, it affects other parties such as the whole network of distributors or dealers who are not before the Commission.
It also affects the entire trade in the product including consumers, dealers and manufacturers in the same line.
The provisions of the Act are infected with public interest and considerations of public interest permeate every proceeding under the Act.
Hence it is necessary to ensure that if, by reason of in attitude or negligence of a party to the proceeding or on account of any other reason, an erroneous order has been made, it should be possible to correct it, lest it may, instead of promoting competition, produce an anti competitive effect or may turn out to be prejudicial to public interest.
It is also possible that there may be some fact or circumstance which may not have been brought to the attention of the Commission, though having a crucial bearing on the determination of the inquiry, and which, if taken into account, may result in a different order being made, or some fact or circumstance may arise which may expose the invalidity of the order or render it bad and in such cases too, some provision has to be made for correcting or rectifying the order.
So also, there may be a material change in the relevant circumstances subsequent to the making of the order which may affect the essential reasoning on which the order is based and this too may necessitate a reconsideration of the order.
After all, an order under section 37 is made in a given constellation of economic facts and circumstances and if that constellation undergoes material challenge, the order would have to be reviewed in the light of the changed economic situation.
No order under section 37 can be immutable.
It is by its very nature transient or pro tempore and must be liable to be altered or revoked according as there is material change in the relevant economic facts and circumstances.
It is obviously for this reason that such a wide and unusual power is conferred on the Commission under section 13(2) to mend or revoke an order at any time.
It is a curial power intended to ensure that the Order passed by the Commission is and continues to be in confirmity with the requirements of the Act and the trade practice condemned by the order is really and truly a restric 1067 tive trade practice and it must, therefore, be construed in a wide sense so as to effectuate to the object and purpose of the grant of the power.
But howsoever large may be the amplitude of this power, it must be pointed out that it cannot be construed to be so wide as to permit rehearing on the same material without anything more, with a view to sowing that the order is wrong on facts.
This is the only limitation we would read in section 13(2).
Outside of that, the power of the Commission is large and ample and the Commission may, in the exercise of such power, amend or revoke an order in an appropriate case.
The respondents relied strongly on Regulation 85 but we fail to see how that Regulation assists the respondents in limiting the width and amplitude of the power under section 13(2).
Regulation 85 does not say that an application under section 13(2) shall be entertained only on certain specific grounds.
It is true that it is open to a statutory authority to lay down broad parameters for the exercise of the power conferred upon it, so long as those parameters are not based on arbitrary or irrational considerations and do not exclude altogether scope for exercise of residuary discretion in exceptional cases.
But we do not think that even broad parameters for exercise of the power under section 13(2) are laid down in Regulation 85.
That Regulation is in two parts.
The first part provides that an application under section ]3(2) "shall be supported by evidence on affidavit of the material change in the relevant circumstances or any other fact or circumstances on which the applicant relies.
" This is a procedural provision which prescribes that if the applicant relies on any material change in the relevant circumstances or 011 any other facts or circumstances in support of the application, he must produce the necessary evidence in proof of the same by affidavits.
This provision merely lays down a rule of procedure and it has nothing to do with the grounds on which an application under section 13(2) may be maintained and it is difficult to see how it can be pressed into service on behalf of the respondents.
The second part states that unless the Commission otherwise directs "notice of the application together with copies of the affidavits in support thereof shall be served on every party who appeared at the hearing of the previous proceedings and every such party shall be entitled to be heard on the application and the provisions of section 114 and Order XLVII rule 1 of the Code of Civil Procedure, 1908 shall as far as may, be applied to these proceedings".
This part first deals with the question as to which parties shall be served with the notice of the application and who shall be entitled to appear at the hearing of the application.
This is purely 1068 procedural in nature and does not throw any light on the issue before us.
But this part then proceeds to add that the provisions of section 114 and Order XLVII rule 1 shall, as far as may, be applied to the proceedings in the application.
Can this provision be read to mean that an application under section 13(2) can be maintained only on the grounds set out in section 114 and Order XLVII, rule 1? The answer must obviously be in the negative.
The words "as far as may" occurring in this provision are very significant.
They indicate that the provisions of section 114 and Order XLVII, rule 1 are to be invoked only to the extent they are applicable and if, in a given case.
they are not applicable, they may be ignored but that does not mean that the power conferred under section 13(2) would not be exercisable in such a case.
The reference to the provisions of section 114 and Order XLVII, rule 1 does not limit the grounds on which an application may be made under section 13(2).
In fact, the respondents themselves conceded that the grounds set out in section 114 and Order XLVII, rule 1 were not the only grounds available in an application under section 13(2) and that the application could be maintained on other grounds such as material change in the relevant circumstances.
It is, therefore, clear to our mind that even if a case does not fall within section 114 and Order XLVII, rule 1, the Commission would have power, in an appropriate case, to amend or revoke an order made by it.
If, for example, a strong case is made out showing that an order made under section 37 is plainly erroneous in law or that some vital fact or feature which would tilt the decision the other way has escaped the attention of the Commission in making the order or that the appellant was prevented by sufficient cause from appearing at the hearing of the inquiry resulting in the order being passed exparte, the Commission would be entitled to interfere in the exercise of its power under section 13(2).
These examples given by us are merely illustrative and they serve to show that Regulation 85 does not in any manner limit the power under section 13(2).
Before we proceed to consider whether any case has been made out by the appellant for the exercise of the power under section 13(2), we may briefly dispose of the contention of the respondents based on acquiescence and estoppel.
The argument of the respondents was that the appellant, by his subsequent conduct, acquiesced in the making of the Order dated 14th May, 1976 and was, in any event, estopped from challenging the same.
We find it difficult to appreciate this argument.
We do not see anything in the conduct of the appellant which would amount to acquiescence or raise any estoppel against it.
It is obvious that the appellant did not wish to be heard in the proceeding before 1069 the Commission because the decision of the Commission in the Telco case held the field at that time and it was directly against the appellant.
Otherwise, there is no reason why the appellant should not have entered an appearance under Regulation 65 and filed a proper reply as provided in Regulation 67 and appeared at the hearing of the inquiry to oppose the application of the Registrar.
The appellant did make its submissions in writing by its letter dated 3rd February, 1976, but since the appellant did not enter an appearance as required by Regulation 65, it was precluded from filing a reply under Regulation 67 and the Commission was legally justified in refusing to look at the submissions contained in the letter of the appellant, though we may observe that it would have been more consonant with justice if the Commission had, instead of adopting a technical and legalistic approach, considered the submissions of the appellant before making the Order dated 14th May, '976.
Be that as it may, the Commission declined to consider he submissions of the appellant and proceeded to make the order dated 14th May, 1976 exparte in the absence of the appellant.
Now, once the order dated 14th May, 1976 was made, it was the bounden duty of the appellant to obey it, until it might be set aside in an appropriate proceeding.
the appellant, therefore, stated preparing a draft of the revised distributorship agreement in conformity with the terms of the O der dated 14th May, 1976 and since the preparation of the draft was likely to take some time, the appellant applied for extension of time which was granted upto 31st March, 1977.
However, before the extended date was due to expiry, this Court reversed the decision of The Commission in the Telco case and as soon as this new fact or circumstance came to its knowledge, the appellant made an application dated 31st March, 1977 stating that in view of the decision given by this Court in the Telco case, the applicant was advised to move a suitable application for amendment and/or modification of the Order dated 14th May, 1976 and the time for filing the revised distributorship agreement should, therefore, be further extended and on this application, the Commission granted further extension of time upto 4th June, 1977.
It is difficult to see how any acquiescence or estoppel could be spelt out from this conduct of the appellant.
It is true that the appellant did not prefer an appeal against the Order dated 14th May, 1976, but he application under section 13(2) being an alternative and perhaps a more effective remedy available to it, the failure of the appellant to prefer an appeal can not be construed as acquiescence on its part.
The appellant undoubtedly asked for extension of time from the Commission for the purpose of implementing the Order dated 14th May, H; 1976 but that also cannot amount to acquiescence, because until the decision of the Commission in the Telco case was reversed in appeal 1070 by this Court, the appellant had no reason to believe that the Order dated 14th May, 1976 was erroneous and as soon as the appellant came to know about the decision of this Court reversing the view taken by the Commission, the appellant immediately pointed out to the Commission that it was moving an application for amendment or revocation of the Order dated 14th May, 1976 under section 13(2).
The appellant did not at any time accept the Order dated 14th May, 1976 knowing that it was erroneous and it is elementary that there can be no acquiescence without knowledge of the right to repudiate or challenge.
Moreover, it may be noted that the appellant did not, right upto the time it made the application under section 13(2), implement the Order dated 14th May, 1976 by entering into revised distributorship agreement with the distributors.
There was, therefore, no acquiescence on the part of the appellant so far as the Order dated 14th May, 1976 is concerned.
Nor could there be any estoppel against the appellant precluding it from challenging the Order by an application under section 13(2), for estoppel can arise only if a party to a proceeding has altered his position on the faith of a representation or promise made by another and here there is nothing to show that the Registrar had altered his position on the basis of the application for extension of time made by the appellant.
Both the contentions, one based on acquiescence and the other on estoppel, must, therefore, be rejected.
That takes us straight to the consideration of the question whether the appellant has made out any case for the exercise of the power of the Commission under section 13(2).
The first ground canvassed by the appellant was that the application on which the Order dated 14th May, 1976 was made was not in accordance with law inasmuch as it did not set out any facts or features which would show that the trade practices complained of by the Registrar were restrictive trade practices.
Now, it is true, as laid down by this Court in the Telco case, that an application by the Registrar under section 10(a) (iii) "must contain facts which, in the Registrar 's opinion, constitute restrictive trade practice" and it is not sufficient to make "mere references to clauses of the agreement and bald allegations that the clauses constitute restrictive trade practice".
The application must set out facts or features "to show or establish as to how the alleged clauses constitute restrictive trade practice in the context of facts".
The application of the Registrar in the present case was, therefore, clearly contrary to the law laid down by this Court in the Telco case.
but on that account alone it cannot be said that the Order dated 14th May, 1976 was vitiated by a legal infirmity.
Even if the application did 1071 not set out any facts or features showing how the trade practices complained of by the Registrar were restrictive trade practices, the Registrar could still at the hearing of the inquiry, in the absence of any demand for particulars being made by the appellant, produce material before the Commission disclosing facts or features which would go to establish the restrictive nature of the trade practices com plained of by him and if the Registrar did so, the defect in the application would not be of much consequence.
But unfortunately in the present case the only material produced by the Registrar was the affidavit of the Assistant Registrar which did nothing more than just reproduce the impugned clauses of the distributorship agreement and the words of the relevant sections of the Act.
There was no material at all produced by the Registrar before the Commission which would show how, having regard to the facts or features of the trade of the appellant, the trade practices set out in the offending clauses of the distributorship agreement were restrictive trade practices.
The Order dated 14th May, 1976 was, therefore, in the submission of the appellant, based on no material at all and was accordingly vitiated by an error of law.
The respondents, however, contended that it was not necessary to produce any material before the Commission in support of the claim of the Registrar, because the trade practices referred to in the offending clauses were per se restrictive trade practices and in any event, even if any supporting material was necessary, it was to be found in the admission of the appellant contained in its letter submitting the distributorship agreement for registration under section 33.
We do not think there is any force in this contention of the respondents and the Order dated 14th May, 1976 must be held to be bad on the ground that it was based on no material and could not possibly have been made by the Commission.
It is now settled law as a result of the decision of this Court in the Telco case that every trade practice which is in restraint of trade is not necessarily a restrictive trade practice.
The definition of restrictive trade practice given in section 2(o) is a pragmatic and result oriented definition.
It defines 'restrictive trade practice ' to mean a trade practice which has or may have the effected of preventing, distorting or restricting competition in any manner and in clauses (i) and (ii) particularises two specific instances of trade practices which fall within the category of restrictive trade practice.
It is clear from the definition that it is only where a trade practice has the effect, actual or probable, of restricting, lessening or destroying competition that it is liable to be regarded as a restrictive trade practice.
If a trade practice merely regulates and thereby promotes competition, it would not fall 1072 within the definition of restrictive trade practice, even though it may be, to some extent, in restraint of trade.
Whenever, therefore, a question arises before the Commission or the Court as to whether a certain trade practice is restrictive or not, it has to be decided not on any theoretical or a priori reasoning, but by inquiring whether the trade practice has or may have the effect of preventing, distorting or restricting competition.
This inquiry obviously cannot be in vacuo but it must append on the existing constellation of economic facts and circumstances relating to the particular trade.
The peculiar facts and features of the trade would, be very much relevant in determining whether a particular trade practice has the actual or probable effect of diminishing or preventing competition and in the absence of any material showing these facts or features, it is difficult to see how a decision can be reached by the Commission that the particular trade practice is a restrictive trade practice It is true that on the subject of restrictive trade practices, the law in the United States has to be approached with great caution, but it is interesting to note that the definition of "restrictive trade practice" in our Act echoes to some extent the 'rule of reason ' evolved by the American Courts while interpreting section 1 of the Sherman Act.
That section provides that "every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce is hereby declared to be illegal" and literally applied,, it would outlaw every conceivable contract which could be made concerning trade or commerce or the subjects of such commerce.
The Supreme Court of United States, therefore, read a 'rule of reason ' in this section in the leading decision in Standard Oil Company vs United States.
It was held by the Court as a 'rule of reason ' that the term "restraint of trade" means that it meant at common law and in the law of the United States when the Sherman Act was passed and it covered only those acts or contracts or agreements or combinations which prejudice public interest by unduly restricting competition or unduly obstructing the due course of trade or which injuriously restrain trade either because of their inherent nature of effect or because of their evident purpose.
Vide also United States vs American Tobacco Co.
It was pointed out that the 'rule of reason ' does not freeze the meaning of "restraint of trade" to what it meant at the date when the Sherman Act was passed and it prohibits not only those acts deemed to be undue restraints of trade at common law but also those acts which new times and economic conditions make unreasonable.
This 'rule 1073 of reason ' evolved by the Supreme Court in the Standard Oil Company 's case and the American Tobacco Co 's case has governed the application of section 1 of the Sherman Act since then and though it does not furnish an absolute and unvarying standard and has been applied, sometimes more broadly and some times more narrowly, to the different problems coming before the courts at different times, it has held the field and, as pointed out by Mr. Justice Reed in the United States vs E.I. Du Pont, the Supreme Court has not receded from its position on this rule.
The 'rule of reason ' has, to quote again the words of the same learned Judge "given a workable content to anti trust legislation".
Mr. Justice Brandeis applied the 'rule of reason ' in Board of Trade vs United States for holding that a rule prohibiting offers to purchase during the period between the close of the call and the opening of the session on the next business day for sales of wheat, corn, oats or rye at a price other than at the closing bid, was not in "restraint of trade" within the meaning of section 1 of the Sherman Act.
The learned Judge pointed out in a passage which has become classical: "Every agreement concerning trade, every regulation of trade, restrains.
To bind, to restrain, is of their very essence.
The true test of legality is whether the restraint imposed is such as merely regulates and perhaps thereby promotes competition, or whether it is such as may suppress or even destroy competition.
To determine that question the court must ordinarily consider the facts peculiar to the business to which the, restraint is applied; its condition before and after the restraint was imposed the nature of the restraint, and its effect, actual or probable.
The history of the restraint the evil believed to exist, the reason for adopting the particular remedy, the purpose or end sought to be attained, are all relevant facts.
This is not because a good intention will save an otherwise objectionable regulation, or the reverse; but because knowledge of intent may help the court to interpret facts and to predict consequences.
" It will thus be seen that the 'rule of reason ' normally requires an ascertainment of the facts or features peculiar to the particular business; its condition before and after the restraint was imposed; the nature of the restraint and its effect, actual or probable; the history of the restraint and the evil believed to exist, the reason for adopting the particular restraint and the purpose or end sought to be attained and it is only on a consideration of these factors that it can be decided whether a particular act, contract or agreement, impos 1074 ing the restraint is unduly restrictive of competition so as to constitute 'restraint of trade '.
The language of the definition of "restrictive trade practice" in our Act suggests, that in enacting the definition, our legislature drew upon the concept and rationale underlying the 'rule of reason '.
That is why this Court pointed out in the Telco case in words almost bodily lifted from the judgment of Mr. Justice Brandeis: "The decision whether trade practice is restrictive or not has to be arrived at by applying the rule of reason and not on that doctrine that any restriction as to area or price will per se be a restrictive trade practice.
Every trade agreement restrains or binds persons or places or prices.
The question is whether the restraint is such as regulates and thereby promotes competition or whether it is such as may suppress or even destroy competition.
To determine this question three matters are to be considered.
First, what facts are peculiar to the business to which the restraint is applied.
Second, what was the condition before and after the restraint is imposed.
Third, what is the nature of the restraint and what is its actual and probable effect.
" These various facts and features set out in the Judgment of Mr. Justice Brandeis and reiterated in the decision of this Court in the Telco case would, therefore, have to be considered before a decision can be reached whether a particular trade practice is restrictive or not.
It is possible that a trade practice which may prevent or diminish competition in a given constellation of economic facts and circumstances may, in a different constellation of economic facts and circumstances, be found to promote competition.
It cannot be said that every restraint imposed by a trade practice necessarily prevents, distorts or restricts competition and is, therefore, a restrictive trade practice.
Whether it is so or not would depend upon the various considerations to which we have just referred.
Of course, it must be pointed out that there may be trade practices which are such that by their inherent nature and inevitable effect they necessarily impair competition and in case of such trade practices, it would not be necessary to consider any other facts or circumstances, for they would be per se restrictive trade practices.
Such would be the position in case of those trade practices which of necessity produce the prohibited effect in such an overwhelming proportion of cases that minute inquiry in every instance would be wasteful of judicial and administrative resources.
Even in the United States a similar doctrine of per se illegality has been evolved in the interpretation of section 1 of the Sherman Act and it has been held that certain restraints of trade are 1075 unreasonable per se and "because of their pernicious effect on competition and lack of any redeeming virtue" they are "conclusively presumed to be unreasonable, and, therefore; illegal without elaborate inquiry as to the precise harm they have caused or the business excuse for their use".
In such cases "illegality does not depend on a showing of the unreasonableness of the practice and it is unnecessary to have a trial to show the nature, extent and degree of its market effect." Vide American Jurisprudence 2d.
volume 54, p. 687, article 32.
We are concerned in the present appeal with clauses of the distributorship agreement imposing restriction as to territory, area or market and providing for exclusive dealership and according to the decision of this Court in the Telco case, such trade practices are not per se restrictive trade practices.
Whether such trade practices constitute restrictive trade practices or not in a given case would depend on the particular facts and features of the trade and other relevant considerations discussed above which would show the actual or probable effect of such trade practices on competition.
It was, therefore, absolutely necessary to produce the necessary material before tho Commission to show that the impugned trade practices had the actual or probable effect of diminishing or destroying competition and were therefore, restrictive trade practices.
The burden was clearly on the Registrar for it was the Registrar who wanted the Commission to strike down these trade practices as restrictive.
The Registrar, however, did Dot produce any material at all before the Commission and the Order dated 14th May, 1976 had no basis at all on which it could be sustained.
There is no doubt that the appellant by its letter dated 19th May, 1972 submitted the distributorship agreement to the Registrar for registration under section 33, but we do not see how this act of the appellant or the letter forwarding the distributorship agreement for registration can be construed as admission on the part of the appellant that the trade practices referred to in the offending clauses of the distributorship agreement constituted restrictive trade practices.
In the first place, the question whether a trade practice is restrictive trade practice or not is essentially a question of law based on the application of the definition in section 2(o) to the facts of a given case and no admission on a question of law can ever be used in evidence against the maker of the admission.
Therefore, even if there was any admission involved in submitting the distributorship agreement for registration, it could not be used as evidence against the appellant in the inquiry under section 37.
Moreover, we do not think that in submitting the distributorship agreement for registration, the appellant 1076 made an admission that any particular clause of the distributorship agreement constituted restrictive trade practices.
There is nothing in the letter of the appellant to show which were the particular clauses of the distributorship agreement regarded by the appellant as restrictive trade practices on the basis of which it made the application for registration.
It is possible that the appellant might have taken the same view which the Commission did in the Telco case, namely, that the moment an agreement contains a trade practice falling within any of the clauses of section 33(1), the trade practice must irrespective of whether it falls within the definition in section 2(o) or not, be regarded as a restrictive trade practice and the agreement must be registered and on that view, the appellant might have submitted the distributorship agreement for registration.
The submission of the distributorship agreement for registration cannot, therefore, possibly be construed as admission on the part of the appellant that the particular clauses of the distributorship agreement faulted by the Commission constituted restrictive trade practices.
There was, accordingly, no admission of the appellant on which the Commission could rely for the purpose of making the Order dated 14th May, 1976.
We must, in the circumstances, hold that, since there was no mate rial at all on the basis of which the Commission could find that the grade practices referred in the offending clauses of the distributorship agreement were restrictive trade practices, the Order dated 14th May, 1976 was contrary to law.
This clearly attracted the exercise of the power of the Commission under section 13(2).
The decision of this Court in the Telco case exposed the invalidity of the Order dated 14th May, 1976 and showed that it was bad as being based on no material whatsoever.
When the commission passed the Order dated 14th May 1976, the decision of the Commission in the Telco case held the field and according to that decision, any trade practice which fall within one of the clauses of section 33(1) would be a restrictive trade practice and that is perhaps the reason why the Registrar did not produce any material before the Commission and even though there was no material before it, the Commission proceeded to invalidate the trade practices referred to in the offending clauses as restrictive trade practices, since they fell within one or the other clauses of section 33(1).
But this view was reversed in appeal and it was held by this Court that a trade practice which does not fall within the definition in section 2(o) can not become restrictive trade practice merely because it is covered by one or the other of the clauses of section 33(1): what section 33(1) requires as the condition for registration is that the agreement must 1077 relate to a trade practice which is restrictive trade practice within the meaning of section 2(o) and such restrictive trade practice must additionally fall within one or more of the categories specified in that section.
It was because of this decision in the Telco case that the necessity for production of material to show that the trade practices complained of were restrictive trade practices became evident and it came to be realised that the Order dated 14th May, 1976 was bad.
The conclusion is, therefore, inescapable that the power of the Commission under section 13(2) was exerciseable in the present case and the Order dated 14th May, 1976 was liable to be revoked.
Before we part with this aspect of the case, we must refer to other decision of this Court which was relied upon on behalf of the respondents and that is the decision in Hindustan Lever Ltd. vs M.R.T.P.
The Judgment in this case was delivered by Beg, C.J., speaking on behalf of himself and Gupta, J. and though Beg, C.J., was also a party to the judgment in the Telco case, this judgment seem to strike a slightly different note and hence it is necessary to examine it in some detail.
Two clauses of the Redistribution Stockists ' Agreement were assailed in this case as constituting restrictive trade practices.
One was clause 5 which in its last portion provided that the redistribution stockists shall purchase and accept from the Company such stock as the Company shall at its discretion send to the redistribution stockist for fulfilling its obligations under the agreement and the other was Clause which imposed a restriction as to area or market by providing that the redistribution stockist shall not rebook or in any way convey transport or despatch parts of stocks of the products received by him outside the town for which he was appointed redistribution stockist.
The Commission held, following the view taken by it earlier in the Telco case, that the last part of clause 5 as well as clause 9 constituted restrictive trade practices and declared them void.
This view was affirmed by Beg, C.J., in the appeal preferred by Hindustan Lever Ltd. We are not concerned with the merits of the question whether the last part of clause 5 and clause 9 were on the facts of that case rightly held to be restrictive trade practices, but certain observations made by the learned Chief Justice in that judgment call for consideration, since they seem to be inconsistent with what was laid down by a Bench of three Judges of this Court in the Telco Case.
In the first place, the learned Chief Justice distinguished the judgment in the Telco case by observing that the agreement in that case could not be understood without reference to the actual facts to which 1078 it was sought to be applied and extraneous evidence in regard to those facts for explaining "the nature of the special agreement for restricting or distribution of areas" was, therefore, admissible under section 92, clause 6 of the Evidence Act, but in the Hindustan Lever case the meaning of the impugned clauses was plain and certain and the principle of Section 92, clause 6 was clearly inapplicable to led in extraneous evidence and hence no oral evidence could be led to deduce their meaning or vary it in view of the provisions of sections 91 and 92.
It was on this view that the learned Chief Justice held that oral evidence for the purpose of showing that the trade practices in the impugned clauses were not restrictive was shut out and all that was necessary for the court to do was to interpret the impugned clauses.
Now, this view taken by the learned Chief Justice does not and we say so with the utmost respect appear to be correct.
We do not see how sections 91 and 92 of the Evidence Act come into the picture at all when we are considering whether a particular trade practice set out in an agreement has or may have the effect of preventing, distorting or restricting competition so as to constitute a restrictive trade practice.
It is the actual or probable effect of the trade practice which has to be judged in the light of the various considerations adverted to by us and there is no question of contradicting, varying, adding to or subtracting from the terms of the agreement by admitting any extraneous evidence.
The meaning of the particular clause of the agreement is not sought to be altered or varied by reference to the various factors which we have discussed above, but these factors are required to be taken into account only for the purpose of determining the actual or probable effect of the trade practice referred to in the particular clause.
The reliance placed by the learned Chief Justice on sections 91 and 92 was, therefore, quite inappropriate and unjustified and we do not think that the learned Chief Justice was right in shutting out oral evidence to determine the actual or probable effect of the trade practices impugned in the case before him.
It may be pointed out that the decision in the Telco case did not proceed on an application of the principle embodied in section 92, clause (6) of the Evidence Act and with the greatest respect, the learned Chief Justice was in error in distinguishing that decision on the ground that extraneous evidence was considered in that case in view of the principle underlying section 92, clause 6, while in the case before him that principle was not applicable and hence extraneous evidence was not admissible.
The learned Chief Justice was bound by the ratio of the decision in the Telco case Secondly, the learned Chief Justice seemed to take the view in his judgment at page 465 of the Report that if a clause in an agreement 1079 relates to a trade practice which infringes any of the clauses of section 33(1), it would be bad and it would be unnecessary to inquire whether the trade practice falls within the definition of 'restrictive trade practice ' in section 2(o).
There were two places in the judgment where the learned Chief Justice used expressions indicating this view.
He said at one place: "The last part of clause (5) would be struck by section 33(1) (b)", and at another place "inasmuch as clauses (5) expressly gives the stockist the discretion to sell at lower than maximum retail prices stipulated, the agreement was not struck by section 33(1) (b)".
This view is plainly and again we say 60 with the greatest respect, contrary to the law laid down by a Bench of three Judges of this Court in the Telco case.
We have already pointed out that, according to the decision in the Telco case, a trade practice does not become a restrictive trade practice merely because it falls within one or the other clause of section 33(1), but it must also satisfy the definition of 'restrictive trade practice ' contained in section 2(o) and it is only then that the agreement relating to it would require to be registered under section 33(1).
It is with the greatest respect to the learned Chief Justice, not correct to say that a particular clause in an agreement is struck by one or the other clause of section 33(1).
It is not section 33(1) which invalidates a clause in an agreement relating to a trade practice, but it is the restrictive nature of the trade practice as set out in section 2(o) which makes it void The view taken by the learned Chief Justice on this point can not, therefore, be accepted.
Lastly, the learned Chief Justice held that the introduction of a clause in an agreement itself constitutes a trade practice and if such clause confers power which can be used so as to unjustifiably restrict trade it would constitute a restrictive trade practice.
The learned Chief Justice pointed out that the definition of trade practice is wide enough to include any practice relating to the carrying on of any trade and observed that "it cannot be argued that the introduction of the clauses complained of does not amount to an action which relates to the carrying on of a trade.
If the result of that action or what could reasonably flow from it is to restrict trade in the manner indicated, it will, undoubtedly, be struck by the provisions of the Act".
The interpretation placed by the learned Chief Justice was that if a clause in an agreement is capable of being used to prevent, distort or restrict competition in any manner, it would be liable to be struck down as a restrictive trade practice, regardless of what is actually done under it, for it is not the action taken under a clause, but the clause itself which permits action to be taken which is unduly restrictive of competition, 1080 that is material for determining whether there is a restrictive trade practice.
The learned Chief Justice emphasised that if a clause in an agreement confers power to act in a manner which would unduly restrict trade, the clause would be illegal and it would be no answer to say that the clause is in fact being implemented in a lawful manner.
This view taken by the learned Chief Justice cannot, with the utmost respect, be accepted as wholly correct.
It is true that a clause in an agreement may embody a trade practice and such trade practice may have the actual or probable effect of restricting, lessening or destroying competition and hence it may constitute a restrictive trade practice and the clause may be voided, but it is difficult to see how the introduction of such a clause in the agreement, as distinguished from the trade practice embodied in the clause itself, can be a restrictive trade practice.
It is not the introduction of such a clause, but the trade practice embodied in the clause, which has or is reasonably likely to have the prescribed anti competitive effect.
Therefore, whenever a question of restrictive trade practice arises in relation to a clause in an agreement it is the trade practice embodied in the clause that has to be examined for the purpose of determining its actual or probable effect on competition.
Now a clause in an agreement may proprio vigore on its own terms, impose a restraint such as allocating a territory, area or market to a dealer or prohibiting a dealer from using machinery or selling goods of any other manufacturer or supplier or requiring the dealer to purchase whatever machinery or goods in the particular line of business are needed by him from the manufacturer or supplier entering into the agreement.
Where such restraint produces or is reasonably likely to produce the prohibited statutory effect and that would depend on the various considerations referred to by us earlier it would clearly constitute a restrictive trade practice and tho clause would be bad.
In such a case it would be no answer to say that the clause is not being enforced by the manufacturer or supplier.
The very presence of the clause would have a restraining influence on the dealer, for the dealer would be expected to carry out his obligations under the clause and he would not know that the clause is not going to be enforced against him.
This is precisely what was pointed out by Mr. Justice Day in United Shoe Machinery Corporation vs United States where the question was whether the restrictive use, exclusive use and additional machinery clauses in certain lease agreements of shoe machinery were struck by the provisions of section 3 of the Clayton Act: "The power to enforce them", that is, the impugned clauses "is omnipresent and their 1081 restraining influence constantly operates upon competitors and lessees.
The fact that the lessor, in many instances, forbore to enforce these provisions, does not make them any less agreements within the condemnation of the Clayton Act".
There would be no difficulty in such a case in applying the definition of restrictive trade practice, in accordance with the law laid down in the Telco case as explained by us in this judgment.
Then there may be a clause which may be perfectly innocent and innocuous such as a clause providing that the dealer will carry out all directions given by the manufacturer or supplier from time to time.
Such a broad and general clause cannot be faulted as restrictive of competition, for it cannot he assumed that the manufacturer or supplier will abuse the power conferred by the clause by giving directions unduly restricting trade.
So much indeed was conceded by the learned Additional Solicitor General appearing on behalf of the respondents.
But a genuine difficulty may arise where a clause in an agreement does not by itself impose any restraint but empowers the manufacturer or supplier to take some action which may be restrictive of competition.
Ordinarily, in such a case, it may not be possible to say that the mere presence of such a clause, apart from any action which may be taken under it, has or may have the prohibited anti competitive effect.
The manufacturer or supplier may take action under the clause or he may not, and even if he takes action, it may be in conformity with the provisions of the Act and may not be restrictive of competition.
The mere possibilities of action being taken which may be restrictive of competition would not in all cases effect the legality on the clause.
In fact, a consistent course of conduct adopted by the manufacturer or supplier in acting under The clause in a lawful manner may tend to show that The clause is not reasonably likely to produce the prohibited statutory effect.
What is required to be considered for determining The legality of the clause is hot mere theoretical possibility that the clause may be utilised for taking action which is restrictive of competition, for it does not necessarily follow from the existence of such possibility that actual or probable effect of the clause would be anti competitive.
The material question to consider is whether there is a real probability that the presence of the clause itself would be likely to restrict competition.
This is basically a question of market effect and it cannot be determined by adopting a doctrinaire approach.
There can be no hard and fast rule and each case would have to be examined on its own facts from a business and commonsense point of view for the purpose Or determining whether the clause has the actual or probable effect of unduly, restricting come petition.
We cannot accept the proposition that in every case where 1082 the clause is theoretically capable of being so utilised as to unjustifiably restrict competition, it would constitute a restrictive trade practice.
There is also another infirmity invalidating the Order dated 14th May, 1976.
We have already pointed out and that is clear from the n decision of this Court in the Telco case that in an inquiry under section 37 the Commission has first to be satisfied that the trade practice com plained of in the application is a restrictive trade practice within the meaning of that expression as defined in section 2(o) and it is by after the Commission is so satisfied, that it can proceed to consider whether any of the 'gateways ' provided in section 38(1) exists so that the trade practice, though found restrictive, is deemed not to be prejudicial to the public interest and if no such 'gateways ' are established, then only it can proceed to make an order directing that the trade practice complained of shall be discontinued or shall not be repeated There are thus two conditions precedent which must be satisfied before a cease and desist order can be made by the Commission in regard to any trade practice complained of before it.
One is that the Commission must find that the trade practice complained of is a restrictive trade practice and the other is that where such finding is reached, the Commission must further be satisfied that none of the gateways pleaded in answer to the complaint exists.
Here in the present case the appellant did not appear at the hearing of the inquiry and no 'gateways? were pleaded by it in the manner provided in the Regulations and hence the question of the Commission arriving at a satisfaction in regard to the 'gateways ' did not arise.
But the Commission was certainly required to be satisfied that the trade practices complained of by the Registrar were restrictive trade practices before it could validity make a cease and desist order.
The Order dated 14th May, 1976 did not contain any discussion or recital showing that the Commission had reached the requisite satisfaction in regard to the offending trade practices.
But we can legitimately presume that the Commission must have applied its mind to the offending causes of the distributorship agreement and come to the conclusion that the trade practices refereed to in those clauses were restrictive trade practices before it made the Order dated 14th May, 1976.
There is in fact inherent evidence to show that the Commission did apply its mind to the clauses impugned in the application of the Registrar, because it struck down only a few out of those clauses and did not invalidate the rest.
This circumstance clearly shows that the Commission considered with reference to each impugned clause whether it related to restrictive trade practice and made the Order dated 14th May, 1976 only in respect of those 1083 clauses where it was satisfied that the trade practices were restrictive.
The charge that the Order dated 14th May, 1976 suffered from non application of mind on the part of the Commission cannot, therefore, be sustained.
But the Order dated 14th May, 1976 was clearly bad inasmuch as it did not disclose the reasons which weighed with the Commission in directing the appellant to cease and desist from the trade practices set out in the order.
The Order dated 14th May, 1976 was a non speaking order.
It consisted merely of bald directions given by the Commission and did not set out any reasons whatsoever why the Commission had decided to issue those directions.
It had a sphynx like face, which goes ill with the judicial process.
It is true that the Order dated 14th May, 1976 was an exparte order, but the exparte character of the order did not absolve the Commission from the obligation to give reasons in support of the order.
Even though the Order dated 14th May, 1976 was exparte, the appellant would have been entitled to prefer an appeal against it under section 55 and it is difficult to see how the appellant could have possibly attacked the order in the appeal when the order did not disclose the reasons on 1 which it was based.
It is now settled law that where an authority makes an order in exercise of a quasi judicial function, it must record its reasons in support of the order it makes.
Every quasi judicial order must be supported by reasons.
That is the minimal requirement of law laid down by a long line of decisions of this Court ending with N. M. Desai vs Textiles Ltd. and Simens Engineering Co. vs Union of India.
The Order dated 14th May, 1976 was, therefore, clearly vitiated by an error of law apparent on the face of the record inasmuch as it contained only the final and operative order made by the Commission and did not record any reasons whatsoever in support of is and the appellant was, in the circumstances, entitled to claim what the Order should be revoked by the Commission This view taken by us renders it unnecessary to consider whether there was any material change in the relevant circumstances justifying invocation of the power under section 13(2) and hence we do not purpose to deal with the same.
The Commission has devoted a part of the order impugned in the present appeal to a consideration of this question and taken the view that there was no material change in the relevant circumstances subsequent to the making of the Order dated 14th May, 1976.
We do not wish to express any opinion on the correctness of this view taken by the Commission, since we are setting aside the impugned order made by the Commission and also revoking 1084 the Order dated 14th May, 1976 and sending the matter back so that the application of the Registrar under section 10(a) (iii) may be disposed of afresh.
We accordingly allow the appeal, set aside the order of the Com mission rejecting the application of the appellant under section 13(2), revoke the Order dated 14th May, 1976 and remit the case to the Commission so that the Commission may dispose of the application of the Registrar under section 10(a) (iii) in the light of the observations contained in this judgment.
The Commission will give an opportunity to the appellant to file a proper reply in conformity with the requirements of the Regulations and after taking such relevant evidence as may be produced by both parties, proceed to dispose Of the application of the Registrar on merits in accordance with law.
There will be no order as to costs of the appeal.
P.B.R. Appeal allowed.
| IN-Abs | Section 10(a) (iii) of the empowers the Monopolies and Restrictive Trade Practices Commission to enquire into any restrictive trade practices upon an application made to it by the Registrar of Restrictive Trade Agreements.
Section 13(2) provides that "any order made by the Commission may be amended or revoked at any time in the manner in which it was made.
" Section 55 provides that any person aggrieved by an order made by the Central Government or the Commission under section 13 or section 37 may prefer an appeal to the Supreme Court on one or more of the grounds specified in section 100, Code of Civil Procedure, 1908.
On the date on which the Act came into force section 100 C.P.C. specified three grounds on which a second appeal could lie to the High Court one of them being that the decision appealed against was contrary to law.
By an amendment made in 1976 s.100 was substituted by a new section which provides that a second appeal shall lie to the High Court only if the High Court is satisfied that the case involves a substantial question of law.
The appellant, who was a manufacturer of jeep motor vehicles, their spare parts and accessories, submitted for registration to the Registrar of Restrictive Trade Agreements, standard distributorship agreements entered into by it with its distributors.
After registering the agreements, in his application to the Commission, the Registrar alleged that certain clauses in the agreement related to restrictive trade practices and that some of them were prejudicial to public interest.
The appellant, in reply to the Commission 's notice, stated that it did not wish to be heard in the proceedings before the Commission, pointing out at the same time that there was nothing in the impugned clauses of the agreement which could be said to constitute restrictive trade practices the reasons whereof had already been explained in its reply.
1039 The Registrar filed before the Commission an affidavit in support of his application but that too did not contain any further or additional material than what was set out in his application.
No other evidence, oral or documentary, was produced by him before the Commission in support of the allegation that the agreement constituted a restrictive trade practice.
By its order dated May 14, 1976 the Commission declared certain clauses of the appellant 's distributorship agreement to be void.
While correspondence was going on between the Registrar and the appellant on the submission of a revised distributorship agreement, this Court in Tata Engineering & Locomotive Co. Ltd. vs Registrar of Restrictive Trade Practices, ; gave its interpretation on the relevant provisions of the Act.
Thereupon the appellant made an application to the Commission pointing out that it did not contest the enquiry proceedings under section 37 in the first instance because the Commission 's decision in the Telco case was directly applicable; but now that that decision had been reversed by the Supreme Court in appeal, its order dated May 14, 1976 needed amendment/modification.
An application under section 13 (2) read with regulation 85 was accordingly made for revocation, amendment or modification of the Commission 's order of May 14, 1976.
The Commission rejected this application by an order dated 28th February 1978.
In its appeal under section 55 of the Act impugning the Commission 's order dated 28th February 1978 the appellant contended that (1) the Registrar 's application alleging restrictive trade practices did not set out any facts showing how the appellant 's trade practices were restrictive in nature and that the Registrar 's application not having been made in accordance with the law laid down by this Court in Telco case the impugned order of the Commission was liable to be revoked or modified under section 13(2); (2) the order did not give any reasons for its decision and so was vitiated; and (3) the order was a continuing order because it required the appellant not merely to cease but also desist from the restrictive trade practices set out in the order and was, therefore required to be continually justifiable and since it was, contrary to the law laid down in Telco case it was liable to be revoked or amended; in any event the decision of this Court being subsequent to the making of the Commission 's order, there was enough justification for revoking or modifying the order under section 13(2) of the Act.
The respondent, on the other hand, contended that (1) on an application of the rule of interpretation enacted in section 8(1) or the General Clauses Act, reference in section 55 to section 100 C.P.C. must be construed as a reference to the new section 100, C.P.C. and so construed an appeal to the Supreme Court would lie only if the case involved "a substantial question of law" and not otherwise and since in this case no such question was involved, the appeal was not maintainable; (2) section 13(2) could not be used by the appellant as a substitute for section 55; and (3) by reason of its subsequent conduct in acquiescing in the Commission 's order and unconditionally accepting it, the appellant was precluded from raising any contention against its validity in appeal to this Court.
Allowing the appeal, ^ HELD: The appeal is maintainable under section 55 of the Act.
[1064 C] 1(a) On a proper interpretation of section 55 it must be held that the grounds speci 1040 fied in the then existing section 100 CPC were incorporated in section 55 and the substitution of the new section 100 did not affect or restrict the grounds as incorporated in section 55.
In any event, the present appeal raises substantial questions of law, and so is maintainable.
[1064 C] (b) There is a distinction between a mere reference to or citation of one statute in another and an incorporation.
Where there is a mere reference to or citation of one enactment in another without incorporation, section 8(1) of the General Clause Act applies and the repeal and re enactment of the provision referred to or cited has the effect set out in that section and the reference to the provision repealed is required to be construed as reference to the provision as re enacted.
But where a provision of one statute is incorporated in another, the repeal or amendment of the former does not affect the latter.
The effect of incorporation is as if the provision incorporated were written out in the incorporting statute and were part of it.
Once the incorporation is made, the provision incorporated becomes an integral part of the statute in which it is transposed and thereafter there is no need to refer to the statute from which the incorporation is made and any subsequent amendment made in it has no effect on the incorporating statute.
[1060 C G] Collector of Customs, Madras, vs Nathella Sampathu Chetty & Anr., ; ; New Central Jute Mills Co. Ltd. vs The Assistant Collector of Central Excise, Allahabad 63 at 69; Council vs Hindustan Co operative Insurance Society Ltd., 58 I.A. 259, Ramswarup vs Munshi & Ors. ; ; Bolani Ores Ltd. vs State of Orissa, ; ; referred to.
(c) Section 55 is an instance of legislation by incorporation and not legislation by reference.
In enacting section 55 the legislature did not want to confer an unlimited right of appeal but wanted to restrict it.
It found that the grounds set out in the then existing section 100 CPC were appropriate for restricting the right of appeal and hence incorporated them in s.55.
The legislature could never have intended to limit the right of appeal to any ground or grounds which might from time to time find place in section 100 without knowing what those grounds were.
[1063 B D] (d) Secondly, the Act is a self contained code and it is not possible to believe that the legislature could have made the right of appeal under such a code dependent on the viscititudes of a section in another statute.
[1063 F] (e) That apart, an indissoluble link between section 55 and section 100, CPC would lead to a startling result.
If, for example, section 100 were repealed, section 55 would be reduced to futility and the right of appeal under the Act would be wholly gone.
It would be absurd to place on the language of section 55 an interpretation which might in a given situation result in denial of the right of appeal altogether and thus defeat the plain object and purpose of the section.
[1063 H] (f) Even assuming that the right of appeal under s.55 is restricted to the ground specified in the new section 100 CPC the present appeal would still be maintainable because it involves a substantial question of law relating to the interpretation of section 13(2) of the Act.
[1064 D] 1041 (g) The test for determining whether a question of law raised in an appeal is a substantial question of law is to see whether it is of general public importance or whether it directly or substantially affects the rights of parties and if so whether it is an open question in the sense that it is not finally settled by this Court or by the Privy Council or by the Federal Court or is not free from difficulty or call for discussion of alternative views.
[1064 E] Sir Chunilal V. Mehta & Sons Ltd. vs The Century Spinning and Manufacturing Co. Ltd., [1962] Supp.
3 SCR 549; referred to.
In the present case the appeal clearly involves a substantial question of law within the meaning of the Act, because the interpretation of section 13(2) directly and substantially affects the rights of the parties and is not finally settled by this Court.
2(a) The words "in the manner in which it was made ' occurring in section 13(2) have no bearing on the content or the scope and ambit of the power but merely indicate the procedure to be followed by the Commission in amending or revoking an order made by it.
[1064 H] (b) The power conferred under section 13(2) is of the widest amplitude and in this respect it is unlike section 22 of the English Act.
This power is intended to ensure that the order passed is and continues to be in conformity with the requirements of the Act, and the trade practice condemned by the order is really and truly a restrictive trade practices and it must therefore, be construed in a wide sense so as to effectuate the object and purpose of the grant of the power.
[1065 B] (c) The powers under section 13(2) and section 55 are distinct and independent powers and one cannot be read as subject to the other.
The scope and applicability of section 13(2) is not cut down by the provision for appeal under section 55.
It is perhaps because the right of appeal given under section 55 is limited to a question of law that a wide and unfettered power is conferred on the Commission to amend or revoke an order in appropriate cases.
[1066 A] (d) The conferment of such wide and unusual power under section 13(2) was necessary to ensure that an erroneous order is capable of being corrected.
An order made under section 37 or under any other provision of the Act may affect not only the parties before the Commission but also others such as the whole net work of distributors or dealers who were not before the Commission.
It may also affect the entire trade in the product.
There may be some Facts or circumstances having a crucial bearing on the determination of the enquiry which, if taken into account, may result in a different order being made or some fact or circumstance may arise which may expose the invalidity of the order or render it bad.
There may be a material change in the relevant circumstances subsequent to the making of the order.
Therefore, by its very nature.
the order of the Commission is transient or pro tempore and must be liable to be altered or revoked according as there is material change in the relevant economic facts and circumstance.
[1366 B E] (e) But howsoever large may be the power under section 13(2), it cannot be construed to be so wide as to permit a rehearing on the same material without anything more with a view to showing that the order was wrong on facts.
[1067] 1042 (f) When Regulation 85 says that the provisions of section 114 and O. XLVII, r. 1 CPC shall as far as may, be applied to the proceedings under section 13(2) it cannot be read to mean that an application under section 13(2) can be maintained only on the grounds set out in section 114 and O. XLVII r. 1.
This regulation does not in any manner limit the width and amplitude of the power under section 13(2).
A good part of it is procedural in nature and has nothing to do with the grounds on which an application under section 13(2) may be maintained.
The words "as far as may" occurring in its last part do not indicate that an application under section 13(2) can be maintained only on the grounds set out in section 114 and O. XLVII, r. 1, CPC.
All that they indicate is that the provisions of section 114 and O. XLVII, r. 1 are to be invoked only to the extent applicable, and if in a given case they are not applicable they may be ignored; but that does not mean that the power conferred under section 13 (2) would not be exercisable in such a case.
The reference to the provisions of section 114 and O. XLVII, r. 1 does not limit the grounds on which an application may be made under section 13(2).
Clearly, therefore, even if a case does not fall within section 114 and O. XLVII, r. 1, the Commission would have power in an appropriate case to amend or revoke an order made by it in the exercise of its power under section 13(2).
[1067 E H] 3(a) The power of the Commission under section 13(2) was exercisable in the present case and the order dated 14th May 1976 was liable to be revoked.
[1077 B] (b) The submission of the distributorship agreement for registration under section 33 cannot be construed as admission on the appellant 's part that the clauses in the agreement constituted restrictive trade practices.
The appellant had possibly submitted the agreement for registration on the erroneous view (which was also the view of the Commission in the Telco case) that the moment an agreement contains a trade practice falling within any of the clauses of section 33(1) the trade practice must, irrespective of whether it falls within the definition of section 2(o) or not, be regarded as a restrictive trade practice and the agreement must be registered.
The question whether a particular trade practice is restrictive or not is essentially a question of law based on the application of the definition in section 2(o) to the facts of a given case and no admission on a question of law can ever be used, in evidence against the make of the admission.
Therefore, even assuming that there was an admission in submitting the agreement for registration it could not be used as evidence against the appellant in the enquiry under section 37.
[1075 C G] (c) There was nothing in the conduct of the appellant which would amount to acquiescence or raise an estoppel against it.
The appellant did not at any time, accept the impugned order knowing that it was erroneous.
There can be no acquiescence without knowledge of the right to repudiate or challenge.
[1068 H] (d) Neither did the failure of the appellant to prefer an appeal amount to acquiescence on its part because an application under section 13(2), which is An alternative and a more effective remedy, was available to it.
[1069 G] (e) The fact that the appellant did not implement the impugned order by entering into revised distributorship agreements with its distributors also showed that there was no acquiescence on its part so far as the order dated 14th May 1976 was concerned.
[1070 C] 1043 (f) Estoppel can arise only if a party to a proceeding had altered his position on the faith of a representation or promise made by another.
In the instant case there is nothing to show that the Registrar had altered his position on the basis of the application for extension of time made by the appellant.
[1107 D] 4(a).
The order of the Commission was bad because it was based on no material and, could not possibly have been made by the Commission.
[1076 A B] (b) The definition of restrictive trade practice in the Act is, to some extent, based on the rule of reason evolved by American courts while interpreting a similar provision in the Sherman Act.
The rule of reason normally requires ascertainment of facts or features peculiar to the particular business, its condition before and after the restraint was imposed, the nature of the restraint and its effect, actual or probable, the history of the restraint and the evil believed to exist, the reason for adopting the particular restraint and the purpose sought to be attained.
It is only on a consideration of these factors that it can be decided whether a particular act, contract or agreement imposing the restraint is unduly restrictive of competition so as to constitute restraint of trade.
Certain restraint of trade are unreasonable per se because of their pernicious effect on competition and lack of any redeeming virtue; they are conclusively presumed to be unreasonable and, therefore, illegal without elaborate enquiry as to the precise harm they have caused or the business execuse for their use.
In such cases illegality does not depend on a showing of the unreasonableness of the practice and it is unnecessary to have a trial to show the nature, extent and degree of its market effect.
[1074 A, B; 1075 A B] (c) It is now settled law that every trade practice which is in restraint of trade is not necessarily restrictive trade practice.
If a trade practice merely regulates and thereby promotes competition it would not fall within the definition even if it is to some extent in restraint of trade.
Therefore, the question whether a trade practice is a restrictive trade practice or not has the decided not on any theoretical or a priori reasoning.
but by inquirie whether it has or may have the effect of preventing distorting or restricting competition.
The peculiar facts and features of the trade would be very much relevant in determining this question.
[1072 H] (d) In the Telco case this Court laid down that an application by the Registrar under section 10(a) (iii) must contain facts which in his opinion constitute restrictive trade practice and show or establish as to how the alleged clauses constitute restrictive trade practice in the context of the facts.
But even if the application does not set out any facts or features showing how the trade practices complained of by the Registrar are restrictive practices, the Registrar can still, at the hearing of the enquiry, in the absence of any demand for particulars being made by the opposite party produce material before the Commission disclosing facts or features which go to establish the restrictive nature of the trade practice complained of and if that is done, the defect in the application would not be of much consequence.
[1070 G H] In the instant case the burden of producing the necessary material that the impugned trade practices had the actual or probable effect of diminishing or destroying competition and were therefore restrictive trade practices was on the Registrar who made on application before the Commission.
No material 1044 beyond reproducing the impugned clauses of the agreement and the words of the relevant sections having been produced, the application of the Registrar was contrary to the law laid down by this Court.
Therefore, the Commission had no basis for making its order dated 14th May 1976.
(e) The argument that the trade practices referred to in the offending clauses were per se restrictive trade practices and in any event, even if any supporting material was necessary, it was to be found in the admission of the appellant contained in its letter submitting the distributorship agreement for registration was without any force.
When the issue before the court is whether a practice trade practice set out in an agreement has or may have the effect of preventing, distorting or restricting competition so as to constitute a restrictive trade practice, it is the actual or probable effect of the trade practice which has to be judged and there is no question of contradicting, varying, adding to or substracting from the terms of the agreement by admitting extraneous evidence.
The various factors stated earlier are required to be taken into account only for the purpose of determining the actual or probable effect of the trade practice referred to in the particular clause.
In such a case it is not right to shut out oral evidence to determine the actual or probable effect of the trade practice.
[1078 D E] (b) It is not section 33(1) which invalidates a clause in an agreement relating to a trade practice but it is the restrictive nature of the trade practice as set out in section 2(o) which makes it void.
[1079 E] (c) When a question of restrictive trade practice arises in relation to a clause in an agreement it is the trade practice in the clause that has to be examined for determining its actual or probable effect on competition.
A clause in an agreement may proprio vigore impose a restraint.
Where such restraint produces or is reasonably likely to produce the prohibited statutory effect it would clearly constitute a restrictive trade practice and the clause would be bad.
[1108 D E] Tata Engineering & Locomotive Co. Ltd., Bombay,, vs The Registrar of the Restrictive Trade Agreement New Delhi, ; , applied.
Observations in Hindustan Lever Ltd. vs M.R.T.P. ; ; disapproved.
(d) In a case where a clause in agreement does not by itself impose any restraint but empowers the manufacturer or supplier to take some action which may be restrictive of competition, the mere possibility of action being taken, which may be restrictive of competition, would not in all cases affect the legality of the clause.
What is required to be considered for determining the legality of the clause is whether there is a real probability that the presence of the clause itself would be likely to restrict competition.
This is basically a question of market effect and cannot be determined by adopting a doctrainaire approach.
Each case would have to be examined on its own facts from a business and commonsense point of view.
It cannot, therefore, be said that in every case where the clause is theoretically capable of being so utilised as to unjustifiably restrict competition it would constitute a restrictive trade practice.
[1081 E H] 1045 6(a).
The order dated 14th May 1976 was clearly vitiated by an error of law apparent on the face of the record inasmuch as it contained only the final and operative order without giving any reasons in support of it.
[1083 E] (b) The two conditions precedent before the Commission can pass a cease and desist order are (i) it must be found that the trade practice complained of is a restrictive trade practice and (ii) where such a finding is reached the Commission must be satisfied that none of the "gateways" pleaded in answer to the complaint exists.
[1082 D E] (c) In the instant case the appellant did not appear before the Commission and no 'gateways" were pleaded and therefore the question of the Commission arriving at a satisfaction in regard to "gateways" did not arise.
Nonetheless the Commission was required to be satisfied that the trade practices complained of were restrictive trade practices.
The order dated 14th May 1976 did not contain any discussion showing that the Commission had reached the requisite satisfaction.
It gave merely bald directions without any reasons.
The ex parte character of the order did not absolve the Commission from the obligation to give reasons in support of the order because the appellant would have been entitled to prefer an appeal even against on ex parte order and in the absence of reasons, the appellant would not be in a position to attack the order in appeal.
It is well established that every quasi judicial order must be supported by reasons.
[1082 E H] N.M. Desai vs Textiles Ltd., C.A. 245 of 1970, dec.
On 17th Dec., 1975; Simons Engineering Co. vs Union of India, [1976] Supp.
SCR 489; followed.
|
ivil Appeal Nos. 466 and 2375 of 1969.
From the Judgment and Order dated 6 8 78 of the Kerala High Court in Appeal Suit Nos. 27/63 and 245/63.
K. section Ramamurthy, Miss Pushpa Nambiar and A. section Nambiar for the Appellant in C.A. 466/69 and R 1 in C.A. 2375/69.
P. Govindan Nair, section Balakrishnan and K. L. Rathi for R. 1 in C.A. 466/69 and Appellant in CA 2375/69.
N. Sudhakaran, section L. Aneja and K. L. Aneja for RR 2 3, in C.A. 466/69 and For RR 3 4 in C.A. 2375/69.
The Judgment of the Court was delivered by SAKARIA, J.
These two appeals on certificate arise out of execution petition No. 118 of 1962 on the file of the Subordinate Judge, Trichur, filed by P. Meriappa Gounder (hereinafter referred to as the plaintiff) to execute the, decree of the Supreme Court in C.A. 129/56 62 passed on April 22, 1958.
The common facts, out of which these appeals arise, are as follows: The plaintiff filed a suit on August 23, 1950 in the District Court, Trichur, for 'specific performance of an agreement, dated May 22, 1950, made by Soliappa Chettiar (hereinafter referred to as defendant 1) to sell a factory known as "Sivakami Tiles Works", for a consideration of Rs. 90,003/ .
The plaintiff made an advance payment on that very date of a sum of Rs. 5,003/ to defendant 1.
It was stipulated in the agreement that the sale deed must be executed and registered on or before July 15, 1950.
It was further provided that out of the balance of sale consideration, Rs. 50,000/ would be paid by the plaintiff at the time of the registration and for the remaining Rs. 35,000/ , the plaintiff was to execute a mortgage of the suit property to be redeemed on or before May 31, 1951.
It was further agreed that on payment of Rs. 50,000/ at the time of registration, the plaintiff would be put in possession of the suit property.
The plaintiff pleaded that he was ready and willing to perform his part of the agreement, but came to know that defendant 1 was trying to evade his obligation under the agreement.
Accordingly, the plaintiff sent a registered notice, dated July 7, 1950, through his lawyer to defendant 1, to which the latter replied the same day, that the factory was in possession of one Neelakanta Iyer as lessee, who had refused to give up possession and therefore, it had become impossible to give effect to the agreement to sell the factory, as giving possession to the plaintiff was a condition precedent to the execution of the sale deed.
The plaintiff further pleaded that the suit property was really in possession of defendant 1 and the alleged lease.
in favour of Neelakanta Iyer was a sham transaction and a device to evade payment of income tax, and hence defendant 1 was bound to carry out the terms of the agreement to sell.
The suit was contested by defendant 1 (who originally was the sole defendant).
His case was that, although there was an agreement to sell the suit property, it had been made clear at the time when negotiation for sale was going on, that the factory was in the possession of Neelakanta Iyer as lessee and that it was a condition precedent to the sale that Neelakanta Iyer would surrender his right under the lease and give up possession and that if he refused to do so, the agreement to sell would not be given effect to.
The defendant urged Neelakanta Iyer to surrender the possession, but he refused to do so.
In the circumstances" the contract for sale had become incapable of performance.
He denied that the lease in favour of Neelakanta was a sham transaction.
63 Pending the suit, T. V. Kochivareed (the deceased husband of the A appellant, Lucy Kochivareed in C.A. 466/69) obtained an assignment of the lease (exhibit D 3) from Neelakanta Iyer on March 5, 1951.
Since Kochivareed was later on, when the suit was pending in the Supreme Court impleaded as defendant 3, for the sake of convenience the appellant in C.A. 466/69, will hereinafter be referred to as defendant 3 On March 8, 1951, defendant 1 executed a sale deed of the suit property in favour of George Thatil, who is the nephew of defendant 3, and will hereinafter be referred to as defendant 2.
Like defendant 3, he also joined as defendant 2 at his own request, when the appeal was pending in this Court.
On December 23" 1950, the Court appointed a Receiver to manage the suit property.
On March 21, 1951, defendant 3 obtained a lease of the suit property at a rent Or Rs. 15,000/ for a period of one year from the Receiver.
The term of the lease was extended for one more year and two years ' rent, amounting to Rs 30,000/ was collected and deposited in the Court by the Receiver.
The District Court, Trichur, on August 28, 1952, decreed the suit for specific performance and mesne profits at a reduced rate of Rs. 15,000/ per annum, instead of Rs. 30,000/ per annum claimed by the plaintiff.
Against the decree of the Trial Court, two appeals were filed in the High Court one by defendant 3 and the other by defendant 2.
The High Court allowed the appeals and dismissed the plaintiff 's suit by a judgment dated March 31, 1953.
Aggrieved, the plaintiff filed C.A. 129/56 in this Court.
The plaintiff ' appeal was allowed by this Court as per its judgment and decree, dated April 22, 1958.
Since a good deal of argument centers round the construction of this Court 's decree, dated April 22, 1958, it will be pertinent to extract here the material part of that decree.
"(a) That the appellant herein do deposit within thirty days of the receipt in the decree of this Court the sum of Rs. 85,000/ in the District Court of Trichur and that on the aforesaid amount being deposited the said District Court of Trichur do forthwith give notice thereof to the respondents abovenamed and that on the aforesaid amount of Rs. 85,000/ being deposited respondents Nos. 2 and 3 herein, namely section M. R. Solaiyappa Chettiar and George Thatil do within 30 64 days from the date of receipt of the notice of the said deposit execute and register a sale deed in favour of the plaintiff (Appellant) in respect of the suit property.
(b) . . . (c) That the respondents above named do pay to the appellant the cost incurred by him in the Court of the District Judge, Trichur, in Suit No. 183 of 1950 and the costs incurred by him in the former High Court of. . . (d) . . . (e) .
AND THIS COURT DOTH FURTHER DE CLARE that appellant shall be entitled to: (a) mesne profits against such of the respondents (Is may have been in possession of the property except during the period that the property was in the custody and management of the receiver appointed by the trial court; (b) the net sum collected by the Receiver during his management; and (c) credit for all such sums as he may have advanced to the receiver under the direction of the Court for the management of property; AND THIS COURT DOTH ACCORDINGLY DIRECT that the trial Court do hold an enquiry about the mesne pro fits and such sums as may be found to be due on inquiry against the second and third respondents in respect of the mesne profits be deducted from the amount to be deposited in cash in the Court by the appellant aforesaid in accordance with clause (a) supra, and do direct the payment of the remaining amount, if any, to the third respondent (defendant 2) who is the assignee of the second respondent (defendant 1) pendent lite;" (Emphasis supplied) On September 12, 1958, the plaintiff filed an application in the District Court for execution of the said decree, dated April 22, 1958" in respect of all the reliefs allowed thereunder.
After the decree holder had deposited a sum of Rs. 85,000/ , as directed in the decree, the execution application was eventually made over to the Subordinate Judge, Trichur.
As per the decree, the sale deed was executed on March 16" 1959! by the Court on behalf of defendants 1 and 2 in favour of 65 the plaintiff and the possession of the property in consequence thereof was delivered to him on March 29. 1959.
Thereafter, the plaintiff filed Miscellaneous Petition No. 229/60 in the Trial Court.
Before the Court, defendant 3 on November 11, 1958, filed objections that he was not iliability for mesne profits, as he was never in possession and occupation of the suit property.
He further contended that his liability for mesne profits, if any.
was limited to the period commencing from the date of notice of the deposit in Court of the amount of Rs. 85,000/ till the date of delivery of possession and that the plaintiff was not entitled to interest on mesne profits, or on costs by way of restitution.
Defendant 2 contended that he was not liable, for mesne profits as he had never been in possession and management of the suit property, and that the entire liability, if at all any, for mesne profits was that of defendant 3, who had been in exclusive possession of the property.
On December 22, 1962, the court of first instance passed orders in respect of mesne profits, costs etc.
It found that defendant 1, 2 and 3 were jointly and severally liable to the plaintiff for a sum of Rs. 10,162.67 on account of costs of the Trial Court and the Supreme Court.
The Court further found that defendant 2 was separately liable to pay to the plaintiff, a sum of Rs. 11,941.63 consisting of three items, namely, Rs. l, 239.02 on account of costs recovered by defendant 2 from decree holder and payable by former with interest by way of restitution, Rs. 2,577.01 on account of costs in the High Court, and Rs. 8125/ on account of mesne profits from the factory from the date of suit till date of exhibit D 3.
The aggregate! amount under these two heads came to Rs. 23,103.70, which was allowed to be set off against Rs. 85,000/ deposited in Court by the plaintiff and the balance was directed to be paid to the second defendant 's mother, his assignee.
Apart from the sum of Rs. 10,162.67 jointly and severally payable by the third and second respondents, the District Court found that the third defendant was separately liable to pay the plaintiff a sum of Rs. l 57.086.81 consisting of these items: (a) Rs. 7,298.l0, by way of restitution on account of costs recovered from the decree holder including interest thereon; (b) Rs. 39,975.00 Rent deposited and withdrawn by him together with interest thereon; (c) Rs. 1,177.00, costs payable by him for the appeal in the High Court; and 66 (d) Rs. 1,08,636.71 net mesne profits payable by him from April 1, 1963 to the date of delivery of possession, during which period, he was found to be in possession and management.
After giving credit of a sum of Rs. 48,321 deposited by the third defendant in Court on March 9, 1959, a net sum of Rs. 1,08,765.81 was directed to be realised by the plaintiff from the estate of defendant 3 in the hands of his legal representative (appellant in C.A. 466/69).
By the same order, the Court dismissed Misc.
Petition No. 229/60 that had been filed by the plaintiff for determination of the extent of waste committed upon the property by defendant 3.
Aggrieved by that Judgment and Order, Lucy Kochivareed, wife of defendant 3, as well as the plaintiff and the second defendant, preferred appeals in the High Court of Kerala.
By a common judgment, dated August 6, 1968, the High Court partly allowed the appeals filed respectively, by the plaintiff and the legal representatives of defendant 3; but dismissed the appeal (A.S. 248/63) filed by defendant 2.
The High Court,, inter alia, affirmed the finding of the Trial Court that the third defendant was in sole and exclusive possession of the suit property during the period in question.
The Trial Court 's findings with regard to the quantum of mesne profits per year, were not found satis factory.
The High Court assessed the mesne profits at a flat rate of Rs. 15,000/ per year and determined the obligations of the parties accordingly.
The High Court further found that the second and third defendants were jointly and severally liable to pay Rs. 10,200/ by way of costs, and the second defendant alone was liable to pay Rs. i 1,000/ by way of restitution, costs in the High Court and mesne profits to the plaintiff, and that the aggregate of Rs. 21,200/ be set off against the sum of Rs. 85,000/ deposited by the plaintiff and the balance be paid to the mother of defendant 2.
Aggrieved by the judgment, dated August 8, 1968, of the High Court, Lucy Kochivareed, wife of the deceased defendant 3, has filed Civil Appeal 466 of 1969; while the plaintiff has preferred Civil Appeal No. 2375 of 1969.
Both the appeals will be disposed of by this common judgment.
We will first take up Civil Appeal 466 of 1969 filed by the widow of defendant 3.
The main contention of Mr. K. section Ramamurthy, learned counsel for the appellant (Luci Kochivareed), is that if the decree, dated April 22, 1958, passed by this Court in C.A. 129/56 is properly construed in the 67 light of the material on record and the law on the subject, then three consequences inevitably follow: (i) Both defendant 2 and defendant 3 would be deemed to be in possession of the suit property during the period in question.
The possession of defendant 2 was juridical or legal possession of an owner, he being the purchaser of the property from defendant l; while that of defendant 3 was on actual permissive possession with the consent of defendant 2.
Defendant 2 and defendant 3 being in the position of joint tort feasors would be jointly and severally liable for mesne profits or compensation.
This being the case, the plaintiff was bound to suffer a set off to the purchase price (Rs. 85,000/ ) deposited by him, against his claim for mesne profits against defendant 3.
But after the decree of this Court, the plaintiff in pursuance of a collusion between him and defendant 2, allowed the High Court to cancel the security given by defendant 2 for withdrawal of Rs. 62,900/ out of the purchase price deposited by the plaintiff.
The plaintiff was thus precluded by his conduct from claim in that much amount from defendant 3.
After setting off the entire deposit of Rs. 85,000/ , defendant 3 will be liable only, for the balance of the mesne profit, jointly with defendant 2.
(ii) The plaintiff 's right to possession of the property under the decree accrued when he deposited the price in Court and thereafter obtained the conveyance in his favour on March 16, 1959.
The possession of defendants 2 and 3 as against the plaintiff became wrongful only from the date on which the conveyance was executed in his favour, at any rate on the date (September 12, 1958) on which he fully deposited the price in Court.
(iii) The period for which the mesne profits have been awarded., is to be restricted to the one permissible under Order XX Rule 12(1) (c) of the Code of Civil Procedure.
Such period in the light of this provision would be the one commencing from the date the institution of the suit and ending on the expiration of three years from the date of the decree of the Trial Court.
The expression "the decree", occurring in the aforesaid clause (according to the counsel) means the decree of the Trial Court.
In other words, the maximum period for which mesne profits can be awarded and would be deemed to have been awarded is three years from the date of the decree of the Trial Court; and the Courts below were wrong in awarding mesne profits for a period of more than six years, commencing from the date of the institution of the suit till the delivery of possession in accordance with the decree of this Court to the plaintiff.
68 Upon the above premises, Mr. Ramamurthy maintains that the plain tiff will not be entitled to any mesne profits because his right to possession did not accrue within three years of the date of the decree of the Trial Court.
Such a right, according to the counsel, accrued to the plaintiff only on April 22, 1958 when his amended suit for specific performance and possession and future mesne profits was decreed.
In the alternative, as already noticed, counsel submits that mesne profits could not be awarded for any period prior to the date (September 12, 1958) on which the plaintiff deposited the price, because his right to possession accrued on that date and not earlier In support of his contentions, Shri Ramamurthy has cited a decision of this Court in Chitturi Subbanna vs Kudapa Subbanna & Ors.(l) He has also referred to some other rulings, wherein some general principles have been enunciated as to who can be made liable for mesne profits.
On the other hand, Mr. Govindan Nair, learned counsel for the plaintiff, submits that the. decree" dated April 22, 1958 of this Court is crystal clear.
There is no ambiguity in it.
Read in the light of this Court 's judgment, it unmistakably shows that whosoever, out of the defendants was/were in actual possession, would be liable for the mesne profits from the date of the suit till the delivery of possession.
It is pointed out that in the courts below, the positive stand taken by defendant 3 was that he was never in possession of the Suit property and therefore, was not liable for mesne profits.
It was never the case of defendant 3 that he was in derivative possession under defendant 2.
Counsel submits that defendant 3 should not be allowed to take a stand diametrically opposed to the one taken by him in the courts below.
It is further submitted that the decree of this Court was final decree so far as it laid down that the liability for the mesne profits shall be fixed on the basis of the defendant found in actual possession of the suit property.
Before dealing with the contentions canvassed on both sides, it will be profitable to notice the general principles relating to the liability formesne profits.
Mesne profits being in the natural of damages, no invariable rule governing their award and assessment in every case, can be laid down and "the Court may mould it according to the justice of the case".
Even so, one broad basic principle governing the liability for mesne profits is discernible from Section 2(12) of the Code of Civil Procedure which defines 'mesne profits ' to mean "those profits which the person in wrongfil possession of property actually received or might with ordinary (1) ; 69 diligence have received therefrom together with interest on such profits, but shall not include profits due to improvements made by the person in wrongful possession".
From a plain reading of this definition, it is clear that wrongful possession of the defendant is the very essence of a claim for mesne profits and the very foundation of the defendant 's liability therefor.
As a rule, therefore, liability to pay mesne profits goes with actual possession of the land.
That is to say, generally, the person in wrongful possession and enjoyment of the immovable property is liable for mesne profits.
But, where the plaintiff 's dispossession, or his being kept out of possession can be regarded as a joint or concerted act of several persons, each of them who participates in the commission of that act would be liable for mesne profits even though he was not in actual possession and the profits were received not by him but by some of his confederates.
ln such a case where the claim for mesne profits is against several trespassers who combined to keep the plaintiff out of possession; it is open to the Court to adopt either of the two courses.
It may by its decree hold all such trespassers jointly and severally liable for mesne profits, leaving them to have their respective rights adjusted in a separate suit for contribution; or, it may, if there is proper material before it, ascertain and apportion the liability of each of them on a proper application made by the defendant during the same proceedings.
Another principle, recognised by this Court in Chitturi Subbanna vs Kudapa Subbanna (ibid) 'is that a decree under Order XX Rule 12 of the Code, directing enquiry into mesne profits, howsoever expressed, must be construed to be a decree directing the enquiry in conformity with the requirements of Rule 12(1)(c), so that the decree holder is not entitled to mesne profits for a period (commencing from the date F of the institution of the suit) extending beyond three years from the date of the preliminary decree.
Again, possession through another, such as a tenant, may be sufficient to create liability for mesne profits if 'such possession is wrongful.
We will now deal with the contentions advanced by Mr. Ramamurthy, in the light of these principles.
The first argument, as already noticed, is that both defendants 2 and 3 were in possession of the suit property during the period in question.
It is contended that the possession of defendant 2 was the legal possession of an owner while that of defendant 3 derivative possession of a lessee or licensee under the former.
70 A perusal of the decree dated April 22, 1958, of this Court, extracted in a foregoing part of this judgment, show 's that it was a composite decree, partly final, partly preliminary.
It was final in so far as it granted the reliefs of specific performance and possession on deposit of the price by the plaintiff.
It was preliminary inasmuch it directed an inquiry with regard to the assessment of mesne profits, and as to who out of the defendants was/were liable for payment of those mesne profits.
But, it laid down in no uncertain terms that only such of the defendants would be liable for mesne profits "as may have been in possession of the property".
Construed in conformity with the legal principles enunciated above, this direction in the decree, means that only the defendant or defendants found in actual possession and enjoyment of the property would be liable for mesne profits.
In the courts below, at no stage, defendant 3 took up the position that he was in derivative possession of the property under defendant 2.
On the contrary, in his objection petition filed before the District Court on November 11, 1958, defendant 3 emphatically asserted that he "is not liable for mesne profits for the suit property as he was never in pos session and occupation of the same".
Defendant 3 further vehemently pleaded that it was never intended at any time that he (defendant 3) "should be a lessee of the property nor was he a lessee at any time".
In para 3 of his petition, defendant 3 further pleaded that the purchase of the factory was made in favour Of defendant 2, with money advanced by him (defendant 3), and the intention then was that the suit property should be worked by defendant 2 with funds advanced by defendant 3 who should be "recouped from the profits accrued from the proper y or otherwise in respect of the purchase money advanced by him as also the advances for the working expenses".
In paragraph 5, he further pleaded that "in any event he cannot be held liable for any amount more than what is stipulated in the lease deed (EX.
I) in favour of Neelakantha Iyer".
There is not even a whisper in the pleadings that defendant 2 and defendant 3 were joint tort feasors and therefore, jointly and severally liable for mesne profits.
The plea now pressed into argument by Mr. Ramamurthy is thus a complete somersault of the position that had been taken in the courts below.
The Court of first instance after an exhaustive.
consideration of the overwhelming evidence, oral and documentary, on record reached the finding that ever since March 5, 1951, defendant 3 was, while defendant 71 2 was not, in actual control, management and possession of the suit property, and therefore, in terms of the decree dated April 22, 1958 of this Court, defendant 3 alone would be liable for mesne profits of the property.
In appeal, the High Court found that "the Court below was perfectly right in holding that the 3rd defendant was in sole and exclusive possession during the period in question and it is idle for him 3 to pretend otherwise".
Indeed, the third defendant himself had repeatedly admitted in various documents that he was in possession.
In his application, Ex 77(a), made in the Court of first instance, on March 7, 1951, the defendant admitted that he was in possession in pursuance of assignment of lease made.
in his favour by Neelakantha Iyer on March 5, 1951.
This lease has been found by this Court to be a sham transaction.
Further, defendant 3 on March 21, 1951, executed a lease in favour of the Receiver appointed by the Court.
In this cease also, he admitted that he had been in possession of the property since March 5, 1951.
The lease executed by defendant 3 in favour of the Receiver ensured for a period of two years on a yearly rental of Rs. 15,000/ and he deposited Rs. 30,000/ ' therefor as rental in Court.
Then, the Bank accounts of the factory (except for a short period from March 25, 1953 to November 11, 1954) were throughout in the name of the third defendant as lessee thereof.
We have absolutely no reason to differ from this concurrent finding of the courts below that the third defendant was in sole, actual possession and control of the suit property from March 3, 1951, when he obtained the alleged assignment of the lease in his favour from Neelakantha Iyer.
In terms of the aforesaid decree of this Court, therefore, defendant 3 alone is liable for mesne profits in respect of the period he was in p(excepting (excepting the period during which the property was under he management of the Court Receiver).
As regards the appellant 's contention that the amount deposited by the plaintiff towards the price should have been set off against the liability of defendant 3 for mesne profits, it may be observed that, there is nothing in the decree, dated April 22, 1958, of this Court which say 's that such a set off should be allowed.
On the contrary, it allowed deduction of the amounts found due against defendant 1 and defendant 2 from the deposit of Rs. 85,000/ to be made by the plaintiff towards the price, and further directed that after such deduction, the balance of such deposit made by the plaintiff" if any, shall be paid "to the third 1 respondent (defendant 2) who is the assignee of the 'second respondent (defendant l ) pendente lite." 72 Assuming arguendo, that both defendants 2 and 3 were, liable for mesne profits jointly and severally, then also, the plaintiff could, at his option, recover the whole of the amount of mesne profits from either of them; and how such inter se liability of the defendants was to be adjusted or apportioned, was a matter between the defendants only.
The plaintiff was not bound to suffer a set off in favour of defendant 3, merely because defendant 2 or his assignee withdrew the price deposited by the plaintiff without furnishing any security for its refund or adjustment towards the liability of defendant 3, there being no evidence, whatever, on record to show that such withdrawal was the result of any collusion or conspiracy between the plaintiff and defendant 2 against defendant 3.
Assuming further, for the sake of argument, that defendant 2 and defendant 3 were ' both acting in concert to keep the plaintiff out of pos session, it was not necessary for the courts below to decide the issue with regard to apportionment of liability and its adjustment between defendants 2 and 3.
Indeed, the adoption of such a course would have militated against the finding that defendant 3 alone was in exclusive possession and control of the suit property ever since March 5, 1951.
We therefore, negative the first contention of the appellant.
This takes us to the second and third points pressed into argument by Mr. Ramamurthy.
It is to be noted that defendant 3 entered into possession of the suit property under an assignment of sham lease from Neelkantha Iyer on March 5, 1951 during the pendency of the plaintiff 's suit which was institute`d on August 25, 1950.
The plaintiff had deposited Rs. 50,000/ some time after the presentation of the plaint Under the agreement for sale, dated May 22, 1950, made by defendant 1 in favour of the plaintiff, the total sale consideration was fixed at Rs. 90,003/ .
Out of it, Rs. 5,003/ had been paid to defendants on the very date of the agreement.
It was further stipulated that out of the balance, Rs. 55.000/ would be paid by the plaintiff purchaser at the time of the registration of the sale deed which was to be executed and registered on or before July 15, 1950.
It was further stipulated that on payment of the further sum of Rs. 50,000/ , the plaintiff would be entitled to be put in possession of the suit property.
Thus, when defendant 3 entered into possession, first, under the garb of an assignee of a sham lease from Neelakantha Iyer, and then further purchased the property with his own funds in favour of defendant 2, pendente lite, he was fully conscious that he was purchasing a litigation.
His possession was,, therefore, wrongful qua the plaintiff from its very inception 73 The material part of Rule 12(1) of Order XX of the Code of Civil procedure, provides: "Where a suit is for the recovery of possession of immoveable property and for rent or mesne profits, the Court may pass a decree (a) for the possession of the property; (b) . . . . (ba) . . . (c) directing an inquiry as to rent or mesne profits from the institution of the suit until (i) the delivery of possession to the decree holder, (ii) the expiration of possession by the judgment debtor with notice to the decree holder through the Court, or (iii)the expiration of three years from the date of the decree, whichever event first occurs.
" D Mr. Ramamurthy argued, if we may say so with respect, somewhat inconsistently, that the word "decree" in sub clause (iii) of clause (c) of the aforesaid rule 12(1), means the decree for possession and mesne profits which the trial court ought to have passed, and that in this view of the matter, the period of three years mentioned in sub clause (iii) will be counted from August 28, 1952, the date of the trial court 's decree, whereby mesne profits at the reduced rate of Rs. 15,000/ instead of Rs. 30,000/ per annum claimed by the plaintiff, were awarded.
In that view of the matter, according to the counsel, the plaintiff was not entitled under the law to get a decree for mesne profits beyond August 27, 1955.
It is pointed out that since the plaintiff had, as a result of the acceptance of the defendants ' appeal and dismissal of his suit by the High Court, withdrawn the deposit of Rs. 50,000/ on August 19, 1953 and he had not redeposited the amount until February g, 1959, he was not then entitled to possession and, in consequence, to any mesne profits during this period.
The argument is certainly ingenious, but untenable, being founded on fallacious premises.
The period of three years mentioned in sub clause (iii) of clause (c) of Rule 12(1) is to be computed from the date of the decree of this Court, i.e. from April 22, 1958 and it will expire on the date on which possession was delivered or relinquished by the defendant in favour of the decree holder pursuant to that decree.
In other words, the decree mentioned in sub clause 6 196SCI/79 74 (iii) of the aforesaid clause (c), would be the appellate decree, dated April 22, 1958, of this Court.
The period of three years mentioned in the said sub clause is, therefore, to be reckoned fro`m April 227 1958.
The words "whichever event first occurs" in sub c1ause (iii) imply that the maximum period for which future mesne profits can be awarded, is three years from the date of the decree for possession and mesne profits, finally passed.
The courts below, therefore, while holding that defendant 3 was liable to pay mesne profits for a period of about 6 years commencing from March 5, 1951/March 21, 195l till the delivery of possession in September, 1958 (less the period during which the property was under the management of the Receiver), were acting in conformity with the law and the terms of the decree, dated April 22, 1958, of this Court.
We, therefore, reject these contentions, also.
Another contention canvassed by Mr. Ramamurthy was that the courts below have wrongly disallowed deduction for interest on the deposit of Rs. 50,000/ , which the plaintiff had withdrawn on August 19, 1953 and had redeposited on February 9, 1959.
It appears to us that in all fairness, the defendant is entitled to deduction for interest for the period from August 19, 1953 to February 9, 1959 on the sum of Rs. 50,000/ , which, at ,6 per cent per annum, after deducting the interest for the period during which the property was under the management of the Receiver.
(According to the agreed calculations made the counsel for the parties it works out to Rs. 14,000/ approximately.
We see no reason why deduction of this amount be not allowed from the mesne profits assessed against defendant 3.
We will now take up Civil Appeal No. 2375 of 1969 filed by the plaintiff Mr. Govindan Nair, learned counsel for the plaintiff appellant.
has contended (i) that mesne profits ought to have been awarded at the Rate of Rs. 25,000/ per annum.
The High Court was in error in awarding the same at the rate of Rs. 15,000/ ; (ii) that the High Court was not justified in reducing the rate on interest from 6 per cent per annum awarded by the Trial Court to 4 per cent per annum; (iii) that interest at 6 per cent per annum was rightly awarded by the court of first instance on the sum of Rs. 30,000/ , which was two years rental paid by defendant 3, under the lease taken from the Receiver for the period from August 19, 1953 to March 9, 1959, and the High Court was in error in disallowing that interest; and 75 (iv) that the Courts below were not justified in denying costs to the plaintiff in the inquiry as to mesne profits or in appeal arising therefrom.
We will deal with these contentions ad seriatim.
Contention (i): In this connection, Mr. Nair drew our attention to Exhibits D 8 to D 15, which are Balance Sheets and Profit & Loss Accounts of the Sivakami Tile Works, relating to the period from March 31, l953 to November S, 1958.
These documents were prepared at the instance of the third defendant for the purposes of his Income tax returns.
The High Court found that these Balance Sheets and Profit & Loss Accounts prepared for Income tax puropses were suspicious documents and by themselves were not proof of the profits derived.
Mr. Nair has no quarrel with this finding.
He, however, contended That the High Court ought to have worked out the real profits by taking into account the quantity of clay purchased according to these documents.
In this connection, it is submitted that according to the evidence produced on the side of the plaintiff about five candies of clay are required for producing 1000 small tiles and even according to the evidence of the second defendant as C.P.W. 2, 51 to 6 candies are required for 1000 small tiles.
We are not impressed by this argument.
The High Court has fully considered the evidence produced on the side of the plaintiff.
It noted that the plaintiff, also, had not produced any cogent evidence to show what were the profits earned by him by working the factory in dispute for the period of one year preceding the date of his examination.
By the time plaintiff appeared in the witness box, he had been working this factory for about one year.
In the alternative, Mr. Nair submitted that even during the period of two years when the Receiver was there and defendant 3 worked the factory as a lessee under the former, he had made a profit of Rs. 22,000/ .
Our attention has, also been drawn to the document (exhibit D 8), that the income for the first year ending 1952 was Rs. 20,000/ .
The point pressed into argument is that the highest profit made by him according to these Balance Sheets and Profit & Loss Accounts during any year by defendant 3, should be taken as the rate for calculating the mesne profits.
The contention does not appear to tenable.
Once it was found that these Balance Sheets and Profit & loss Accounts were not reliable, nor the evidence produced by the plaintiff, the only reliable evidence left on the file was the rate at which the factory was leased out 76 by the Receiver to defendant 3.
When the lease for the second year was granted to defendant 2 by the Receiver on a rental of Rs. 15,000/ , the plaintiff should have objected that the rent was less or he could himself take the lease on paying higher rent.
The High Court was, therefore, not wrong in holding that this rent fixed under the lease granted by the Receiver represented the real rental value of the factory during the year in question and in the absence of any other reliable evidence for assessing the profits actually earned or which, with due diligence, could have been earned the mesne profits may reasonably be fixed at Rs. 15,000/ per annum.
We, therefore, negative the first contention of Mr. Nair, Contention (ii): The Trial Court had awarded interest at the rate of 6 per cent per annum on the mesne profits assessed by it.
The High Court reduced that rate to 4 per cent, with the observation that having regard to all the circumstances of the case, including that the plaintiff had the use of the sum of Rs. 85,000/ which he was to pay towards the price of the property a rate of 4 per cent per annum would be reasonable and just.
Even Mr. Ramamurthy has not been able to support this reduction in the rate of interest.
It was after a long drawn out litigation that the plaintiff got possession of the property.
The Trial Court, therefore rightly awarded the interest at the rate of 6 per cent per annum.
We, therefore, accept this contention and direct that interest as part of the mesne profits assessed in this case, shall be payable at the rate of 6 per cent per annum upto March 29, 1959 when possession was delivered in pursuance of the decree of this Court, to the plain tiff and further interest at 6 per cent per annum on the outstanding amount shall be payable till the date of payment.
Contention (iii): A sum of Rs. 30,000/ , being the rent collected by the Receiver from the third defendant, was deposited in Court.
This amount was withdrawn by the third defendant on August 19, 1953 following the dismissal of the plaintiff 's suit, by the High Court.
When the plaintiff 's appeal succeeded in this Court and a decree was passed in his favour by this Court, then defendant 3 redeposited the sum of Rs. 30,000/ , only on March 9, 1959.
The Trial Court had awarded interest at 6 per cent per annum on this amount of Rs. 30,000/ for the period from August 19, 1953, the date on which the defendant withdrew that deposit, until March 9, 1959, the date when he redeposited the sum.
The High Court has disallowed interest on this account 77 for the aforesaid period on the ground "that the Supreme Court does not award that".
We are unable to agree with this reasoning.
It overlooked the fact that interest on the sum of Rs. 30,000/ was being claimed under Section 144 of the Code of Civil Procedure, by way of restitution.
Section 144 in terms says that for the purpose of the restitution, the Court may make any orders, including orders for the payment of interest, damages, compensation and mesne profits which are properly consequential on variation or reversal of the decree.
There is nothing in the decree, dated April 22, 1958, of this Court which expressly or by implication prohibited the payment of interest on this sum, by way of restitution.
The Trial Court had rightly allowed interest on amount for this period at 6 per cent per annum, and we restore the same direction.
Contention (iv): The argument is that costs have been unfairly denied to the plaintiff by the Courts below.
We do not agree.
The Courts below could not have been oblivious of ' the fact that defendant 3 has since died and the respondent is his widow.
We, therefore, do not want to interfere with the discretion of the Courts below in the matter of costs.
For the foregoing reasons, we, partly allow the plaintiff 's appeal (Civil Appeal No. 2375 of 1969) to the extent indicated above, with proportionate costs.
We will dismiss the defedant 's appeal (Civil Appeal No. 466 of 1969) except to the extent that the defendant shall be allowed a set off in the sum of Rs. 14,000/ , being the interest on the sum Or Rs. 50,000/ for the period from August 19, 1953 (the date of the withdrawal of the deposit by the plaintiff) to the date when he redeposited it.
Interest on the outstanding amount at 6 per cent per annum shall be payable till the date of payment.
In Civil Appeal 466 of 1969, however, the parties will bear their own costs in this Court.
CA 2375/69 allowed in part.
CA 466/69 S.R. dismissed with modifications.
| IN-Abs | Meriappa Gounder respondent No. 1 in C.A. 466/69 and appellant 1 in C.A. 2375/69 filed a suit on August 23, 1950 in the District Court, Trichur, for specific performance of an agreement dated May 22, 1950 made by one Soliappa Chettiar.
The said Soliappa Chettiar pleaded inability to perform the contract in view of the refusal of one Neelakanta Iyer a lessee of the factory to give up possession.
Pending the suit Late Kochivareed, husband of the appellant in C.A. 466/69 obtained an assignment of the lease from Neelakanta Iyer on March 5, 1951.
On March 8, 1951 Soliappa Chettiar executed a sale deed of the suit property in favour of one George Thatil, a nephew of Kochivareed.
In the course of the proceedings the trial court appointed a Receiver to manage the suit property.
On March 21, 1951, Late Kochivareed obtained a lease, of the suit property at a rent of Rs. 15,000/ for a period of one year which was renewed for another year from the Receiver and a sum of Rs. 30,000/ SO collected as rent for two years was deposited in the Court by the Receiver.
The District Court on August 28, 1952 decreed the suit for specific performance and mesne profits at a reduced rate of Rs. 15,000/ per annum, instead of at Rs. 30,000/ per annum as claimed.
Against the decree two appeals were filed in the High Court by Kochivareed and George Thatil.
The High Court allowed the appeals and dismissed the suit by its judgment dated March 21, 1953.
The appeal filed by Meriappa Gounder (CA 129/56) was allowed by this Court as per its judgment and decree dated April 22, 1958.
On the question of the liability of the mesne profits, the present appeals arose out of interpretation of the direction (e) of this Court 's decree dated April 22, 1958.
Allowing the appeals by certificate in part the Court ^ HELD: 1.
Mesne profits being in the nature of damages, no invariable rule governing their award and assessment in every case can be laid down and the "Court may mould it according to the justice of the case".
Even so one broad basic principle governing the liability for mesne profits is discernible 59 from section 2(12) of the Code of Civil Procedure which defines 'mesne profits ' to mean 'those profits which the person in wrongful possession of property actually received or might with ordinary deligence have received therefrom together with interest on such profits, but shall not include profits due to improvements made by the person in wrongful possession." [68G H, 69A] Wrongful possession of the defendant is the very essence of a claim for mesne profits and the very foundation of the defandant 's liability therefor, Generally, the person in wrongful possession and enjoyment of the immovable property is liable for mesne profits.
But, where the plaintiff 's dispossession, or his being kept out of possession can be regarded as a joint or concreted act of several persons, each of them who participants in the Commission of that act would be liable for mesne profits even though he was not in actual possession and the profits were received not by him but by some of his confederates.
Possession through another, such as a tenant may be sufficient to create liability for mesne profits, if such possession is wrongful.
[69A C and G] 2.
In such a case, where the claim for mesne profits is against several tresoassers who had combined to Keep the plaintiff out of possession, it Is open to the Court to adopt either of the two courses.
It may by its decree hold all such trespassers jointly and severally liable for mesne profits leaving them to have their respective rights adjusted in a separate suit for contribution; or it may, if there is proper material before it ascertain and apportion the liability of each of them on a proper application made by the defendant during the same proceedings.
[69C D] 3.
A decree under Order XX Rule 12 of C.P.C., directing enquiry into mesne profits, howsoever expressed must be construed to be a decree directing the enquiry in conformity with the requirements of Rule 12(1)(c), 80 that the decreeholder is not entitled to mesne profits for a period (commencing from the date of the institution of the suit) extending beyond three years from the date of the preliminary decree.
[69E Fl Chitturi Subhanna vs Kudappa Subbanna, ; ; referred to.
The words "whichever event first occurs" in sub clause (c)(iii) of clause I of Rule 12 of Order XX Civil Procedure Code imply that the maximum period for which future mesne profits can be awarded is three years from the date of the decree for possession and mesne profits, finally passed.
The period of three years is to be computed from the date of decree of this Court i.e. from April 22, 1958 and it will expire on the date on which possession was delivered or relinquished by the defendant in favour of the decreeholder pursuant to that decree.
In other words, the decree mentioned in sub clause (iii) of clause (c) would be the appellate decree dated April 22, 1958 of this Court.
The period of three years mentioned in the said subclause is, therefore, to be reckoned from April 22, 1958.
[73G H, 74A B] 5.
Section 144 of the Code of Civil Procedure, in terms, says that for the purpose of the restitution, the Court may make any orders, including orders for the payment of interest, damages compensation and mesne profits which are properly consequential on variation or reversal of the decree.
[77A B] There is nothing in the decree, dated April 22, 1958 of this Court which expressly or by implication, prohibits the payment of interest on the sum of 60 Rs. 30,000/ withdrawn by defendant 3 by way of restitution.
The trial court had rightly allowed interest.
[77B C] 6.
The decree dated April 22, 1958 of this Court was a composite decree, partly final, and party preliminary.
It was final in so far as it granted the reliefs of specific performance and possession on deposit of the price by the Plaintiff.
It was preliminary in as much as it directed an inquiry with regard to the assessment of mesne profits and as to who out of the defendants was/were liable for payment of those mesne profits.
But? it laid down in no uncertain terms that only such of the defendants would be liable for mesne profits "as may have been in possession of the property".
This direction in the decree means that only the defendant or defendants found in actual possession and enjoyment of the property would be liable for mesne profits.
[70A C] In the instant case: (a) The third defendant was in sole, actual possession and control of the suit property from March 3, 1951, when he obtained the alleged assignment of lease in his favour from Neelakanta Iyer.
In terms of the decree of this Court, therefore defendant 3 alone is liable for mesne profits in respect of the period he was in possession (excepting the period during which the property was under the management of the Court Receiver).
[71E F] (b) The contention that the possession of defendant 2 was the legal possession of an owner while that of defendant 3 was derivative possession of a lessee or licensee under the former is not correct, since at no stage, in the Courts below defendant 3 took up the position that he was in derivative possession of the property under defendant 2.
Nor was there even a whisper in the pleadings that defendant 2 and defendant 3 were joint tortfeasors and therefore jointly and severally liable for mesne profits.
[69H, 70C, G] (c) There is nothing in the decree of this Court dated April 22 1958, indicating that the amount deposited by the plaintiff towards the price should have been sel off against the liability of defendant 3 for mesne profits.
On the contrary, it allowed deduction of the amounts found due against defendant 1 and defendant 2 from the deposit of Rs. 85.000/ to be made by the plaintiff towards the price, and further directed that after such deduction, the balance of such deposit made by the plaintiff, if any, shall be paid to the third respondent (defendant 2) who is the assignee of the second respondent (defendant 1) pendente lite.
[71F H] (d) The plaintiff was not bound to suffer a set off in favour of defendant 3, merely because defendant 2 or his assignee withdrew the price deposited by the plaintiff without furnishing any security for its refund or adjustment towards the liability of defendant 3, there being no evidence whatever, on record to show that such withdrawal was the result of any collusion or conspiracy between the plaintiff and defendant 2 and defendant 3.
Even assuming that both defendants 2 and 3 were liable for mesne profits jointly and severally, then also, the plaintiff could at his option.
recover the whole of the amount of mesne profits from either of them; and how such inter se liability of the defendants was to be adjusted or apportioned was a matter between the defendants only.
[72A C] (e) Defendant 3 entered into possession of suit property under a l assignment of sham lease from Neelakanta Iyer on March 5, 1951 during the 61 pendency of the plaintiffs suit, which was instituted on August 25, 1950.
The A plaintiff had deposited Rs. 50,000/ sometimes after the presentation of the plaint.
Under the agreement of the sale, dated May 22, 1950 made by defendant 1 in favour of the plaintiff, the total sale considerations was fixed @ Rs. 90,003/ .
Out of it Rs 5,003/ had been paid to defendant I on the very date of the agreement.
It was further stipulated that out of the balance, Rs. 50,000/ would be paid by the plaintiff purchaser at the time of the registration of the sale deed which was to be executed and registered on or before July 15, 1950.
It was further stipulated that on payment of the further sum of Rs. 50,000/ the plaintiff would be entitled to be put in possession of the suit property.
Thus when defendant 3 entered into possession, first under the garb of an assignee of sham lease from Neelkanta Iyer, and then further purchased the property with his on funds in favour of defendant 2 pendente lite, he was fully conscious that he was purchasing a litigation.
His possession was therefore wrongful qua the plaintiff from its inception [72E H] (f) Disallowance of the claim for deduction for interest on the deposit of Rs. 50,000 which the plaintiff had withdrawn on August 19, 1953 and had redeposited on 9 2 1959 is incorrect.
The defendant is entitled to interest @ 6% per annum for the said period, after deduction the interest for the period during which the property was under the management of the Receiver.
[74D E] (g) The plaintiff`s claim for mesne profits @ the rate of Rs. 25,000/ has correctly been negatived.
Since the plaintiff did not object to the lease granted by the Receiver to defendant 3 on an annual rental of Rs. 15,000/ and since he did not produce any other reliable evidence, the High Court was not wrong in holding that the mesne profits should be on the basis of this rental value of Rs. 15,000/ [76A C] (h) The plaintiff, in view of the long drawn out litigation is entitled to interest @ 6% per annum upto March 29, 1959.
[76E F]
|
Civil Appeal Nos.
2062 2063/ 78.
Appeals by Special Leave from the Judgment and Order dated 20 9 78 of the Madhya Pradesh High Court in Civil Misc.
Petition No. 403/78.
A. K. Sen, K. K. Adhikari, section K. Gambhir and Miss B. Ramrikhyanai for the Appellant.
N. C. Upadhaya, K. P. Gupta and B. B. Tawakley for Respondents 1 2.
The Judgment of the Court was delivered by KRISHNA IYER, J.
If King Midas suffered from the course of turning into gold everything he touched, Indo Anglian legalism suffers from the pathology of making mystiques of simple words of common usage when they are found in the Corpus Juris.
We cannot afford this luxury of legalistics, the besetting sin of law in action.
This acid comment is provoked by the prolonged debate carried on with logomachic dexterity in this appeal against a meticulous judgment where the semantic complexity and definitional intricacy of innocent words like 'syllabus ', 'courses of instruction ' and 'publish ' and the procedural mechanics for prescribing text books for secondary education set out in a fasciculus of sections have been investigated.
Law, in a democratic, pluralist society spreads over vast spaces where the Constitution of developing countries, like ours, commands the Slate to adventure into a profusion of welfare measures and commits to the judicial process the interpretation of legislation, not to obfuscate but to objectify the meaning of enactments.
The Justice System ceases to be functional if courts do not make the technology of statutory construction serve the betterment of society.
In Cardozo 's lofty diction: "We may figure the task of the judge, if we please, as the task of a translator, the reading of signs and symbols given from without.
None the less, we will not set men to such a task, unless they have absorbed the spirit, and have filled themselves with a love, of the language they must read ." (1) If a broad and viable reading of statutory language were not adopted by Judges filled with the wish to make things work according to social justice courts may be classed with the dinosaurs.
(1) The Nature of the Judicial Process by Benjamin N. Cardozo.
P. 174, 45 The State of Madhya Pradesh, alive to its obligation to promote education in widest commonalty, with accent on quality and cost, among the impressionable generation, undertook the task of statutory regulation of teaching material for 'primary education ', 'middle school education ', and 'secondary education '.
Then followed, in conformance with the rule of law, executive action, legislative measures, regulatory procedures and infra structures, necessary for the incarnation of a State directed but expert oriented scheme of pre university education.
A painstakingly accurate and comprehensively detailed statement of the project, with an integrated analysis of the statutory provisions and erudite enunciation of the law, is found in the judgment of Bhagwati, J. in Naraindas(1), if we may say so with respect, that a repeat performance here again may be supererogatory.
We read that ruling into this judgment by incorporations, as it were, and content ourselves with a skeletal projection of the legislation with special reference to the key sections, viz, sections 3, 4 and 5 of the Madhya Pradesh Act No. 13 of 1973.
Its title is Prathamik, Middle School Tatha Madhyamik Shiksha (Pathya Pustakon Sambandhi Vyavastha) Adhiniyam (hereinafter referred to, for short, as the 1973 Act).
The respondent before us who was the petitioner before the High Court is a private publisher.
It may be cynical to say that textbooks are commodity for consumers of school education and there is big money in the trade especially when the private sector in the book E business has been enjoying a ready market provided by the proliferation of schools and the obligatory purchase of text books, once Government prescribes them.
So, behind the veil of educational excellence formulation of syllabi and competent text books is the vast profit pouring into private publishers.
In our system, unalloyed public interest litigation, through organisations crusading in the field, is yet 'a consummation devoutly to be wished ', and private vested interests are the vociferous ventriloquists of public causes.
Democratic participation in the justice process gains reality only when popular organs blossom from the desert and enter the litigative oasis with fighting faiths.
Here the respondent successfully challenged before the High Court the validity of the prescription of the State 's text book for 'Rapid Reading ', an item in the syllabus for secondary schools.
Once Government books were chased out, the respondent filled the vacuum since prior to the entry of the State his book on the subject had admittedly been legally in vogue.
The State has, by special leave, come up in appeal and secured a stay of operation of the judgment of the High (1) Naraindas Indurkhva vs State of Madhya Pradesh & Ors. ; 46 Court, and its books are back in circulation in the schools.
brief calendar of events shows that since the opening of schools this academic year Government text books have been in use uptil now, barring for about a month between the judgment of the High Court and the stay ordered by this Court.
This bears upon moulding the relief since the benign power under article 226 is a special instrument of justice which, with flexible pragmatism and genius for equity inhibits social trauma even while upholding individual rights.
The writ jurisdiction is geared to community good.
There is a trichotomy of school education in Madhya Pradesh as in many other States Primary, Middle and Secondary.
We are concerned in this case with the text book controversy for secondary schools.
The Board of Secondary Education, Appellant No. 2, was constituted under Act No. 23 of 1965 which also conferred power on it to prescribe courses of instruction in such branches of secondary education as it deemed fit.
Indeed, the Board was a functional entity with expert capability and entrusted with secondary education in its many facets.
Even the power to make regulations was given to the Board and it did make such regulations providing for appointment of Committees on Courses which, in turn, could lay down syllabi in the various subjects and recommend suitable text books when required.
The courses approved by the Committee went to the Board and when sanctioned by the Board found their way in the printed prospectus which served as the guide book for study and examination for the students.
All that we need emphasise here is that the provisions of the 1965 Act and the regulations framed by the Board took good care of the Rule of Law as against behavioral caprice of administrative organs in this branch of education.
In 1973 the legislature enacted Act 13 of 1973, referred to earlier in this Judgment.
The provisions of this Act form the basis of the powers claimed by the appellants and the nidus of rights of the respondent alleged to have been violated.
The scheme of the statute runs as follows: Section 2 contains definitions and we are concerned particularly with section 2(d) which tells us what the legislature means by the expression 'syllabi '.
The Section also defines 'text book ', although there is not much quarrel about its connotation in the case before us.
One of the basic disputes between the parties turns on the conceptual clarity of 'syllabi ' as defined in 2(d).
Section 3 clothes the State Government and the Board with powers vis a vis laying down of syllabi.
To narrow the scope of the dispute we may straightway state that section 3(2) empowers the Board 47 to lay down 'syllabi ' in the case of secondary education.
We may have to take a close up of this provision a little later.
But suffice it to say for the present that the syllabus for 'Rapid Reading ', wh ch is the bone of contention before us, is within the province of the Board to lay down.
We may vivify the discussion by quoting the provisions of direct concern in this case and they are sections 2(d), 3 and 5. "2.(d) syllabi" means a document containing courses of instructions for each standard of primary education, middle school education and secondary education; 3.(1) Subject to the provisions of sub section (2) the State Government may, from time to time, in relation to primary education and middle school education and the Board may, from time to time, in relation to secondary education lay down syllabi and publish the same in such manner as may be prescribed.
(2) The syllabi laid down under the authority of the State Government in the case of primary education and middle school education and by the Board, in the case of the secondary education and in force immediately before the appointed day shall be the syllabi laid down and published for the purpose of sub section (1).
4.(1) The State Government may, by order, prescribe the text books according to syllabi laid down under section 3: Provided that text books for secondary education shall not be prescribed without prior con sultation with the Board.
(2) The text books prescribed by the State Government or the Board according to the syllabi referred to in sub section (2) of section 3 and in force immediately before the appointed day shall, till they are changed in accordance with the provisions of this Act, be the text books prescribed for the purpose of sub section (1).
48 (3) As from the appointed day, no books other than the text books prescribed under sub section (1) or referred to in sub section (2) shall be used in any approved school or recognised school for imparting instructions in accordance with syllabi in primary education, middle school education or secondary education.
The State Government may, if it considers it necessary so to do, undertake the preparation, printing or distribution of text books itself or cause the text books to be prepared, printed or distributed through such agency as it may deem fit on such terms and conditions as may be prescribed.
" Section 2(d) conceputalises 'syllabi '; section 3 statutorises the modus operandi for fixing the 'syllabus '.
Once the syllabus is fixed, the follow up is the prescription of text books in accordance with the syllabus.
Section 4 makes the State Government, the competent authority, to prescribe text books in accordance with the syllabus laid down under section 3.
Of course, even the provisions of text books for secondary education must be made by Government only after prior consultation with the Board.
This is obviously intended to ensure the quality of the text books which sometimes suffers at the hands of unenlightened departmental officers or unheeding political bosses too hubristic to listen to experts in the field.
It is vital to notice that until valid prescription of text books under section 4 (1) the books prescribed and in vogue immediately before the change shall continue; that is to say, the legislature has taken care to avoid a gap when there would be no text books for the students to study and take their examinations.
The scheme of section 4 is for the State Government to prescribe text books.
This may be done in one of the two ways.
Government may select from the private sector when text books are offered by publishers, if they satisfy quality control, price, social perspective and other relevant aspects.
Indeed, many publishers compete in the text book market because it assures purchasers and profit.
However, for a variety of good reasons the State Government may consider it necessary to depart from the practice of picking and choosing from the private sector.
May be, books are of sub standard quality; may be, the paper on which they are printed or the manner and design may be unsatisfactory; may be the cost is such that the poor children may be 49 priced out.
It may also be that Government thinks that more excellence and better educational direction may be imparted to the impressionable generation of students at the secondary school level by the public sector getting such text books compiled in conformity with the syllabi laid down by the concerned authority.
Section 5, therefore, makes it perfectly legitimate for the State Government to n undertake the preparation, printing and distribution of text books itself or cause them to be so done through such agency as it may deem fit and on such terms and conditions as may be prescribed.
In short, the relevant provision creates a facultative public sector for text book production and distribution.
What is significant to note is that the departure from the private sector and the "nationalisation" of text book manufacture may be undertaken only if the State Government "considers it necessary so to do".
Once it comes to that judgment, the competence to deprive the private sector and entrust to the public sector is beyond challenge.
In the present case, one of the subjects of secondary education is "Rapid Reading".
The syllabus has to be laid down in this behalf.
Text books need to be prescribed in conformity with the syllabi and then a decision has to be taken by the Government either to choose extant text books from the private publishers or take over the operation itself if it considers it necessary so to do.
The first appellant, in the present case, chose to exercise its power under section 5 and produced the necessary text book for "Rapid Reading" and distributed it among the students in many schools. 'Until then, the respondent 's books were in use for "Rapid Reading".
Naturally, when his customers vanished and his profit was extinguished he came up to the Court contending that the statutory exercise had not been carried out before preparing E ' and distributing the text books under section 5 and that, for that reason, the Government text books had to be withdrawn as invalid and his books, instead, resuscitated for circulation.
The specific grounds of invalidation relied on by the Writ Petitioner are many and the long Judgment of the High Court has lavished discussion on these aspects.
Counsel have sought to repeat the rival contentions before us.
But we do not think that it is necessary to embark upon the labyrinthine details or prolix analyses which have engaged the learned Judges of the High Court.
Nor do we think that extensive or intensive consideration of the decision in Naraindas 's case (supra) is called for since its ratio is clear and does not come in for serious application in the present dispute.
In this view, we proceed to specificate the precise issues pertaining to the decision as to whether 50 the production and distribution of text books by the State Government, on its own, is liable to be voided on the score of any fatal statutory infirmity.
The laying down of the syllabus is a condition precedent to the prescription of text books, because the courses of instruction follow upon and should be in conformity with the syllabus and text books are in implementation of the courses of instruction.
The first question that falls for consideration, therefore, is as to whether there has been a legally sustainable laying down of the syllabus for "Rapid Reading".
If there has been, the second crucial issue of importance is as to whether the State Government has given consideration to the availability of text books in terms of the 'syllabi ' with the publishers.
If such publishers have offered their text books, Government may consider them from many angles and reach a conclusion that it is necessary for the Government itself to undertake the preparation, printing and distribution of text books in this regard or entrust these operations to a choosen agency.
The question is whether such a consideration had been bestowed by the Government as required by section 5 before it produced and distributed the text books compiled by itself among the students of the secondary schools.
Assuming there is any breach, the next question is whether such non compliance spells invalidation of the text books altogether.
Finally, assuming all the points against the State Government, should the Court make a realistic appraisal of the situation as it exists currently and mould the relief appropriately so that the student community, which has to take the examinations in a couple of months or so, may not be obliged to switch text books belatedly in taking their examinations.
The ultimate concern of the judicial process is not to guarantee the profit of the private producers or to condone every executive sin but, within statutory parameters, to promote the educational welfare of the student community.
The core of the controversy turns on whether there is statutorily solemnised syllabus at all under section 3(2) of the 1973 Act and, whether the State has the facultative power to compile and distribute its own text books under section 5, even if there are private publishers in the field with ready made text books This duplex challenge once disposed of, the other disputes do not merit much discussion.
Naraindas (supra), heavily relied on by the respondent, is impeccable law but inapplicable here.
True many points arise, according to counsel.
But abbreviation, without amputation, does justice to the lis and avoids forensic prolixity, and so we turn the focus on these two points and, in the light of 51 Our answers, structure the relief to promote the interests of the invisible and inarticulate student sector for whose sake the law was made.
The real party, in many litigative battles under article 226, is the community whose processual participation is alien to the adversary system inherited from an individualistic legal culture.
The judges are the guardians of that silent sector until our system of procedure is re structured.
This observation assumes prominence as we shape the remedy finally.
Section 3 as well as section 5 must now come under the legal microscope.
Before that, we must bestow attention on a preliminary plea which respondent 's counsel, encouraged by his success at the High Court level, has urged before us.
He argues that the mere mention of topics in bare outline, such as has been done here by the Board of Secondary Education, does not constitute 'syllabi ' as defined in section 2(d).
To fulfil the statutory requisites, a syllabus for a subject must concretise and constellate courses of instruction, short of which it is no syllabus in the eye of law.
If this be valid, no syllabus, no text book; and no text book, the status quo ante; and the book of the respondent being admittedly extant immediately before, it gains legal re incarnation and all the students shall have to do 'rapid reading ' of his book for which they must first buy them.
The Board is the legislative instrument for laying down the syllabi and must be presumed to possess academic expertise sufficient to understand what is a syllabus.
Words of technical import whose signification is familiar for specialists in the field should not be petrified by courts based on verbalism. 'A little learning is a dangerous thing ' and courts should not 'rush in ', tempted by definitional attraction, where experts 'fear to tread '.
Section 2(d) tells us that a syllabus is a document containing courses of instruction.
A broad outline, a brief indication, a demarcation of the topic may well meet with lexical approval.
Moreover, section 2(d) speaks of a 'course of instruction '.
This can be a bare outline, a bald mention of the matter and does not compel particularisation of details, even if it be desirable.
That part is taken care of by the next step of prescription of text books.
A syllabus may helpfully give general features but may not cease to be so solely because only an outline is silhouetted.
For instance, 'music ' without more, is not syllabus, because it may range wildly from weird noises which make music among African tribes but to an Indian ear may offensively amount to 'sound and fury signifying nothing ' to a concord of sweet sounds or continuous flow of micro notes which thrills the West and the East.
But if 'sitar ' or 'violin ' is mentioned it illumines, although it still leaves much for imagination to fill in a hundred details for instruction to be actually imparted in the class.
52 'Courses of Instruction ' in section 2(d) simply means the rubric for teaching, not more, although treacherous vagueness which disables textbook producers from responding to the Government by offering their books may be bad.
It must be a syllabus of courses and so the courses must be spelt out with relevancy, even though with brevity.
To exemplify again, 'Justice ' is not enough, Indian Justice System may fill the bill.
Brief may be, but not blank.
While courts, will not surrender their decisional power to the vagarious experts non interference by courts in fields of specialists, save in gross cases, is a wise rule of guidance.
From this angle, we are not satisfied that for so elusive a subject as 'Rapid Reading ', 'particularise or perish ' should be the test.
The absence of syllabus cannot defeat the case of the State.
We stress, however, that, functionally speaking, the syllabus must tell the publishers and pundits in the concerned field sufficient to enable them to help Government under section 4 to choose text books.
If this minimum is not complied with the court will use the lancet and issue an appropriate writ.
Language permitting, the appropriate interpretational canon must be purpose oriented.
Therefore, the expression "syllabi" must be so interpreted as to fulfil the purpose of sections 3 and 4 which means there must be sufficient information for those concerned to know generally what courses of instruction are broadly covered under the heading mentioned, so that they may offer text books for such courses.
If there is total failure here the elements of syllabi may well be held to be non existent even though experts might claim otherwise.
The law is what the Judges interpret the statute to be, not what the experts in their monopoly of wisdom assert it to be.
Now we move on to section 3 to verify what flaws vitiate the laying down of syllabi.
In this case if we predicate the existence of syllabus the next ingredient it its publication "in such a manner as may be prescribed.
" Publication of the syllabus is thus essential under section 3 and when confronted by this requirement, Shri A. K. Sen, counsel for the State, sought to construe that expression to mean communication by the Board to the Government or other concerned authorities.
To publish, according to him, is to make known to those concerned.
On the contrary, Shri Upadhyaya, counsel for the respondent, argued that "to publish" was more than to communicate to the Government Departments and really meant making known to the community or the concerned section of the community.
Contextually speaking, we are satisfied that 'publication ' means more than mere communication to concerned officials or Departments.
To publish a news item is to 53 make known to people in general; "an advising of the public or making known of something to the public for a purpose" (Black 's Legal Dictionary, p. 1386).
In our view, the purpose of section 3 animates the meaning of the expression 'publish '.
'Publication ' is "the act of publishing anything; offering it to public notice, or rendering it accessible to public scrutiny. an advising of the public; a making known of something to them for a purpose." Logomachic exercises need not detain us because the obvious legislative object is to ensure that when the Board lays down the 'syllabi ' it must publish 'the same ' so that when the stage of prescribing text books according to such syllabi arrives, both the publishers and the State Government and even the educationists among the public may have some precise conception about the relevant syllabi to enable Government to decide upon suitable text books from the private market or compiled under section 5 by the State Government itself.
In our view, therefore, "publication" to the educational world is the connotation of the expression.
Even the student and the teaching community may have to know what the relevant syllabus for a subject is, which means wider publicity than minimal communication to the departmental officialdom.
If this view be sound, the State Government has failed to comply with the requisite of publication of the syllabus before prescribing the text books.
On that ground atone the order of the Government prescribing text books must fail because the condition preceding such prescription, namely, publishing of the syllabi has not been complied with.
We confine our observations only to the item relating to "Rapid Reading ' ' so that there is no need for reopening other subjects and syllabi and to create chaos or uncertainty.
What should be the follow up action that the Court should adopt in issuing the necessary direction on this finding that, for want of publication of the syllabus, the prescription of text books even under section 5 must fail ? Necessarily publication is important and we should insist that the State Government should not dismiss it as a ritual of little moment.
As we have earlier indicated, but may repeat for emphasis that there is an object in publishing the syllabi and this public purpose will be stultified to the prejudice of the school going community if the syllabi ar not made known to the public generally.
Only when they come to know about the syllabi prescribed, representatives in the educational field or in the public sector may be able to tell the State Government what type of text books are available, what kinds of books will make for excellence in teaching and what manner of material will promote 54 the interests of the students in the subjects of study.
If there are existing text books, Government may give consideration for them or may invite opinion of experts on their worth.
Government may pay attention to the cost of the books so made available, their readability, their design and arrangement, the impression that they may produce on the 8 plastic minds and a host of other factors.
All these possibilities may be frustrated if the syllabi are not published.
What has been done in the present case by the State Government is to exercise its power under section 5 to prepare, print and distribute text books of its own compilation.
Certainly, this is well within the power of Government under section 5.
To dispel misapprehension we emphasise that no private publisher has a right under section 4 that his text book shall be prescribed or necessarily considered by Government.
No such right as is claimed by the respondent publisher has, therefore, been violated by the State Government.
We upset Government 's text books, not because the respondent publisher has a right to have his books necessarily considered by the Government, but because the syllabi have not been published prior to the prescription of text books.
We must erase another possible confusion.
Government has plenary power under section 5 to produce its own text books in tune with the syllabi prescribed under section 3.
No private published can quarrel 13 with it on the ground that his profit is affected or that the State sector acquires monopoly in text book production.
The legislature, in its wisdom, has empowered the State to do so and there is no vice of unconstitutionality whatever.
But there is a caveat built into section 5 by the legislature.
Before the State Government undertakes the preparation, printing or distribution of text books or causes them to be so done by any other agency, it must bestow appropriate attention on the wisdom of the policy in the given circumstances.
Section 5 authorises Government to enter the text book field as a monopolist "if it considers it necessary so to do.
" These are weighty words and cannot be slurred over.
Nationalisation of the activity of preparation, printing or distribution of text books is a serious step and resort to that measure calls for a policy judgment.
Government must consider it necessary so to do and this consideration must imply advertence to relevant factors.
Myriad matters, material to a right decision, may be thought of since books are more than collection of information but mental companionship for good or evil.
School children require uplifting books, not such as pollute their minds or inject prurience.
Their creativity must be kindled and not stifled.
The presentation of subjects must be appetising, not inhibiting.
The cost must be within the means of the 55 poor Indian parent.
Availability of sufficient number of books within easy reach so as to avoid a scarcity situation may be yet another criterion.
Indeed, it is beyond exhaustive enumeration to catalogue the considerations.
We do not think that the Court should sit in judgment over Government decisions in these matters save in exceptional cases.
The law is complied with if Government has, before under taking action under section 5, bestowed consideration on matters of relevance which may vary from time to time and from subject to subject.
We need hardly say that Government may like to avoid expenditure from the public exchequer if books, inexpensive and qualitatively acceptable, are easily available.
The decision is that of the Government and it has a wide discretion.
Publishers have no right to complain, and if the mind of the Government has been relevantly applied to the subject, courts must keep their hands off.
The construction we have put upon section 5 gives Government power which is also a responsible power.
Indeed, all public power is a public trust and in that spirit sections 4 and 5 must be executed.
On this basis, the direction that we give is that the State Government will publish, under section 3, the syllabus for 'Rapid Reading ' as a first step.
Thereupon, representations from any relevant quarters, if received, will be considered under section 4 so as to reach a decision on the prescription of the text books according to the syllabus.
This decision may be either to choose some text books available in the field or to compile text books on its own.
If the decision is the latter, Government is perfectly free to undertake preparation, printing and distribution.
It may be right to caution the State while choosing text books from the private sector or preparing such books on their own to remember the vital constitutional values of our nation.
Social justice is the corner stone of our Constitution.
Freedom of expression is basic to our democratic progress.
The right to know, awareness of the implications of a sovereign, secular, socialist republic and its membership and the broad national goals incorporated in the Constitution are fundamental.
When education is a State obligation, when prescription of syllabi and text books falls within the governmental function, when the constellation of values mandated by the Constitution is basic to our citizenship, the play of sections 3, 4 and 5 must respond to this script.
Instruction at the secondary school level must be promotional of these paramount principles.
Ultimately, it is Youth Power that makes for a Human Tomorrow.
The felt necessities of our cultural integration and constitutional creed are fostered essentially at the school level.
Books are not merely the best companions but make or mar the rising generation.
56 We have reached the final.
What remains is to crystallise the conclusions and to formulate the directions.
The syllabus for 'rapid reading ' is not bad as falling short of definitional needs, although it is desirable for the Board to be more expressive when laying it down.
Wilful vagueness in syllabi will invite an adverse verdict. 'Rapid Reading ', as a rubric, in itself, somewhat slippery as a substantive topic and so the syllabus for it also may share that trait.
The new plea urged specifically for the first time at the argument stage in this Court (and controverted by the State) that no syllabus has been laid down, as a fact, for 'Rapid Reading ' is too late to be permitted.
The syllabus for 'Rapid Reading ' suffers invalidation under section 3 because it has not been published.
The publication must precede the prescription af text books under section 4 or their preparation under section 5.
Here the case of the State show that the syllabus was published only on June 30, 1978, while the text books were prescribed in October 1977.
So sections 3 and 4 have been breached and a fresh decision by Government prescribing text books for 'Rapid Reading ' must be taken.
We are not disposed, even as in the case of the plea of no syllabus for 'Rapid Reading ', to consider the nascent discovery of Sri Upadhyaya, counsel for the respondent, that the two text books prescribed for 'Rapid Reading ' were not even in printed existence when they were prescribed.
Judicial proceedings, especially at the earlier stages, should not ordinarily be allowed to become the scene of newly discovered points of contention.
There is no substitute for proper briefs and good home work.
Never can controverted facts he raised de novo here.
We disallow the contention of non existence of text books in print or otherwise, when they were prescribed.
Reverting to the project of providing for the future course of action and to obviate the untowardness of a void in the syllabus and text books, we hold that the State Government shall take a fresh decision under sections 4 and 5 read together.
If publishers of text books or pro bono publico representationists communicate relevant matters bearing on the selection of text books and the wisdom of the State itself under taking the task, Government will give thought to them.
There is no need to wait idefinitely for such representations.
If within one month from they are received, their merits will be examined departmentally.
If, thereafter, Government considers it proper to take over the text book business under section 5 it is free to do so.
We make it clear that the private sector has no "right" and Government 's jurisdiction is wide although the State need not be allergic to private publishers if books of excellence, inexpensive and well designed, are readily available.
57 These directions take care of the future.
But what about the current academic year ? To change horses mid stream may be disastrous.
Throughout the better part of the year, except for around a month, Government text books have been in use.
The examinations are impending.
To harass the young alumni by putting them through fresh books of the respondent (though in circulation last year) is an avoidable infliction.
Therefore, for the nonce, Government books for 'Rapid Reading ' will continue in this year 's classes.
We direct so.
Before the next academic year begins, Government will decide, under sections 4 and 5, on preparing text books itself or selecting from the private sector.
This will be done on or before March 31, 1979.
If the decision taken is either way, the books shall be well stocked by the end of May.
We allow the appeal in part and dismiss in part and as a corollary, ing dates and months but governmental processes are often 'paper logged '. 'The fear that the State Government may not be sufficiently conscious of the due priority to be given to the tasks now set before it has persuaded us to issue these time bound directions.
We allow the appeal in part and dismiss in part and as a corollary, order the parties to bear their costs throughout.
N.V.K. Appeal allowed in part.
| IN-Abs | The M. P. Prathmik Middle School Tatha Madhyamik` Shiksha (Pathya Pusthakon Sambandhi Vyavastha) Adhiniyam 1973 empowered the State Government to prescribe text books according to syllabus laid down and to undertake the preparation, printing and distribution of text books.
Section 2(d) of the Act defines "syllabi" as a document containing courses of instructions for each standard of primary, middle school and secondary education.
Section 3 empowers the State Government, in the case of primary and middle school education, and the Board in the dace of secondary education, to lay down the syllabi and publish the same.
Section 4 lakes the State Government the competent authority to prescribe the text books in accordance with the syllabus laid down under section 3.
Section 5 empowers the State Government to undertake the preparation, printing and distribution of text books itself or cause them to be done through such agency as it deems fit and on such terms and conditions as may be prescribed.
The appellant (State Government) exercised its power under section 5 of the Act and produced the necessary text book for "Rapid Reading" an item in the syllabus for secondary schools and distributed it among the students in many schools.
Until then, the books of the respondent, 2 private publisher were in use.
The respondent challenged the action of the State Government in the High Court on the ground that the State Government had not given consideration to the availability of text books in terms of the "syllabi" with private publishers as required by section 5 of the Act, before it produced and distributed the text books compiled by itself among the students of the secondary schools.
The High Court upheld the challenge and held that the statutory exercise envisaged under the Act had not been carried out before preparing and distributing the Government text books.
In the State Government 's appeal to this Court it was contended that (I) as section 2(d) envisages syllabus as a document containing courses of instruction, a broad outline, a demarcation if the topic would be sufficient compliance and that there need not be particularisation of details, and (2) 'publication ' of the syllabus, essential under section 3 means communication by the Board to the Government or the concerned authorities.
On behalf of the respondent it was submitted that the mere mention of topics in bare outline, as in the instant case did not constitute 'syllabi ' as defined in section 2(d) and that to fulfil, 4 196SCI/79 42 the statutory requisites a syllabus for a subject must concretise and constellate courses of instruction, short of which it is no syllabus in the eye of law.
Allowing the appeal in part, ^ HELD: 1.
The syllabus for 'Rapid Reading ', suffers invalidation under section 3 because it has not been published.
The publication must precede the Prescription of text books under section 4 or their preparation under section 5.
[56C] In the instant case the syllabus was published only on June 30, 1978 while the text books were prescribed in October, 1977.
So sections 3 and 4 have been breached and a fresh decision by Government prescribing text books for 'Rapid Reading ' must be taken.
[56D] 2.
The State Government shall take a fresh decision under sections 4 and 5 read Together.
If publishers of text books or pro bono publico representationists communicate relevant matters bearing on the selection of text books, their merits will be examined departmentally.
If, thereafter, Government considers it proper to take over the text books business under section 5 it is free to do so.
The private sector has no 'right ' and Government 's jurisdiction is wide, although the State need not be allergic to private publishers if books of excellence, inexpensive and well designed, are readily available.
[56G H] 3.
The laying down of the syllabus is a condition precedent to the prescription of text books, because the courses of instruction follow upon and should be in conformity with the syllabus and text books are in implementation of the courses of instruction.
[50B] 4.
To fulfil the statutory requisites, a syllabus for a subject must concretise and constellate courses of instruction, short of which it is no syllabus in the eye of law.
[51D] 5.
No private publisher has a right under section 4 that his text book shall be prescribed or necessarily considered by Government.
No such right as is claimed by the respondent publisher has, therefore, been violated by the State Government.
[54C] 6.
The syllabus for 'Rapid Reading ' is not bad as falling short of definitional needs, although it is desirable for the Board to be more expressive i when laying it down.
Wilful vagueness in syllabi will invite an adverse verdict.
[56A] 7.
A syllabus may helpfully give general features but may not cease to be so solely because only an outline is silhouetted. 'Courses of Instruction ' in section 2(d) simply means the rubric for teaching, not more.
It must be a syllabus of courses and so the courses must be spelt with relevancy, even though with brevity.
[51G, 52A] 8.
Functionally the syllabus must tell the publisher and pundits in the concerned field sufficient to enable them to help Government under section 4 to choose text books.
If this minimum is not complied with the court will use the lancet and issue an appropriate writ.
[52C D] 9.
The expression "syllabi" must be so interpreted as to fulfil the purpose of sections 3 and 4 which means there must be sufficient information for those concerned to know generally what courses of instruction are broadly covered 43 under the heading mentioned, so that they may offer text books for such A courses.
If there is total failure here the elements of syllabi may well be held to be non existent, even though experts might claim otherwise.
The law is what the Judges interpret the statute to be, not what the experts in their monopoly of wisdom assert it to be.
[52E F] 10. 'Publication ' means more than mere communication to concerned officials or departments.
The purpose of section 3 animates the meaning of the expression 'publish '. 'Publication is "the act of publishing anything; offering it to public notice, or rendering it accessible to public scrutiny. an advising of the public; a making known of something to them for a purpose." [52H, 53A B] 11.
The legislative objective is to ensure that when the Board lays down the 'syllabi ' it must publish 'the same ' so that when the stage of prescribing text books according to such syllabi arrives, both the publishers and the Stab Government and even the educationists among the public may have some precise conception about the relevant syllabi to enable Government to decide upon suitable text books from the private market or compiled under section S by the State Government.
[53C] 12.
"Publication" to the educational world is the connotation of the expression.
Even the student and the teaching community may have to know what the relevant syllabus for a subject is, which means wider publicity than minimal communication to the departmental officialdom.[53D] Only when they come to know about the syllabi prescribed representatives in the educational field or in the public sector may be able to tell the State Government what type of text books are available, what kind of books will make for excellence in teaching and what manner of material will promote the interests of the students in the subjects of study [53H 54A] 13.
Government has plenary power under section 5 to produce its own text books in tune with the syllabi prescribed under section 3.
No private publisher can quarrel with it on the ground that his profit is affected or that the State sector acquires a monopoly in text book production.
The legislature has empowered the State to do so and there is no vice of unconstitutionality whatever.
The caveat built into section S by the legislature is that it authorises Government to enter the text book field as a monopolist "if it considers so to do." [54E F] 14.
Nationalisation of the activity of preparation, printing or distribution of text books is a serious step and resort to that measure calls for a policy judgment.
[54G] 15.
The Court should not sit in judgment over Government decisions in these matters save in exceptional cases.
The law is complied with if Government has, before undertaking action under section 5, bestowed consideration on matters of relevance which may vary from time to time and from subject to subject.
Government may like to avoid expenditure from the public exchequer if books, inexpensive and qualitatively acceptable, are easily available.
The decision is that of the Government and it has a wide discretion.
Publishers have no right to complain, and if the mind of the Government has been relevantly applied to the subject, courts must keep their hands off.
[55B C] Naraindas Indutkhya vs State of M.P. & Ors., ; ; Black 's Legal Dictionary, p. 1386, referred to. 44
|
Civil Appeal No. 2218 of 1969.
Appeal by Special Leave from the Judgment and Decree dated 14 3 1969 of the Calcutta High Court in appeal from Appellate Decree No 718 of 1962.
D. N. Mukherjee and N. R. Chaudkary for the Appellant.
Purshottam Chatterjee, P. K. Chatterjee and Rathin Das, for the Respondents.
The Judgment of tho Court was delivered by SARKARIA, J.
This appeal by special leave is directed against a judgment, dated March 14, 1969, of the High Court at Calcutta.
22 The appellant had the interest of a Darpatnidar in the land in suit, measuring 9 acres (27 bighas).
The plaintiff by a lease deed (Ex.
A) dated July 10, 1941, granted to the defendant respondents a lease of this land for the purpose of raising and taking sand out of the land for a period of 9 years ending on July 13, 1949.
In this lease deed, the property was described to be Patni Mahal.
Under the terms of this lease, the lessee had an option of renewal for another 9 years.
Subsequently on April 27, 1950, appellant made a similar grant (exhibit
I) for another 9 years expiring on April 13, 1959 but this grant was called a "licence".
The respondents did not pay the licence fee for the period from 1362 (14 4 1955) to 1365 B.S.
The plaintiffs thereupon issued notice, dated March 31, 1966, terminating the licence and then filed Suit No. 37 of 1960 for ejectment of the respondent in the Court of the Munsif, Second Court, Chandernagore.
The suit was resisted by the defendant respondents, inter alia, on the ground that the land had vested in the State under the West Bengal Estates Acquisition Act, 1953 (hereinafter referred to as the Acquisition Act); that they were tenants, and not licensees, under the plaintiff and after the date of vesting with effect from April 14, 1955, became direct tenants under the State in respect of suit land and were paying rent to the State.
The Trial Court dismissed the suit holding: (i) that the defendants were not licensees, but were tenants; and (ii) that the plaintiff was not in khas possession on the date of the vesting (April 14, 1955); so he could not retain the land under Section 6(1) (i) of the Act In the result, the suit was dismissed.
The first appellate Court reversed the decision of the trial court and decreed the suit with the finding that the grant being a licence, the plaintiff intermediary was entitled to retain the holding under Section 6 (1) (i) of the Act.
Allowing the Second Appeal by the defendants, the High Court held: (a) that if the lease (Ex.A), being a lease for 9 years, was void under Section 107 of the , it would still operate as a lease from month to month; (b) it was not a licence; and (c) section 28 of the Act applied and, as the plaintiff was not directly working the mine in the land, he could not retain it.
23 Aggrieved, the plaintiff has come in appeal by special leave to this Court.
The principal question that falls to be determined is: whether Section 6 or Section 28 of the Acquisition Act governs the case ? The High Court has held that it is Section 28, and not Section 6, which is applicable; while the appellant contends that Section 6 is applicable by virtue of which he is entitled to retain the holding.
Section 6, so far as relevant for our purposes, is in these terms: "6.
Rights of intermediary to retain certain kinds (1) Notwithstanding anything contained in Sections 4 and 5, an intermediary shall, except in the cases mentioned in the proviso to sub section (2) but subject to the other provisions of that sub section, be entitled to retain with effect from the date of vesting;. . . (i) Where the intermediary is. an institution established exclusively for a religious or a charitable purpose, or both, or is a person holding under a trust or an endowment or other legal obligation exclusively for a purpose which is charitable or religious or both land held in khas by such . institution or person, not being a tenant, by leave or licence of such. institution or person.
" The contention of the learned counsel for the appellant is that since the suit land was held by the appellant intermediary in khas for a religious purpose through a licensee the defendant being a licensee, and not a tenant he would be entitled to retain and hold this land from the date of vesting by virtue of clause (i) of sub section (1) of Section 6.
The other relevant provisions are in Chapter IV of the Acquisition Act.
They are as follows: "Sec. 27.
Provisions of Chapter IV to override other pro visions of the Act.
The provisions of this Chapter shall have effect notwithstanding anything to the contrary elsewhere in this Act." "Sec. 28.
Right of intermediaries directly working mines.
So much of the land in a notified area held by an intermediary immediately before the date of vesting (including sub soil rights therein, but excluding rights in hats and bazars not in the khas possession of the intermediary and land comprising forests, if any) as was comprised in or as appertained to any mine which was being directly worked 24 by him immediately before such date shall with effect from such date be deemed to have been leased by the State Government to such . intermediary.
The terms and conditions of such lease shall be as agreed upon between him and the State Government, or in default of agreement as may be settled by the Mines Tribunal: Provided that all such terms and conditions shall be consistent with the provisions of any Central Act for the time being in force relating to the grant of mining leases.
" Section 2(j) of the , defines 'Mine ' to mean "any excavation where any operation for the purpose of searching for obtaining mineral has been or is being carried on and includes. " "Minor Minerals" as defined in clause (e) of Section 3 of the Mines and Minerals (Regulation and Development) Act, (No. 67 OF 1957) include "ordinary sand".
Clause (c) of the same Section defines "mining lease" as a "lease granted for the purpose of undertaking mining operations, and includes a sub lease granted for such purpose.
" Clause (d) of the same Section defines "mining operations" to mean "any operations undertaken for the purpose of winning any minerals.
" Before the High Court, it was common ground between the parties that the land in dispute has a sub soil deposit of sand and the rights granted to the respondent, under the document (exhibit I); styled as a 'licence ', were "to raise" and "take" away that deposit of sand.
Before us, an attempt was made to deviate from that stand by con tending that the deposits of sand are on the surface in the shape of sand dunes and for removing the same no excavation or mining operations are necessary.
The contention must be repelled.
The definition of "mining operations" and "mine", noticed above, are very wide.
The expression "winning of mineral" in the definition of 'mining operations ' is spacious enough to comprehend every activity by which the mineral is extracted or obtained from the earth irrespective of whether such activity is carried out on the surface or in the bowels of the earth.
As pointed out by this Court in B. Dass vs State of Uttar Pradesh(1), it is wrong to assume that mines and minerals must always be sub soil and that there can be no minerals on the surface of the earth.
It is true that in the definition of "Mine", the term "excavation", in the ordinary dictionary sense, means "hole", "hollow" or "cavity made by digging out".
But the word "any" prefixed to "excavation" (1) ; 25 in the context of the phrase "for the purpose of searching for or obtaining mineral" gives it a much more extensive connotation, so that every "excavation", be it in the shape of an open cast cavity or a subterranean tunnelling, will fall within the definition of 'Mine '.
Similarly, it is not a requirement of the definition of 'mining operation ' that the activity for winning the mineral, must necessarily be an under ground activity.
The essence of 'mining operations ' is that it must be an activity for winning a mineral, whether on the surface or beneath the surface of earth.
Thus considered, the land ill dispute having large deposits of sand, which is a minor mineral, was admittedly being excavated and removed by the defendant, was at the date of vesting "comprised in or appertained to a mine" within the meaning of Section 28.
Having seen that the land in dispute is a 'mine ' in which 'mining operations ' were being carried on, the further question to be considered is, whether this mine was "being directly worked" by the appellant intermediary ? The word "directly", according to Webster 's New World Dictionary means "in a direct way, without a person or thing 1 coming between"; "immediately: as directly responsible".
The use of the expression "directly" in the context of the word "worked", follow ed by the words "by him", unmistakably shows that the legislative intent was to allow only those intermediaries to retain land comprised in or appertaining to a mine, as lessees under the State, who immediately before the date of vesting, were working the mine under their immediate control, management and supervision.
Thus construed, the phrase "being directly worked by him" in the Section will not take in a case were the mine was being worked through a lessee or licensee to whom the right to conduct mining operations and to take away the mineral had been granted by the intermediary in consideration of receiving a periodic rent, royalty or a like amount.
It was contended by the learned counsel for the appellant, that this interpretation of the phrase "directly worked by him", is inapplicable to an intermediary who is an idol because an idol, albeit a juristic person, has perforce to work the mine through a lessee or licensee.
The argument is ingenious but untenable.
The idol held the suit land comprised in the mine as an intermediary, only in the juristic sense, but, in fact he was exercising his rights in the suit land, through his human representative, the Shebait, Mohanta Srimat Dandi Swami.
The Shebait could in that representative capacity, directly work the mine himself.
But, instead of doing so, he, on April 27, 1950 granted the right of carrying on mining operations in the land and taking away the mineral, on payment of an annual sum for a period of 9 years to 3 196SCI/79 26 the respondents.
Thus, irrespective of whether this transaction or grant, dated April 27, 1950, was a lease or a license, the fact remains that immediately before the date of vesting, the mine in the suit land, was not being "directly worked " by the intermediary within the con templation of Section 28.
The provisions of Section 6(1) (i) of the Acquisition Act, extracted earlier, give to an intermediary a right to retain land held by him in khas for the purposes mentioned therein, through a licensee.
Section 28, as construed by us, denies the right to retain the land comprised in a mine or appertaining to a mine, it, at the material date, it was not being directly worked by the, intermediary but through a licensee, or other agency to whom the right to conduct mining operations had been granted by the intermediary.
In that respect, the provisions of Section 28 (in Chapter IV) are contrary to those of Section 6(1) (i).
In this situation, according to the legislative mandate in Section 27, the provisions of Section 6(1)(i) must yield to those in Section 28.
Assuming arguendo, that the plaintiff was at the material time, holding the land in khas through a licensee and fulfilled all other conditions which entitled him to retain under Section 6(1) (i), then also, this case being in conflict with Section 28, the latter Section would prevail over the former.
In this view of the matter, it is not, strictly speaking, necessary to resolve the controversy as to whether the transaction (exhibit I) dated April 27, 1950, was a lease or a license.
But, as in the Courts below, and here also, a good deal of argument was addressed on this point, we propose to go into the same.
It is well settled that in ascertaining the real character of a document, regard must be had to the substance of the transaction and not merely the words or the form in which it is dressed.
The Agreement (exhibit I), which is named as a licence, is to be construed in the light of this cardinal canon.
The Agreement (exhibit I) is not a very lengthy document.
The material part of this document may be extracted as below: "This deed of Agreement is executed to the effect following: . . .
We the First Party, have been carrying on the business of sand near Haripal Station.
Sand was necessary for carrying on the said business and the said sand Lying inside the land described in the schedule below should be taken out and proposal having been made to the second parties for the purpose of business, the second parties agreed to take settlement to the effect that we can take out 27 the sands of the said lands and become bound by the agreement on the following terms and conditions of taking out the sand from the said land only.
TERMS AND CONDITIONS 1.
The sand which is in the said land belongs to the own share of the First Party and should be taken out within the month of Chaitra from 1357 to 1365.
Save and except the raising of the said sand there will be no right, title and interest in the land with the First Party.
No right, title and interest will accrue to the First Party in respect of the land.
The First Party for the purpose of raising sand, will pay Rs. 66/ (Rupees sixty six) per annum as the price of the said sand.
If the Government fixes any new amount of demand, then, save and except this, they will take the said amount of Rs. 66/ and/or the Second Party will not be entitled to claim the same.
If the amount is not paid within the month of Chaitra every year, then the parties will not be entitled to raise the sand next year, and for realisation of the said amount of Rs. 66/ , Second Party can bring a suit against the First Party, and will get the arrears of interest at the rate of 12%.
At the end of the stipulated period, the Second Party will take khas possession of the said land; and the licence of the First Party will be revoked. " (Emphasis added) From what has been extracted above, the following characteristics of the transaction are clear: F (i) A right to "raise" and "take out" and remove sand "lying inside" the land in dispute was granted by the plaintiff to the defendant.
The words "raise" and "take out sand" from "inside" the land are wide enough to include not only the "right to carry out all the operations" necessary for extracting sand, but also to take it away and appropriate it.
Construed in the context of the document as a whole, these words put it beyond doubt that rights to carry out mining operations" [within the definition in clause (d) of Section 3 of the Central Act 67 of 1957] for winning sand and to appropriate it were granted.
(ii) The rights were granted for a period of 9 years, commencing from April 27, 1950.
28 (iii)These rights were granted for a "price" fixed on yearly basis, irrespective of the quantity of sand extracted.
The "price" fixed is Rs. 66/ per annum.
This consideration is payable 0in the month of Chaitra every year.
In case of default, the First Party (grantee) shall not be entitled "to raise" the sand "next year" and the Second Party (grantor) shall have a right to recover the arrears of rent together with interest at 12% by bringing a suit against the First Party.
(iv) "The Second Party will be entitled to take khas possession of the land" "at the end of the stipulated period".
This condition, (contained in paragraph 4 of exhibit
I) read along with the other parts of the document, necessarily implies that if the First Party continues to pay the "price", as stipulated, (a) he shall be entitled to enter into and remain in exclusive khas possession of the land for the purpose of carrying out the mining operations for the full stipulated period of 9 years and (b) the Second Party (plaintiff) will not be entitled to retake khas possession of the land and revoke the so called "license" before the end of the said period of 9 years.
It is contended on behalf of the appellant that, according to Condition 2 of the Agreement (extracted above), "except the raising of the sand", no right, title and interest in the land was given to the defendant.
It is submitted that in view of this express condition, the transaction was only a 'licence '.
Relying on Paragraph 899 of Halsbury 's Laws of England, 3rd Edition, Vol. 26, it is maintained that, in any case, it is not a 'lease ' as defined in Section 105 of the , but only a contract to sell sand, the price being pay able in yearly instalments.
It is emphasised that the essential characteristic of a "lease" is that the subject is one which is occupied and enjoyed and the corpus of which does! not in the nature of things and by reason of user disappear.
Reference has also been made to the dictum of the Judicial Committee of the Privy Council in Raj Kumar Thakur Giridhari Singh vs Megh Lal Pandey(l), and the decision of the House of Lords in Gowan vs Christie(2).
We are unable to accept these contentions.
Para 899 of Halsbury 's Laws of England (ibid) reads, thus: "A lease may be granted of land or any part thereof, and since minerals are a part of the land it follows that a (1) L. R 44 I.A.246.
(2) [1873] L. R. 29 lease can be granted to the surface of the land and the A minerals below, or of the surface alone, or of the minerals alone.
It has been said that a contract for the working and getting of minerals alone though for convenience called a mining lease, is not in reality a Lease, at all in the sense in which one speaks of an agricultural lease, and that such a contract, properly considered, is really a sale of a portion of 1 the land at a price payable by instalments, that is, by way of rent or royalty, spread over a number of years.
" This statement of the law in England, appears to be founded on the observations of Cairns, L. J. in Gowan vs Christie (ibid) and Gozens Hardy, L.J. in Aldam 's Settled Estate(1).
In Raj Kumar Thakur Giridhari Singh (ibid), Lord Shaw, delivering the opinion of the Board, said that "it must be born in mind also that the essential characteristic of a lease is that the subject is one which is occupied and enjoyed and the corpus of which does not in the nature of things and by reason of the user disappear".
Counsel for the appellant has adopted this very argument.
But this observation should not be torn out of the context.
Lord Shaw had further observed: "In order to cause the latter speciality to arise, minerals must be expressly denominated, so as thus to permit of the idea of partial consumption of the subject leased".
Thus, Lord Shaw had himself pointed out that minerals may be made a part of the subject matter of a lease, and in such a case the lease would permit the idea of the partial consumption of the subject matter of the lease.
It is important to bear in mind that the term "lease" occurring in the definition of "mining lease" given in Section 3(c) of Act 67 of 1957 does not appear to have been used in the narrow technical sense in which it is defined in Section 105 of the .
But, as rightly pointed out by a Bench of the Calcutta High Court in Fala Krishna Pal vs Jagannath Marwari(2), a settlement of the character of a mining lease is everywhere in India regarded as 'lease '.
A mining lease, therefore, may not meticulously and strictly satisfy in all cases, all The characteristics of a 'lease ' as defined in the .
Nevertheless, in the accepted legal sense, it has always been regarded as a lease in this country.
In Fala 's case (ibid) Mukerji, J., speaking for the Bench, held that a coal mining settlement may be regarded as satisfying the requirements of Section 105 and treated as a lease because under such H (1) at page 56.
(2) I. L. R. 30 settlement some portion, however small, of the surface has to be used for carrying on the mining operations and taking the coal out.
Be that as it may, in the instant case, as shall be presently discussed, the transaction evidenced by exhibit I, not only falls within the definition of a "mining lease" under Act 67 of 1957, but also partakes of all the essential characteristics of a 'lease ' defined in Section 105 of the .
Section 105, , defines a 'lease ' of immovable property as "a transfer of a right to enjoy such property, made for a a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms.
" In the second paragraph of the Section, it is expressly stated that the price so paid in consideration of the transfer is called "the premium, and the money, share, service, or other thing to be so rendered, is called the rent.
" The definition of 'immovable property ' given in Section 3, Para I of that Act is in the negative, and is not exhaustive.
Therefore, the definition given in Section 3(26) of the General Clauses Act (X of 1897) will apply to the expression used in this Act, except as modified by the definition in the first clause of Section 3.
According to the definition given in Section 3(26) of the General Clauses Act, "immovable property" shall include land, benefits to arise out Or land, and things attached to the earth, or permanently fastened to anything attached to the earth".
In short, the expression 'immovable property ' comprehends all that would be real property according to English Law and possibly more.
(See 1 I.A. 34).
Thus, every interest in immovable property or a benefit arising out of land, will be 'immovable property ' for the purpose of Section 105, .
A right to carry on mining operations in land to extract a specified mineral and to remove and appropriate that mineral, is a 'right to enjoy immovable property ' within the meaning of Section 105; more so, when as in the instant case it is coupled with a right to be in its exclusive khas possession for a specified period.
The 'right to enjoy immovable property ' spoken of in Section 105, means the right to enjoy the property in the manner in which that property can be enjoyed.
If the subject matter of the lease is mineral land or a sand mine, as in the case 31 before us, it can only be enjoyed and occupied by the lessee by working it, as indicated in Section 108, , which regulates the rights and liabilities of lessors and lessees of immovable property.
In the view we take, we are supported by the observations of the Judicial Committee in Nageshwar Bux Roy vs Bengal Coal Company(1).
Delivering the opinion of the Board, Lord Macmillan said: "In considering the character and effect of acts of possession in the case of a mineral field, it is necessary to bear in mind the nature of the subject and the possession of which it is susceptible.
Owing to the inaccessibility of minerals in the earth, it is not possible to take actual physical possession at once of a whole mineral field: it can be occupied only by extracting the minerals and until the whole minerals are ex hausted the physical occupation must necessarily be partial." In H. V. Low & Co. Ltd. vs Jyoti Prasad Singh Deo(2), the law, as laid down in Gowan 's case (ibid), was strongly relied upon by the appellants, therein.
Negativing this contention, the Judicial Committee pointed out that the rights and liabilities of lessor and lessee are defined in Section 108 of the , and the appellant h ad not shown that the respondent had failed, or was not in a position to perform the duties incumbent on a lessor under Section 108 of the said Act.
The discussion will not be complete without noticing, the decision of the Patna High Court in Commissioner of Income Tax, Bihar & Orissa vs Kumar Kanakhaya Narain Singh(3), which is ill point.
In that case.
after an exhaustive survey of all the decisions on the subject, (including some of those which have been cited before us) a Full Bench consisting of three eminent Judges, held that coal mining settlements whereby certain rights of entering upon the land of the settlor, sinking shafts etc.
and winning and taking away the coal are granted in consideration of receiving a salami and annual sums computed on the amount of coal raised and the amount of coke manufactured, subject always to a minimum annual sum which was always payable irrespective of what coal was raised or coke manufactured, were not "a sale of coal", but could be regarded as 'leases ' within the meaning of Section 105 read with Section 108, , or with (1) [1930] L. R. 58 I. A. 29.
(2) [1931] 1. L. R. ; L. R. 58 I. A. 392.
(3) 1.
L. R. (XX) Patna 13.
32 in the legal acceptance of the term "lease" in this country.
This decision of the High Court was affirmed by the Judicial Committee, and the appeal filed by Kumar Kanakhaya was dismissed.
(See L.R. 70 I.A. 180).
The ratio of the Patna case applies with greater force to the facts of the case before us, because, herein, (a) the annual fixed payment had no relation, whatever, with the quantity of sand extracted and appropriate(i, and, what is more important, (b) the defendant was given a right to enter into and remain in khas possession of the mineral field for the stipulated period of 9 years.
The transaction (exhibit I), though labelled as a licence, has all essential elements of a 'lease ' ever.
under Section 105 of the Transfer for Property Act.
In short, stripped of the form in which it is draped, the Agreement (exhibit I), in substance and in fact, is a 'lease ' in the accepted legal sense of the term and not a 'licence ' as defined in Section 52 of the Indian Easements Act.
If this be the correct construction of the document, and we think it is so it is doubtful whether Section 6(1) (i) could cover the appellant 's case and give him a right to retain the land in dispute eve if Section 28 was out of his way.
In sum, we may reiterate that even on the assumption that the respondent was a licensee, the appellant will not be entitled to retain the holding because he was not directly working the mine immediately before the date of vesting, and as such, will not be entitled to retain, due to the overriding operation of Section 28.
For all the foregoing reasons, the appeal fails and is dismissed.
In the circumstances of the case, however, there will be no order as to costs.
V.D.K. Appeal dismissed.
| IN-Abs | The appellant idol, a juristic person, was exercising the rights, through the Shebait, Mohanta Srimati Dandi Swami, of a Darpatnidar in the land in suit.
By a lease deed (exhibit A), dated July 10, 1941, the appellant granted to the respondents a lease of the suit land for the purpose of raising and taking sand out of the land for a period of nine years ending on July 13, 1949.
Subsequently, on April 27, 1950, the appellant made a similar grant (exhibit I) for another nine years expiring on April 13, 1959, but this grant was called "licence".
The respondents did not pay the licence fee for the period 1362 (14 4 1955) to 1365 B.S.
The appellant thereupon issued notice dated March 31, 1966, terminating the 'licence ' and then filed a suit No. 37 of 1960 for ejectment of the respondent in the Court of the Munsiff, Chandernagore.
The trial court having dismissed the suit, the appellant filed a first appeal which was allowed.
In second appeal the High Court restored the decree of the trial court.
In appeal by special leave to this Court, it was contended on behalf of the appellant: (a) The transaction evidenced by the document (exhibit I) dated April 277 1950 was a 'license ' for taking away sand and not a 'lease ' of immovable property.
Therefore, the appellant intermediary will be considered to be in Khas possession of the holding on the date of vesting (April 1, 1955) through the licensee and as such.
entitled to retain it under Section 6 of the Bengal Estates Acquisition Act.
1953; (b) Section 28 of the Bengal Estates Acquisition Act, 1953 is not applicable because there was no 'mine ' in the suit land, as defined in the Central Act 67 of 1957; the sand deposits naturally exist on the surface and not below it and mere collection and removal of the sand from the surface did not constitute mining operations.
therefore, it could not be said that the suit land was comprised in a mine or appertained to a mine within the meaning of the said Section 28; (c) Even if the land was a 'mine ' or appertained to a mine, the mine was being worked by the appellant through a licensee, and as such, was being 19 'directly worked ' by the appellant intermediary within the contemplation of Section 28 of the Bengal Estates Acquisition Act, and therefore, the land would be deemed to have been leased to the appellant by the Government.
Rejecting these contentions, and dismissing the appeal, ^ HELD: A.
In ascertaining whether a document evidences a 'lease ' or a 'licence ', regard must be had to the substance of the transaction and not merely the words or the form in which it is dressed.
[26F] .
The document (exhibit I the Agreement), in the instant case reveals the following characteristics.
which show that in fact and substance, it is a 'lease" and not a 'licence ': [27E, 32C] (i) A right to "raise ' and "take out" and remove sand "lying inside" the land in dispute was granted by the plaintiff to the defendant.
The words "raise" and "take out sand" from "inside" the land are wide enough to include not only the "right to carry out all the operations" necessary for extracting sand, but also to take it away and appropriate it.
Construed in the context of the document as a whole, these words put it beyond doubt that right to carry out "mining operations" [within the definition in Cl.
(d) of section 3 of the Central Act 67 of 1957] for winning sand and to appropriate it, were granted.
[27F G] (ii) The rights were granted for a period of 9 years, commencing from April 27.
[27H] (iii) These rights were granted for a "price" fixed on yearly basis, irrespective of the quantity of sand extracted.
The "price" fixed is Rs. 66/ per annum.
This consideration is payable in the month of Chaitra every year.
In case of default, the First Party (grantee) shall not be entitled "to raise the sand next year" and the Second Party (grantor) shall have a right to recover the arrears of rent together, with interest at 12% by bringing a suit against the First Party.
[28A B] (iv) "The Second Party will be entitled to take Khas possession of land" "at the end of the stipulated period.
This condition, (contained in paragraph 4 of exhibit 1) read along with the other parts of the document necessarily implies that if the First Party continues to pay the "price", as stipulated, (a) he shall be entitled to enter into and remain in exclusive khas possession of the land for the purpose of carrying out the mining operations for the full stipulated period of 9 years and (b) the Second Party (plaintiff) will not be entitled to retake khas possession of the land and revoke the so called "licence" before the end of the said period of 9 years.
[28B D] The term "lease" occurring in the definition of "mining lease" given in cl.
(c) of section 3 of the Mines and Minerals (Regulation and Development) Act is not used in the narrow technical sense in which it is defined in section 105 of the .
A mining lease may not meticulously and strictly satisfy in all cases, all the characteristics of a "lease" as defined in the .
Nevertheless, in the accepted legal sense, it has always been regarded as a lease in this country.
[29E G] In the instant case the transaction evidenced by exhibit I not only falls within the definition of a mining lease under Act, 67 of 1957, but also partakes of 20 all the essential characteristics of a "lease" defined in section 105 of the .
[30 A B] Balakrishna Pal vs Jagannath Marwari, ILR ; approved Raj Kumar Thakur Girdhari Singh vs Megh Lal Pandey LR 44 I.A. 246; Gowan vs Christie, ; differed.
The negative definition of "immovable property" given in section 3, Para 1 of the , is not exhaustive.
Therefore, applying the definition given in section 3(26) of the General Clauses Act (X of 1897) to the expression used in the , except as modified by the definition in the first clause of section 3 every interest in immovable property or a benefit arising out of land, will be 'immovable property ' for the purpose of section 105, .
[30E G] A right to carry on mining operations in land to extract a specified mineral and to remove and appropriate that mineral, is a right to enjoy immovable property within the meaning of section 105, more so, when it is coupled with a right to be in its exclusive khas possession for a specified period.
The right to enjoy immovable property spoken of in section 105, means the right to enjoy the property in the manner in which that property can be enjoyed.
If the subject matter of the lease is mineral land or a sand mine, it can be enjoyed and occupied by the lessee by working it as indicated in section 108 of the which regulates the rights and liabilities, of lessors and lessees of immovable property, [30G H, 31A] Nageshwar Bux Roy vs Bengal Coal Company, [1930] LR 58 IA 29; applied.
H. V. Low & Co. Ltd. vs Joyti Prasad Singh Deo, Cal. 699; LR 58 IA 392.
differed from.
Commissioner of Income Tax, Bihar and Orissa vs Kumar Kanakhaya Narain Singh, ILR (XX) Patna 13; approved.
The true character of the transaction evidenced by the document (exhibit 1) being that of a 'lease ' and not a 'licence, ' Section 6(1)(i) of the West Bengal Estates Acquisition Act, 1953 will not cover the appellant 's case and give him a right to retain the land in dispute, even if section 28 of that Act was out of the way.
[32C D.] B.
The definition of "mining operations" and "mine", in the Central Act 67 of 1957 are very wide.
The expression "winning of mineral" in the definition of "mining operations is spacious enough to comprehend every activity by which the mineral is extracted or obtained from the earth, irrespective of whether such activity is carried out on the surface or in the bowels of the earth.
Mines and minerals need not always be sub soil and there can be minerals on the surface of the earth.
[24G] B. Dass vs State of U.P. ; , reiterated.
It is true that in the definition of "mine", the term "excavation" in the ordinary dictionary sense means "hole", "hollow" or "cavity made by digging out".
But the word "any" prefixed to "excavation" in the context of the phrase "for the purpose of searching for or obtaining mineral" gives it a 21 much more extensive connotation, so that every "excavation", be it in the shape of an open cast cavity or a sub terranean tunnelling, will fall within the definition of 'mining operations '.
The essence of 'mining operations ' is that it must be an activity for winning a mineral, whether on the surface or beneath the surface of the earth.
[24H, 25A B] In tho instant case, the land in dispute has large deposits of sand, which is a minor mineral.
The sand was admittedly being excavated and removed by the respondent lessee.
The land was, thus, at the date of vesting, "com prised in or appertained to a 'mine ' within the meaning of section 28 of the West Bengal Estates Acquisition Act, 1953.
[25B C] C.
The phrase "being directly worked by him" in section 28 of the West Bengal Estates Acquisition Act, 1953, will not take in a case where the mine was being worked through a lessee or licensee to whom the right to conduct mining operations and to take away the mineral had been granted by the intermediary in consideration of receiving a periodic rent, royalty or a like amount.
[25E F] The word "directly" means "in a direct way, without a person or thing coming between", immediately as directly responsible.
The use of the expression "directly" in the context of the word "worked", followed by the words "by him" unmistakably shows that the legislative intent was to allow only those intermediaries to retain land comprised in or appertaining to a mine, as lessees under the State, who immediately before the date of vesting, were working the mine under their immediate control, management and supervision.
[25C E] Section 28 of the West Bengal Estates Acquisition Act, 1953 denies the right to retain the land comprised in a mine or appertaining to a mine, if, at the material date, it was not being directly worked by the intermediary but through a licensee, or other agency to whom the right to conduct mining operations had been granted by the intermediary.
In that respect, the provisions of s.28 are contrary to those of section 6(1)(i), which give to an intermediary a right to retain land held by him in khas for the purpose mentioned therein through a licensee.
In this situation, according to the legislative mandate in section 27, the provisions of section 6(1) (i) must yield to those in section 28.
[26 B C] Thus, even on the assumption that the respondent was at the material date, holding the land in Khas through a licensee and fulfilling all other conditions which entitled him to retain under section 6 (1) (i), then also, the case being in conflict with section 28, the latter section would prevail over the former.
[26D & 32E]
|
Civil Appeals Nos.
1760 1763/69.
Appeals by Special Leave from the Judgment and Decree dated 25 10 1967 of the Andhra Pradesh High Court in Civil Revision Application Nos.
342 345/64.
Vepa P. Sarathi and A. V. Rangam for the Appellant.
Ex parte for the Respondent.
The Judgment of the Court was delivered by CHINNAPPA REDDY, J.
The petitioner who lost before the Subordinate Tribunals and the High Court is the appellant in this appeal by special leave.
Alleging that he was the landlord and that the respondents were his tenants in respect of certain lands in Bhommika village, the appellant filed petition before the Tehsildar, Pathapatnam under Section 13 of the Andhra Tenancy Act for the eviction of the respon 203 dents on the ground of default in payment of rent.
The respondents pleaded that the lands were situated in an Inam Estate which had been taken over by the Government under the provisions of the Andhra Pradesh (Andhra Area) Estates (Abolition and Conversion into Ryotwari) Act, 1948, and that, they and their ancestors, who had occupancy rights were always in cultivating possession of the lands.
It was also pleaded that after the taking over of the estate by the Government there was no longer any relationship of landlord and tenant between the petitioner and the respondents.
The Tehsildar dismissed the petition for eviction on the ground, among others, that the respondents had occupancy rights in the land.
The landlord preferred an appeal before the Revenue Divisional Officer, Tekkali.
The Revenue Divisional Officer rejected the appeal on the ground that the petition for eviction was not maintainable since the question as to who was the lawful ryot in respect of any holding in an estate had to be decided by the Settlement Officer under Section 56(1)(c) of the Andhra Pradesh (Andhra Area) Estates (Abolition and Conversion into Ryotwari) Act, and that the decision of such question was within the exclusive competence of the Settlement Officer.
A revision petition filed before the High Court of Andhra Pradesh under Article 227 of the Constitution was dismissed by the High Court again for the reason that the question as to who was entitled to the grant of ryotwari patta had to be decided by the Settlement Officer under Section 56 of the Andhra Pradesh (Andhra Area) Estates (Abolition and Conversion into Ryotwari) Act and that the decision of such question was within the exclusive jurisdiction of the Settlement Officer.
The appellant has preferred this appeal by special leave of this Court.
Shri Vepa P. Sarathi, learned Counsel for the appellant argued that the view expressed by the High Court regarding the exclusive jurisdiction of the Settlement Officer to decide the question as to who was the lawful ryot of a holding was not good law in view of the decision of a Full Bench of three Judges of the Andhra Pradesh High Court in Cherukuru Muthayya vs Gadde Gopalakrishnayya & Ors.
It is not disputed that the lands are situated in Bhommika village.
It is not also disputed that Bhommika village was in Inam estate and that it was taken over by the Government under the provisions of the Andhra Pradesh (Andhra Area) Estates (Abolition and Conversion into Ryotwari) Act.
The appellant claims that he is the lawful ryot of the lands in dispute and that the respondents are his tenants.
On the other hand the respondents claim that they are the lawful ryots of 204 the holding.
The question at issue between the parties therefore is, whether the appellant or the respondents are the lawful ryots of the holding.
Under Section 56(1)(e) of the Andhra Pradesh (Andhra Area) Estates (Abolition and Conversion into Ryotwari) Act "where, after an estate is notified, a dispute arises as to (a) whether any rent due from a ryot for any fasli year is in arrear or (b) what amount of rent is in arrear or (c) who the lawful ryot in respect of any holding is, the dispute shall be decided by the Settlement Officer".
Section 56(2) provides for an appeal to the Estates Abolition Tribunal against the decision of the Settlement Officer and further provides that the decision of the Tribunal shall be final and shall not be liable to be questioned in any Court of law.
Prima facie, therefore, the question as to who is the lawful ryot of any holding, if such question arises for decision after an estate is notified, has to be resolved by the Settlement Officer and by the Estates Abolition Tribunal under Section 56 (1) (c) and 56(2) of the Andhra Pradesh Estates Abolition Act.
The Andhra Pradesh Estates Abolition Act is a self contained code in which provision is also made for the adjudication of various types of disputes arising after an estate is notified, by specially constituted Tribunals.
On general principles, the special Tribunals constituted by the Act must necessarily be held to have exclusive jurisdiction to decide disputes entrusted by the statute to them for their adjudication.
Shri Vepa P. Sarathi 's submission was that Section 56(1) (c) did not enable the Settlement Officer to decide the question as to who was the lawful ryot of a holding every time such question arose and for all purposes but only when such question arose in connection with the matters dealt with by Section 55 and Section 56(1) (a) and (b).
In other words the argument was that Section 56(1)(c) was controlled by Section 55 and Section 56(1) (a) and (b) and that an enquiry into the question as to who was the lawful ryot of a holding under Section 56(1)(c) was permissible only for the purpose of identifying the person liable to pay the arrear of rent which had accrued in respect of the holding before the taking over of the estate.
The submission of Shri Vepa P. Sarathi is supported by the decision of the Full Bench of the Andhra Pradesh High Court in Cherukuru Muthayya vs Gadde Gopalakrishnayya & Ors.
(supra).
We are, however, unable to see any justification for restricting the scope of Section 56(1)(c) in the manner suggested by Shri Sarathi.
We will briefly indicate our reasons for holding that the scope of Section 56(1) (c) is not to be restricted as was done by the Full Bench of Andhra Pradesh High Court in Cherukuru Muthayya vs Gadde Gopalakrishnayya & Ors.
(supra).
We 205 are fortunately relieved of the necessity of considering the matter more elaborately in view of the fact that the decision in Cherukuru Muthayya vs Gadde Gopalakrishnayya & Ors.
on this part of the case has since been over ruled by a Full Bench of five Judges of the High Court of Andhra Pradesh in I. Munuswami Naidu (died) & Ors.
vs R. Venkata Reddy & Ors.
after a thorough and exhaustive consideration of the question.
We may also add here that until the decision in Cherukuru Muthayya vs Gadde Gopalakrishnayya & Ors., for several years it was understood that Section 56(1) (c) conferred complete and exclusive jurisdiction on the Settlement Officer to decide rival claims of ryots for the grant of ryotwari patta and Section 55 or 56(1)(a) and (b) were never understood as controlling Section 56(1)(c).
A brief resume of the provisions of the Andhra Pradesh (Andhra Area) Estates (Abolition and Conversion into Ryotwari) Act relevant for our present purpose is permissible here.
As stated in the preamble the Act was enacted to provide for the repeal of the Permanent Settlement, the acquisition of the Rights of land holders in permanently settled and certain other estates and the introduction of the ryotwari settlement in such estates.
Section 1(4) provides for the notification of estates and Section 3 enumerates the consequences of notifying an estate under Section 1(4) of the Act.
In particular Section 3 (b) provides that the entire estate shall stand transferred to the Government and vest in them free of all encumbrances Section 3(c) provides that all rights and interests created in/or over the estate by the land holder shall cease and determine as against the Government.
Section 3(d) empowers the Government to take possession of the estate but saves from dispossession any person who the Government considers is prima facie entitled to a ryotwari patta until the question whether he is actually entitled to such patta is decided by the Settlement officer in the case of a ryot or by the Settlement Officer and the Tribunal on appeal in the case of a land holder.
Section 3(f) provides that the relationship of the landholder and ryot shall, as between them, be extinguished.
Section 3(g) provides that ryots in the estate shall, as against the Government be entitled only to such rights and privileges as are recognised or conferred on them by or under the Act.
Section 11 confers on every ryot in an estate the right to obtain a ryotwari patta in respect of ryoti land which was included or ought to have been included in the holding on the notified date.
Sections 12, 13 and 14 confer on the land holder the right to obtain a ryotwari patta in respect of private land in a Zamindari, Inam and Under tenure estate respectively.
Section 15(1) provides for enquiry by the Settlement Officer into claims 206 by a land holder for a ryotwari patta, Under Sections 12, 13 and 14.
Section 15(2) provides for an appeal to the Tribunal from the decision of the Settlement Officer and it declares that the decision of the Tribunal shall be final and not liable to be questioned in any Court of law.
Section 16 imposes on every person, whether a land holder or a ryot who becomes entitled to a ryotwari patta under the Act in respect of any land, the liability to pay to the Government the assessment that may be lawfully imposed on the land.
Section 21 to 23 provide for the survey of estates, the manner of affecting ryotwari settlement and the determination of the land revenue.
Sections 55 to 68 occur under the heading "Miscellaneous".
Section 55 provides for the collection of rent which had accrued before the notified date.
Section 56 provides for the decision of certain disputes arising after an estate is notified.
It provides for the decision of a dispute as to (a) whether any rent due from a ryot for any fasli year is in arrear or (b) what amount of rent is in arrear or (c) who the lawful ryot in respect of any holding is.
The dispute is required to be decided by the Settlement Officer.
Against the decision of the Settlement Officer, an appeal is provided to the Tribunal and the decision of the Tribunal is declared final and not liable to be questioned in any Court of law.
Now the Act broadly confers on every tenant in an estate the right to obtain a ryotwari patta in respect of ryoti lands which were included or ought to have been included in his holding before the notified date and on the land holder the right to obtain a ryotwari patta in respect of lands which belonged to him before the notified date as his private lands.
The Act makes express provision for the determination of claims by landholders for the grant of ryotwari patta in respect of the alleged private lands.
If there is provision for the determination of the claims of a landholder for the grant of ryotwari patta in respect of his alleged private lands, surely, in an Act aimed at the abolition of intermediaries and the introduction of ryotwari settlement, there must be a provision for the determination of the claims of ryots for the grant of ryotwari patta.
Section 56(1) is clearly such a provision.
But in Cherukuru Muthayya vs Gadde Gopalakrishnayya & Ors (supra) it was held that an enquiry as to who was the lawful ryot was permissible under Section 56(1) (c) for the limited purpose of fastening the liability to pay arrear of rent which had accrued before a notified date and for no other purpose.
The conclusion of the Full Bench was based entirely on the supposed context in which the provision occurs.
The learned Judges held that Section 56(1) (c) occurred so closely on the heels of Section 55 and Section 56(1)(a) and (b), that the applicability of Section 56(1)(c) must be held to be "intimately and integrally connected" 207 with those provisions.
We think that the approach of the Full Bench was wrong.
Apart from the fact that Section 55 and 56(1)(a), (b) and (c) occur under the heading "Miscellaneous", and, therefore, a contextual interpretation may not be quite appropriate, the Full Bench over looked the serious anomaly created by its conclusion.
The anomaly is that while express provision is found in Section 15 of the Act for the adjudication of claims by land holders for the grant of ryotwari pattas., there is, if the Full Bench is correct, no provision for the adjudication of claims by ryots for the grant of ryotwari pattas.
It would indeed be anomalous and ludicrous and reduce the Act to an oddity, if the Act avowedly aimed at reform by the conferment of ryotwari pattas on ryots and the abolition of intermediaries, is to be held not to contain any provision for the determination of the vital question as to who was the lawful ryot of a holding.
The object of the Act is to protect ryots and not to leave them in the wilderness.
When the Act provides a machinery in Section 56(1) (c) to discover who the lawful ryot of a holding has, it is not for the Court to denude the Act of all meaning by confining the provision to the bounds of Section 55 and 56(1) (a) and (b) on the ground of "contextual interpretation".
Interpretation of a statute, contextural or otherwise must further and not frustrate the object of the statute.
We are, therefore, of the view that Cherukuru Muthuyya vs Gadde Gopalakrishnayya & ors.
(supra) was wrongly decided in so far as it held that ambit of Section 56(1)(c) was controlled by Section 55 and Section 56(1) (a) and (b).
We do not think it necessary to consider the matter in further detail in view of the elaborate consideration which has been given to the case by the later Full Bench of five Judges of the High Court of Andhra Pradesh in T. Muniswami Naidu (died) & Ors vs R. Venkata Reddi & Ors.
(supra) except to add that to adopt the reasoning of the Full Bench of three Judges in Cherukuru Muthayya vs Gadde Gopalakrishnayya & Ors. would lead to conflict of jurisdiction and the implementation of the Act would be thrown into disarray.
In this connection we may quote the observations of Subba Rao, Chief Justice, who said as follows in Appanna vs Sriramamurty.
"Where a special tribunal, out of the ordinary course is appointed by an Act to determine questions as to rights which are the creation of that Act, then except so far as is otherwise expressly provided or necessarily implied, that tribunal 's jurisdiction to determine those questions is exclusive.
Under the 208 Act old rights were abolished and new rights were created.
A lawful ryot is entitled to a patta, when a question arises whether a person is a lawful ryot or not, that question falls to be decided by the special Tribunal created by the Act".
In view of the above discussion the appeal is dismissed.
S.R. Appeal dismissed.
| IN-Abs | Under Section 56(1)(c) of the Andhra Pradesh (Andhra Area) Estates (Abolition and conversion into Ryotwari) Act, 1948, "where, after an estate is notified, a dispute arises as to (a) whether any rent due from a ryot for any fasli year is in arrear or (b) what amount of rent is in arrear or (c) who the lawful ryot in respect of any holding is, the dispute shall be decided by the Settlement Officer".
Section 56(2) of the Act provides for an appeal to the Estates Abolition Tribunal against the decision of the Settlement Officer whose decision was final and not to be questioned in any court of law.
The petition filed before the Tahsildar, Pathapatnam under section 13 of the Andhra Tenancy Act by the appellant, for the eviction of the respondents on the ground of default in payment of rent was dismissed on the ground, among others that the respondents had occupancy rights in the land.
The appeal before the Revenue Divisional Officer Tekkali was dismissed on the ground that the petition for eviction was not maintainable since the question as to who was the lawful ryot in respect of any holding in an estate had to be decided by the Settlement Officer under Section 56(1)(c) of the Andhra Pradesh (Andhra Area) Estates (Abolition and Conversion into Ryotwari) Act and that the decision of such question was within the exclusive competence of the Settlement Officer.
In the revision petition filed before it under article 227 of the Constitution, the High Court of Andhra Pradesh agreed with the appellate order.
Dismissing the appeal by special leave the Court, ^ HELD: 1.
Interpretation of a statute contextual or otherwise must further and not frustrate the object of the statute.
[207 D] The object of the Andhra Pradesh (Andhra Area) Estates (Abolition and Conversion into Ryotwari) Act, 1948 is to protect ryots and not to leave them in wilderness.
When the Act provides a machinery in Section 56(1)(c) to discover who the lawful ryot of a holding was, it is not for the Court to denude the Act of all meaning by confining the provisions to the bounds of Section 55 and 56(1) (a) and (b) on the ground of "contextual interpretation".
[207 C D] 202 2.
The scope of section 56(1)(c) cannot be restricted to mean that it was controlled by Section 55 and 56(1)(a) and (b) and that an enquiry into the question as to who was the lawful ryot of a holding under that section was permissible only for the purpose of identifying the person liable to pay the arrear of rent which had accrued in respect of the holding before the taking over of the estate.[204 E G] It would indeed be anomalous and ludicrous and reduce the Act to an oddity, if the Act avowedly aimed at reform by the conferment of ryotwary pattas on ryots and the abolition of intermediaries is to be held not to contain any provision for the determination of the vital question as to who was the lawful ryot of a holding.
Section 56(1)(c) is indeed such a provision.
A contextual interpretation may not be quite appropriate in view of the fact that Sections 55 and 56(1)(a) and (b) occur under the heading 'Miscellaneous '.
Any other interpretation would lead to conflict of jurisdiction and the implementation of the Act would be thrown into disarray.
A, B C] Munuswami Naidu (died) & Ors., vs R. Venkata Reddy and Ors., A.I.R. 1978 A.P. 200 (F.B.); approved.
The Andhra Pradesh Estates Abolition Act is a self contained Code in which a provision is also made for the adjudication of various types of disputes arising after an estate is notified by specially constituted Tribunals.
On general principles, the special Tribunals constituted by the Act must necessarily be held to have exclusive jurisdiction to decide disputes entrusted by the statute to them for their adjudication.
[204 D E] Appanna vs Sriramamurthy, ; approved.
|
orm at all, some regard must be had to the plight of the victim or his or her family by making provision for payment of compensation.
While it is commonly accepted that these convicted of violations of the criminal law must "pay their debt to society, little emphasis is placed upon requiring offenders to "pay their debt" to their victims.
These again are matters for the Parliament to Provide.] & CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No. 512 of 1978.
Appeal by Special Leave from the Judgment and Order dated 12 9 74 of the Allahabad High Court in Criminal Appeal No. 501/74.
AND CRIMINAL APPEAL NO.
513 of 1978 Appeal by Special Leave from the Judgment and Order dated 9 1 1978 Kerala High Court in Crl.
A. No. 213/77 and Ref.
Trial No. 3/77.
AND CRIMINAL APPEAL NO.
513 of 1978 Appeal by special leave from the Judgment and Order dated 28 9 77 of the Allahabad High Court in Criminal Appeal No. 261/73 and Reference No. 6/77.
R. K. Garg for the Appellant in Crl.
A. No. 513/78.
section K. Bagga, Amicus Curiae for the Appellant in Crl.
A.512/78 P. K. Pillai, Amicus Curiae for the Appellant in Crl.
A. No. 511/78 D. P. Uniyal and M. V. Goswami for the State of U.P. K.R. Nambiar for the State of Kerela.
The Judgment of Krishna Iyer and Desai, JJ. was delivered by Krishna Iyer, J.; Sen, J. gave a dissenting opinion.
KRISHNA IYER, J. THE DEADLY QUANDARY To be or not to be: that is the question of lethal import and legal moment, in each of these three appeals where leave is confined to the 89 issue of the propriety of the impost of capital penalty against which the brutal culprits desparately beseech that their dear life be spared by the Summit Court and the incarceratory alternative be awarded instead.
There is, as here, a judicial dimension to the quasi Hamletian dilemma when "a murder most foul" demands of sentencing justice punitive infliction of death or the lesser punishment of life imprisonment, since the Penal Code leaves the critical choice between physical liquidation and life long incarceration to the enlightened conscience and sensitized judgment of the Court.
A narration of facts is normally necessary at this early stage but we relegate it to a later part, assuming for the nonce the monstrosity the murder in each case.
Is mere shock at the horrendous killing sufficient alibi to extinguish one more life, de hors circumstances, individual and social, motivational and psychical ? The crime and the criminal, contemporary societal crisis, opinions of builders and moulders of the nation, cultural winds of world change and other profound factors, spiritual and secular, and above all, constitutional, inarticulately guide the Court 's faculty in reading the meaning of meanings in preference to a mechanistic interpretation of section 302 I.P.C. projected in petrified print from Macaulay 's vintage mint.
We banish the possible confusion about the precise issue before us it is not the constitutionality of the provision for death penalty, but only the canalisation of the sentencing discretion in a competing situation.
The former problem is now beyond forensic doubt after Jagmohan Singh( ') and the latter is in critical need of tangible guidelines, at once constitutional and functional.
The law reports reveal the impressionistic and unpredictable notes struck by some decisions and the occasional vocabulary of horror and terror, of extenuation and misericordia, used in the sentencing tailpiece of judgments.
Therefore, this jurisprudential exploration, within the framework of section 302 I.P.C., has become necessitous, both because the awesome 'either/or ' of the Section spells out no specific indicators and law in this fatal area cannot afford to be conjectural.
Guided missiles.
with lethal potential, in unguided hands, even judicial, is a grave risk where the peril is mortal though tempered by the appellate process.
The core question the only question that occupies our attention, within the confines of the Code, is as to when and why shall capital sentence be pronounced on a murderer and why not in other cases.
The penological poignancy and urgency of the solution is obvious since the human stakes are high, and error, even judicial error (1) Jagmohan Singh v State of Uttar Pradesh (1973) I S.C.C.20.
7 196SCI/79 90 silences for ever a living being and despatches him to that 'undiscovered country from whose bourn no traveller returns ': nor, once executed, can 'storied urn or animated bust back to its mansion call the fleeting breath '.
The macabre irrevocability of the extreme penalty makes the sombre issue before us too important to be relegated, as often happens, to a farewell paragraph, with focus on fright ful features of the crime and less stress on the crime doer and related factors.
When human rights jurisprudence and constitutional protections have escalated to sublime levels in our country and heightened awareness of the gravity of death penalty is growing all over the civilised globe in our half century, is it right to leave section 302 I.P.C. in vague duality and value free neutrality? Any academic who has monitored Indian sentencing precedents on murder may awaken to 'the overt ambivalence and covert conflict ' among judges 'concerning continued resort to the death sentence ' which, according to Prof. Blackshield,( ') 'seems to minor the uncertainties and conflicts of values in the community itself '.
This tangIed web of case law has been woven around the terse terms of section 302, I.P.C. during the last hundred years.
THE OLD TEXT AND THE NEW LIGHT Section 302.
Whoever commits murder shall be punished with death, or imprisonment for life, and shall also be liable to fine.
Such stark brevity leaves a deadly discretion but beams little legislative light on when the court shall hang the sentencee or why the lesser penalty shall be preferred.
This facultative fluidity of the pro vision reposes a trust in the court to select.
And 'discretionary navigation in an unchartered sea is a hazardous undertaking unless recognised and recognizable principles, rational and constitutional, are crystallised as 'interstitial legislation ' by the highest court.
The flame of life cannot flicker uncertain! and so section 302 I.P.C. must be invested with pragmatic concreteness that inhibits ad hominem Responses of individual judges and is in penal conformance with constitutional norms and world conscience.
Within the dichtomous frame work of section 302 I.P.C., upheld in Jagmohan Singh, we have to evolve working rules of punishment bearing the markings of enlightened flexibility and societal sensibility.
Hazy law, where human life hangs in the balance, injects an agonising consciousness that judicial error may (1) Prof. A. R. Blackshield, Associate Professor of Law, University of New South Wales: Capital Punishment in India: The Impact of the Ediga Anamma Case July 1977.
91 prove to be 'crime ' beyond punishment '.
And history bears testimony to reversal of Court verdict by Discovery of Time.
The tragic speech in the Commons of former Home Secretary (Chuter Ede) makes ghastly reading (1) "I was the Home Secretary who wrote on Evans ' papers.
"The law must take its course.
" I never said, in 1948 that a mistake was impossible.
I think Evans ' case shows, in spite of all that has been done since, that a mistake was possible, and that, in the form in which the verdict was actually given on a particular case, a mistake was made.
I hope that no future Home Secretary, which in office or after he has left office, will ever have to feel that although he did his best and no one could accuse him of being either careless or inefficient, he sent a man to the gallows who was not "guilty as charged.
" That is why we devote a whole judgment to what ordinarily is a brief finale at the end of a long opinion.
ln Ediga Annamma(2), this Court did set down some working formulae whereby a synthesis could be reached as between death sentence and life imprisonment.
Notwithstanding the catalogue of grounds warranting death sentence as an exceptional measure, 'life ' being the rule, the judicial decisions have been differing (and dithering) at various levels, with the result the need for a thorough re examination has been forced on us by counsel on both sides.
Prof. Blackshield makes an acid comment: (3) "The fact is that decisions since Ediga Anamma have displayed the same pattern of confusion, contradictions and aberrations as decisions before that case .
To test this, I have abstracted from the All India Reporter seventy cases in which the Supreme Court has had to choose between life and death under Section 302: the last twenty five reported cases before the date of Ediga Anamma, and the next forty five (including, of course, Ediga Anamma itself) on or after that date." "But where life and death are at stake, inconsistencies which are understandable may not be acceptable.
The hard evidence of the accompanying "kit of cases" compels the (1) The Crusade against Capital Punishment in Great Britain by Elizabeth Orman Tuttle, 1961, p. 96.
(2) Ediga Annama vs State of Andhra Pradesh ; (3) Prof. A. R. Blackshield, Associate Professor of Law, University of New South Wales: Capital Punishment in India.
The Impact of Ediga Annamma.
Case July 1977.
92 conclusion that, at least in contemporary India, Mr. Justice Douglas ' argument in Furman vs Georgia(l) is correct: that arbitrariness and uneven incidence are inherent and inevitable in a system of capital punishment; and that therefore in Irritant constitutional terms, and in spite of Jagmohan Slngh the retention of such a system necessarily violates Article 14 's guarantee of "equality before the law.
" The author further observes: "One source of the confusion seems to have been an under current of disagreement as to the correctness and applicability of the argument in Ediga Anamma.
But the only direct challenge has been in Bishan Dass vs State of Punjab, AIR 1975 SC 573 (January 10, 1975: Case 52) and, with respect, the challenge there seems clearly misconceived.
" What a study of the decisions of the higher courts on the life or death choice shows is that judicial impressionism still shows up and it is none too late to enunciate a systematised set of criteria or at least reliable beacons Ediga Annamma (supra) in terms, attempted this systematisation: "Let us crystallise the positive indicators against death sentences under Indian Law currently.
Where the murderer is too young or too old, the clemency of penal justice helps him.
Where the offender suffers from socio economic, psychic or penal compulsions insufficient to attract a legal exception or to down grade the crime into a lesser one, judicial com mutation is permissible.
Other general social pressures, war ranting judicial notice, with an extenuating impact may in special cases, induce the lesser penalty.
Extraordinary features in the judicial process, such as that the death sentence has hung over the head of the culprit excruciatingly long, may persuade the Court to be compassionate.
Like wise, if others involved in the crime and similarly situated have received the benefit of life imprisonment or if the offence is only constructive (i.e. combining the "murder" provision with the "unlawful assembly" provisione again (if) the accused has acted suddenly under another 's instigation, without premeditation, perhaps the court may humanely opt for life, even life where a just cause or real suspicion of wifely infidelity pushed the criminal into the crime.
On the other hand, the weapons used and the manner of their use the (1) 408 U. section at 238.
93 horrendous features of the crime and hapless, helpless state A of the victim, and the like, steel the heart of the law for a sterner sentence.
We cannot obviously feed into a judicial computer all such situations since they are astrological imponderables in an imperfect and undulating society.
A legal policy on life or death cannot be left for ad hoc mood or individual predilection and so we have sought to objectify to the extent possible, abandoning retributive ruthlessness, amending the deterrent creed and accepting the trend against the extreme and irrevocable penalty of putting out life. ' '(l) From what we have said and quoted and from the persistence Or forensic divarication, it has now become necessary to have a second look at the life versus death question, not for summarising hitherto decided cases and distilling the common factors but for applying the Constitution to cut the Gordian knot.
The Suprema lex must set the perspective and illumine the meaning of subordinate statutes especially where some provisions contain obfuscatory elements, for, our founding fathers have not hammered out a merely pedantic legal text but handed down a constellation of human values, cherished principles and spiritual norms which belight old codes and imperial laws and impel new interpretations and legislations to tune up the New Order.
The Indian Penal Code must be sensitized by the healing touch of the Preamble and Part lII.
Wrote Wheeler, J :(2) "That court best serves the law which recognises that the rules of law which grew up in a remote generation may, in the fullness of experience, be found to serve another generation badly, and which discards the old rule when it finds that another rule of law represents what should be according to the established and settled judgment of society. " Benjamin N. Cardozo, said: (3) "If judges have woefully misinterpreted the mores of their day, or if the mores of their day are no longer those of ours, they ought not to tie, in helpless submission, the hands of their successors.
" Such a solution to the death/life alternatives, where the Code leaves the Judge in the cold, has its limits. "Justice Homes put his view pithily when he said that judges make law interstitially, that they are confined from molar to molecular motion.
Justice Frankfurter puts (1) Ediga Annamma vs State of A. P. (1974) 4 S.C.C. 443 at 453.
(2) Dwy vs Connecticut Co., , 99.
(3) The Nature of the Judicial Process by Benjamin N. Cardozo.
p. 152.
94 it more colloquially saying that judges make law at retail, legislators at wholesale. ' '(l) Therefore, it is no heresy to imbibe and inject the social philosophy of the Constitution into the Penal Code to resolve the tension between the Past and the Present.
QUO VADIS DISCRETIONARY DEATH SENTENCE ? lndian Justice and the constitutional order are centuries ahead of the barbarities of Judge Jeffreys of 'Bloody Assizes ' fame; and ideologically away from the years of imperial butchery of Indian uprising when the Penal Code was drafted.
Since Law reflects Iife, new meanings must permeate the Penal Code.
The deprivation of life under our system is too fundamental to be permitted save on the gravest ground and under the strictest scrutiny if Justice, Dignity, Fair Procedure and Freedom are creedally constitutional.
So it is that in this bunch of appeals the court is called upon by counsel for the appellants to repel sentence by hunch and to lay down broad norms and essential principles as beacon lights which make the law of murder, in the sentencing sector, most restrictive and least vagarious.
More illumination and closer examination of the provisions viz., s.302 in the larger humanist context and constitutional conspectus, is necessitous.
Legal justice must be made of surer stuff where deprivation of life may be the consequence.
So we have heard a wider range of submissions and sought the, 'amicus ' services of the learned Solicitor General.
An intervener (Committee for Abolition of Death Penalty, interested in abolition of death penalty has submitted, through Dr. L. M. Singhvi, some material.
We record our appreciation af the assistance given by the former and take due note of the views presented by the latter.
Light, not heat, is welcome from any source in aid of judicial justice.
We are cognizant of the fact that no inflexible formula is feasible which will provide a complete set of criteria for the infinite variety of circumstances that may affect the gravity of the crime of murder, as pointed out by Palekar, J. in Jagmohan Singh (supra).
The learned Judge further observed: "The impossibility of laying down standards is at the very core of the criminal law as administered in India which in vests the judges with a very wide discretion in the matter of fixing the degree of punishment.
The discretion in the matter of sentence is, as already pointed out, liable to be corrected , by superior courts." (p. 35) (1) "Social Justice" Ed.
by Richard B. Brandt, p. 109. 95 What is important to remember is that while rigid prescriptions and random prescriptions which imprison judicial discretion may play tricks with justice, the absence, altogether, of any defined principles except a variorum of rulings may stultify sentencing law and denude is of decisional precision. 'Well recognised principles ' is an elegant phrase.
But what are they, when minds differ even on the basics ? Fluctuating facts and keleidoscopic circumstances, bewildering novelties and unexpected factors, personal vicissitudes and societal variables may defy standard setting for all situations; but that does not mean that humane principles should be abandoned and blanket discretion endowed, making life and liberty the plaything of the mentality of human judges.
Benjamin Cardozo has pricked the bubble of illusion about the utter objectivity of the judicial process: (1) "I have spoken of the forces of which judges avowedly avail to shape the form and content of their judgments.
Even these forces are seldom fully in consciousness.
They lie so near the surface, however, that their existence and influence are not likely to be disclaimed.
.Deep below consciousness are other forces, the likes and the dislikes, the predilections and the prejudices, the complex of instincts and emotions and habits and convictions, which make the man, whether he be litigant or judge.
" Section 302 is silent; so the judges have to speak, because the courts must daily sentence.
Merely to say that discretion is guided by wellrecognised principles shifts the issue to what those recognised rules are.
Are they the same as were exercised judicially when Bhagat Singh was swung into physical oblivion ? No. The task is to translate in new terms the currently consecrated principles, informed by tradition, methodized by analogy, disciplined by system, and subordinated to 'the primordial necessity of order in social life '.
The error of parallax which dated thought processes, through dusty precedents, may project needs to be corrected.
That is the essay we undertake here.
Moreover, the need for well recognised principles to govern the 'deadly ' discretion is so interlaced with fair procedure that unregulated power may even militate against article 21 as expounded in Maneka Gandhi 's case(2), an aspect into which we do not enter here.
Judicial absolutism or ad hocism is anathema in our constitutional scheme.
It (1) The Nature of the Judicial Process by Benjamin N. Cardozo p. 167.
(2) Maneka Gandhi vs Union of India (1978) I S.C.C. 248.
(2) Maneka Gandhi v Union of India (1978) 1 S.C.C.248 96 has been said that 'a judge untethered by a text is a dangerous instrument '; and we may well add, judge power, uncanalised by clear principles may be equally dangerous when the consequence of his marginal indiscretion may be horrific hanging of a human being until he be dead.
Palekar, J. himself accepted that "well recognised principles" must govern sentencing discretion.
The precise criteria which constitute, and the normative nature of those principles did not directly fall for decision as that case proceeded on the basis that the lower courts had rightly exercised the sentencing discretion.
The precise and only issue that was mooted and decided in Jagmohan Singh(l) was the constitutionality of section 302 I.P.C. and the holding was that 'the death sentence imposed after trial in accordance with procedure established by law is not unconstitutional '.
The acceptance of the invulnerability of discretionary power does not end the joureney; it inaugurates the search for those 'well recognised principles ' Palekar, J., speaks of in the Jagmohan case.
Incidental observations without concentration on the sentencing criteria are not the ratio of the decision.
Judgments are not Bible for every line to be venerated.
When the legislative text is too bald to be self acting or suffers zigzag distortion in action the primary obligation is on Parliament to enact necessary clauses by appropriate amendments to section 302 I.P.C.
But if legislative undertaking is not in sight judges who have to implement the Code cannot fold up their professional hands but must make the provision viable by evolution of supplementary principles even if it may appear to possess the flavour of law making.
Lord Dennings observations are apposite: "Many of the Judges of England have said that they (lo not make law.
They only interpret it.
This is an illusion which they have fostered.
But it is a notion which is now being discarded everywhere.
Every new decision on every new situation is a development of the law.
Law does not stand still.
It moves continually.
Once this is recognised, then the task of the Judge is put on a higher plane.
He must consciously seek to mould the law so as to serve the needs of the time.
He must not be a mere mechanic, a mere working mason, laying brick on brick, without thought to the overall design.
He must be an architect thinking of the structure as a whole, building for society a system of law which is strong, durable and just.
It is on his work that civilised society itself depends." (1) The Supreme Court of India A Socio Legal Critique of its Juristic Techniques by Rajeev Dhavan Foreword by Lord Denning, M. R. 97 The Court 's tryst with the Constitution obligates it to lay down A general rules, not a complete directory, which will lend predictabilily to the law vis a vis the community and guide the judiciary in such a grim verdict as choice between life and death.
The right to life, in our constitutional order, is too sacred to be wished away without so much as Directive Principles for its deprivation, save sweeping judical discretion and reference for confirmation or appellate review_ the know how for exercise of either being left to the assumed infallibility of the curial process in the face of the daily reality that there are cxtreme variations among judges themselves on 'when ' and 'why ' the extreme penalty shall or shall not be inflicted.
Currently, the welter of the British Indian and post Independence decisions and the impact of laconic legislative changes in the Criminal Procedure Code the competition among the retributive, deterrent, the reformative and even the existentialist theories of punishment and of statistical studies and sociological and cultural winds settle the lethal fate of the living man in the cage.
Law must be honest to itself.
Is it not true that some judges count the number of fatal wounds, some the nature of the weapons used, others count the corpses or the degree of horror and yet others look into the age or sex of the offender and even the lapse of time between the trial court 's award of death sentence and the final disposal of the appeal ? With some judges, motives, provocations, primary or constructive guilt, mental disturbance and old feuds, the savagery of the murderous moment or the plan which has preceded the killing, the social milieu, the sublimated class complex and other odd factors enter the sentencing calculus.
Stranger still, a good sentence of death by the trial court is sometimes upset by the Supreme Court because of Law 's delays.
Courts have been directed execution of murderers who are mental cases, who do not fall within the McNaghten rules, because of the insane fury of the slaughter.
A big margin of subjectivism, a preference for old English precedents, theories of modern penology, behavioural emphasis or social antecedents, judicial hubris or human rights perspectives, criminological literacy or fanatical reverence for outworn social philosophers buried in the debris of time except as part of history this plurality of forces plays a part in swinging the pendulum of sentencing justice erratically.
Therefore, until Parliament speaks, the court cannot be silent.
(Hopefully, s.302 l.
P.C. is being amended, at long last, but it is only half way through as the Rajya Sabha proceedings show.
We will revert to it later).
98 Prof. Blackshield, on an analytical study of Indian death sentence decisions, has remarked with unconventional candour: "But where life and death are at stake, inconsistencies which are understandable may not be acceptable." His further comments are noteworthy: "The fact is that in most cases where the sentence of death under S.302 is confirmed by the Supreme Court, there is little or no discussion of the reasons for confirmation.
Sometimes there is a brief assertion of "no extenuating circumstances" (which seems to imply that the Court is making its own discretionary judgment; at other times there is a brief assertion of "no ground to interfere" (which seems to imply that the Court is merely reviewing the legitimacy of the High Court 's choice of sentence).
The result is to obfuscate, probably beyond any hope of rationalisation, the analytical issues involved.
"(supra) The twists and turns in sentencing pattern and the under emphasis on the sentencee 's circumstances in decided cases make an in depth investigation of the 'principles ' justifying the award of death sentence a constitutional duty of conscience.
This Court must extricate, until Parliament legislates, the death sentence sector from judicial sub jectivism and consequent uncertainty.
As Justice Cardozo, in The Nature of the Judicial Process, bluntly states: (1) "There has been a certain lack of candor in much of the discussion of the theme, or rather perhaps in the refusal to discuss it, as if judges must lose respect and confidence by the reminder that they are subject to human limitations. if there is anything of reality in my analysis of the judicial process, they do not stand aloof on these chills and distant heights; and we shall not help the cause of truth by acting and speaking as if they do.
The great tides and currents which engulf the rest of men do not turn aside in their course and pass the judges by.
" It is fair to mention that the humanistic imperatives of the Indian Constitution, as paramount to the punitive strategy of the Penal code, have hardly been explored by courts in this field of 'life or death ' at the hands of the law.
The main focus of our judgment is on this poignant gap in 'human rights jurisprudence ' within the limits of the Penal Code, impregnated by the Constitution.
To put it pithily, a world order voicing the worth of the human person, a cultural legacy (l) pp.
167 168. 99 charged with compassion, an interpretative liberation from colonial A callousness to life and liberty, a concern for social justice as setting the sights of individual justice, interact with the inherited text of the Penal Code to yield the goals desiderated by the Preamble and Articles 14, 19 and 21.
Nor can courts be complacent in the thought that even if they err the clemency power will and does operate to save many a life condemned by the highest court to death.
For one thing, the uneven politics of executive clemency is not an unreality when we remember it is often the violent dissenters, patriotic terrorists, desperadoes nurtured by the sub culture of poverty and neurotics hardened by social neglect, and not the members of the Establishment or con formist class, who get executed through judicial and clemency processes.
Executive commutation is no substitute for judicial justice; at best it is administrative policy and at worst pressure based partiality.
In either case, that court self condemns itself which awards death penalty with a sop to its conscience that the habitual clemency of Government will soften the judicial excess in sentence.
If justice under the law justifies the lesser sentence it is abdication of judicial power to inflict the extreme penalty and extraneous to seek consolation in the possible benign interference by the President.
The criteria for clemency are often different.
We arc thus left with the necessity to decipher sentencing discretion in the death/life situation.
SENTENCING CYNOSURES Having stated the area and object of investigation we address ourselves to this grave penological issue purely as judges deciding a legal problem, putting aside views, philosophical or criminological, one holds.
But law, in this area, cannot go it alone; and cross fertilisation from sociology, history, cultural anthropology and current national perils and developmental goals and above all, constitutional currents, cannot be eschewed.
Let us leave 'law ' a while and begin with drawing the backdrop with a lurid brush.
Every sombre dawn a human being is hanged by the legal process, the flag of humane justice shall be hung half mast.
Such is the symbolic reverence the land of Gandhi should pay to human life haltered up by lethal law.
The values of a nation and ethos of a generation mould concepts of crime and punishment.
So viewed, the lode star of penal policy to day, shining through the finer culture of former centuries, strengthens the plea against death penalty.
Moreover, however much judicially screened and constitutionally legitimated, there is a factor of fallibility, a pall that falls beyond recall and a core of sublimated cruelty implied in every death penalty.
100 This is the starting point of our re appraisal of presidential and legislative texts, with a view to evolving clearer criteria for choice between the Life Death Alternatives enacted into the Penal Code.
We may, for emphasis, recall section 302 I.P.C., at once laconic and draconic, which reads: s.302.
Punishment for murder.
Whoever commits murder shall be punished with death, or imprisonment for life, and shall also be liable to fine.
" We approach the resolution of the punishment predicament in a manner at once legal, logical and criminological and impregnated with values constitutional.
Therefore, we will first study the significant legislative developments in the two interacting Codes and related par liamentary essays at change.
Where broad conclusions emerge from such an investigation, constitutional reinforcement may be sought.
Since the Constitution is paramount and paramountcy is paramountcy, its expansive humanism must overpower traditional 'terrorism ' in the practice of sentencing.
When this stage is reached and formulation of guidelines made, we will consider the criminological foundations of theories of punishment which harmonise with the human rights jurisprudence of our cultural cosmos.
Finally, we will set down the salient cynosures for judges in their day to day labours.
One sentencing aspect which has found prominent place in the Criminal Procedure Code, 1973, but more often ignorantly ignored, needs to be highlighted for future guidance.
The cases actually de manding decision, their factual matrices and the actual application of The principles we have formulated to the appeals under consideration are the decisive part of the judgment.
The sister Codes the Indian Penal Code and the Criminal Procedure Code are interwoven into the texture of sentencing.
So much so, the various changes in s.367 of the Procedure Code, 1898 and its re incarnation in s.354 of the Code of 1973 impact on the inter pretation of section 302 of the Penal Code.
The art of statutory construction seeks aid from connective tissues, as it were, of complementary enactments.
This mode offers a penological synthesis Parliament legislatively intended.
From this angle, we may examine the history of the amendments to the Procedure Code in so far as they mould ' the sentencing discretion vested by section 302 I.P.C. Vintage words adapt their semantic content with change in Society 's thoughtways and people 's mores.
Linkwise, Law Life mutuaIity moulds judicial construction.
So when a nineteenth century Code, 101 with vital impact on life and liberty, falls for examination in the last quarter of the twentieth century, criminological developments finds their way into the process of statutory decoding.
This is obviously permissible, even necessary.
A progressive construction which up dates the sense of statutory language has been adopted in Weems vs United States(1) and commended by jurists.
We may ask ourselves whether the Procedure Code, which intertwines with the Penal Code lends discretionary direction? Similarly, a brief suruey of the trend of legislative endeavours may also serve to indicate whether the people 's consciousness has been projected towards narrowing or widening the scope for infliction of death penalty.
Current criminological theories, the march of the abolitionist movement across the continents, the national heritage and voice of the makers of modern India and parliamentary re thinking on reform of the Penal Code may also be indicators.
In this setting, let us rationalize and humanize the discretionary exercise under s.302 I.P.C. Several attempts have been made to restrict or remove death penalty under section 302 but never even once to enlarge its application.
Parliamentary pressure has been to cut down death penalty, although the section formally remains the same and is very nearly being wholly recast benignly.
The cue for the Court is clear.
"In 1931, an abolition bill was introduced in the Legislative Assembly by Gaya Prasad Singh; but a motion for circulation of the bill was defeated after it was opposed by the government.
The pattern after independence has been much the same.
In 1956, a bill introduced in the Lok Sabha by Mukund Lal Agarwal was rejected after government opposition.
In 1958 a Resolution for abolition, moved in the Rajya Sabha by Prithvi Raj Kapur, was withdrawn after debate.
(Its purpose had been served, said Shri Kapur).
"The ripples are created and it is in the air": Rajya Sabha Debates, April 25, 1958, Cols.444 528.
In 1961 a further Resolution, moved in the Rajya Sabha by Mrs Savitry Devi Nigam, was negatived after debate.
In 1962, however Resolution moved in the Lok Sabha by Raghunath Singh received more serious attention: Lok Sabha Debates, April 21, 1962, Cols.307 365.
The Resolution was withdrawn, but only after the government had given an undertaking that a transcript of the debate would be forwarded to the Law Commission, for consi 102 deration in the context of its review of the Penal Code and the Criminal Procedure Code.
The result was a separate Law Commission Report on Capital Punishment, submitted to the government in September, 1967.
" (supra) At pages 354 55, the Law Commission summarized its main conclusions as follows It is difficult to rule out that the validity of or the strength behind, many of the arguments for abolition.
Nor does the commission treat lightly the argument based on the irrevocability of the sentence of death, the need for a modern approach, the severity of capital punishment, and the strong feeling shown by certain sections of public opinion in stressing deeper questions of human values.
Having regard, however, to the conditions in India, to the variety of the social upbringing of its inhabitants, to the disparity in the level of morality and education in the country, to the vastness of its area, to the diversity of its population and to the paramount need for main taining, law and order in the country at the present juncture India cannot risk the experiment of abolition of capital punishment.
" Currently, there is a Bill introduced in the Lok Sabha for total abolition.
The most meaningful contribution to 'human rights legality ' in the 'terminal ' territory of punitivity is the parliamentary amendment to s.302 I.P.C. half way through and, if we may say so with respect, half fulfinling both the humanist quintessence of the Constitution and, may be, the creed of the Father of the Nation.
Gandhiji long ago wrote in the Harijan: "God Alone Can Take Life Because He Alone Gives it" We will dwell on this Indian Penal Code (Amendment) Bill, 1972 passed by the Rajya Sabha in 1978, later in this Judgment but mention this seminal event as a kindly portent against the 'homicidal ' exercise of discretion, often an obsession with retributive justice in disguise.
And the parliamentary prospects, to the extent relevant to judicial discretion disappoint those who are restless if murder is divorced from death penalty.
The Future shapes the Present on occasions and therefore we take note of this big change in the offing.
Section 302, as now recast by the Rajya Sabha, reads: 302.
(1) Whoever commits murder shall, save as otherwise vided in sub section (2), be punished with imprisonment for life and shall also be liable to fine.
103 (2) Whoever commits murder shall, (a) if the murder has been committed after previous planning and involves extreme brutality; or (b) if the murder involves exceptional depravity; or (c) if the murder is of a member of any of the armed forces of the Union or of a member of any police force or of any public servant and was committed (i) while such member or public servant was on duty; (ii) in consequence of anything done or attempted to be done by such member of public servant in the lawful discharge of his duty as such member or public servant whether at the time of murder he was such member or public servant as the case may be, or had ceased to be such member or public servant; or (d) if the murder is of a person who had acted in the lawful discharge of this duty under section 43 of the Code of Criminal Procedure, 1973, or who had rendered assistance to a Magistrate or a police officer demanding his aid or requiring his assistance under section 37 or section 129 of the said Code; or (e) if the murder has been committed by him, while under sentence of imprisonment for life, and such sentence has become final, be punished with death, or imprisonment for life, and shall also be liable to fine.
(3) Where a person while undergoing sentence of imprisonment for life is sentenced to imprisonment for an offence under clause (e) of sub section (2) such sentence shall run consecutively and not concurrently:(1) Maybe, the fuller and finer flow of the constitutional stream of human dignity and social justice will shape the provision more reformatively.
Suffice it to say that the battle against death penalty by parliamentary action is gaining ground and those who do live in the ivory tower and Judges, hopefully, do not will take cognizance of this compassionate trend.
The inchoate indicators gatherable from the direct reforms of death penalty take us to the next 'neon sign ' from the changes in the 104 Procedure Code.
Section 302 I.P.C., permits death penalty but s.354 (3) of the Procedure Code, 1973 processes the discretionary power.
The central issue of death/life discretion is not left naked by the Procedure Code which, by necessary implication, has clothed it with pro life language.
The legislative development, through several successive amendments, has shifted the punitive centre of gravity from life taking, to life sentence.
To start with, section 367(5) obligated the court to 'state the reason why sentence of death was not passed '.
In other words, the discretion was directed positively towards death penalty.
The next stage was the deletion of this part of the provision leaving the judicial option open.
And then came the new humanitarian sub section [section 354 (3)] of the Code of 1973, whereby the dignity and worth of the human person, under scored in the Constitution, shaped the penal policy related to murder.
The sub section provides: "When the conviction is for an offence punishable with death or, in the alternative, with imprisonment for life or imprisonment for a term of years, the judgment shall state the reasons for the sentence awarded, and, in the case of sentence of death, the special reasons for such sentence." (emphasis added) Thus on the statutory side, there has been a significant shift since India became free.
In practice, the effect of the pre 1955 version is that while the former rule was to .
sentence to death a person convicted for murder and to impose the lesser sentence for reasons to be recorded in writing, the process has suffered a reversal now.
Formerly, capital punishment was to be imposed unless special reasons could be found to justify the lesser sentence.
The 1955 amendment, removing the requirement, had left the courts equally free to award either sentence.
Finally, with the new 1973 provision "a great change has overtaken the law. .The unmistakable shift in legislative emphasis is that life imprisonment for murder is the rule and capital sentence the exception to be resorted to for reasons to be stated.
It is obvious that the disturbed conscience of the State on the vexed question of legal threat to life by.
way of death sentence has sought to express itself legislatively, the stream of tendency being to wards cautious, partial abolition and a retreat from total retention.
" The twin survey of attempted and half accomplished changes in the Penal Code and the statutory mutation, pregnant with significance, 105 wrought into the procedure Code, definitely drives judicial discretion to a benign destination.
The message of the many legislative exercises is that murder will ordinarily be visited only with life imprisonment and it is imperative that death sentence shall not be directed unless there exist "special reasons for such sentence.
" The era of broad discretion when Jagmohm 's case was decided has ended and a chapter of restricted discretion has since been inaugurated.
This is a direct response, not merely to the humane call of the Constitution, but also to the wider cultural and criminological transformation of opinion on the futility of the law of 'Life for Life ' 'red in tooth and claw '.
No longer did judicial discretion depend on vague 'principles '.
It became accountable to the strict requirements of s.354(3) of the 1973 Code.
By way of aside, we may note that the consolation that judicial discretion in action is geared to justice is not always true to life.
"The discretion of a judge is said by Lord Camden to be the law of tyrants: it is always unkonwn; it is different in different men; it is casual, and depends upon constitution, temper and passion.
In the best, it is of ten times caprice; in the worst, it is every vice, folly and passion to which human nature is liable. . " 1 Bouv.
Law Dict.
, Rawles ' Third Revision p.885." "An appeal to a judge 's discretion is an appeal to his judicial conscience.
The discretion must be exercised, not in opposition to, but in accordance with, established principles of law." (Griffin vs State, Here is thus an appeal to the informed conscience of the sentencing judge not to award death penalty save for special reasons which have direct nexus with the necessity for hanging the murderer by law.
The revolutionary import of the target expression, in a death sentence situation, viz., 'the special reasons for such sentence demands perceptive exploration with emotional explosion or sadistic sublimation disguised as 'special reason '.
Here we enter the penological area of lethal justice, social defence and purpose oriented punishment.
Before launching on the decisive discussion it is fair to be frank on one facet of the judicial process.
To quote Richard B Brandt: 106 "Much of law is designed to avoid the necessity for the judge to reach what Holmes called his 'can 't helps ', his ultimate convictions or values.
The force of precedent, the close applicability of statute law, the separation of powers, legal presumptions, statutes of limitations, rules of pleading and evidence, and above all the pragmatic assessments of fact that point to one result whichever ultimate values be assumed, all enable the judge in most cases to stop short of a resort to his personal standards.
When these prove unavailing, as is more likely in the case of courts of last resort at the frontiers of the law, and most likely in a supreme constitutional court, the judge necessarily resorts to his own scheme of values.
It may, therefore, be said that the most important thing about a judge is his philosophy; and if it be dangerous for him to have one, it is at all events less dangerous than the self deception of having none.
" THE CODES, THE CONSTITUTION AND THE CULTURAL BACKDROP Primarily we seek guidelines from the two Codes, in the omnipresence and omnipotence of the over arching Constitution.
The Indian cultural current also counts and so does our spiritual chemistry, based on divinity in everyone, catalysed by the Buddha Gandhi compassion. 'Every saint has a past and every sinner a future ' strikes a note of reformatory potential even in the most ghastly crime.
This axiom is a vote against 'death ' and hope in 'life '.
Many humane movements and sublime souls have cultured the higher consciousness of mankind, chased death penalty out of half the globe and changed world view on its morality.
We will, in the culminating part of our judgment, cull great opinions to substantiate this assertion but content here with pointing to their relevance as part of the conspectus.
Criminologists have elaborately argued that 'death ' has decisively lost the battle as the dominant paradigm and even in our Codes has shrunk into a weak exception.
Even so, what are these exceptional cases? Not hunch or happen stance but compelling grounds, lest the 'Chancellor 's foot ' syndrome reappear in different form.
So let us examine the grounds in this new sheen.
An easy confusion is over stress on the horror of the crime and the temporary terror verging on insane violence the perpetrator displays, to the exclusion of a host of other weighty factors when the scales are to settle in favour of killing by law the killer who resorts to unlaw.
107 Speaking illustratively is shocking crime, without more, good to justify the lethal verdict? Most murders are horrifying, and an adjective adds but sentiment, not argument.
The personal story of an actor in a shocking murder, if considered, may bring tears and soften the sentence.
He might have been a tortured child, an illtreated orphan, a jobless starveling, a badgered brother, wounded son, a tragic person hardened by societal cruelty or vengeful justice, even a Hamlet or Parasurama.
He might have been angelic boy but thrown into mafia company or inducted into dopes and drugs by parental neglect or moraly mentally retarded or disordered.
Imagine a harijan village backed out of existence by the genocidal fury of a kulak group and one survivor, days later, cutting to pieces the villain of the earlier outrage.
Is the court in error in reckoning the prior provocative barbarity as a sentencing factor? Another facet.
Maybe, the convict 's poverty had disabled his presentation of the social milieu or other circumstances of extenuation in defence.
Judges may be of moods, soft or severe; their weaknesses may be sublimated prejudices; their sympathies may be persona hyper sensitivity.
Did not Lord Camden, one of the greatest and purest of English judges, say "that the discretion of a judge is the law of tyrants; it is always unknown; it is different in different men; it is casual, and depends upon constitution, temper and passion.
In the best it is oftentimes caprice; in the worst, it is every vice, folly and passion to which human nature can be liable." (State vs Cummings 36 Mo.263 278 (1865)? When life is at stake, can such frolics of fortune play with judicial veriest? The nature of the crime too terrible to contemplate has often been regarded a traditional peg on which to hang a death penalty.
Even Ediga Annamma (supra) has hardened here.
But 'murder most foul ' is not the test, speaking scientifically.
The doer may be a patriot, a revolutionary, a weak victim of an overpowering passion who, given better environment, may be a good citizen, a good administrator, a good husband, a great saint .
What was Valmiki once? And that sublime spiritual star, Shri Aurobindo, tried once for murder but by history 's fortune acquitted.
If we go only by the nature of the crime we get derailed by subjective paroxysm. 'Special reasons ' must vindicate the sentence and so 108 must be related to why the murderer must be hanged and why life imprisonment will not suffice.
Decided cases have not adequately identified the manifold components of comprehensive sentencing.
Resultantly, what is regarded as decisive is only relevant and what is equally telling remains untold.
For reasons of ' special ' grimness may be cancelled by juvenile justice.
Brutality of the crime may be mollified at the level of sentencing justice by background of despair.
Even a planned barbarity may be induced by an excessive obsession by one who could be a good person under other surroundings.
Why, the ghastly crime may in rare cases be due to a brain tumour.
Myriad factors of varying validity may affect the death penalty either way.
The criminal will be projected on the scene and examined from different angles since the punishment is on the person though for the offence.
CAPITAL PENALTY AND THE CONSTITUTION In these pathless woods we must seek light from the Constitution regarding 'special reasons '.
After all, no Code can rise higher than the Constitution and the Penal Code can survive only if it pays homage to the suprema lex.
The only correct approach is to read into s.302 I.P.C. and s.354(3) Cr.
P.C., the human rights and humane trends in the Constitution.
So examined, the right to life and to fundamental freedoms is deprived when he is hanged to death, his dignity is defiled, when his neck is noosed and strangled.
What does s.302 do by death penalty to the sentence? It finally deprives him of his fundamental rights.
True, fundamental rights are not absolute and may be restricted reasonably, even prohibited totally, if social defence compels such a step.
Restriction may expand into extinction in extreme situations.
(see Narendra Kumar) Punishment by deprivation of life or liberty must be validated by articles 21, 14 and 19 the first guarantees fair procedure, the second is based on reasonableness of the deprivation of freedom to live and exercise the seven liberties and the last is an assurance of non arbitrary and civilized punitive treatment.
But in the connotation of these and other Articles of Part III, the social justice promise of Part IV and the primordial proposition of human dignity set high in the Preamble must play upon the meaning.
Crime and penal policy have to obey the behests set out above and we may gain constitutional light on the choice of 'life ' or death ' as appropriate punishment.
Article 14 surely ensures that principled sentences of death, not arbitrary or indignant capital penalty, shall be imposed.
Equal protection emanates from equal principles in 109 exercise of discretion.
In other words, the constraint of consistency and the mandate against unreasoning disregard of material circumstances are implicit lest discretion attracts the acrid epigram of judicial caprice.
The dignity of the individual shall not be desecrated by infliction of atrocious death sentence merely because there is a murder proved although crying circumstances demand the lesser penalty.
To exemplify, supposing a boy of fifteen incited by his elder brothers, chases with them a murderer of their father and after hours of search confronts the villain and vivisects him in blood thirsty bestiality.
Do you hang the boy, blind to his dignity and tenderness intertwined? We mean to illustrate the applicability, not to exhaust the variables.
Even here we may make it clear that equality is not to be confounded with flat uniformity.
The element of flexibility and choice in the process of adjudicating is precisely what justice requires in many cases.
Flexibility permits more compassionate and more sensitive responses to differences which ought to count in applying legal norms, but which get buried in the gross and rounded off language of rules that are directed at wholesale problems instead of particular disputes.
Discretion in this sense allows the individualization of law and permits justice at times to be hand made instead of mass produced.
In urging that discretion is the "effective individualizing agent of the law", Dean Pound pointed out that In proceedings for custody of children, where compelling consideration(s) cannot be reduced to rules. determination must be left, to no small extent, to the disciplined but personal feeling of the judge for what justice demands." (22 Syracuse L.R. 635, 636) (1).
Every variability is not arbitrary.
On the contrary, it promotes rationality and humanity.
Article 19 is a lighthouse with seven lamps of liberty throwing luminous indications of when and when only the basic freedoms enshrined therein can be utterly extinguished.
The Judge who sits to decide between death penalty and life sentence must ask himself: Is it 'reasonably ' necessary to extinguish his freedom of speech, of assembly and association, of free movement, by putting out finally the very flame of life? It is constitutionally permissible to swing a criminal out of corporeal existence only if the 110 security of State and society, public order and the interests of the general public compel that course as provided in article 19(2) to (6).
They are the special reasons which s.354(3) speaks of.
Reasonableness as envisaged in Art.19 has a relative connotation dependent on a variety of variables cultural, social, economic and otherwise.
We may give concrete instances at a later stage of this judgment but feel it necessary to state here that what is reasonable at a given time or in a given country or in a situation of crisis may not be the same as on other occasions or in other cultural climates.
Indeed, that is the unspoken but inescapable silent command of our constitutional system.
So, we search for guidelines within s.302 I.P.C. read with s.354 Cr. P.C., and find that ordinarily, for murder a life term is appropriate save where 'special reasons ' are found for resort to total extinction of the right to life and farewell to fundamental rights.
Public order and social security must demand it.
That is to say, the sacrifice of a life is sanctioned only if otherwise public interest, social defence and public order would be smashed irretrievably.
Social justice is rooted in spiritual justice and regards individual dignity and human divinity with sensitivity.
So, such extra ordinary grounds alone constitutionally qualify as 'special reasons as leave no option to the court but to execute the offender if State and society are to survive.
One stroke of murder hardly qualifies for this drastic requirement, however gruesome the killing or pathetic the situation, unless the inhere t testimony oozing from that act is irresistible that the murderous appetite of the convict is too chronic and deadly that ordered life in a given locality or society or in prison itself would be gone if this man were now or later to be at large.
If he is an irredeemable murderer, like a bloodthirsty tiger, he has to quit his terrestrial tenancy.
Exceptional circumstances, beyond easy visualisation, are needed to fill this bill.
To repeat for emphasis, death corporeal death is adieu to fundamental rights.
Restrictions on fundamental rights are permissible if they are reasonable.
Such restriction may reach the extreme state of extinction only if it is so compellingly reasonable to prohibit totally.
While sentencing, you cannot be arbitrary since what is arbitrary is per se unequal.
As stated earlier you cannot be unusually cruel for that spells arbitrariness and violates Art.14.
Douglas, J. made this point clear: (1) 111 "There is increasing recognition of the fact that the basic theme of equal protection is implicit in "cruel and unusual" punishments. "A penalty . should be considered 'unusually ' imposed if it is administered arbitrarily or discriminatorily.
" They are pregnant with discrimination and discrimination is an ingredient not compatible with the idea of equal protection of the laws that is implicit in the ban on "cruel and unusual" punishments.
" In Maneka Gandhi, this Court wrote We must reiterate here what was pointed out by the majority in E.P.Royappa vs State of Tamil Nadu (2) namely that "from a positivistic point of view, equality is antithetic to arbitrariness.
In fact equality and arbitrariness are sworn enemies; one belongs to the rule of law in a republic, while the other, to the whim and caprice of an absolute monarch.
" You cannot inflict degrading punishment since the preamble speaks of 'dignity of the individual '.
To stone a man to death is lynch law which breaches human dignity and is unreasonable under Art.19 and unusually cruel and arbitrary under article 14.
Luckily, our country is free from that barbarity legally.
The searching question the Judge must put to himself is: what then is so extra ordinarily reasonable as to validate the wiping out of life itself and with it the great rights which inhere in him in the totally of facts, the circle being drawn with ample relevancy.
Social justice, which the Preamble and Part IV (Art.38) hignlight as paramount in the governance of country, also has a role to mould the sentence.
But what is social justice? Despite its shadowy semantics we may get its essence once we grasp the Third World setting, the ethos and cultural heritage and the national goal or tryst with destiny.
Balakrishna Iyer, J., in Sridharan Motor Service, Attur vs Industrial Tribunal, Madras and Others(3) observed: "Concepts of social justice have varied with age and clime.
What would have appeared to be indubitable social justice to a Norman or Saxon in the days of William the 112 Conqueror will not be recognised as such in England today.
What may apear to be incontrovertible social justice to a resident of Quebec may wear a different aspect to a resident of Peking.
If it could be possible for Confusius, Manu, Hammurabi and Solomon to meet together at a conference table, I doubt whether they would be able to evolve agreed formulae as to what constitutes social justice, which is a very controversial field.
In countries with democratic forms of Government public opinion and the law act and react on each other.
" We may add that in a developing country, in the area of crime and punishment, social justice is to be rationally measured by social defence and, geared to developmental goals.
Thus, we are transported to the region of effective social defence as a large component of social justice.
If the murderous operation of a die hard criminal jeopardizes social security in a persistent, planned and perilous fashion, then his enjoyment of fundamental rights may be rightly annihilated.
When, then, does a man hold out a terrible and continuing threat to social security in the setting of a developing country? He does so if, by his action, he not only murders but by that offence, poses a grave peril to societal survival.
If society does not survive, individual existence comes to nought.
So, one test for impost of death sentence is to find out whether the murderer offers such a traumatic threat to the survival of social order.
To illustrate, if an economic offender who intentionally mixes poison in drugs professionally or willfully adulterates intoxicating substances injuriously, and knowingly or intentionally causes death for the sake of private profit, such trader in lethal business is a menace to social security and is, therefore, a violator of social justice whose extinction becomes necessary for society 's survival.
Supposing a murderous band of armed dacoits inteintionally derails a train and large number off people die in consequence, if the ingredients of murder are present and the object is to commit robbery inside the train, they practise social injustice and imperil social security to a degree that death penalty becomes a necessity if the crime is proved beyond doubt.
There may be marginal exceptions or special extenuations but none where this kind of dacoity or robbery coupled with murder becomes a contagion and occupation, and social security is so gravely imperilled that the fundamental rights of the defendant become a deadly instrument whereby many are wiped out and terror strikes community life.
Then he 'reasonably ' forefeits his fundamental rights and takes leave of life under the law.
The style of violence and 113 systematic corruption and deliberately planned economic offences by corporate top echelons are often a terrible technology of knowingly causing death on a macro scale to make a flood of profit.
The definition of murder will often apply to them.
But because of corporate power such murderous depradations are not charged.
If prosecuted and convicted for murder, they may earn the extreme penalty for taking the lives of innocents deliberately for astronomical scales of gain.
Likewise, if a man is a murderer, so hardened, so blood thristy, that within the prison and without, he makes no bones about killing others or carries on a prosperous business in cadavers, then he becomes a candidate for death sentence.
If psychoanalysts and psychiatrists find him irredeemable in the reasonable run of time then his being alive will involve more lives being lost at his hands.
If, however, he can be reformed in a few years ' time by proper techniques of treatment imprisonment for life is good enough.
But, on the other hand if he is far too hadened that it has become his second nature to murder, society cannot experiment with correctional strategy, for, when he comes out of jail, he may kill others.
Such an incurable murderer deserves to be executed under the law as it stands.
Difficult to imagine though, but even the bizarre may happen.
The social setting, the individual factors and like imponderables still remain to be spelt out.
While the world is spiralling spiritually towards a society without State sanctioned homicide, a narrow category may under current Indian societal distortions deserve death penalty although realistically the Law is held at bay by corporate criminals killing people through economic, product, environmental and like crimes.
Death penalty functionally fails to operate in this area for reasons not relevant to unravel here but theta justice often claims human lives by hanging sentences by a distorted vision of the penological purposes anu results.
What we mean is that the retention of death sentence in section 302 is rigorously restricted to these macro purposes of social defence, state security and public order.
But in practice, purblind application of capital penalty claims victims who should not be hanged at all.
The gross misapplication springs from professional innocence of the ideological, constitutional, criminological and cultural trends in India and abroad.
Judicial decisions have hardly investigated these areas, have conjured up grisly images of crime and criminal, and, fed on discarded doctrines of retribution and deterrence, indulged in death awards blind to the socio spiritual changes taking place in theoretical foundations of criminology and sublime movements on our human 114 planet.
The 'robes ' are a repository of many rare qualities but shall add to its repertory latest developments in sentencing wisdom.
A paranoid preoccupation with the horror of the particular crime oblivious to other social and individual aspects is an error.
The fact that a man has been guilty of barbaric killing hardly means that his head must roll in the absence of proof of his murderous recidivism, of incurable criminal violence, of a mafia holding society in ransom and of incompatibility of peaceful co existence between the man who did the murder and society and its members.
We may constellate some of the principles.
Never hang unless society or its members may probably lose more lives by keeping alive an irredeemable convict.
If rehabilitation is possible by long treatment in jail, if deterrence is possible by life long prison terms, capital sentence may be misapplied.
Death penalty is constitutionalised by reading into section 354(3) Cr.
P.C., those 'special reasons ' which validate the sentence as reasonably necessitous and non arbitrary, as just in the special societal circumstances.(1) Social justice turns on culture and situation.
We must listen, even as judges who are human and not wholly free from sublimated violence, to the words of great men condensed in the message to the Delhi Conference Against Death Penalty a few months ago.
Lok Nayak Jai Prakash Narain said : To my mind, it is ultimately a question of respect for life and human approach to those who commit grievous hurts to others.
Death sentence is no remedy for such crimes.
A more humane and constructive remedy is to remove the culprit concerned from the normal milieu and treat him as a mental case.
I am sure a large proportion of the murderers could be weaned away from their path and their mental condition sufficiently improved to become useful citizens.
In a minority of cases, this may not be possible.
They may be kept in prison houses till they die a natural death.
This may cast a heavier economic burden on society than hanging.
But I have no doubt that a humane treatment even of a murderer will enhance man 's dignity and make society more human." (emphasis added) Andrie Sakharov, in a message to the Stockholm Conference on Abolition organised by Amnesty International last year, did put the point more bluntly: (2) 115 I regard the death penalty as a savage and immoral institution which undermines the moral and legal foundations of a society.
A State, in the person of its functionaries, who like all people are inclined to making superficial conclusions who like all people are subject to influences, connections, prejudices and egocentric motivations for their behaviour, takes upon itself the right to the most terrible and irreversible act the deprivation of life.
Such a State cannot expect an improvement of the moral atmosphere in its country.
I reject the notion that the death penalty has any essential deterrent effect on potential offenders.
I am convinced that the contrary is true that savagery begets only savagery.
I am convinced that society as a whole and each of its members individually, not just the person who comes before the courts, bears a responsibility for the occurrence of a crime.
I believe that the death penalty has no moral or practical justification and represents a survival of barbaric customs of revenge.
Blood thirsty and calculated revenge with no temporary insanity on the part of the judges, and therefore, shameful and disgusting.
" (emphasis added) Tolstoy wrote an article "I cannot be silent" protesting against death sentence where he said : "Twelve of those by whose labour we live, the very men whom we have depraved and are still depraving by every means in our power from the poison of vodka to the terrible falsehood of a creed we impose on them with all our might, but do not ourselves believe in twelve of those men strangled with cords by those whom they feed and clothe and house, and who have depraved and still continue to deprave them.
Twelve husbands, fathers, and sons, from among those upon whose kindness, industry, and simplicity alone rests the whole of Russian life, are seized, imprisoned, and shackled.
Then their hands are tied behind their backs lest they should seize the ropes by which are to be hung, and they are led to the gallows.
" Victor Hugo 's words are not vapid sentimentalism: "We shall look upon crime as a disease.
Evil will be treated in charity instead of anger.
The change will be simple and sublime.
The cross shall displace the scaffold, 116 Reason is on our side, feeling is on our side, and experience is on our side." Gandhiji wrote: "Destruction of individuals can never be a virtuous act.
The evil doers cannot be done to death.
Today there is a movement afoot for the abolition of capital punishment and attempts are being made to convert prisons into hospitals as if they are persons suffering from a disease." Quotations from noble minds are not for decoration but for adaptation within the framework of the law.
This Gandhian concept was put to the test without effects calamitous in the Chambal dacoits ' cases : "Take the classic example of the blood thirsty dacoits of Chambal.
The so called dacoits, in reality the Thakurs of Delhi in the 12th century, were driven to the desolate Chambal Valley.
They had no other recourse except to steal and, if necessary, murder for their survival.
The 800 years injustice they suffered can be remedied only by their economic emancipation.
Remember, no one is born a criminal.
Sarvodaya leaders Jayaprakash Narain and Vinoba Bhave won over dacoits with love, affection and understanding something sophisticated, automatic weapons failed to do.
" We have, unfortunately no follow up study of this experiment.
Coming down to unhappy pragmatism, death penalty is permissible only where reformation within a reasonable range, is impossible.
The confusion is simple but die hard.
We lawfully murder the murderer, not the murder, by infliction of capital sentence.
for which the strictest justification is needed if human ignity assured by the Constitution is not to be judicially dismissed as an expandable luxury.
The deduction is inevitable that simply because a murder is brutal, lex talionis must not take over nor humane justice flee.
This proposition is tested in a crisis and the court 's responsibility is heavy to satisfy itself that the nature of the crime is considered, not for its barbarity as such but for its internal evidence of incurably violent depravity.
We have dealt with this aspect earlier but repeat, since it is horrendous or many lives have been lost.
Our culture is at stake, our Karuna is threatened, our Constitution is brought into contempt by a cavalier indifference to the deep reverence for life and a superstitious offering of human sacrifice to propitiate the Goddess of Justice.
117 These illustrations show that angry or scary irrationality has no place in awarding death sentence because 'reasonableness ' and fairness are the touchstone of the constitutionality of capital penalty.
Thus, we hold that only in these very limited circumstances can the court award the extreme penalty.
The terrible nature of the murder should not frenzy the court into necessary 'capital ' penalty, for its pertinence is only to the extent it helps to decide whether the prisoner, if released after a few years in a penitentiary, will reasonably be prone to continued killing.
If life long imprisonment will prevent further killing, he may be allowed to live with the limited fundamental rights allowed in a prison setting.
Even in extreme cases, one has to judge carefully whether the social circumstances, personal remorse, the excruciation of long pendency of the death sentence, with the prisoner languishing in nearsolitary suffering all the time, are not adequate infliction, so as to make capital sentence too cruel and arbitrary and agonising not to violate article 14.
Our penal pharmacopoeia must provide for the extreme remedy of extinction of the whole personality only in socially critical situations.
This is spiritual social justice.
Sometimes the thought is expressed that the life of the victim, the misery of his family and the great pain cruelly caused, are forgotton by those who advocate mercy for the brutal culprit.
This is a fallacy fraught with miscarriage of justice.
Punishment is not compensation like the 'blood money ' of Islamic law.
It is not lex talionis of retributive genre.
To be strictly compensatory or retributive, the same type of cruel killing must be imposed on the killer.
Secondly, can the hanging of the murderer bring the murdered back to life ? 'The dull cold ear of death ' cannot hear the cries or see the tears of the dying convict.
There is a good case for huge fines along with life terms in sentences where the sum is realisable and payable to the bereaved.
The Indian Penal Code fabricated in the imperial foundry well over a century ago has not received anything but cursory parliamentary attention in the light of the higher values of the National Charter which is a testament of social justice.
Our Constitution respects the dignity and, therefore, the divinity of the individual and preservation of life, of everyone 's life.
So the Court must permeate the Penal Code with exalted and expanded meaning to keep pace with constitutional values and the increasing enlightenment of informed public opinion.
A nineteenth century text, when applied to twentieth century conditions, cannot be construed by signals from the grave.
So, while courts cannot innovate beyond the law, the law cannot be viewed as cavemen 's pieces.
The penological winds of change, reflected in 118 juristic debates, bills for abolition of death penalty in Parliament and the increasing use of clemency and commutation by the highest Executive, must affect the living law of statutory application.
There is yet another consideration of grave moment which must, weigh with the court, vowed to uphold Justice Social, Economic and Political.
Who, by and large, are the men whom the gallows swallow ? The white collar criminals and the corporate criminals whose wilful economic and environmental crimes inflict mass deaths or who hire assassins and murder by remote control ? Rarely.
With a few exceptions, they hardly fear the halter.
The feuding villager, heady with country liquor, the striking workers desperate with defeat, the political dissenter and sacrificing liberator intent on changing the social order from satanic misrule, the waifs and strays whom society has hardened by neglect into street toughs, or the poor householder husband or wife driven by dire necessity or burst of tantrums it is this person who is the morning meal of the macabre executioner.
Justice Douglas, in a famous death penalty case, observed: Former Attorney Ramsey Clark has said: 'It is the poor, the sick, the ignorant, the powerless and the hated who are executed." "A characteristic of village murderers in India: over 60 per cent of them have lost their parents, either one or both, at the time of commission of the crime.
Inadequate parental protection is thus one of the primary factors in the upbringing of a murderer.
The very existence of parents helps the healthy growth of the offspring and prevents the children from falling into the whirlpool of crime." Comments the Editor, the Illustrated Weekly of India dated August 29, 1976.
Historically speaking, capital sentence perhaps has a class bias and colour bar, even as criminal law barks at both but bites the proletariat to defend the proprietariat, a reason which, incidentally, explains why corporate criminals including top executives who, by subtle processes, account for slow or sudden killing of large members by adulteration, smuggling, cornering, pollution and other invisible operations, are not on the wanted list and their offending operations which directly derive profit from mafia and white collar crimes are not visited with death penalty, while relatively lesser delinquencies have, in statutory and forensic rhetoric, deserved the extreme penalty.
Penal 119 law is not what the printed text professes but what the prison cell and the condemned man testify.
Courts take a close up of the immediate circumstances not the milieu which made the murderer nor the environs which make him man again.
In equal justice under the law, this imbalance of section 302 I.P.C., in action cannot be missed.
The tradition bound agencies of justicing cocooned by judicial precedents reflecting by gone values make sentencing processes 'soft ' where they should be severe and tainted with torture where a healing touch comports with culture.
Indeed, the habitual cerebrations of both wings of the profession have been guiltless of the great experiment of injecting the humanism of the National Charter through the interpretative art into criminal statistics.
Social justice on the one hand, means social defence from white collar and kindred criminals not through procrastinating illusions of punishment but instant deterrents to anti social delinquents and, on the other, Prison Justice, Reforms of offenders, non institutional strategies through community participation in correction and, above all, sentencing essays which ensure dignity of the individual human decencies and uplifting projects which re make the criminal into a good citizen.
Several of our prison houses and practices make us wonder about institutional criminality and 'punishment ' becoming a brand of crime and, worse, a manufacturing process of dehumanized criminals.
Prison Reform is on the national agenda.
Sentencing Reform soon deserves to be added.
An Indo Anglian appreciation of British Justice is sometimes relied on subconsciously, strengthened by the ambiguous Report of the Royal Commission on Capital Penalty to substantiate the retentionist theory.
But it is note worthy that Sir Samuel Romilly, critical of the brutal penalties in the then Britain, said in 1817: 'The Laws of England are written in blood '.
Alfieri has suggested: 'Society prepares the crime, the criminal commits it. 'We may permit ourselves the liberty to quote from Judge Sir Jeoffrey Streatfield: 'If you are going to have anything to do with the criminal courts, you should see for yourself the conditions under which prisoners serve their sentence. ' "It would be extremely gratifying to scan the pages of British legal and social history and to find that the members of the judiciary were invariably in the fore front of the movement towards enlightenment, progress and humanity.
Unfortunately until very recently, this has never been the case; in fact, it would be fair to say the judges have usually been amongst the principal opponents of penal reform.
It may be 120 that they were too far divided from the rest of the populace in the remoteness of their dignity, and too far removed in their standards of physical comfort and intellectual elegance.
Perhaps if a number of them had personally investigated the pitiable squalor of the prisons, the depravity of the haulks, and the bestial cruelties on the scaffold, some at least might have been shocked into a public condemnation of the entire penal system.
But, as it was, they preferred to remain either ignorant of or acquiescent to the aftermath of their judgments and of all the ensuing horrors which were being carried out in the name of the law. ' '(1) British Justice has abandoned death penalty for murder for two decades now (Homicide Act, 1957) without escalation of murderous crime.
Attempts to get round the Murder (Abolition of Death Penalty) Act, 1965 have failed in Parliament and as Barbara Wooton says, 'Capital punishment thus appeared to be itself sentenced to death ' for murder.
To quote the Royal Commission 's recommendation for retention after Parliament has abolished death penalty is only of historical interest: "After the Abolition Act had been in force for over seven years, the Criminal Law Revision Committee considered whether any further changes in the penalty for murder were desirable.
Their conclusions were almost entirely negative.
" This perspective justifies judicial evolution of a humane penal doctrine because the legislative text is not static; and as Chief Justice Warren wrote in Trop vs Dulles the court 'must draw its meaning from the evolving standards of a maturing society '.
The great answer to grave crime is culturing of higher consciousness, removing the pressure of a perverted social order, and nourishing the inner awareness of man 's true nature.
This is true penal reform, including jail reform.
A difficult category which defies easy solution, even in the developmental social justice background, is the political or ideological murderer.
Where freedom of faith and conscience is affirmed, as in our Constitution, where concentration of wealth and ethnic and social suppression are anathema and egalitarian cum distributive justice are positive goals, 'criminals ' motivated by the fundamental creed of our Constitution may well plead for the benefit of life imprisonment.
Count Leo Tolstoy in his Recollections and Essays denounces death penalty even against revolutionaries by arguments too Gandhian to be dismissed by Indian judges in the sentencing sector of discretion.
We 121 do not dogmatise but suggest the trend.
Law by itself is no answer to Justice as the sublime instances of Socrates, Jesus are martyrs galore in the long story of Man point.
We do not underrate the importance of strong public denunciation of serious crimes like murder and heavy punishment for it.
The critical question is whether capital sentence or incarceration for life in a hospital setting both stern, but the former a final farewell to life itself, the latter a protracted living ordeal which of the two harsh alternatives should be inflicted.
Criminologists have reached near consensus that death penalty for murder is judicial futility as a deterrent and is a vulgar barbarity, if fruitless.
And Reformationists have made headway so much that about 80 countries have given up capital sentence.
England had 200 offences which carried death sentences and publicly hanged boys and girls for stealing spoons and the like.
Stealing persists, death penalty has disappeared.
The importance of death sentence as a deterrent is brought out with characteristic wit by Dr. Johnson, who according to Boswell, noted pickpockets plying their trade in a crowd assembled to see one of their number executed.
There is no moral defence against the application of Justitia dulcore misericordiac temperate (Justice tempered by mercy, literally by sweetness of compassion) even in the name of deterrence.
CONDENSED GUIDELINES We may summarise our conclusions to facilitate easier application and to inject scientific formulation.
The criminal law of the Raj vintage has lost some of its vitality, notwithstanding its formal persistence in print in the Penal Code so far as section 302 I.P.C. is concerned.
In the post Constitution period section 302 I.P.C., and section 345(3) of the Code of Criminal Procedure have to be read in the humane light of Parts III and IV, further illumined by the Preamble to the Constitution.
In Sunil Batra a Constitution Bench of this Court has observed: "Consciously and deliberately we must focus our attention, while examining the challenge, to one fundamental fact that we are required to examine the validity of a pre constitution statute in the context of the modern reformist theory of punishment, jail being treated as a correctional institution" "Cases are not unknown where merely on account of a long lapse of time the Courts have commuted the sentence of 122 death to one of life imprisonment on the sole ground that the prisoner was for a long time hovering under the formenting effect of the shadow of death." "The scheme of the Code, read in the light of the Constitution, leaves no room for doubt that reformation, not retribution, is the sentencing lode star." (emphasis added) 2.
The retributive theory has had its day and is no longer valid.
Deterrence and reformation are the primary social goals which make deprivation of life and liberty reasonable as penal panacea.
The current ethos, with its strong emphasis on human rights and against death penalty, together with the ancient strains of culture spanning the period from Buddha to Gandhi must ethically inform the concept of social justice which is a paramount principle and cultural paradigm of our Constitution.
The personal and social, the motivational and physical circumstances, of the criminal are relevant factors in adjudging the penalty as clearly provided for under the new Code of 1973.
So also the intense suffering already endured by prison torture or agonising death penalty hanging over head consequent on the legal process.
Although the somewhat absolescent M 'Naughten Rules codified in section 84 of the Penal Code alone are exculpatory mental imbalances, neurotic upsets and psychic crises may be extenuatory and the sense of diminished responsibility may manifest itself in judicial clemency of commuted life incarceration.
Social justice, projected by article 38, colours the concept of reasonableness in article 19 and non arbitrariness in article 14.
This complex of articles validates death penalty in a limited class of cases as explained above.
Maybe, train dacoity and bank robbery bandits, reaching menacing proportions, economic offenders profit killing in an intentional and organised way, are such categories in a Third World setting.
Apart from various considerations which may weigh with the Court, one consideration which may be relevant in given circumstances, is the planned motivation that goaded the accused to commit the crime.
Largely in India death is caused not by a cool, calculated, professionally cold blooded planning but something that happened on the spur of the moment.
In fact in faction ridden society factions come to grip on a minor provocation and a gruesome tragedy occurs.
123 But with the development of the complex industrial society there has come into existence a class of murderers who indulge in a nefarious activity solely for personal, monetary or property gain.
These white collar criminals in appropriate cases do deserve capital punishment as the law now stands, both as deterrent and as putting an end to an active mind indulging in incurably nefarious activities.
It is such characteristics that determine more or less the gravity and the character of the offence and offender.
We may venture that sometimes there is big money in the subtle "murder" business disguised as economic offences or industrial clashes; and there social justice in certain circumstances punctures 'soft ' justice and opts for lethal sentence.
Where intractable mafia shows up in murderous profusion, the sentence of death must, reluctantly though, defend society.
The survival of an orderly society without which the extinction of human rights is a probability compels the higher protection of the law to those officers who are charged with the fearless and risky discharge of hazardous duties in strategic situations.
Those officers of law, like policemen on duty or soldiers and the like have to perform their functions even in the face of threat of violence sometimes in conditions of great handicap.
If they are killed by designers of murder and the law does not express its strong condemnation in extreme penalisation, justice to those called upon to defend justice may fail.
This facet of social justice also may in certain circumstances and at certain stages of societal life demand death sentence.
When an environmental technologist, food and drug chemist or engine manufacturer intentionally acts in the process, abetted by the top decision makers in the corporation concerned, in such manner that the consumer will in all probability die but is kept wilfully in the dark about the deadly consequence by glittering advertisement or suppressio veri, he deserves dealth penalty for society 's survival, if he fulfils the elements of murder.
Maybe, a re definition of murder may be needed to make this legal mandate viable.
Parliamentarians and judicial personnel may benefit by the observations made by Ralph Nader on American Law in action. "In no clearer fashion has the corporation held the law at bay than in the latter 's paralysis toward the corporate crime wave.
Crime statistics almost wholly ignore corporate or business crime; there is list of the ten most wanted corporations; the law affords no means of regularly collecting 124 data on corporate crime; and much corporate criminal behaviour (such as pollution) has not been made a crime because of corporate opposition.
For example, wilful and knowing violations of auto, tire, radiation, and gas pipe line safety standards are not considered crimes under the relevant statutes even if lives are lost as a result.
The description of an array of corporate crimes in this forthright book reveals a legal process requiring courage, not routine duty, by officials to enforce the laws against such outrages.
The law is much more comfortable sentencing a telephone coin box thief to five years than sentencing a billion dollar price fixing executive to six weeks in jail.
In one recounting after another, the authors pile up the evidence toward one searing conclusion that corporate economic, product, and environmental crimes dwarf other crimes in damage to health, safety and property, in confiscation or theft of other people 's monies, and in control of the agencies which are supposed to stop this crime and fraud.
And it all goes on year after year by blue chip corporate recidivists.
Why ? It is easy to answer "power.
" But that is the beginning, not the end, of understanding.
" 9. 'Special reasons ' necessary for imposing death penalty must relate, not to the crime as such but to the criminal.
The crime may be shocking and yet the criminal may not deserve death penalty.
The crime may be less shocking than other murders and yet the callous criminal, e.g. a lethal economic offender, may be jeopardizing societal existence by his act of murder.
Likewise, a hardened murderer or dacoit or armed robber who kills and relishes killing, the raping and murdering to such an extent that he is beyond rehabilitation within a reasonable period according to current psycho therapy or curative techniques may deserve the terminal sentence.
Society survives by security for ordinary life.
If officers enjoined to defend the peace are treacherously killed to facilitate perpetuation of murderous and often plunderous crimes social justice steps in to demand death penalty dependent on the totality of circumstances.
We must always have the brooding thought that there is a divinity in every man and that none is beyond redemption.
But death penalty, still on our Code, is the last step in a narrow category where, within a reasonable spell, the murderer is not likely to be cured and tends to murder others, even within the prison or immediately on release, if left alive a king cobra which, by chronic habit, knows only 125 to sting to death unless defanged if possible.
The patience of society must be tempered by the prudence of social security and that is the limited justification for deprivation of fundamental rights by extinguishment of the whole human being.
The extreme penalty can be invoked only in extreme situations.
The criminology of higher consciousness claims that by expanding inner awareness through meditational and yogic techniques the worst offender can be reformed, if prisons can function more fulfillingly and less fatuously a consummation devoutly to be wished ! Murderers are not born but made and often can be unmade.
This claim, if experimented with and found credible, goes a long way to remove from the scales of justice stains of human blood.
When this healing hope is developed adequately, may be the penal pharmacopoeia may remove death sentence from the system.
The journey is long and we are far from home.
Currently, our prisons often practice zoological, not humanising strategies, as some competent reports and writings tend to prove.
What we have laid down is not in supersession of those extenuating situations already considered by this Court as sufficient to commute death sentence but is supplementary to them and seeks to streamline, so that erratic judicial responses may be avoided.
In Ediga Annamma(supra), for instance, this Court has held, and while endorsing, we repeat it for emphasis: "Where the murderer is too young or too old, the clemency of penal justice help him.
Where the offender suffers from socio economic, psychic or penal compulsions insufficient to attract a legal exception or to downgrade the crime into a lesser one, judicial commutation is permissible.
Other general social pressures, warranting judicial notice, with an extenuating impact may, in special cases, induce the lesser penalty.
Extraordinary features in the judicial process, such as that the death sentence has hung over the head of the culprit excruciatingly long, may persuade the Court to be compassionate.
Likewise, if others involved in the crime and similarly situated have received the benefit of life imprisonment or if the offence is only constructive, being under section 302 read with section 149, or again the accused had acted suddenly under another 's instigation, without pre meditation, perhaps the Court may humanely opt for life, even like where a just cause or real suspicion of wifely indefility pushed the criminal into the crime.
On the other hand, the weapons used and 126 the manner of their use, the horrendous features of the crime and hapless, helpless state of the victim, and the like, steel the heart of the law for a sterner sentence.
" In Srirangan vs State of Tamil Nadu the Court set aside a death sentence even though three had been killed.
That was a case of three innocent lives put down without provocation and although the courts below had concurrently inflicted death sentence, a Bench of three judges confining the focus on sentence alone commuted the punishment.
The crucial role of young age (in his twenties) and a trace of mental imbalance in robbing the propriety of a death impost even from such a ghastly case of tripe murder was emphasised.
This Court 's observations on the sensitive attitude to sentencing and the wide spectrums of considerations under section 354(3) Cr.
P.C. are helpful here: "The plurality of factors bearing on the crime and the doer of the crime must carefully enter the judicial verdict.
The winds of penological reform notwithstanding, the prescription in section 302 binds, the death penalty is still permissible in the punitive pharmacopoeia of India.
Even so, the current of precedents and the relevant catena of clement facts, personal, social and other, persuade us to hold that even as in Nanu Ram vs State of Assam (AIR , the lesser penalty of life imprisonment will be a more appropriate punishment here.
" A brief word about Lalla Singh.
That was a case of murder of three persons and the head of one of the deceased, a lady, was severed.
The trial judge awarded the extreme penalty to him who did this gruesome deed.
But the court reduced the sentence to life term grounded on the long and agonising gap between the date of offence and the disposal of the case by the Supreme Court: "While we are unable to say that the learned Sessions Judge was in error in imposing the extreme penalty, we feel that as the offence was committed on 18 6 1971 more than six years ago, the ends of justice do not require that we should confirm the sentence of death passed on the first respondent.
" 127 We have read the penal Code (section 302) in harmony with the Procedure Code (section 354(3)) and tuned up both the Codes to receive the command of the Constitution. 'Too kind for too long to criminals ' is a cynical comment which comes with a call for revival of more hangings as a gut reaction to a horrible crime, forgetting that crimelessness comes only from higher consciousness.
And, in a democracy, if such offences escalate beyond endurance and such cries rise from all over, penal policy may change, whether the judges and jurists and moralists and murderers relish it or not.
Even so, the basic humanity of mankind cannot be surrendered to panicky calls and passionate reactions provoked by stray though shocking, events.
Two significant developments need to be stressed before we conclude the general discussion.
The first is the functional failure, at the forensic level, of the meaningful provision in the Procedure Code, 1973 intended to help the court to individualise sentencing justice to fit the crime and the criminal.
The sentence of death can be imposed by the Sessions Judge and it can only be executed after it is confirmed by the High Court as provided in Chapter XXVIII of the Code.
The procedure prescribed for the trial of sessions cases is contained in Chapter XVIII.
Section 235 which is relevant for this purpose reads as under: "235(1) After hearing arguments and points of law(if any), the Judge shall give a judgment in the case.
(2) If the accused is convicted, the Judge shall, unless he proceeds in accordance with the provisions of section 360, hear the accused on the question of sentence, and then pass sentence on him according to law.
" A specific stage is prescribed in the trial of cases tried by the Sessions Court in accordance with the procedure prescribed in Chapter XVIII.
After the prosecution evidence is complete and the accused is called upon to enter the defence and if evidence is led on behalf of defence, after the defence evidence is complete, the Court should hear arguments of the Prosecutor and the advocate on behalf of the accused (see section 234).
Thereafter comes section 235 which obligates the Court to give a judgment.
The question of sentence does not enter the verdict or consideration at this stage.
If the accused is to be acquitted, the matter ends there.
If the Court, upon consideration of the evidence led before it, holds the accused guilty of any offence it must pronounce judgment to the extent that it holds accused guilty of a certain offence.
128 Thereafter a statutory duty is cast upon the Court to hear the accused on the question of sentence.
Sub section
(2) obligates the Court to hear the accused on the question of sentence.
In fact, this provision should be construed to mean that where the Court has to choose one or the other sentence and if with a view to inflicting a certain sentence, special reasons are required to be recorded, obviously the State which is the prosecutor, must be called upon to state to the Court which sentence as prosecutor it would consider appropriate in the facts and circumstances of the case.
Where the accused is convicted for an offence under section 302, I.P.C., the Court should call upon the Public Prosecutor at the stage of section 235(2) to state to the Court whether the case is one where the accused as a matter of justice should be awarded the extreme penalty of law or the lesser sentence of imprisonment for life.
If the Public Prosecutor informs the Court that the State as Prosecutor is of the opinion that the case is not one where extreme penalty is called for and if the Sessions Judge agrees with the submission, the matter should end there.
If on the other hand the Public Prosecutor states that the case calls for extreme penalty prescribed by law, the Court would be well advised to call upon the Public Prosecutor to state and establish, if necessary, by leading evidence, facts for seeking extreme penalty prescribed by law.
Those reasons and the evidence in support of them would provide the special reasons according to the State which impel capital punishment.
It would be open to the accused to rebut this evidence either by submissions or if need be, by leading evidence.
At that stage the only consideration relevant for the purpose of determining the quantum of punishment would be the consideration bearing on the question of sentence alone and not on the validity of the verdict of guilty.
After considering the submissions and evidence it would be for the Court with its extreme judicious approach and bearing in mind the question that the extreme penalty is more an exception, to determine what would be the appropriate sentence.
This would ensure a proper appreciation of vital considerations entering judicial verdict for determining the quantum of sentence.
We hope the Bar will assist the Bench in fully using the resources of the new provision to ensure socio personal justice, instead of ritualising the submissions on sentencing by reference only to materials brought on record for proof or disproof of guilt.
The second major development is the amendment of section 302 IPC moved by Government and already passed by the Rajya Sabha doing 129 away with death penalty for murder save in exceptional categories.
So far as it goes, the benignity of the change reflects the constitutional culture we have explained.
The discretion still left, in our view, must be guided by the mariner 's compass we have supplied in this Judgment.
THE FACTS AND CONCLUSIONS Having stated the law at length, we have to apply it to the facts of the cases, which we proceed to state.
After all, "Let the facts be known as they are, and the law will sprout from the seed and turn its branches towards the light".
We may now state the facts needed for the application of the principles set out above.
RAJENDRA PRASAD 'S CASE A long standing family feud, with years long roots, let to a tragic murder.
The houses of Ram Bharosey and Pyarelal had fallen out and periodic fuelling of the feud was furnished by the kidnapping of a wife, the stabbing of a brother and the like.
Lok Adalats of village elders brought about truce, not peace.
The next flare up was a murder by the appellant, a rash son of one of the feuding elders Pyarelal.
He was sentenced to life imprisonment (which means no reformation but hardening process, since our jails are innocent of carefully designed programme of re humanizing but have an iatrogenic, inherited drill of de humanising).
The young man, after some years served in prison, was released on Gandhi Jayanti Day.
But Gandhian hospital setting was, perhaps, absent in the prison which, in all probability, was untouched by reformation of diseased minds, the fundamental Gandhian thought.
The result was the release kept alive his vendetta on return, aggravated by the 'zoological ' life inside.
Some minor incident ignited his latent feud and he stabbed Ram Bharosey and his friend Mansukh several times, and the latter succumbed.
The 'desperate character ' once sentenced, deserved death this second time, said the Sessions Court and the High Court confirmed the view.
An application of the canons we have laid down directly arises.
There is the common confusion here.
A second murder is not to be confounded with the persistent potential for murderous attacks by the murderer.
This was not a menace to the social order but a specific family feud.
While every crime is a breach of social peace, the assailant is bound over only if he is a public menace.
Likewise, here was not a youth of uncontrollable violent propensities against the com 130 munity but one whose paranoid preoccupation with a family quarrel goaded him to go at the rival.
The distinction is fine but real.
How do we designate him 'desperate ' without blaming the jail which did little to make a man out of the criminal clay ? So long as therapeutic processes are absent from prisons, these institutions, far from being the healing hope of society, prove hardening schools to train desperate criminals.
The pitiless verse of Oscal Wilde is pitifully true even today: "The vilest deeds, like poison weeds, Bloom well in prison air; It is only what is good in Man That wastes and withers there" "Desperate criminal" is a convenient description to brand a person.
Seldom is the other side of the story exposed to judicial view the failure of penal institutions to cure criminality and their success in breaking the spirit or embittering it.
Prasad 's prison term never 'cured ' him.
Who bothered about cure ? The blame for the second murder is partly on this neglect.
Nothing on record suggests that Rajendra Prasad was beyond redemption; nothing on record hints at any such attempt inside the prison Lock up of a criminal for long years behind stone walls and iron bars, with drills of breaking the morale, will not change the prisoner for the better Recidivism is an index of prison failure, in most cases.
Any way, Rajendra showed no incurable disposition to violent outbursts against his fellow men.
We see no special reason, to hang him out of corporeal existence.
But while awarding him life imprisonment instead, we direct for him mental moral healing courses through suitable work, acceptable meditational techniques and psychotherapic drills to regain his humanity and dignity.
Prisons are not human warehouses but humane retrieval homes.
Even going by precedents like Lalla Singh (supra) this convict has had the hanging agony hanging over his head since 1973, with nearsolitary confinement to boot.
He must, by now, be more a vegetable than a person and hanging a vegetable is not death penalty.
This is an additional ground for our reduction.
THE KUNJUKUNJU CASE The next case is no different in the result but very different on the facts.
The scenario is the usual sex triangle, terribly perverted.
One 131 randy Janardanan the appellant with a wife and two children, developed sex relations with a fresh girl and the inevitable social resistance to this betrayal of marital fidelity led to a barbaric short cut by this in criminal of cutting to death the innocent wife and the immaculate kids in the secrecy of night.
To borrow the vivid words of the courts below, 'deliberate ', 'cold blooded ' was the act, attended as it was with 'considerable brutality '.
This ruled out mitigation and supplied 'special reasons ', according to both the courts below, for the awesome award of death penalty.
Was that right ? If the crime alone was the criterion, yes; but if the criminal was the target, No. The brucial question is whether the crime and its horrendous character except to the extent it reveals irreparable depravity and chronic propensity is relevant.
The innocent three will not be happy because one guilty companion is also added to their number.
Is Janardanan a social security risk, altogether beyond salvage by therapeutic life sentence ? If he is, the pall must fall on his cadayer.
If not, life must burn on.
So viewed, no material, save juridical wrath and grief, is discernible to invoke social justice and revoke his fundamental right to life.
A course of anti aphrodisiac treatment or willing castration is a better recipe for this hypersexed human than outright death sentence.
We have not even information on whether he was a desperate hedonist or any rapist with 'Y ' chromosomes in excess, who sipped every flower and changed every hour, so as to be a sex menace to the locality.
Sentencing is a delicate process, not a bling man 's buff.
We commute the death sentence to life imprisonment.
THE DUBEY CASE There were three accused to begin with.
The appellant was convicted of the murder of three relatives and sentenced to death.
The other two were held guilty, by the Sessions Judge of an offence of section 302 read with section 34 I.P.C. and awarded life imprisonment.
The appeal of the latter was allowed and that of the former dismissed both on crime and punishment.
The learned Judges expressed themselves thus: "Considering that Sheo Shankar, appellant caused the death of three persons so closely related to him, by stabbing each of them in the chest one after the other, and that too on no greater provocation than that there had been an exchange of abuses, I do not see how it can be said that sentence of death errs on the side of severity.
It was urged that this appellant was only 17, 18 years old and so in view of 132 the ruling of the Supreme Court in Harnam vs State (AIR , he should not be sentenced to death.
In the first place, the note of learned Sessions Judge on his statement shows that he was 19, 20 years old and he had understated his age.
Secondly, I doubt that the observation of the Supreme Court in the said case can be applicable to such a case of triple murder, where such victim is deliberately stabbed in the chest.
" The whole reasoning crumbles on a gentle probe.
A thumbnail sketch of the case is that the appellant, his father and his brother were angrily dissatisfied with a family partition and, on the tragic day, flung the vessels over the division of which the wrangle arose, went inside the house, emerged armed, picked up an altercation eventuating in the young man (whose age was around 18 or 20) stabbing to death three members of the other branch of the family.
He chased and killed, excited by the perverted sense of injustice at the partition.
It is illegal to award capital sentence without considering the correctional possibilities inside prison.
Anger, even judicial anger, solves no problems but creates many.
Have the courts below regarded the question of sentence from this angle ? Not at all.
The genesis of the crime shows a family feud.
He was not a murderer born but made by the passion of family quarrel.
He could be saved for society with correctional techniques and directed into repentance like the Chambal dacoits.
What startles us is the way the adolescence of the accused has been by passed and a ruling of this Court reduced to a casualty by a casual observation.
Hardly the way decisions of the Supreme Court, read with article 141 should be by passed.
Had the appellant been only 18 years of age, he would not have been sentenced to death as the High Court expressly states.
The High Court is right in stating so.
Tender age is a tender circumstance and in this country, unlike in England of old, children are not executed.
Since the age of the accused is of such critical importance in a marginal situation like the present one, one should have expected from the courts below a closer examination of that aspect.
Unfortunately, they have not got the accused medically examined for his age nor have they received any specific evidence on the point but have disposed of the question in a rather summary way: "In the first place, the note of the learned Sessions Judge on his statement shows that he was 19/20 years old and he had understated his age.
Secondly, 133 I doubt that the observations of the Supreme Court in the said case ; can be applicable to such a case of triple murder, where each victim is deliberately stabbed in the chest.
" A judge is no expert in fixing the age of a person and when precise age becomes acutely important reliance on medical and other testimony is necessary.
One cannot agree with this manner of disposal of a vital factor bearing on so grave an issue as death sentence.
Nor are we satisfied with the court vaguely distinguishing a ruling of this Court.
It is not the number of deaths caused nor the situs of the stabs that is telling on that decision to validate the non application of its ratio.
It is a mechanistic art which counts the cadavers to sharpen the sentence oblivious of other crucial criteria shaping a dynamic, realistic policy of punishment.
Three deaths are regrettable, indeed, terrible.
But it is no social solution to add one more life lost to the list.
In this view, we are satisfied that the appellant has not received reasonable consideration on the question of the appropriate sentence.
The criteria we have laid down are clear enough to point to the softening of the sentence to one of life imprisonment.
A family feud, an altercation, a sudden passion, although attended with extra ordinary cruelty, young and malleable age, reasonable prospect of reformation and absence of any conclusive circumstance that the assailant is a habitual murderer or given to chronic violence these catena of circumstances bearing on the offender call for the lesser sentence.
It is apt to notice in this context that even on a traditional approach this is not a case for death sentence, if we are to be belighted by the guidelines in Carlose John.
The murder there was brutal but the act was committed while the accused were in a grip of emotional stress.
This was regarded as persuasive enough, in the background of the case, to avoid the extreme penalty.
The ruling in Kartar Singh related to a case of brutal murder and of hired murderers with planning of the criminal project.
In that background, the affirmation of the death sentence, without any discussion of the guidelines as between 'life ' and 'death ' awards was hardly meant as a mechanical formula.
It is difficult to discern any such ratio in that ruling on the question of sentence in the grey area of life versus death.
The holding was surely right even by the tests we have indicated but to decoct a principle that if three lives are taken, death sentence is the sequel, is to read, without warrant, into that decision a reversal of the process spread over decades.
134 Social defence against murderers is best insured in the short run by caging them but in the long run, the real run, by transformation through re orientation of the inner man by many methods including neuro techniques of which we have a rich legacy.
If the prison system will talk the native language, we have the yogic treasure to experiment with on high strung, high risk murder merchants.
Neuroscience stands on the threshold of astounding discoveries.
Yoga, in its many forms, seems to hold splendid answers.
Meditational technology as a tool of criminology is a mascent ancient methodology.
The State must experiment.
It is cheaper to hang than to heal, but Indian life any human life is too dear to be swung dead save in extreme circumstances.
We are painfully mindful that this Judgment has become prolix and diffuse.
But too many pages are not too high a price where death sentence jurisprudence demands de novo examination to do justice by the Constitution.
Much of what we have said is an exercise in penal philosophy in the critical area of death sentence.
"Philosophizing is distrusted by most of the professions that are concerned with the penal system.
It is suspect for lawyers because they are conscious that if the criminal law as a whole is the Cinderella of jurisprudence, then the law of sentencing is Cinderella 's illegitimate baby.
" After all, the famous words of Justice Holmes "The Law must keep its promises" must be remembered.
The appeals stand allowed and the death sentences stand reduced to life imprisonment; and, hopefully, human rights stand vindicated.
SEN, J.
In an appeal confined to sentence under Article 136 of the Constitution, this Court has not only the power, but as well as the duty to interfere if it considers that the appellant should be sentenced 'differently ', that is, to set aside the sentence of death and substitute in its place the sentence of imprisonment for life, where it considers, taking the case as a whole, the sentence of death to be erroneous, excessive or indicative of an improper exercise of discretion; but at the same time, the Court must impose some limitations on itself in the exercise of this broad power.
In dealing with a sentence which has been made the subject of an appeal, the Court will interfere with a 135 sentence only where it is 'erroneous in principle '.
The question, therefore, in each case is whether there is an 'error of principle ' involved.
The Court has the duty to see that on the particular facts and circumstances of each case the punishment fits the crime.
Mere compassionate sentiments of a humane feeling cannot be a sufficient reason for not confirming a sentence of death but altering it into a sentence of imprisonment for life.
In awarding sentence, the Court must, as it should, concern itself with justice, that is, with unswerving obedience to established law.
It is, and must be, also concerned with the probable effect of its sentence both on the general public and the culprit.
In the three cases before us, there were 'special reasons ' within the meaning of section 354, sub section
(3) of the Code of Criminal Procedure, 1973 for the passing of the death sentence in each and, therefore, the High Courts were justified in confirming the death sentence passed under section 368(a) of the Code.
Indeed, they are illustrative of the rare type of cases, that is, first degree murders, where a death sentence is usually awarded in any civilised country.
These were cases of diabolical, cold blooded brutal murders of innocent persons, that is, first degree murders of extreme brutality or depravity.
The inhumanity of some of these offenders defies belief.
I had the advantage of reading the judgment as originally prepared by my learned brother Krishna Iyer J., which, by defining the class of cases in which a death sentence may be passed upon conviction of a person for having committed an offence of murder punishable under section 302 of the Indian Penal Code, 1860, and by putting a restrictive construction on the words "special reasons" appearing in section 354, sub section
(3) of the Code of Criminal Procedure, 1973, does, in my opinion, virtually abolish the death sentence.
I was, therefore, constrained to write this dissenting opinion, as it is difficult to share the views of my learned brother Krishna Iyer J. He has now completely revised his draft judgment in which he has endeavoured to meet my point of view, and I have had the advantage of reading it.
But I see no particular reason to change my views on the subject or to re write or revise my dissenting opinion as the matter essentially involves a question of principle.
My learned brother Krishna Iyer J. pleads for abolition of the death penalty, in accordance with the Stockholm Declaration of the Amnesty International.
He believes that the death penalty is not only physically but psychologically "brutal", referring to the lengthy period between sentencing and execution as a "lingering death".
He recalls the names of many patriots who faced the firing squad or died by the hangmen 's 136 noose, in the cause of the country 's freedom, and pleads that it is the duty of the State to protect the life of all persons without exception.
He asserts that by its application, the death penalty contradicts the very sanctity of life which all human society claims to hold among the highest values.
He tells us that almost all civilised countries have abolished it as a symbol of their respect for human life, and expresses deep anguish that we, in our country, still cling to it with little regard to the basic rights of the man.
I fully reciprocate the feelings of my learned brother Krishna Iyer J. in so far as he speaks of the barbarity involved in killing of patriots who have sacrificed their lives in the country 's struggle for freedom.
The citizen 's right to life and personal liberty are guaranteed by Article 21 of the Constitution irrespective of his political beliefs, class, creed or religion.
The Constitution has, by Article 21 itself forged certain procedural safeguards for protection to the citizen of his life and personal liberty.
The idealistic considerations as to the inherent worth and dignity of man is a fundamental and pervasive theme of the Constitution, to guard against the execution of a citizen for his political beliefs.
1, however, must enter a dissent when my learned brother Krishna Iyer J. tries to equate a patriot with an ordinary criminal.
The humanistic approach should not obscure our sense of realities.
When a man commits a crime against the society by committing a diabolical, cold blooded, pre planned murder, of an innocent person the brutality of which shocks the conscience of the Court, he must face the consequences of his act.
Such a person forfeits his right to life.
The main thrust of his judgment is the decision of the Supreme Court of the United States of America in Furman vs Georgia am afraid, Furman no longer holds the field even in the United States.
I shall deal with this aspect in detail at a later stage.
The constitutionality of the death sentence provided for the offence of murder under section 302 of the Indian Penal Code is not before the Court.
I fail to appreciate how can we say that imposition of death penalty, except in the classes of cases indicated by my learned brother, would be violative of Articles 14, 19 and 21 of the Constitution.
The question really does not arise for our consideration.
In Jagmohan Singh vs State of U.P. this Court rejected the contention that capital punishment for an offence of murder punishable under section 302 infringes Article 19 of the Constitution in as much as it could not be said that such punishment was unreasonable or not required in public interest.
It fur 137 ther held that section 302 was not violative of Article 14 as it did not suffer by the vice of excessive delegation of legislative functions, merely because it does not provide for the cases in which a Judge should sentence the accused to death and the cases in which he should sentence him to life imprisonment.
It was observed that the exercise of judicial discretion in the matter of fixing the degree of punishment was based on well recognised principles and on the final analysis, the safest possible safeguard for the accused.
Nor it could be said that section 302 confers uncontrolled and unguided discretion to Judges in the matter of sentence and is, therefore, hit by Article 14.
The Court further held that section 302 did not contravene Article 21 of the Constitution insofar as the trial was held as per provisions of the Code of Criminal Procedure 1973 and the Evidence Act 1872 which were undoubtedly part of the procedure established by law.
I, therefore, take it that the opinion of my learned colleague that imposition of a death sentence in a case outside the categories indicated would be constitutionally invalid, is merely an expression of his personal views.
As Judges we are not concerned with the morals or ethics of a punishment.
It is but our duty to administer the law as it is and not to say what it should be.
It is not the intention of this Court to curtail the scope of the death sentence under section 302 by a process of judicial construction inspired by our personal views.
The question whether the scope of the death sentence should be curtailed or not, is one for the Parliament to decide.
The matter is essentially of political expediency and, as such, it is the concern of statesmen and, therefore, properly the domain of the legislature, not the judiciary Two propositions, I think, can be stated at the very outset: (1) It is constitutionally and legally impermissible for this Court while hearing an appeal by special leave under article 136 of the Constitution, on a question of sentence, to re structure section 302 of the Indian Penal Code, 1860 or section 354, sub section
(3) of the Code of Criminal Procedure, 1973, so as to limit the scope of the sentence of death provided for the offence of murder under section 302.
(2) It is also not legally permissible for this Court while hearing an appeal in a particular case where capital sentence is imposed, to define the expression "special reasons" occurring in sub section
(3) of section 354 of the Code, in such a manner, by a process of judicial interpretation, which virtually has the effect of abolishing the death sentence.
138 Section 302 of the Indian Penal Code, 1860, provides: "Whoever commits murder shall be punished with death, or imprisonment for life, and shall also be liable to fine" Sub section (3) of section 354 of the Code of Criminal Procedure, 1973, enacts: "When the conviction is for an offence punishable with death or, in the alternative, with imprisonment for life or imprisonment for a term of years, the judgment shall state the reasons for the sentence awarded, and, in the case of sentence of death, the special reasons for such sentence." The question of abolition of capital punishment is a difficult and controversial subject, long and hotly debated and it has evoked, during the past two centuries strong conflicting views.
Opinion as to whether the death penalty is necessary in order to prevent an outraged community from taking the law into its own hands has been sharply divided.
Immanual Kant in his 'Philosophy of Law ', in upholding the death penalty observes: "It is better that one man should die than the whole people should perish for if justice and righteousness perish, human life could no longer have any value in the world." "Even if a Civilised Society resolve to dissolve itself with the consent of all its members as might be supposed in the case of People inhabiting an island resolve to separate and scatter itself throughout the world the last murderer lying in the prison ought to be executed before the resolution is carried out".
This ought to be done in order that everyone may realise the dessert of his deeds." Montesquieu in L 'Esprit des Lois regarded the death penalty as repugnant, but necessary "the remedy of a sick society".
John Stuart Mill, made a very strong speech in the House of Commons(1) advocating the use of the death penalty when it was applied to the most heinous cases.
Attacking the argument that this punishment was not a deterrent to crime, he said: "As for what is called the failure of death sentence, who is able to judge that.
We partly know who those are whom it has not deterred; but who is there who knows whom it has deterred, or how many human beings saved who should have lived.
" 139 Mill felt that the probability of an innocent person 's suffering the death penalty was very slight indeed.
Judges and juries would let the guilty escape before the innocent would suffer.
If there were the slightest doubt of a man 's innocence the death sentence would not be imposed or carried out.
Sir Henry Maine, the English legal historian, observed that punishment evolved from social necessity.
The concept of punishment as a form of expiation or atonement reaches far back into human nature as well as into human history.
The notion that the threat of punishment by the State will restrain the potential criminal is one of the most commonly accepted justifications for it.
The idea has a philosophical basis in the utilitarians ' concept of the rational man acting upon a deliberate calculation of possible losses and gains.
If men choose rationally among possible future courses of action then surely the likelihood of a criminal course of action could be decreased by attaching to it a quick, certain and commensurate penalty.
The value of capital punishment, as an aspect of deterrence, was perhaps most strongly put forward and very clearly stated by the great jurist, Sir James Fitzjames Stephen more than a hundred years ago: "No other punishment deters man so effectually from committing crimes as the punishment of death.
This is one of those propositions which it is difficult to prove, simply because they are in themselves more obvious than any proof can make them.
It is possible to display ingenuity in arguing against it, but that is all.
The whole experience of mankind is in the other direction.
The threat of instant death is the one to which resort has always been made when there was an absolute necessity for producing some result.
No one goes to certain inevitable death except by compulsion.
Put the matter the other way.
Was there ever yet a criminal who, when sentenced to death and brought out to die, would refuse the offer of commutation of his sentence for the severest secondary punishment ? Surely not.
Why is this ? It can only be because 'All that a man has will he give for his life '.
In any secondary punishment, however terrible, there is hope; but death is death; its terrors cannot be described more forcibly.
" Supporters of capital punishment commonly maintain that it has a uniquely deterrent force which no other form of punishment has or 140 could have.
The arguments adduced both in support of this proposition and against it fall into two categories.
The first consists of what we may call the 'common sense argument ' from human nature applicable particularly to certain kinds of murders and certain kinds of murderers.
This, a priori argument proceeds on the view that by doing so, the law helps to foster in the community a special abhorrence of murder as "a crime of crimes".
By reserving the death penalty for murder the criminal law stigmatises the gravest crime by the gravest punishment, so that the element of retribution merges into that of deterrence.
The second justifies the ethics of capital punishment.
Whatever be the ultimate justification for the punishment, the law cannot ignore the public demand for retribution which heinous crimes undoubtedly provoke; it would be generally agreed that, though reform of the criminal law ought sometimes to give a lead to public opinion, it is dangerous to move too far in advance of it.
The movement to abolish death penalty started with the humanitarian doctrine evolved by Marchese De Cesars Bonesana Beccaria, Italian publicist.
In 1764, Bonesana published the famous little treaties Dei Delitti e della Pen.
The French translation contained anonymous preface by Voltaire.
In the preface to this book first appeared the phrase "the greatest happiness of the greatest number".
It advocated the prevention of crime rather than punishment, and promptness in punishment, where punishment was inevitable; above all it condemned confiscation, capital punishment, and torture.
Beccaria 's ideas directly influenced the reforming activities of many social thinkers and philosophers.
This represented a school of doctrine, born of the new humanitarian impulse of the Eighteenth Century with which Rousseau, Voltaire and Montesquieu in France and Bentham in England were associated, which came afterwards to be known as the classical school.
Moved by compassionate sentiment of a humane feeling, Beccaria asserted that all capital punishment is wrong in itself and unjust.
He maintained that since man was not his own creator, he did not have the right to destroy human life, either individually or collectively.
It is the ultimate cruel, inhuman and degrading punishment, and violates the right to life.
Its basic value, he affirmed, is its incapacitative effect.
Beccaria claimed capital punishment was justified in only two instances, first if an execution would prevent a revolution against a popularly established government, and secondly, if an execution was the only way to deter others from committing a crime.
141 The policy of retribution is justified and sustained by an ethical philosophy which regards punishment as an integral and inviolative element in wrong doing, as a moral necessity.
This doctrine has been consistently maintained by intuitive or idealistic philosophers from Plato to Thomas Aquinas and from Kant to T. H. Green and his disciples.
The deterrent effect of punishment has also been claimed by adherents of this school but its widespread adoption as a policy has probably been due more to the influence of the utilitarian philosophy of Bentham, Paley, John Stuart Mill and Herbert Spencer, which makes the welfare of the society "the greatest good of the greatest number", the aim of all moral activity.
It is this utilitarian philosophy which is now in the ascendent in penal legislation and which governs the view of most modern penologists.
It still survives in the death penalty for murder and in the drastic penalties imposed for rape and other crimes which are peculiarly offensive to the moral sentiment as to the sense of security of the community.
Nearly everywhere, in the more recent stages of social development, this motive has been supplemented, but never wholly supplanted, by an unquestioning faith in the deterrent effect on potential offenders of exemplary, i.e., drastic, punishment, inflicted on actual offenders which, in practice if not in theory, comes to much the same thing.
The doctrine of the "individualisation of punishment", that is to say of the punishment of the individual rather than the crime committed by him, which is of commanding importance in present day penology, is only a development of the neo classical school of the revolutionary period in France, which modified Beccaria 's rigorous doctrine by insisting on the recognition of the varying degrees of moral, and therefore, legal responsibility.
Its fundamental doctrine is that the criminal is doomed by his inherited traits to a criminal career and is, therefore, a wholly irresponsible actor.
Society must, of course, protect itself against him, but to punish him as if he were a free moral agent is as irrational as it is unethical.
In his 'Introduction to Principles of Morals and Legislation ', the great work in which the English philosopher and jurist, Jeremy Bentham was engaged for many years, was published in 1789.
Mankind, he said, was governed by two sovereign motives pain and pleasure, and the principle of utility recognised this subjection.
The object of all legislation must be the "greatest happiness of the greatest number".
On the legal side, he deduced from the principle of utility that since all punishment is itself evil it ought only to be admitted "so far as it promises to exclude some greater evil".
142 The English social reformer, Sir Samuel Romilly devoted himself primarily to reform the criminal law of England, then at once cruel and illogical, by attempting to influence Parliament to pass three Bills designed to repeal the death penalty for theft.
By statute law innumerable offences were punishable with death in England, but, as wholesale execution would be impossible, the larger number of those convicted and sentenced to death at every assizes were respited, after having heard the sentence of death solemnly passed upon them.
This led to many acts of injustice, as the lives of convicts depended on the caprice of the Judges, while, at the same time it made the whole system of punishment and of the criminal law ridiculous.
In 1808 Romilly managed to repeal the Elizabethian statute, which made it a capital offence to steal from the person.
In the following year, three equally sanguinary statutes were thrown out of the House of Lords under the influence of Lord Ellenborough.
Year after year the same influence prevailed, and Romilly saw his bills rejected; but his patient efforts and his eloquence ensured victory eventually for his cause by opening the eyes of Englishmen to the barbarity of their criminal law.
In spite of the efforts which Romilly made to procure the abolition of the death penalty in many cases, it should be noted, however, that he was not an "abolitionist" in the sense of the term today.
All punishment properly implies moral accountability.
It is related to injury and not only to damage or danger, however great.
Capital punishment does so in an eminent degree.
It is directed against one who is ex hypothesi an inhuman brute, i.e. it is imposed simply to eliminate one who is held to have become, irretrievably, a liability or a menace to society.
As Aristotle put it, just retribution consists not in simple but in proportionate retaliation, that is, in receiving in return for a wrongful act not the same thing but its equivalent, and, what this is, can only be estimated if the whole context is taken into account.
It may be argued that murder for instance, as the one crime which is quite irrevocable, as justly met by the one punishment which is equally irrevocable, a unique form of punishment for a unique form of crime.
To reduce its punishment to something of the same order as other punishments, is to weaken the abhorrence which it should express and diffuse.
On this showing an execution expresses absolute condemnation.
It both satisfies and educates the public conscience; for those in authority thus deepen in themselves and diffuse throughout the community their sense of "the wickedness of wickedness, the criminality of crime".
It is an outward and visible sign of the utmost imaginable disgrace.
The death 143 penalty has signified shame and infamy and has generally been understood to do so; and all this is expressed in symbolic action of a kind that is both spontaneous and calculated to arrest attention.
If the appeal of capital punishment were merely to fear of death, it would be a very inefficient protector of society.
In civilized society and in peacetime, government relies for obedience more on its moral prestige than on violent repression of crime.
Punishment only protects life effectively if it produces in possible murderers, not only fear of the consequences of committing murder, but a horrified recoil from the thing itself.
It can only achieve this, more ambitious, task, if sentence of death is felt to embody society 's strongest condemnation of murder and keenest sense of its intolerable wickedness.
It is not by the fear of death but by exciting in the community a sentiment of horror against any particular act, that we can hope to deter offenders from committing it.
The Royal Commission sucinctly explained the normal character of capital punishment thus: "by building up in the community, over a long period of time, a deep feeling of peculiar abhorrence for the crime of murder.
" The criminality of a crime consists not only in the criminal act, but in what that signifies.
Its immediately apparent features, the obvious damage to person or property or to public security, are symptoms of a deeper disorder.
It betokens, and it fosters, an attitude in man to man, of reckless selfishness, deceit or malice, which is incompatible in the long run with any decent social life.
In any advanced society it is, in part at least, on account of this wider character, less easily discerned, that the graver offences are punished.
Also punishment like crime has a dual character.
The penalty which the convicted murderer incurs is not simply death, but death in disgrace and death as a disgrace.
In so far as capital punishment is a threat, the threat consists not only in death but in infamy.
Any theory which ignores this characteristic is certainly defective.
For a long time the problem of capital punishment was regarded as a purely academic question.
Everything that could be said appear to have been said on a question which Beccaria had brilliantly brought to public notice in the second half of the Eighteenth Century, but which had been exhausted by subsequent controversy.
Punishment inflicted by the State in response to a violation of the criminal law 144 has been justified in various ways.
It has been seen as society 's vengeance upon the criminal as atonement by the wrong doer, as a means of deterring other criminals, as protection for the law abiding and as a way of rehabilitating the criminal.
The individual who has inflicted harm on another, runs the revenge argument, should be made to suffer in return; for only an act of vengeance can undo the harm that has been done and assuage the suffering of the victim.
As against this, some social reformers have maintained that punishment ought to be decent to transform the values and attitudes of the criminal so that he no longer wishes to commit illegal acts.
The problem, of course, has been to discover how to do it.
Theories of rehabilitation are largely speculative, since there is lack of scientific evidence to support them.
Nevertheless, it has been influential in the development of modern penology.
In England, during the Nineteenth Century, Disraeli and Gladstone, the leading politicians in the country, took no part in the movement to abolish the death penalty.
Leadership in this crusade fell to lesser men, and the abolitionists formed a distinct minority.
The majority in the House of Commons evidently felt, as Sir John Holkar, the Attorney General felt, that criminals were deterred from adding deliberate murder to their other crimes by the fear of the death penalty.
In the period between the first and second world wars, however, the emergence of authoritarian systems of penal law raised once more the problem of capital punishment in a particularly acute manner.
At the end of the second world war, there was a renewed upsurge of this humanitarian tendency which, like the desire to safeguard human rights and human dignity, had been the mainspring of the movement for the abolition of the death penalty.
Several attempts were made to break the parliamentary fortress but without any success.
Very little was actually accomplished by the abolitionists in Parliament till after the second world war, when the Labour Government came to power.
In between 1949 and 1953 the Royal Commission on Capital Punishment carried out an exhaustive inquiry.
The Royal Commission made a study of this complex and many sided task.
It held its inquiries not only in Great Britain but also in the United States and several European countries and heard evidence from every possible source.
It listened to an impressive array of witnesses.
In addition to all this, information was collected from Commonwealth countries and several other European countries.
Its 145 result is reflected in the Royal Commission Report on Capital Punishment which presents a comprehensive and dispassionate picture of the whole subject.
The Commission was debarred by their terms of reference from considering the question of abolition of capital punishment, but in the course of their investigation they naturally accumulated a good deal of information which is just as relevant to this issue as to the question of limiting the scope of capital punishment.
The report contains a good deal of material on the "Deterrent Value of Capital Punishment".
It is evident from the report that some of the most distinguished judicial witnesses including Lord Goddard, the Lord Chief Justice of England, Lord Denning, the Master of Rolls, and some very experienced Judges like Mr. Justice Humphreys, Sir John Beaumont, Mr. Justice Byrne, were firmly of the view that the capital punishment must be retained for the protection of the society.
They went to the extent of expressing their strong disapprobation of the free use of prerogative as being an interference by the Executive with the Judiciary and argued that the exercise of the power should be narrowly confined.
As a justification for retention of death penalty, some of these distinguished Judges put forth the principle of retribution, and the others placed greater importance on deterrence.
There was, however, general agreement that justification for the capital sentence, as for other salient features of the penal system must be sought in the protection of the society and that alone.
The punishment of death, said Lord Denning to the Royal Commission, should reflect adequately the revulsion felt for the gravest of crimes by the great majority of citizens.
But, in saying this, he implied that legislators and Judges share this revulsion themselves; otherwise indeed their action would be morally indefensible.
Their aim then should be, not only to strike terror nor even to awaken popular indignation in a direction convenient to Government.
It would be to arouse in all and sundry their own indignant repudiation of a wicked act and, at the same time, to deepen it in themselves.
In this vein, sentence of death has been pronounced, carried out and acclaimed, with stern satisfaction.
This principle of action is still avowed in high places, and, I believe, it is semi consciously at work more often than it is avowed, for it is said that otherwise, the conscience of the community would be revolted if the criminal were allowed to live.
In the same vein, Lord Chief Justice Goddard said in 1948: 146 "The public conscience will not tolerate that persons who deliberately condemn others to painful, and it may be lingering, deaths should be allowed to live .
Some of these bestial murderers should be destroyed.
" The use of capital punishment has declined in recent times, although it is still permitted by law, as in this country, for various kinds of offences like treason, murder etc.
The issue of abolishing it has aroused much controversy.
The advocates of capital punishment claim it as a necessary deterrent to crime and relatively painless if done properly.
Even where it has been legally retained, as here, capital punishment is now seldom employed except in very grave cases where it is a crime against the society and the brutality of the crime shocks the judicial conscience.
Indeed, the death penalty satisfies the society 's retributive goals and is still presumed to be a deterrent to potential offenders.
Of the three purposes commonly assigned to punishment retribution, deterrence and reformation deterrence is generally held to be the most important, although the continuing public demand for retribution cannot be ignored.
Prima facie, the death sentence is likely to have a stronger effect as a deterrent upon normal human beings than any other form of punishment.
There is some evidence that this is, in fact, so and also that abolition may be followed by an increase in homicides and crimes of violence.
In brief, people are believed to refrain from crime because they fear punishment.
Since people fear death more than anything else the death penalty is the most effective deterrent.
In Britain, following the Report of the Royal Commission on Capital Punishment, the Homicide Act, 1957 was enacted due to the growing pressure of public opinion to mitigate the rigour of the criminal law.
(1=6) It brought about a division of criminal homicide into degrees of murder.
It resulted in the establishment of a distinction between capital and non capital murders.
It not only eliminated long standing iniquities and rigidities in the law of murder such as the doctrine of "constructive malice", but also brought the law into accord with modern criminological thoughts by the importation of the doctrine of "diminished responsibility".
147 By section 7 the Act abolished the liability to suffer the death penalty on conviction of murder and substituted the sentence of imprisonment for life by section 9, sub section
(1) except in cases of first degree murders falling within section 5 or section 6.
Section 5 reserved the death penalty for five classes of first degree murders, namely: (i) any murder done in the course or furtherance of theft; (ii) any murder by shooting or by causing an explosion; (iii)any murder done in the course or for the purpose of resisting or avoiding or preventing a lawful arrest, or of effecting or assisting an escape or rescue from legal custody; (iv) any murder of a police officer acting in the execution of his duty or of a person assisting a police officer so acting; and (v) in the case of a person who was a prisoner at the time when he did or was a party to the murder, any murder of a prison officer acting in the execution of his duty or of a person assisting a prison officer so acting.
Sub section (2) of section 5 provided for death penalty on the principal assailant and not his accessories before the fact, where a group of persons made a murderous assault causing grievous bodily hurt resulting in death.
The distinction drawn in felonies between principals in the first and second degree and accessories before the fact have since been abolished by virtue of the Criminal Law Act 1967, section 1, and all these participants have to be punished in accordance with the Accessories and Abettors Act 1861.
Section 6 provided the death penalty for repeated murders.
The cases in which the death penalty was retained were those where, in the view of the Government, murder was most dangerous to the preservation of law and order, and where the death penalty was likely to be a particularly effective deterrent.
The death penalty for murder was thereafter temporarily abolished for a period of five years, as an experimental measure by the Murder (Abolition of Death Penalty) Act 1965.
This Act was to expire on July 31, 1970 but was made permanent by resolution of both Houses of Parliament.
The punishment for murder in Britain is now imprisonment for life by section 1, sub section
(1) of the Murder (Abolition of Death Penalty) Act 148 1965.
On sentencing any person convicted of murder to imprisonment for life, the Court may at the same time declares a period which it recommends to the Secretary of State as the minimum period which in its view should elapse before the Secretary of State orders the release of that person on licence under section 27 of the Prison Act 1952.
In R. vs Flemming it has been suggested that no such recommendation should be for a period of less than twelve years.
It must, however, be observed that in Britain a sentence of death can still and only be awarded for high treason (Treason Act 1814) section 1; piracy with violence (Piracy Act 1837) section 2; setting fire to the Queen 's ships, arsenals etc.
(Dockyards etc.
Protection Act 1772) section 1.
When a person is convicted of treason, sentence of death must be pronounced, but in case of piracy with violence and setting fire to the Queen 's ships, arsenals, etc., it may be merely recorded.
Sentence of death cannot, however, be pronounced on or recorded against an expectant mother [Sentence of Death (Expectant Mothers) Act 1931] section 1, or against a person who was under the age of eighteen when the offence was committed (Children and Young Persons Act 1933) section 53 (1).
The successful campaign to abolish the death penalty in Britain has been achieved in a comparatively short period of time by no more than a handful ardent penal reformers like Sydney Silverman who carried out the unfinished work of Romilly and other reformers, pertinacious in their lobbying and propaganda, in the face of majority opinion favouring retention of an admittedly barbaric but, to that majority, necessary penal instrument.
If the final debates were protracted Silverman 's private members ' Bill (with invaluable Legislative time given by the Government) was introduced on December 4, 1964, and reached the Statute Book only on November 2, 1965 the history of the campaign is a remarkable testament to British democracy which can convert convinced minority opinion into progressive legislative action Due to an increase in the incidence of criminal behaviour, and steady rise in the volume of reported crime, there is a genuine public concern in Britain for re assessment of the penal policy of the Government.
149 D.A. Thomas in his article "Development in Sentencing 1964 1973" observes: "As a society, we have made inconsistent demands on our official system of social control expecting greater security from violence, disorder and depreciation and simultaneously requiring that penal sanctions become less rigorous and more adopted to the individual offender.
" The learned author proceeds to say: "The provisions of the Murder (Abolition of Death Penalty) Act 1965 provides a simple illustration.
Taken in isolation, they provide that a person convicted of murder shall be sentenced to life imprisonment, and the judge passing such a sentence may make a recommendation that a specified minimum period should elapse before the offenders may be released on licence.
The mandatory life sentence, part of the political price of the abolition of the death penalty, cannot be defended on any rational grounds.
" And then concludes: "In assessing the future trend of penal policy in this country, it is probably wise to bear in mind that the problems facing the criminal justice system are unlikely to diminish during the next decade of their own accord things will almost certainly become worse rather than better.
There seems to be no reason to suppose that the relatively steady rate of increase in the volume of reported crime over the last ten years will not continue." The two recent decisions of the Privy Council in Eaton Baker vs The Queen and Michael de Freitas vs George Ramoutar Benny are completely destructive of the theory that the death penalty is per se cruel and unusual punishment, and (2) alternatively, the inordinate delay in carrying it out, makes it so.
In Eaton Baker 's case the appeal was on a question of sentence.
The issue was whether the Court of Appeal of Jamaica was right in sentencing to death the two youngmen who when they committed the murder were under the age of eighteen years, but when they were convicted of the offence and sentenced to death, had both attained the age of 18 years.
The mandatory sentence of death upon conviction for murder is imposed 150 by section 2 of the Offences against the Person Act 1925.
The exception on account of youth is contained in section 29(1) of the Juveniles Law which interdicts that a sentence of death shall not be pronounced on or recorded against a person under the age of 18 years.
The Judicial Committee while holding that the statutory exemption from death penalty under section 29(1) of the Juveniles Law was not applicable, observed that the time for ascertaining whether the appellants were to be treated as Juveniles was the date on which the sentence was passed and not the date of the offence.
As to the constitutional issue, the Judicial Committee held that when a person was held guilty of a charge of murder, the death sentence passed on him cannot be treated as a contravention of section 20(7) of the Constitution of Jamaica, stating: "One 's opinion as to whether the consequences of giving effect to the sub section would be irrational or unjust is inevitably coloured by whether one starts with the belief that capital punishment should be abolished for all offences except, perhaps, for treason a view accepted by the legislature, if not by public opinion in general, in the United Kingdom; or with the contrary belief that capital punishment is normally the appropriate penalty for murder a view which the continuance in force of section 2 of the Offences against the Person Law suggests is accepted by the legislature in Jamaica." (Emphasis supplied).
In de Freitas case the Privy Council confirmed the sentence of death passed by the Court of Appeal of Trinidad and Tobago, and held that there was no violation of the human rights and fundamental freedoms guaranteed under sections 1 and 2 of the Constitution of Trinidad and Tobago inasmuch as the sentence of death was passed according to the "due process of law".
In repelling the alternative argument based upon delay, it observed that " the delay was of the appellant 's own making" and he could not put forth this as a ground for commutation of the sentence of death.
It stated: "It is not contended that the executive infringed the appellant 's constitutional rights by refraining from executing him while there were still pending legal proceedings that he himself had instituted to prevent this execution.
" There was evidence that prior to independence, the normal period spent in condemned cell by the prisoner before execution was five months and that this practice was sufficient to give rise to an 'unwritten rule of law ' in force at the commencement of the Constitution.
The contention was that the executive was, therefore, bound to so organise the procedure for carrying out the death sentence that the 151 average lapse of time is not more than five months, and the carrying out of the death sentence beyond the period was incompatible with the right of the individual under section 1 (a) of the Constitution not to be deprived of life "execpt by due process of law" because it involves the imposition of "cruel and unusual punishment" within the meaning of section 2,(b).
The Judicial Committee rejected the contention saying: "This contention in their Lordships ' view needs only to be stated to be rejected.
Not only does it involve attributing to the expression "unwritten rule of law" in section 105(1) of the Constitution a meaning which it is incapable of bearing, but it conflicts with the very concept of the nature of law.
" That takes us to the decision of the Supreme Court of the United States of America in Furman vs Georgia (supra) in which my learned brother Krishna Iyer J. strongly relies.
There, the question was whether the death penalty at least as generally practised in the United States, per se, was 'cruel and unusual ' because the imposition of capital punishment "does not comport with human dignity" or because it was "morally unacceptable" and "excessive" and thus violative of the Eighth Amendment.
In the United States of America, the death penalty has paradoxcally existed more or less harmoniously with humane theories of criminal justice for over two hundred years.
The Eighth Amendment prohibits 'cruel and unusual punishment '.
The Eighth Amendment 's ban on cruel and unusual punishment has raised some very difficult moral issues.
The Supreme Court applied various standards in interpreting the provision.
In Trop vs Dulles the Court by a majority of five to four, refused to consider "the death penalty as an index of the constitutional limit on punishment", stating: "Whatever the arguments may be against capital punishment. the death penalty has been employed throughout our history and, in a day when it is still widely accepted, it cannot be said to violate the constitutional concept or cruelty." Chief Justice Warren, speaking for Mr. Justice Black, Mr. Justice Douglas and Mr. Justice Whittakar, asserted that: "this Court has had little occasion to give precise content to the Eighth Amendment", that it content is not static, but 152 "must draw its meaning from the evolving standards of decency that mark the progress of a maturing society." This amendment whose "basic concept is nothing less than the dignity of man" guarantees "the principle of civilised treatment.
" There began concerted legal attacks on the constitutionality of capital punishment in the 1960s, stimulated in part by the fact that those receiving death sentences were disproportionately Blacks.
The issue as to the constitutionality of the death penalty in a State usually arose in the Supreme Court of the United States on procedural grounds, that is, on the question of fairness of the procedural aspect and its application, viz., the practice under which state statutes left a jury to mote out the death penalty at its discretion, with no standards of any sort to guide them, or the application of the penalty without judicial standards.
In McGoutha vs California the Supreme Court rejected the contention holding that the absence of any guidelines was not a violation of "due process".
Mr. Justice Harlan thought it would be impossible to draft statutory standards for this purpose, saying: "To identify before the fact these characteristics of criminal homicides and their perpetrators which call for the death penalty, and to express these characteristics in language which can be fairly understood and applied by the sentencing authority, appear to be tasks which are beyond present human ability." In Furman vs Georgia, the Court by a majority of five to four ultimately held that capital punishment, at least as generally administered, did violate the Eighth Amendment.
It held that imposition of the death penalty in the three cases, one for murder and two for rape, constituted cruel and unusual punishment in violation of the Eighth and Fourteenth Amendments.
The Court issued a brief per curiam order, followed by substantial statements by every member of the Court.
The judgment in the case was reversed and the cases remanded for further proceedings.
Each of the five majority Justices and four dissenters wrote a separate opinion, supporting his position.
The five Justices in the majority each wrote a concurring opinion which approached the matter from a different angle so that clear categorisation is impossible.
It can thus be seen that the multiple opinions did not rule out altogether re imposition of the death penalty in the future provided there was legislative structuring of a permissible system 153 providing for sufficient procedural safeguards.
This is exactly what has happened in the United States where the death penalty has been re imposed and the judicial approach stands re oriented.
Broadly stated, Mr. Justice Douglas, Mr. Justice Stewart and Mr. Justice White held that the death Penalty as imposed, is arbitrarily and infrequently meted out, in violation of the Eighth and the Fourteenth Amendments.
They took an analytic and empirical approach, appraising the practice under the Eighth Amendment in the light of due process and equal protection.
Their concern was whether the death penalty was evenly applied, and of course they found that it was not.
This is reflected in the opinion of Mr. Justice Douglas who held that the death penalty was cruel and unusual because applied irregularly and "selectively to minorities whose members are few, who are outcasts of society, and who are unpopular, but whom society is willing to see suffer though it would not countenance general application of the same penalty across the boards" Mr. Justice Stewart 's comment was: "These death sentences are cruel and unusual in the same way that being struck by lightning is cruel and unusual.
For, of all the people convicted of rapes and murders in 1967 and 1968, many just as reprehensible as these, the petitioners are among a capriciously selected random handful upon whom the sentence of death has in fact been imposed." Mr. Justice White conceded that the death penalty, while cruel in "the dictionary sense", would nevertheless be justified if it served "social ends".
But he did not believe "that society 's need" for specific deterrence justifies death for so few when for so many in like circumstances life imprisonment or shorter prison terms are judged sufficient.
Mr. Justice Brennan and Mr. Justice Marshall took a normative approach.
They advocated the total abolition of the death penalty because it is in all cases violative of the Eighth Amendment cruel and unusual punishment clause.
For them, the Eighth Amendment posed a core question of values; they were concerned less with fairness and equality and more with mercy and charity.
For Mr. Justice Brennan, "the primary principle. is that a punishment must not by its severity be degrading to human dignity".
Mr. Justice Marshall, in by far the longest opinion of the day pleaded for an humanistic approach.
His impassioned conclusion was that ending the death sentence would recognise "the humanity of our fellow beings" and achieve "a major milestone in the long road up from barbarism".
154 The opinions of the four dissenting Justices were as important as the majority statements because any subsequent challenges on Furman would incorporate their reasoning.
Mr. Justice Blackman and Mr. Justice Rehnquist, who are advocates of strict judicial conservation, felt that the matter was essentially political, and properly the domain of the legislature, not the judiciary.
Chief Justice Burger, admitting that since the ruling a Trop vs Dulles (supra) in 1958, it is necessary to evaluate a challenged punishment in terms of the "evolving standards of decency. of a maturing society", felt nonetheless that there is no judicially significant public opposition to capital punishment in the United States.
Pointing out that the decision rejecting the death penalty was essentially based on procedural grounds, as the majority agreed that the arbitrary infliction of the death penalty was unconstitutional, Burger contends that the Eighth Amendment does not deal with procedure, and with only the substantive nature of the punishment in question.
He believes that the imposition of a mandatory death penalty for certain offences would not be invalidated by the holding in this case because a mandatory penalty could not be arbitrily meted out.
Mr. Justice Powell dissented by establishing that the constitutionality of the death penalty is supported by four factors, viz., (i) the references to capital punishment in the Constitution, (ii) the past Supreme Court decisions on the death penalty, (iii) the limitation of judicial restraint, and (iv) the doctrine of separation of powers.
He found that the evidence of the petitioners fell short of satisfying their burdens of persuasion with respect to these factors.
Due to the ambiguity of the Furman decision, it is fortunate that the Supreme Court gave further indication of its intentions regarding the death penalty in subsequent decisions.
But Furman was not determinative of the issue on the merits, namely, the constitutionality of the penalty because it violates the Eighth Amendment cruel and unusual punishment.
It was widely assumed that the Court had not declared capital punishment unconstitutional per se but only its unpredictable and fortuitous use.
Since the Furman decision, the legislatures of thirty five states in the United States acted to tighten up the laws under which the death penalty was to be imposed.
They took two different approaches.
Some State including Georgia, Florida and Texas, established new procedures for capital cases requiring sentencing judges and juries to 155 consider certain specified aggravating or mitigating circumstances of the crime and the offender.
There was a bifurcated trial with pre sentencing, hearing.
Courts of Appeal were given broader authority to decide whether the death penalty was fair in the light of the sentences for similar offences These laws were intended to redress the arbitrariness and racial prejudices renounced in Furman.
But the other States, including North Carolina, Louisiana and Oklahoma sought to meet the Furman objections by removing all flexibility from the sentencing process, though limiting the offences for which the death sentence could be imposed.
Anyone found guilty of the specified offences was to be sentenced to death automatically.
The constitutionality of the sentences imposed under such procedures has been upheld by five State Supreme Courts.
On July 2, 1976, the Supreme Court of the United States delivered the judgment it had postponed a year earlier.
It handed down five opinions dealing with the death penalty.
Three of these were concerned with the mandatory sentence of death.
All involved the crime of murder.
The five cases were: Gregg vs Georgia, Proffitt v Florida, Jurek vs Texas Woodson vs North Carolina, and Roberts vs Louisiana.
The issue in the three cases dealing with discretionary sentencing (Gregg, Proffitt and Jurek) was whether imposition of the sentence of death for the crime of murder under the laws of the respective states violated the Eighth and Fourteenth Amendments.
In all three, the Court reached the same conclusion, that the punishment of death did not invariably violate the Constitution.
The Court 's reasons in Gregg as to why the death sentence was not a per se violation of the Eighth and Fourteenth amendments were as follows: First, history and precedent do not support the conclusion that the death sentence is a per se violation.
Second, the evolving standards of decency argument has been substantially undercut in the last four years because a large segment of the enlightened population regards the death penalty as appropriate and necessary, as seen in the new legislation passed in response to Furman.
The Court came to the conclusion that the death penalty was not inherently cruel and unusual.
It served two principal social purposes, 156 retribution and deterrence, and held that the death sentence for the crime of murder was (1) not without justification, (2) not unconstitutionally severe, and (3) not invariably disproportionate to the crime.
The Court found that Furman mandated, where discretionary sentencing was used there must be suitable direction and limitation to minimise the risk of wholly arbitrary and capricious action.
The bifurcated trial with standards modelled after the Model Penal Code gives juries just such guidance.
Therefore, the concerns of Furman can be met by carefully drafted statutes that ensure sentencing authorities are given adequate information and guidance in making their decision.
As a general proposition, the Court concluded that these concerns were best met by bifurcated proceedings with standards to guided the use of the evidence.
I wish to conclude this part of the judgment by quoting Herbert L.A. Hart, who in his article on "Murder and the Principles of Punishment: England and the United States, admirably sums up the two points of view: "There are indeed ways of defending and criticising the death penalty which are quite independent of the utilitarian position and of the questions of fact which the utilitarian will consider as crucial.
For some people the death penalty is ruled out entirely as something absolutely evil which, like torture, should never be used however many lives it might save.
Those who take this view find that they are sometimes met by the counter assertion that the death penalty is some thin which morality actually demands, a uniquely appropriate means of retribution or "reprobation" for the worst of crimes, even if its use adds nothing to the protection of human life.
"Here we have two sharply opposed yet similar attitudes: for the one the death penalty is morally excluded; for the other it is moral necessity; but both alike are independent of any question of fact or evidence as to what the use of the death penalty does by way of furthering the protection of society.
Argument in support of views as absolute as these can consist only of an invitation, on the one hand, to consider in detail the execution of a human being, and on the other hand, to consider in detail some awful murder, and then to await the 157 emergence either of a conviction that the death penalty must never be used or, alternatively, that it must never be completely abandoned.
" The controversy over capital punishment is not new.
Its roots lie deep in human history, and its battles have been waged on and off on a political level for almost two centuries.
It is not necessary for this Court to attempt to analyse the substantive merits of the cases for and against the death penalty for murder.
It is in my view, essentially, a question for the Parliament to resolve and not for this Court to decide.
I feel that it is futile for us to attempt to project our personal views in a matter which lies in the realm of political decision making, by focussing on a single controversy, the question of the proper penalty for the crime of murder.
The capital punishment controversy falls within the strict limits of 'independent ' parliamentary law making, and is a typical or representative of the kind of problems that leaders of Parliament face every day.
In short, the case for abolition of the death sentence is political, not constitutional.
The Government carries the responsibility of law and order.
That is the first and fundamental duty of any Government.
The Executive has the duty of advising the Government of the laws it believes necessary for the national well being.
It is the duty of the courts, including this Court, to administer the laws as they are.
The Law Commission, in its Thirty fifth Report has dealt with the question of abolition of capital punishment, of limiting the scope of death sentence under section 302, and of the mode of execution of the sentence.
It sent out questionnaires.
Almost all the State Governments, all High Court Judges, all the Bar Associations throughout the country, many distinguished lawyers were in favour of retention of the death sentence.
There was, in fact, almost complete 'unanimity ' of view on this complex question.
The Commission examined a large number of witnesses including many distinguished Judges and lawyers and ultimately was in favour of its retention.
It concluded stating that "Having regard to the conditions in India, to the variety of social upbringing of its inhabitants, to the disparity of the level of morality and education in the country, the vastness of its area, to the diversity of its population and to the paramount need for maintaining law and order, the country can not risk the abolition of capital punishment.
" 158 Indeed, a distinguished lawyer while giving his evidence before the Joint Committee of the Indian Penal Code Bill thought that the abolition of death sentence would be a dangerous experiment and we should continue to have this form of deterrent punishment till we reach "a certain state of enlightenment".
The basic principle of the nineteenth century Indian Penal Code, said Lord Macauley who drafted it, is 'the principle of suppressing crime with the smallest possible amount of suffering(1) '.
He lays this down as an unassailable axiom rather than as a contention for debate.
Section 302 of the Indian Penal Code, 1860 gives the Court a discretion as to the punishment to be imposed for an offence of murder and that discretion has to be exercised between the two alternatives mentioned, namely, a sentence of death and a sentence of imprisonment for life.
Prior to the amendment of section 367, sub section
(5) of the Code of Criminal Procedure, 1898 by the Criminal Procedure Code (Amendment) Act, 1955 it was a well settled principle that where a person was convicted for an offence of murder, the Court was normally bound to sentence him to death unless there were extenuating or mitigating circumstances.
This rule was stated in Rattanlal 's Law of Crimes, 21st ed., p. 813; "The extreme sentence is the normal sentence; the mitigated sentence is the exception.
It is not for the Judge to ask him self whether there are reasons for imposing the penalty of death but whether there are reasons for abstaining from doing so The reason probably was that this provision was not more than the restatement of the law as it stood in England at that time, where till the year 1965 the only penalty for murder was death, except in two specific cases.
The effect of the Criminal Procedure Code (Amendment) Act, 1955, which repealed section 367, sub section
(5) of the Code with effect from January 1, 1956, was to restore to the Court the discretion conferred by section 302 to award the appropriate sentence having regard to the attendant circumstances, including the mitigating circumstances, if any.
This brought the law into conformity with the intentions of the framers of the Code.
As regards the death sentence, far from making it the normal sentence for an offence of murder, they stated that it ought to be 'sparingly used '.
Under section 354, sub section
(3) of the Code of Criminal Procedure, 1973, the law is now entirely changed.
159 Under section 354, sub section
(3) of the Code of Criminal Procedure, 1973, the Court is required to state the reasons for a sentence awarded, and in the case of imposition of a sentence of death and Judge has to record "special reasons" for imposing death sentence.
Punishment for murder as a rule should be life imprisonment and death sentence is only an exception.
In Balwant Singh 's case, Ambaram 's case and Sarveshwar Prasad Sharma 's case the Court held that it was neither necessary nor possible to specify the "special reasons" which may justify the passing of death sentence in a given case.
It would thus be obvious that it is neither feasible nor legally permissible for this Court to give a definite connotation to the expression "special reasons" occurring in section 354, sub section
(3) of the Code of Criminal Procedure, 1973.
It is difficult to put "special reasons" in a straight jacket.
Each case must depend on its own particular facts.
The question of sentence must, in my view, be left to the discretion of the Sessions Judge trying the accused.
Under the present Code, a trial for murder is divided into two stages.
There is a bifurcated trial.
The first part of the trial is directed solely to the issue of guilt or innocence, and concludes with the finding of the Sessions Judge on that issue.
At the end of the trial when he comes to a conclusion of guilt, he has to adjourn the case for hearing the accused on the question of sentence.
Section 235, sub section
(2) of the Code specifically provides for an opportunity of hearing to the accused on the question of sentence after a verdict of guilt is recorded against him.
The burden is upon the prosecution to make out a case for imposition of the extreme penalty.
Where a sentence of death is passed, the Sessions Judge has to make a reference to the High Court under section 366, sub section
(1) of the Code.
Under section 367, sub section
(1) if the High Court thinks a further inquiry should be made into, or additional evidence taken upon, any point bearing upon the guilt or innocence of the convicted person, it may make such inquiry or take such evidence itself, or direct it to be made or taken by the Court of Sessions.
In a case submitted under section 366, the High Court under section 368(a) may either confirm the sentence, or pass any other sentence, i.e. reduce the sentence of death into a sentence of imprisonment for life.
Thereafter, an appeal lies to this Court by a special leave under Article 136 on the question of sentence.
Failing the appeal, there is the President 's power to grant reprieve and pardon under Article 72(1), as well as the Governor 's power of 160 commutation under Article 161 of the Constitution which is a sovereign function.
The power of the President and of the Governor to grant reprieves and pardons is wide enough to include the power to commute and to remit sentence of punishment.
All cases of capital punishment are closely scrutinised by the Executive at both the levels to see whether there are such extenuating circumstances as would justify a reprieve, and the power to commute a death sentence is freely exercised, whenever there is some doubt as to the severity of the punishment.
Under the present system the prerogative of Mercy in the case of persons under sentence of death works well and it produces results generally regarded as satisfactory.
It helps in mitigating the rigour of the death sentence, particularly in case of those murderers whose execution would offend the public conscience.
Very few persons under a sentence of death may be one or two in a year, in a State are usually executed.
Such cases are usually of the kind indicated by me above, and even some of them escape the sentence of death.
It is, therefore, not proper for the Court to trench upon the President 's or the Governor 's prerogative to grant pardon or reprieve under Articles 72(1) and 161, in taking upon itself the task of commutation of a death sentence, which is properly imposed, in the facts and circumstances of a particular case, merely because there is a doubt that the Executive may commute the sentence ultimately, or by one 's views as to the utility of a death penalty.
Judges are entitled to hold their own views, but it is the bounden duty of the Court to impose a proper punishment, depending upon the degree of criminality and the desirability to impose such punishment as a measure of social necessity, as a means of deterring other potential offenders.
It is only in very grave cases where it is a crime against the society and the brutality of the crime shocks the judicial conscience that the Court has the power, as well as the duty, to impose the death sentence.
In view of these adequate safeguards, it can hardly be asserted that the sentence of death provided for an offence of murder punishable under section 302 is 'de humanising ' or that it is 'unnecessary '.
With respect, my learned brother Krishna Iyer J., despite his sense of humanism, does not appear to be wholly an 'abolitionist '.
That is the impression I get from his various judgments on the subject.
In Ediga Anamma and Bishan Dass he clearly accepts that where the crime is cruel and inhuman, a death sentence may be called for.
In the present judgment also, he observes: 161 "If the murderous operation of a die hard criminal jeopardises social security in a persistent, planned and perilous fashion then his enjoyment of fundamental rights may be rightly annihilated.
If society does not survive, individual existence comes to nought.
So, one test for impost of death sentence is to find out whether the murderer others such a traumatic threat to the survival of social order.
To illustrate, if an economic offender who intentionally mixes poison in drugs professionally or wilfully adulterates intoxicating substances injuriously, and knowingly or intentionally causes death for the sake of private profit such trader in lethal business is a menace to social security and is, therefore, a violator of social justice whose extinction becomes necessary for society 's survival.
Supposing a murderous band of armed dacoits intentionally derails a train and large number of people die in consequence, if the ingredients of murder are present and the object is to commit robbery inside the train, they practise social injustice and imperil social security to a degree that death penalty becomes a necessity if the crime is proved beyond doubt.
There may be marginal exceptions or special extenuations but none where this kind of dacoity or robbery coupled with murder becomes a contagion and occupation, and social security is so gravely imperilled that the fundamental rights of the defendant become a deadly instrument whereby many are wiped out and terror strikes community life.
Then he `reasonably ' forfeits his fundamental rights and takes leave of life under the law.
The style of violence and systematic corruption and deliberately planned economic offences by corporate top echelons are often a terrible technology of knowingly causing death on a macro scale to make a flood of profit.
The definition of murder will often apply to them.
But because of corporate power such murderous depredations are not charged.
If prosecuted and convicted for murder, they may earn the extreme penalty for taking the lives of innocents deliberately for astronomical scales of gain.
Likewise, if a man is murderer, so hardened, so bloodthirsty, that within the prison and without, he makes no bones 162 about killing others or carries on a prosperous business in cadavers, then he becomes a candidate for death sentence.
" My learned brother Krishna Iyer J. wants the death penalty to be inflicted in the case of three categories of criminals, namely (1) for white collar offences, (2) for anti social offences, and (3) for exterminating a person who is a menace to the society, that is, a `hardened murderer '.
Edwin H. Stherland defines a white collar offence as `a crime in relation to business '.
(1)The validity of white collar crime as a crime has been a subject of severe controversy in social studies.
Now `white collar crime ', as commonly understood, means a crime committed by a person of respectability and of high social status in the course of his occupational role.
It takes in such forms as restraint of trade, mis representation in advertising, infringement of patents, unfair labour practices, financial fraud, unethical or illegal rebating and violation of trusts.
It may also take the form of theft, sale and export of entiques like sculptures, any work of art of historical value, illegal sale of narcotics and alcohol, abortion, fraudulent accident report, income tax frauds etc.
An `anti social offence ' may consist of sale of spurious drugs, adulteration of articles of food meant for human consumption, auto thefts, `sharp ' business practices which do not conform to the national well being.
Some of these offences must undoubtedly be ruthlessly dealt with.
But unfortunately our penal laws do not provide for a death sentence for either white collar crimes or anti social offences, although I wish they did, at least for certain anti social offences.
There will be general measure of agreement that some of the serious anti social offences call for a death sentence viz. acts of sabotage by a person who hijacks a plane and the like and large number of persons die or are injured in consequence, or disrupts lines of communications, or holds up a train and commits armed robbery with murder inside the train.
He is a menace to the society and deserves a death sentence, as his existence does not conform to the national well being.
Like wise, a person who indulges in theft or illegal trade and export of art treasures such as invaluable monuments, paintings and sculptures of historical importance and of priceless antiques of what remains of our national heritage, or in adulteration of articles of food meant for human consumption, or in manufacturing and selling of spurious drugs, or engages in illegal sale in narcotics or alcohol, which are injurious to the very life of the community, also deserves a death sentence, as in many other countries, or at any rate a sentence of imprisonment for life.
The same applies to economic offences which may disrupt the economic life of the community as a whole, like smuggling of gold and other contraband 163 goods, which call for a very deterrent punishment.
This is necessary to protect the basic economic order of the nation.
But these are all matters for the Parliament to decide.
It may be stated that the State of West Bengal has taken a step forward in that direction.
The Prevention of Adulteration of Food, Drugs and Cosmetics Act, 1973 (West Bengal Act 42 of 1973 makes the offence of sale of spurious drugs, adulteration of articles of food meant for human consumption etc., punishable with imprisonment for life.
As regards `hardened ' murderers, I am afraid, there are few to be found.
Many murders unfortunately go undetected, and many a brutal murderer has to be acquitted for want of legal evidence bringing his guilt beyond all reasonable doubt.
Nevertheless, when the guilt is proved, the Court should leave aside all humanitarian considerations, if, the extreme penalty is called for.
A `professional ' murderer must, as a matter of course, be sentenced to death because he is a menace to the society.
Whatever sympathy the Court can have should be reserved for the victims of the crime rather than for the perpetrators.
In such cases, the law must take its course.
I do not intend to enter upon any philosophical dialectics as to the `utility ' of the death sentence or enter into the controversy whether it is `unnecessary ', `brutal ' or `dehumanizing ', but I would, for my part, like to say, that I am of the opinion with much deference for the great authority of those who think otherwise that the weight of evidence and reason is in favour of the retention of the death penalty.
I am afraid, if the Courts were to be guided by the classification made by the majority the death sentence for an offence of murder punishable under section 302, for all practical purposes would be virtually non existent.
I feel that it is not necessary for the purposes of these appeals to refer to the Indian Penal Code (Amendment) Bill, 1976, which by section 125 introduces a new section 302 in the Indian Panel Code, 1860.
The re drafted section seeks to bring about a change in the law.
It abolishes the liability to suffer the death sentence on conviction of murder and substitutes the sentence of imprisonment for life by sub section
(1) except in cases of certain first degree murders falling within sub section
(2) thereof.
The cases in which the death sentence is to be retained are those where, in the view of the Government, murder is most dangerous to the preservation of law and order, and where the death sentence is likely to be a particularly effective deterrent, viz., pre planned murders involving extreme brutality and murders involving exceptional depravity.
The Bill is not before the Court.
It is, therefore, not proper to deal with it.
164 It is, however, necessary to emphasise that if there has to be a law reform at all, some regard must be had to the plight of the victim or his or her family by making provision for payment of compensation.
While it is commonly accepted that those convicted of violations of the criminal law must "pay their debt to society", little emphasis is placed upon requiring offenders to "pay their debt" to their victims.
These again are matters for the Parliament to provide.
From a life time of experience, Sir John Beaumont, speaking with unrivalled authority, told the Royal Commission on Capital Punishment(1) that the alternative sentence under section 302 of the Indian Penal Code 1860 had "worked well" in India, and that he had never himself felt that the responsibility of choosing between the sentence of death and a lesser punishment was unfair or excessive, nor had he ever heard any Judge in India express such a feeling.
He expressed the opinion that there was "no class of offences in which the degree of moral culpability differs more than in case of murder".
It is wholly illogical to require a Judge to pass the same sentence in every case.
In his view, the proper solution lies in giving to the Judge the same discretion that he had in regard to other offences.
A large body of judicial opinion still shares the same view.
If Parliament thought it right to give to the Judges discretion as to the sentence, I do not think they would or ought to shrink from the onerous responsibility.
I feel it would not be appropriate for this Court to curtail the ambit of their discretion by judicial process.
We cannot but be oblivious that a sentence of a wrong type, that is, to substitute a sentence of imprisonment for life where the death sentence is called for, causes grave miscarriage of justice.
A sentence or pattern of sentences which fails to take due account of the gravity of the offence can seriously undermine respect for law.
Turning to the appeals before us, I cannot say that the award of death sentence in any of these cases was not appropriate or uncalled for.
In the three cases before us, there were "special reasons" within the meaning of section 354, sub section
(3) of the Code of Criminal Procedure, 1973 for the passing of the death sentence in each and therefore, the High Courts were justified in confirming the death sentences passed, under 368(a) of the Code.
In the circumstances, any interference with the sentence of death, in my view, would be wholly unwarranted in each of these cases.
165 In Rajendra Prasad 's case, the Allabhabad High Court in confirming the death sentence observes that the accused Rajendra is a `desperate character ', who after having been convicted under section 302 and undergone a sentence of imprisonment for life was released only a few days prior to the occurrence, on October 2, 1972, that is, on the occasion of Gandhi Jayanti, committed the brutal murder of the deceased Mansukh by striking him with a knife.
On the date of occurrence, that is, on October 25, 1972, at about 11 a.m. the accused along with his brother Pooran rushed towards Sri Kishan, brother of Rambharosay, armed with a knife but Sri Kishan ran to safety and was not hurt.
Later in the evening at about 5.30 p.m., the same day, while Rambharosay and the deceased Mansukh were standing in the lane in front of Rambharosay 's house, the accused suddenly appeared and dealt several blows with the knife on vital parts of the body of Rambharosay but Rambharosay released himself from his grip and ran inside his house and bolted the door.
The accused chased him all the way with the blood stained knife and knocked at the door asking him to open it.
Meanwhile, the deceased Mansukh came and tried to entreat the accused not to assault Rambharosay.
Thereupon the accused struck deceased Mansukh, who tried to escape, but the accused chased him over a distance of 200 to 250 feet and inflicted repeated knife blows on the deceased resulting in his death.
The deceased was done to death by the accused merely because he tried to prevent him from assaulting Rambharosay.
Not only there are no mitigating circumstances but this was a pre planned, cold blooded murder.
While Rajendra was in jail, his family members used to wield out a threat that the members of the family of Rambharosay would be dealt with after Rajendra is released from jail.
The case of this accused is destructive of the theory of reformation.
The `therapeutic touch ' which it is said is the best way of preventing repetition of the offence has been of no avail.
Punishment must be designed so as to deter, as far as possible, from commission of similar offences.
It should also serve as a warning to other members of society.
In both respects, the experiment of reformation has miserably failed.
I am quite sure that with the commutation of his death sentence, the accused will commit a few more murders and he would again become a menace to the community.
In Kunjukunju Janardhanan 's case, the Kerala High Court while confirming the death sentence of the accused observes that he acted, with extreme depravity.
Infatuated by the charm of a village girl, Smt.
166 Santhamma, then aged about 21 years, the accused Kunjukunju Janardhanan, aged 28 years, committed the brutal murder of his innocent wife, Smt.
Chandramathi, aged 26 years and his two minor sons, Sunil aged 7 and Manoj aged 5 at the dead of night while they were sleep by repeatedly striking them with a sharp edged deadly weapon.
It redounds to the credit of Smt.
Santhamma, P.W. 2, the village girl, with whom the accused was on terms of illicit intimacy, that she used to entreat him in her letters not to court her as it would destroy the happiness of his family.
It was then that the accused wrote the letter, Ext.
P 2, that he would exterminate his wife and children once for all so that he may live happily with her.
I fail to understand what is meant by the `eternal triangle ' as a mitigating circumstance.
The accused, who acted as a monster, did not even spare his two innocent minor children in order to get rid of his wife and issues through her.
If the death sentence was not to be awarded in a case like this I do not see the type of offence which calls for a death sentence.
In Sheo Shankar Dubey 's case, the Allahabad High Court has found the accused Sheo Shankar guilty of triple murder and rightly confirmed the sentence of death passed on him.
The accused Sheo Shankar murdered his uncle Narottam Dubey, and his two sons Chandra Bhushan and Chandra Shekher.
On the date of occurrence, i.e., on June 15, 1976 after there was a partition of the joint family lands between the deceased Narottam and Purushottam, father of the accused Sheo Shankar, there was a dispute regarding division of three bataulis.
The three bataulis could not be equally divided because they were of different sizes.
The accused insisted that they should be broken and then partitioned.
Vidyawati widow of Narottam, in fact, in trying to pacify her brother in law Purushottam, brought out one batauli and the remaining two were taken out by Chandra Shekhar.
It all happened over the act of Chandra Shekher in flinging the two bataulis on the ground which collided making a sound showing his resentment.
The expression of resentment implicit in the gesture of Chandra Shekhar infuriated the accused Sheo Shankar to such an extent that he committed the three murders in a row.
These were nothing but first degree murders.
The weapon used by the accused in committing the crime, the manner in which the operation was carried out, and the determination with which the accused acted, as well as the number of injuries inflicted on the unfortunate victims, give a clear picture of the cruelty and brutality 167 with which the accused murdered his uncle and his two sons.
He first inflicted a knife blow on his uncle Narottam Dubey who tried to run away and as he turned, the accused dealt him another knife blow resulting in his death on the spot.
Narottam Dubey, it appears, attempted his best to escape.
Even after he had sustained bleeding injuries at the hands of the accused, he made an effort to run away but he was chased by the accused and the accused finished the victim with grim determination.
His cousin Chandra Bhushan tried to intercept with a view to protect the life of his aged father but he was even not spared by the accused who struck a fatal blow on the chest.
The second cousin, Chandra Shekher, who moved forward to save his brother was chased by the accused who also finished him of by a stroke of the blade of knife he wielded.
It was no doubt a trifling incident over the division of three betaulis resulting in the triple murder.
It is said that the murders were not `pre meditated ' but committed in the heat of passion over a `family feud '.
But that hardly furnishes a justification for the extreme brutality with which the accused acted.
There is no inexorable rule that either the extreme youth of the accused or the fact that he acted in a heat of passion must always irrespective of the enormity of the offence or otherwise be treated as a sufficient ground for awarding the lesser punishment.
The Court has to take into consideration all the circumstances which do not merit the extreme penalty.
I find that in the facts and circumstances of this particular case, these factors cannot outweigh other considerations.
Three precious lives have been lost by the dastardly act of the accused.
A family has been wiped off.
The death sentence was clearly called for in this case firstly, as a threat or warning to deter potential murderers, and secondly, as the guarantee against the brutalisation of human nature.
The grim determination of the accused to bring the entire operation to the end desired by him is also reflected in the manner of his repelling the interception of Chandra Bhushan who went to the rescue of his father and Chandra Shekher who tried to rescue his brother Chandra Bhushan, the unfortunate victims of the murderous assault.
All these facts and circumstances, to my mind, constitute `special reasons ' why the accused should be sentenced to death.
In retrospect, I venture to say that in these appeals, it cannot be asserted that the award of death sentence to the appellants was `erroneous in principle '.
Nor can it be said that the sentence of death passed on them was arbitrary or excessive or indicative of an improper exercise of discretion.
It is the duty of the Court to impose a proper punishment, 168 depending upon the degree of criminality and desirability to impose such punishment as a measure of social necessity, as a means of deterring other potential offenders.
Failure to impose a death sentence in such grave cases where it is a crime against the society particularly in cases of murders committed with extreme brutality, will bring to nought the sentence of death provided by section 302 of the Indian Penal Code, 1860.
To allow the appellants to escape with the lesser punishment after they had committed such intentional, cold blooded, deliberate and brutal murders will deprive the law of its effectiveness and result in travesty of justice.
I would, therefore, for these reasons dismiss the appeals.
The appellants are at liberty to apply for reprieve for commutation of their sentence which is an executive act of clemency.
ORDER In the light of the opinion of the majority the death sentence in each of these appeals is commuted to a sentence of imprisonment for life.
| IN-Abs | (Per majority Krishna Iyer and Desai, JJ.) ^ 1.
The only question before the Court is as to when and why shall capital punishment be pronounced on a murderer and why not in other cases, within the confines of the Code.
Urgency to the solution is obvious.
The overt ambivalence and covert conflict among judges concerning continued resort to the death sentence mirrors the uncertainties and conflicts of values in the community itself.
[89G & 90D] 2.
Section 302 of the IPC throws little light on when the court shall be the sentence of why the lesser penalty shall be preferred.
Since law reflects life, new meanings must permeate the Penal Code.
Deprivation of life under our system is too fundamental to be permitted except on the gravest ground and under the strictest scrutiny.
[90F: 94C D] 3.
To say that discretion of the Judge passing the sentence under section 302 IPC is guided by well recognised principles shifts the issue to what those recognised rules are.
The big margin of, subjectivism.
a preference for old precedents, theories of modern penology, behavioral emphasis or social antecedents, judicial hubris or human rights perspectives, reverence for outworn social philosophers this plurality of forces plays a part in swining the pendulum of sentencing justice erratically.
Until Parliament speaks, this Court cannot be silent.
[95; 97G] 4.
Executive commutation is no substitute for judicial justice, at best it is administrative policy and at worst pressure based partiality.
The criteria for clemency are often different [99C] 5.
In so far as section 302 IPC is concerned several attempts had been made to restrict or remove death penalty but never to enlarge its application.
Parliamentary pressure has been to cut down death penalty, although the section formally remains the same.
In the case of the Criminal Procedure Code the legislative development has shifted the punitive centre of gravity from life taking to life sentence.
In other words, the legislative trend seems to be while formerly the rule was to sentence to death a person who is convicted for murder, it is now to impose a lesser sentence for reasons to be recorded in writing.
Formerly, capital punishment was to be imposed unless special reasons could be found to justify the lesser sentence.
After 1955 courts were left equally free to award either sentence.
The 1973 Code has made an an mistakable shift in legislative emphasise under which life imprisonment for murder is the rule and capital sentence the exception for reasons to be stated.
[101D:104B C] 79 6.
Criminologists all the world over, however, argued that death has decisively lost the battle, and even in our Codes it has shrunk into a weak exception.
What are the exceptional cases ? Personal story of an actor in a shocking murder, if considered, may bring tears and soften the sentence.
He might have been a tortured child, an ill treated orphan, a jobless man or the convict 's poverty might be responsible for the crime.
[106G: 107B] 7.
In the post Constitution period section 302 IPC and section 345(3) of the Cr.
P.C. have to be read in the humane light of Parts III and IV illumined by the Preamble to the Constitution.
In other words the sacrifice of a life sentence is sanctioned only if otherwise public interest and social defence and public order would be smashed irretrievably.
Such extraordinary grounds alone constitutionally qualify as special reasons.
One stroke of murder hardly qualifies for this drastic requirement, however gruesome the killing may be.
The searching question the Judge must put to himself is what is so extra ordinari ly reasonable as to validate the wiping out of life itself and with it the great rights which inhere in him in the totality of facts.
[121F; 110E F] 8.
The retributive theory has had its day and is no longer valid.
Deterrence and reformation are the primary social goals which make deprivation of life and liberty reasonable as penal penacea.
[122C] 9.
The current ethos, with its strong emphasis on human rights and against death penalty, together with the ancient strains of culture spanning the period from Buddha to Gandhi must ethically inform the concept of social justice which is a paramount principle and cultural paradigm of our Constitution [l22C D] 10.
The personal and social, the motivational and physical circumstances, of the criminal are relevant factors in adjudging the penalty as clearly provided for under the Code of 1973.
So also the intense suffering already endured by prison torture or agonishing death penalty hanging over head consequent on the legal process.
[112D El 11.
Although the somewhat obsolescent Mc 'Naughten Rules codified in section 84 of the Penal Code alone are exculpatory, mental imbalances, neurotic upsets and psychic crises may be extenuatory and the sense of diminished responsibility may manifest itself in judicial clemency of commuted life incar ceration.
[l22F] 12.
The social justice which the Preamble and Part IV (article 38) highlight, as paramount in the governance of the country has a role to mould the sentence.
If the murderous operation of a die hard criminal jeopardizes social security in a persistent, planned and perilous fashion then his enjoyment of fundamental rights may be rightly annihilated.
One test for imposition of death sentence is to find out whether the murderer offers such a traumatic threat to the survival of social order.
Some of the principles are never hang unless society or its members may lose more lives by keeping alive an irredeemable convict.
Therefore social justice projected by article 38 colours the concept of reasonableness in article 19 and non arbitrariness in article 14.
This complex of articles validates death penalty in limited cases.
Maybe train dacoity and bank robbery bandits reaching menacing proportions, economic offenders profit killing in an intentional and organised way, are such categories in a Third World setting.
[112D: 114C: 112G] 80 13.
Survival of an orderly society without which the extinction of human rights is a probability compels the higher protection of the law to those officers who are charged with the fearless and risky discharge of hazardous duties in strategic situations.
Those officers of law, like policemen on duty or soldiers and the like have to perform their functions even in the face of threat of violence, sometimes in conditions of great handicap.
If they are killed by designers of murder and the law does not express its strong condemnation in extreme penalisation, justice to those called upon to defend justice may fail.
This facet of social justice also may in certain circumstances and at certain stages of societal life demand death sentence.
[123D E] 14.
Special reasons necessary for imposing death penalty must relate not to the crime as such but to the criminal.
[124E] Jagmohan Singh vs State of U.P., ; ; Ediga Annama vs State of A.P., ; ; Sunil Batra vs Delhi Admn.; , at 569 & 572; referred to.
Capital punishment in India; The Impact of the Ediga Anamma, by Prof. A. R. Blackshield (July 1977), referred to.
Rajendra Prasad 's case: The family to which the appellant and the deceased belonged were on inimical terms.
The appellant who was the son of one of the families murder ed the deceased.
After some years in the prison, he was released on Gandhi Jayanti day.
On return some minor incident ignited his latent feud and he stabbed to death a friend of the opposite family, he was sentenced to death.
The second murder is not to be confounded with the persistent potential for murderous attacks by the murderer.
This was not a menace to the social order but a specific family feud.
Here was not a youth of controllable violent propensities against the community but one whose paranoid preoccupation with a family quarrel goaded him to go the rival.
So long as the therapeutic processes are absent from prisons these institutions, for from being the healing hope of society, prove hardening schools to train desperate criminals.
Desperate criminal is a convenient description to brand a person.
Seldom is the other side of the story exposed to judicial view.
There is nothing on record to suggest that the appellant was beyond redemption; nothing on record hints at any such attempt inside the prison.
The appellant showed no incurable disposition to violent outbursts against his fellow men.
There is therefore, no special reason to hang him.
He should be awarded life imprisonment.
Kunjukunju 's case: The appellant, a married man with two children, developed illicit sex relations with a fresh girl.
In order to win her hand he murdered his wife and two children.
There is no evidence to show that he was a desperate hedonist or randy rapist.
He is not a social security risk altogether beyond salvage by therapeutic life sentence.
Death sentence is commuted to life imprisonment.
Dubey 's case: The appellant, a young man, aged about 20, stabbed to death three members of the family with whom his family had a quarrel over partition of 81 property.
It is illegal in this case to award capital sentence without considering correctional possibilities inside prison.
He was not a murderer born but made by the passion of family quarrel.
He could be saved for society with correctional techniques and directed into repentance.
A family feud, an altercation, a sudden passion, although attended with extraordinary cruelty, young and malleable age, reasonable prospect of reformation and absence of any conclusive circumstance that the assailant is a habitual murderer or given to chronic violence these catenate of circumstances bearing on the offender call fol the lesser sentence.
Sen l. (Dissenting) 1.
(a) It is constitutionally and legally impermissible for the Supreme Court while hearing an appeal by special leave under article 136 of the Constitution, on a question of sentence, to restructure section 302 of the Indian Penal Code, 1860 or section 354, sub section
(3) of the Code of Criminal Procedure 1973, so as to limit the scope of the sentence of death provided for the offence of murder under section 302.
[131F G] (b) The question whether the scope of the death sentence should be curtailed or not, is one for the Parliament to decide.
The matter is essentially of political expediency and, as such, it is the concern of statesmen and, therefore, properly the domain of the legislature, not the judiciary.
[137E] (c) In an appeal confined to sentence under Article 136 of the Constitution, Supreme Court has not only the power but as well as the duty to interfere if it considers that the appellant should be sentenced 'differently ', that is, to set aside the sentence of death and substitute in its place the sentence of imprisonment for life, where it considers, taking the case as a whole, the sentence of death to be erroneous, excessive or indicative of an improper exercise of discretion; but at the same time, the Court must impose some limitations on itself in the exercise of this broad power.
In dealing with a sentence which has been made the subject of an appeal, the Court will interfere with a sentence only where it is 'erroneous in principle '.
The question, therefore, in each case is whether there is an 'error of principle ' volved.[134G Hl (d) The Court has the duty to see that on the particular facts and circumstances of each case the punishment fits the crime.
Mere compassionate sentiments of a humane feelings cannot be a sufficient reason for not confirming a sentence of death but altering it into a sentence of imprisonment for life.
In awarding sentence, the Court must, as it should, concern itself with justice, that is, with unswerving obedience to established law.
It is, and must be, also concerned with the probable effect of its sentence both on the general public and the culprit.
Judges are not concerned with the morales or ethics of a punishment.
It is but their duty to administer the law as it is and not to say what it should be.
It is not the intention of the Supreme Court to curtail the scope of the death sentence` under section 302 by a process of judicial construction inspired by the personal views [35B: 137D E] 2.
It is also not legally permissible for this Court while hearing an appeal in a particular case where a capital sentence is imposed, to define the expression "Special reasons" occurring in sub section
(3) of section 354 of the Code, in such 82 virtually has the effect of abolishing the death sentence.
[137H] (a) Under section 354, sub section
(3) of the Code of Criminal Procedure, 1973, the Court is required to state the reasons for a sentence awarded, and in the case of imposition of a sentence of death the Judge has to record "special reasons" for imposing death sentence.
Punishment for murder as a rule should be life imprisonment and death sentence is only an exception.
[l59A] (b) It is neither feasible nor legally permissible for this Court to give a definite connotation to the expression "special reasons" occurring in section 354 sub section
(3) of the Code of Criminal Procedure, 1973.
It is difficult to put "special reasons" in a straight jacket.
Each case must depend on its own particular facts.
The question of sentence must be left to the discretion of the Sessions Judge trying the accused.
Under the present Code, a trial for murder is divided into two stages.
There is a bifurcated trial.
The first part of the trial is directed solely to the issue of guilt or innocence, and concludes with the finding of the Sessions Judge on that issue.
At the end of the trial when he comes to a conclusion of guilt, he has to adjourn the case for hearing the accused on the question of sentence.
[159C D] Section 235, sub section
(2) of the Code specifically provides for an opportunity of hearing to the accused on the question of sentence after a verdict of guilt is recorded against him.
The burden is upon the prosecution to make out a case for imposition of the extreme penalty.
Where a sentence of death is passed, the Sessions Judge has to make a reference to the High Court under section 366, sub section
(1) of the Code.
Under section 367, sub section
(1) if the High court thinks a further inquiry should be made into, or additional evedence taken upon, any point bearing upon the guilt or innocence of the convicted person, it may make such inquiry or take such evidence itself, or direct it to be made or taken by the Court of Sessions.
In a case submitted under section 366, the High Court under section 368(a) may either confirm the sentence, or pass any other sentence, i.e. reduce the sentence of death into a sentence of imprisonment for life.
thereafter an appeal lies to this Court by a special leave under Article 136 on the question of sentence.
[159E H] Failing the appeal, there is the President 's power to grant reprieve and pardon under Article 72 (1), as well as the Governor 's power of commutation under Article 161 of the Constitution which is a sovereign function.
The power of the President and of the Governor to grant reprieves and pardons is wide enough to include the power to commute and to remit sentence of punishment.
All cases of capital punishment are closely scrutinised by the Executive at both the levels to see whether there are such extenuating circumstances as would justify a reprieve, and the power to commute a death sentence is freely exercised, whenever there is some doubt as to the severity of the punishment.
Under the present system the Prerogative of Mercy in the case , of persons under sentence of death works well and it produces results gene rally regarded as satisfactory.
It helps in mitigating the rigour of the death sentence, particularly in case of those murderers whose execution would offend the public conscience.
Very few persons under a sentence of death may be one or two in a year, in a State are usually executed.
It is, therefore, not proper for the Court to trench upon the President 's or the Governor 's perogative to grant pardon or reprieve under Articles 72(1) and 161 in taking 83 upon itself the task of commutation of a death sentence, which is properly imposed, in the facts and circumstances of a particular case, merely because there is a doubt that the Executive may commute the sentence ultimately, or by one 's views as to the utility of death penalty.
[160A E] Balwant Sing case ; Ambaram 's Case 11974] 4 SCC 298 and Sarveshwar Prasad Sharma 's case 11978] 1 SCR 360; referred to.
(c) Judges are entitled to hold their own views, but it is the bounden duty of the Court to impose a proper punishment, depending upon the degree of criminality and the desirability to impose such punishment as a measure of social necessity, as a means of deterring other potential offenders.
It is only in very grave cases where it is a crime against the society and the brutality of the crime shocks the judicial conscience that the Court has the power, as well as the duty, to impose the death sentence.
In view of these adequate safeguards, it can hardly be asserted that the sentence of death provided for an offence of murder punishable under section 302, is 'dehumanizing ' or that it is 'unnecessary '.
Where the crime is cruel and inhuman a death sentence may be called for.
[160F H] Ediga Anamma; , ; Bishan Das & Ors. ; referred to.
(d) If Parliament thought it right to give to the Judges discretion as to the sentence, they would not or ought not to shrink from their onerous responsibility.
It would not be appropriate to curtail the ambit of their discretion by judicial process.
A sentence of a wrong type, that is, to substitute a sentence of imprisonment for life where the death sentence is called for, causes grave miscarriage of justice.
A sentence or pattern of sentences which fails to take due account of gravity of the offence can seriously undermine respect for law.
[164E F] (e) In the three cases there were 'special reasons ' within the meaning of section 354, sub section
(3) of the Code of Criminal Procedure, 1973 for the passing of the death sentence in each and, therefore, the High Courts were justified in confirming the death sentence passed under section 368(a) of the Code.
Indeed, they are illustrative of the rate type of cases, that is, first degree murders, where a death sentence is usually awarded in any civilised country.
These were cases of diobolical, cold blooded brutal murders of innocent persons, that is, first degree murders of extreme brutality or depravity.
The inhumanity of some of the offences defied belief Any interference with the sentence of death, would be wholly unwarranted in each case.
[l64G] (f) It is the duty of the Court to impose a proper punishment depending upon the degree of criminality and desirability to impose such punishment as a measure of social necessity as a means of deterring other potential offenders.
Failure to impose a death sentence in such grave cases where it is a crime against the society particularly in cases of murders committed with extreme brutality, will bring to nought the sentence of death provided for by section 302 of the Indian Penal Code, 1860.
To allow the appellants to escape with the lesser punishment after they had committed such intentional, cold blooded deliberate and brutal murders will deprive the law of its effectiveness and result in travesty of justice.
[l68A B] 84 (g) In these appeals it cannot be asserted that the award of death sentence to the appellants was "erroneous in principle".
Nor can it be said that the sentence of death passed on them was arbitrary or excessive or indicative of an improper exercise of discretion.
[167H] (i) Rajendra Prasad 's case is destructive of the theory of reformation.
The 'therapeutic touch ' which it is said is the best way of preventing repetition of the offence has been of no avail.
Punishment must be designed so as to deter, as far as possible from commission of similar offences.
It should also serve as a warning to other members of society.
In both respects, the experiment of reformation has miserably failed.
There is no doubt, with the commutation of his death sentence, the accused will commit a few more murders and he would again become a menace to the community.
[165G] (ii) In Kunjukunju Janardhan 's case the accused, who acted as a monster, did not even spare his two innocent minor children in order to get rid of his wife and issues through her.
The death sentence was the only and appropriate penalty which should be awarded in such a case.
[166D] (h) There is no inexorable rule that either the extreme youth of the accused or the fact that he acted in a heat of passion must always irrespective of the enormity of the offence or otherwise be treated as a sufficient ground for awarding the lesser punishment.
The Court has to take into consideration all the circumstances which do not merit the extreme penalty.
In the facts and circumstances of this particular case i.e. Sheo Shanker .
Dubey 's case these factors cannot outweigh other considerations.
Three precious lives have been lost by the dastardly act of the accused.
A family has ` been wiped off.
The death sentence was clearly called for in this case E firstly, as a threat or warning to deter potential murderers, and secondly as the guarantee against the brutalisation of human nature.
All facts and circumstances, constitute 'special reasons ' why the accused should be sentenced to death.
[167E Fl 3.
It cannot be said that imposition of death penalty, except in the classes of cases indicated in the majority Judgment would be violative of Articles 14,19 and 21 of the Constitution.
Such a question really does not arise forconsideration.
[136G] (a) The citizen 's right to life and personal liberty are guaranteed by Article 21 of the Constitution irrespective of his political beliefs, class, creed or religion.
The Constitution has, by Article 21 itself forged certain procedural safeguards for protection to the citizen of his life and personal liberty.
The idealistic considerations as to the inherent worth and dignity of man is a fundamental and prevasive theme of the Constitution, to guard against the execution of a citizen for his political beliefs.
[136C D] (b) A patriot cannot be equated with an ordinary criminal.
A humanistic approach should not obscure one 's sense of realities.
When a man commits a crime against the society by committing a diabolical, cold blooded, pre planned murder, of an innocent person the brutality of which shocks the conscience of the Court, he must face the consequences of his act.
Such a person forfeits his right to life.
[136E3] 85 Jagmohan Singh vs State of U.P. ; followed.
Furman vs Georgia, ; , 33 L. ed, 2nd 346 explained and differed from.
Michael de Freites vs Gaorgie Ramouter Benny, L.R. ; quoted with approval.
(c) If the Courts were to be guided by the classification for inflicting death penalty only in the case of three categories of criminals, namely, (i) for white collar offences (ii) for anti social offences, and (iii) for exterminating a person who is a menace to the society, that is, a 'hardened murderer ', the death sentence for an offence of murder punishable under section 302, for all practical purposes would be virtually non existent.
Unfortunately our penal laws do not provide for death sentence for either white collar crimes or anti social offences.
As regards 'hardened ' murderers, there are few to be found.
Many murders unfortunately go undetected and many a brutal murderer has to be acquitted for want of legal evidence bringing his guilt beyond reasonable doubt.
Nevertheless, when the guilt is proved, the Court should leave aside all humanitarian considerations if the extreme penalty is called for.
A 'professional ' murderer must, as matter of course, be sentenced to death because he is menace to the society.
Whatever sympathy the Court can have should be reserved for the victims of the crime rather than for the perpatrators.
In such cases, the law must take its course.
[162B E; 163C D] 4.
The criminality of a crime consists not only in the criminal act but in what that signifies.
Its immediately apparent features, the obvious damage to person or property or to public security, are symptoms of a deeper disorder.
It betokens, and it fosters, an attitude in man to man, of reckless selfishness, decit or malice, which is incompatible in the long run with any decent social life.
In any advanced society it is, in part at least, on account of this wider character, less easily discerned, that the graver offence are Punished.
[l43E F] (a) All punishment properly implies moral accountability.
It is related to injury and not only to damage or danger however greater.
Capital punishment does so in an eminent degree.
It is directed against one who is ex hypothesi an inhuman brute, i.e. it is imposed simply to eliminate who is held to have become irretrievably, a. Iiability or a menace to society.
[142E] (b) Punishment like crime has a dual character.
The penalty which the convicted murderer incurs is not simply death, but death in disgrace and death as a disgrace.
In so far as capital punishment is a threat, the threat consists not only in death but in infamy.
Any theory which ignores this characteristic is certainly defective.
[l43F] Sir Walter Moberly The Ethics of Punishment Ch.
Xl Capital Punishment pp.
271 81: referred to.
(c) Punishment inflicted by the State in response to a violation of criminal law has been justified in various ways namely, as society 's vengeance upon the criminal as atonement by the wrong doer, as a means of deterring other criminals, as protection for the law abiding and as a way of rehabilitating the criminal.
86 Theories of rehabilitation are largely speculative, since there is lack of scientific evidence to support them, though it has been influential in the development of modern penology.[144A B] 5.
(a) The capital punishment controversy falls within the strict limits of 'independent ' parliamentary law making, and is a typical or representative of the kind of problems that leaders of Parliament face every day.
In short, the case for abolition of the death sentence is political, not constitutional, The Government carries the responsibility of law and order.
That is the first` and fundamental duty of any Government.
The Executive has the duty of advising the Government of the laws it believes necessary for the national wellbeing.
It is the duty of the Court, including this Court, to administer the laws as they are.
[l57D E] (b) Analysing the substantive merits of the cases for and against the death penalty for murder is essentially a question for the Parliament to resolve and not for the Supreme Court to decide.
Therefore, it would not be proper for the Judges to attempt to project their personal views in a matter which lies in the realm of political decision making, by focussing on a single controversy, the question of the proper penalty for the crime of murder.
[157B] (c) Any justification for the capital sentence, as for other salient features of the penal system must be sought in the protection of the society and that alone.
[145E] Even where it has been legally retained, as in India, Capital Punishment is now seldom employed except in very grave cases where it is a crime against the society and the brutality of the crime shocks the judicial conscience.
Indeed the death penalty satisfies the society 's retributive goals and is still presumed to be a deterrent to potential offenders Of the three purposes commonly assigned to punishment retribution, deterrence and reformation deterrence is generally held to be the most important, although the continuing public demand for retribution cannot be ignored.
Prima facie, the death sentence is likely to have a stronger affect as a deterrent upon normal human beings than any other form of punishment.
People are believed to refrain from crime because they fear punishment.
Since people fear death more than anything else, the death penalty is the most effective deterrent.
[146C E] (d) If the appeal of capital punishment were merely to fear of death, it would be a very inefficient protector of society.
In civilised society and in peace time, government relies for obedience more on its moral prestige than on violent repression of crime.
Punishment only protects life effectively if it produces in possible murderers, not only fear of the consequences of committing murder, but a horrified recoil for the thing itself It can only achieve, this, more ambitious, task, if sentence of death is felt to embody society 's strongest condemnation of murder and keenest sense of its intolerable wickedness.
It is not by the fear of death but by exciting in the community a sentiment of horror against any particular act, that the offenders could be deterred from committing it.
[143B C] Royal Commission on Capital Punishment Para 59: referred to.
(e) The punishment of death should reflect adequately the revulsion felt for the gravest of crimes by the great majority of citizens.
Legislators and Judges: 87 share this revulsion themselves; otherwise indeed their action would be morally indefensible.
Their aim then should be, not only to strike terror nor even to awaken popular indignation in a direction convenient to Government.
It would be to arouse in all and sundry their Own indignant repudiation of a wicked act and at the same time, to deepen it in themselves.
In this vain sentence of death has been pronounced, carried out and acclaimed with stern satisfaction.
Otherwise the conscience of the community would be revolted if the criminals were allowed to live.[145F G] 6.(a) The theory that (i) the death penalty is per se cruel and unusual punishment and (ii) alternatively the inordinate delay in carrying it out makes it so has now been completely destroyed by two recent decisions of the Privy Council.[149F] Eaton Baker v The Queen, Freites vs George Ramouter Benny, ; discussed.
(b) ln the United States of America also the death penalty has practically existed more or less harmoniously with humane theories of criminal justice for over two hundred years (e.g).
[151E] (i) In Trop vs Dulles, ; , L. ed.
630, the Court refused to consider the death penalty as an indent of the constitutional limit of punishment; (ii) In McGouths vs California, ; , it was held that the absence of any guidelines was not a violation of "due process" and (iii) In Furman vs Georgia the multiple opinions did not rule out altogether re imposition of the death penalty in the future provided there was legislative structuring of a permissible system providing for sufficient procedural safeguards; (iv) Later on, the death penalty has been reimposed and this judicial approach stood reoriented.
The constitutionality of the death penalty was supported by four factors (1) the reference to capital punishment in the Constitution (ii) the past Supreme Court decisions on the death penalty (iii) the limitations of judicial restraints and (iv) the doctrine of separation of powers.
[151F; 152D; 154E] M. Cherif Bassi Owni; Substantive Criminal Law p. 120 128; referred to and (v) In Gregg vs Georgia, ; ; 49 L.ed.
859; Proffit vs Floride, [1976] 428 242; ; 913; Jurek Texas; , ; , 929 all concerned with discretionary sentencing procedures and in Woodson vs North Carolina, ; ; and Roberts vs Lonisiana ; [1976] 428 US 326; both concerned with mandatory death sentence it was held that (a) the punishment of death did not invariably violates the Constitution (b) history and precedent did not support the conclusion that the death sentence was per se violation of 8th and 14th Amendments (c) the evolving standards of decency arguments had been substantially under cut in the last four years because a large segment of the enlightened population regarded the death penalty as appropriate and necessary as seen in the new legislation passed in response to Furman (d) the death penalty was not inherently cruel and unusual.
It served two principal social purposes retribution and deterrence, and therefore the death sentence for the crime of murder was (1) not without justification (2) not unconstitutionally severe and (3) not invariably disproportionate to the crime and (e) that Furman mandated, where discretionary sentencing was used, there must be suitable direction and 88 limitation to minimise the risk of wholly and arbitrary and capricious action, the bifurcated trial with standards modelled after the Modern Penal Code juries gave just such guidance.
[155F G; 156A] Observation:
|
Civil Appeal No. 1118 of 1972 (Appeal by Special Leave from the Judgment and Order dated 18 1 72 of the Jammu and Kashmir High Court in L.P.A. No. 6 of 1969.) L.N. Sinha, Satish Gupta, K.J. John and P.P. Singh, for the appellant R.K. Bhat and D.C. Anand for respondent 1B 1K.
The Judgment of the Court was delivered by KOSHAL, J.
This appeal by special leave has arisen out of a suit brought by Smt.
Punna, respondent No. 1, against the two appellants and respondent No. 2 for the issuance of a perpetual injunction restraining the three defendants from interfering with her right to recover her father 's share of six annas in a rupee in the offerings made 211 at the sacred shrine of Shri Vaishno Devi Ji which is situated on the Trikutta Hills.
The suit was decreed by the trial court whose judgment was upheld in first appeal by the District Judge, in a second appeal by a learned Single Judge of the High Court of Jammu & Kashmir and in a Letters Patent Appeal by a Full Bench of that Court.
It is the judgment of the Full Bench (which is dated the 18th of January, 1972) that is impugned before us.
The averments made in the plaint may be summarised thus.
The plaintiff is the daughter of one Bagu who died in or about the year 1959.
During his life time Bagu and the three defendants were entitled to receive the offerings made at the shrine of Shri Vaishno Devi Ji on certain days falling within every seventh Bikrami year so that Bagu would have 6/16th share therein and the defendants collectively a similar share.
After the death of the plaintiff 's father the parties were entitled to receive the offerings in the shares abovementioned on every eighth day in the Bikrami year 2019, the plaintiff having succeeded to the share of her father both under the law of inheritance and by virtue of a will executed by him in her favour.
The plaintiff had to resort to the suit as the defendants had started interfering with her right to collect her share of the offerings.
The defendants contested the suit.
They challenged the will set up by the plaintiff as a forged one and further pleaded that only members of four sub castes namely, Khas Thakars, Darora Thakars, Manotra Thakars and Samnotra Brahmins were entitled to receive the offerings and that while Bagu was entitled to a share in the same, the plaintiff was not as she had lost her original sub caste by marriage outside the four sub castes mentioned above.
The offerings, according to the defendants, were also not liable to devolve by inheritance or demise.
The findings arrived at by the trial court were these: (i) On the death of a baridar (which expression, when literally translated, means turn holder) belonging to any of the aforementioned sub castes, his heirs inherited his right to receive offerings just as they inherited his other property.
(ii) Under section 4 of the Hindu Succession Act, any custom or usage inconsistent with the provisions of that Act becomes ineffective.
(iii)Even under section 6 of the Hindu Succession Act read with the Schedule appended therto the pro 212 perty of Bagu would devolve on the plaintiff in case Bagu died intestate.
(iv) Gagu executed a valid will in favour of the plaintiff devising to her the right to receive the offerings, apart from other properties.
(v) The plaintiff was entitled, in view of the above four findings to inherit the right to receive offerings not only by reason of the provision of sections 4 and 6 of the Hindu Succession Act, but also because of the will.
(5) At the hearing of the Letters Patent Appeal by the Full Bench, the following four contentions were raised on behalf of the defendants: (i) The chance of future worshippers making offerings to the deity is a mere possibility of the nature referred to in clause (a) of section 6 of the Transfer of Property Act and is not property which can be transferred or inherited.
(ii) The right to receive offerings is not a transferable or heritable right.
(iii)The provisions of the Hindu Succession Act do not apply to the case in hand.
(iv) According to the custom governing the shrine of Shri Vaishno Devi Ji, only the abovementioned four subcastes were entitled to share the offerings.
All these contentious were rejected by the Full Bench as untenable.
In regard to the first of them the Full Bench followed Balmukand and Others vs Tula Ram and Others in which it was held that the right to receive offerings when made is a definite and fixed right and does not depend on any possibility of the nature referred to in clause (a) of section 6 of the Transfer of Property Act, because the fact that offerings whether large or small are bound to be made is a certainty.
In relation to the second contention, the Full Bench noted the contents of paragraph 422 of "Principles of Hindu Law" by Mulla which states, inter alia, that where offerings, though made to idols, are received by persons independently of any obligation to render ser 213 vices, they are alienable and attachable.
Reference in this connection was also made to Balmukand and Others vs Tulla Ram and Others (supra) wherein the following passage occurs: "but when the right to receive the offerings made at a temple is independent of an obligation to render services involving qualifications of a personal nature, such as officiating at the worship we are unable to discover any justification for holding that such a right is not transferable.
That the right to receive the offerings when made is a valuable right and is property, admits of no doubt and, therefore, that right must, in view of the provisions of section 6 of Transfer of Property Act, be held to be transferable, unless its transfer is prohibited by the Transfer of Property Act or any other law for the time being in force.
" In view of these observations which were adopted and followed in Nand Kumar Dutt vs Ganesh Dass, the Full Bench, being in agreement therewith, proceeded to determine whether the right to receive the offerings in the present case was or was not independent of services of a priestly or personal nature.
The following translation of an extract from the Wajib ul Arz relating to village Purana Daiur wherein the holy shrine is situated, was then taken up for consideration : "Leaving aside cash, whatever is the 'Charatth ' at the temples of 'Ad Kanwari ' and 'Sri Trikutta Devi ' the entire Darora community distributes that among itself and of (?) other attached areas of Pangal, Sarron, Batan, Kotli, Gran, Parhtal etc.
according to hereditary shares.
And the castes 'Thakar Khas ' and 'Minotra ' are included in it.
Darora caste take two shares and Manotra and Khas castes also take one equal share of Charatth '.
That is divided as per hereditary shares.
There is no service in lieu thereof.
Only it is described as the blessings of Goddess.
Rupees twenty one hundred (two thousand one hundred rupees) go to the Government.
Every baridar keeps his man present in the temple who receives the 'Charatth '.
Pujaries get pay from us." and it was interpreted to mean that the right to share in the offerings made at the holy shrine had no connection with any priestly functions or with other services involving qualifications of a personal nature and therefore was a heritable as well as allenable right.
This very con 214 clusion was reached by the Full Bench on a consideration of the deposition of the Patwari of the concerned circle and the Ain i Dharamarth which purports to be the constitution of a Board of Trustees appointed by the State to manage the shrine.
In relation to the third contention, the Full Bench noted that the properties to which the Hindu Succession Act does not apply are only those which find enumeration in section 5 thereof, that the right to share the offerings is not one of those properties and that, therefore, such a right could not but be governed by the provisions of the Act.
In repelling the last contention the Full Bench relied upon the provisions of the Hindu Succession Act which over rides all customs or usage being part of the Hindu Law as in force immediately prior to the commencement of the Act and concluded that the custom of the right to share in the offerings being restricted to members of the four sub castes abovementioned could not be given effect to and that the plaintiff was fully entitled to succeed to that right in spite of the fact that she did not belong to any of those sub castes.
It was in these premises that the Letters Patent Appeal was dismissed by the Full Bench.
At the very outset Mr. L.N. Sinha, learned counsel for the appellant, has drawn our attention to the fact that the extract from the Wajib ul Arz taken note of by the Full Bench of the High Court relates not to the temple of Shri Vaishno Devi Ji but to a couple of other temples situated in its vicinity, namely, the temples of 'Ad Kanwari ' and 'Sri Trikutta Devi ' and has urged that the extract could not possibly relate to the temple of Shri Vaishno Devi Ji which was the main temple in the complex and a reference to which could not have been omitted from the extract in case it was intended to apply to that temple also.
A careful perusal of the extract shows that Mr. Sinha 's contention is well founded because there is not so much as a hint to the main temple in the extract.
According to Mr. Sinha, the duties to which the right to share the offerings is subject are detailed in the settlement record prepared for village Daiur (Shri Vaishno Devi Ji) for the year 1965 66 Bikrami and a resolution passed by the Dharamarth Committee on Sawan 27, 1983 Bikrami.
These documents may be set out in extenso: Settlement Record "In the column of ownership, the State is entered as owner; in the column of possession Dharmarth Trust entered as in possession. 'Mandir Gupha ' situate on land compris 215 ing 7 marlas bearing Khasra No. 166 and 'Bhawan ' situate on land comprising 4 marlas bearing Khasra No. 167.
The sub caste Thakar Darora, Manotra, Khas, and Brahmin Samnotra have been sharing the offerings according to the shares mentioned below from the very beginning.
Thakar Daroras and Brahmin Samnotra are entitled to three shares and one share respectively out of 2/3 of the total offerings whereas Thakar Manotras and Khas are entitled to share equally in the rest 1/3 of the total offerings. "Darora Thakars are sub divided into further four subcastes namely; (i) Darora Sunk (ii) Darora Jaga (iii) Darora Pai and (iv) Darora Deoch and each one of them has one equal share.
Similarly Brahmin (Samnotra) have also divided their share into four shares which are received as under: Samnotra Brahmins from the branch of 'Darya ' one share, Brahmins from the branch of 'Bairaj ' one share; Brahmins from the branch of 'Gobind ' one share; and Brahmins from the branch of 'Ganesh ' one share.
Therefore 'Darora Sunk ' and Samnotras from the branch of 'Bairaj ' have their turn together in the one year and they divide the offerings for that in the proportion of 3.1 (i.e. 3 shares of Darora Sunk and 1 share to Samnotras from the branch of Bairaj).
Similarly Brahmins from the branch of 'Darya ' have their turn with 'Darora Jaga ' Brahmins from the branch of 'Ganesh ' with 'Darora Parath ' and Brahmins from the branch of 'Ganesh ' with 'Darora Deoch ' and Brahmins in each case receive 1/4th share and Darora Thakars have 3/4th share.
"In the beginning nothing was taken from these persons (baridaran) in consideration of their receiving the offering.
But because the Sadhus would often go to the shrine and due to the mismanagement of their stay and meals over there, there were always riots at the shrine.
Therefore, in the year 1907 Bikrami during the regime of Maharaja Gulab Singh an amount of Rs. 1150/ was fixed as 'Aian ' to be paid by the baridars for the management of stay and meals for Sadhus at the shrine.
The said amount was to be deposited in the State Treasury.
Thereafter in 1920 Bikrami another hundred rupees were added to the above said amount and thenceforth Rs. 1250/ were fixed per annum which was being deposited in the State Treasury.
After 1940 Bikrami the said 216 amount of Rs. 1250/ was being deposited with the Dharmarth Trust and this continues till today.
The said amount is recovered from Thakar sub castes.
Besides this, so many other things (such as silk chunis etc.) are received from the said Thakar baridars.
Thakar baridars are also liable to provide three permanent servants and six more peons during the season and will be liable to pay them.
The said Thakars are liable to arrange the carriage and pay for the 'Parshad ', etc., from Katra to Vaishno Devi temple.
With regard to the cattle kept by the Dharmarth Trustees, the said Thakars are liable to arrange for taking them from one place to another.
If any Government servant visits the shrine the said Thakars will be liable to arrange for the carriage of his luggage, etc.
The said Thakars are also liable to perform the following duties: (1) Cleanliness of the Gupha (Vaishno Devi temple) and the compound appurtenant thereto.
(2) To carry Puja material inside the Gupha (temple along with the Pujari.
(3) If during mela season there is any trouble to any pilgrim or he becomes, sick, etc, the said Thakars are liable to make proper arrangements for the removal of any such trouble.
" RESOLUTION OF THE DHARMARTH COMMITTEE "(a) Dharmarth Trust shall charge its usual Aian (rent) from the baridaran which shall be paid by them before they distribute their share of the offering.
The baridar who refuses or avoids the payment of rent to Dharmarth shall not be entitled to receive his share of the offering and the same shall be attached and deposited with the manager, Dharmarth Trust.
The baridar whose share has been thus attached can receive his share on payment of the rent due to the Dharmarth Trust." "(b) Unanimously it is passed that the strangers or persons other than baridars (i.e. four sub castes) shall have no right to get the Puja performed in the shrine." "(c) In case any baridar or his legal representative, due to any reason, cannot attend in person then it will be the duty of other co sharer to deposit the absentee 's share with 217 the Manager, Dharmarth Trust and when that baridar comes present, the Manager, Dharmarth Trust shall, after deducting the due, if any, from him to the Dharmarth, pay his share to him.
The baridaran shall be bound to perform the duties (such as Kah, Kunda, Argi etc.
as being performed by them previously).
" According to these documents the right to share the offerings is restricted to members of the four sub castes abovementioned, and although to begin with baridars did not perform any duties in return, certain obligations were superimposed on the right from the year 1907 Bikarmi onwards.
Those obligations are: (a) A duty to deposit a fixed annual sum with the Dharmarth Trust to be spent on arrangements for lodging and boarding of Sadhus visiting the shrine.
(b) To provide three permanent servants, in addition to six peons, during the "season".
(c) To pay for the 'prasad ' and to arrange its transport from Katra to Vaishno Devi temple.
(d) To arrange for the cattle owned by the Dharmarth Trust being taken from one place to another.
(e) To arrange for the carriage of the luggage of Government servants visiting the shrine.
(f) To keep the temple and the compound appurtenant thereto in a state of cleanliness.
(g) To carry inside the temple the material required for worship by the priest.
(h) To look after visitors to the shrine who fall ill and to make proper arrangements for the restoration or their health.
There is thus no doubt that the right to receive a share in the offerings is subject to the performance of onerous duties.
But then it is apparent that none of those duties is in nature priestly or requiring a personal qualification.
On the other hand all of them are of a non religious or secular character and may be performed not necessarily by the baridar personally but by his agents or servants so that their performance boils down to mere incurring of expense.
If the baridar chooses to perform those duties personally he is at liberty to do so.
But then the obligation extends merely to the making of necessary arrangements which may be secured on payment 218 of money to others, the actual physical or mental effort involved being undertaken by those others.
The right is, therefore, a transferable right as envisaged in the passage above extracted from Balmukand and other vs Tula Ram and others (supra) which has not been challenged before us as erroneous and which we regard as laying down the law correctly.
The contentions raised by Mr. Sinha to the contrary is thus repelled.
Another challenge made by Mr. Sinha to the impugned judgment is that the right to share offerings coupled with the duties to which it was subject must in its totality be regarded as an office (like that of a shebait) only and not as property and that therefore no question of its heritability could arise.
In this connection reference was made to the following observations made by Mukherjea, J., who delivered the judgment of the majority of this Court in Angurbala Mullick vs Debabrata Mullick. "In a Hindu religious endowment on the other hand the entire ownership of the dedicated property is transferred to the deity or the institution itself as a juristic person and the shebait or mahant is a mere manager.
" There is nothing to indicate that baridars in the present case are the managers of the shrine in the sense that a shebait is in relation to the temple in his charge.
On the other hand it appears that the overall management of the shrine vests in the Board of Trustees known as Dharmarth Committee and it would not be correct therefore to look at the right of the baridars in the light of the rights and duties of a shebait.
However, it may be pointed out that shebaitship cannot be described as a mere office because apart from certain responsibilities, it carries with it a definite right to property.
This is a proposition on which emphasis was laid by this Court in Angurbala 's case (supra) itself.
Mukherjea, J., observed in this connection: "But though a shebait is a manager and not a trustee in the technical sense, it would not be correct to describe the shebtaitship as a mere office.
The shebait has not only duties to discharge in connection with the endowment, but he has a beneficial interest in the debutter property.
As the Judicial Committee observed in the above case, in almost all such endowments the shebait has a share in the usufruct of the debutter property which depends upon the terms of the grant or upon custom or usage.
Even 219 where no emoluments are attached to the office of the shebait, he enjoys some sort of right or interest in the endowed property which partially at least has the character of a proprietary right.
Thus, in the conception of shebaiti both the elements of office and property, of duties and personal interest, are mixed up and blended together; and one of the elements cannot be detached from the other.
It is the presence of this personal or beneficial interest in the endowed property which invests shebaitship with the character of proprietary rights and attaches to it the legal incidents of property.
This was elaborately discussed by a Full Bench of the Calcutta High Court in Monohar Mukherji vs Bhupendra Nath Mukherji and this decision of the Full Bench was approved of by the Judicial Committee in Ganesh Chunder Dhur vs Lal Behary, and again in Bhabatarini vs Ashalata.
The effect of the first two decisions, as the Privy Council pointed out in the last case, was to emphasise the proprietary element in the shebaiti right, and to show that though in some respects anomalous, it was an anomaly to be accepted as having been admitted into Hindu Law from an early date. "According to Hindu law," observed Lord Hobhouse in Gossamee Sree Greedharreejee vs Rumanlollji Gossammee "when the worship of a Thakoor has been founded, the shebaitship is held to be vested in the heirs of the founder, in default of evidence that he has disposed of it otherwise, or there has been some usase, course of dealing, or some circumstances to show a different dealing, or some circumstances to show a different mode of devolution.
" Unless, therefore, the founder has disposed of the shebaitship in any particular manner and this right of disposition is inherent in the founder or except when usage or custom of a different nature is proved to exist, shebaitship like any other species of heritable property follows the line of inheritance from the founder.
" Angurbala 's case was followed by this Court in a recent decision reported as Ram Rattan vs Bajrang Lal & Others wherein Desai, J., who delivered the judgment of the Court observed: 220 "In the conception of shebait both the elements of office and property, duties and personal interest are mixed up and blended together and one of the elements cannot be detached from the other.
Old texts, one of the principal sources of Hindu law and the commentaries thereon, and over a century the Courts with very few exceptions have recognised hereditary office of shebait as immovable, property, and it has all along been treated as immovable property almost uniformly.
While examining the nature and character of an office as envisaged by Hindu law it would be correct to accept and designate it in the same manner as has been done by the Hindu law text writers and accepted by courts over a long period.
It is, therefore, safe to conclude that the hereditary office of shebait which would be enjoyed by the person by turn would be immovable property." These observations as also those made in Angurbala 's case and extracted above demolish the contention of Mr. Sinha that shebaitship is nothing more or less than an office and is not heritable property.
The right to share the offerings being a right coupled with duties other than those involving personal qualifications and, therefore, being heritable property, it will descend in accordance with the dictates of the Hindu Succession Act and in supersession of all customs to the contrary in view of the provisions of section 4 of that Act, Sub section (1) of which state: (a) Save as otherwise expressly provided in this Act any text, rule or interpretation of Hindu law or any custom or usage as part of that law in force immediately before the commencement of this Act shall cease to have effect with respect to any matter for which provision is made in this Act: (b) any other law in force immediately before the commencement of this Act shall cease to apply to Hindus in so far as it is inconsistent with any of the provision 's contained in this Act.
" The requirements of the custom relied upon by the appellants to the effect that the right could not be exercised by a person who is not a member of any of the four sub castes mentioned above becomes wholly ineffective in view of these provisions, being contrary to the 221 order of succession laid down in Chapter II of the Hindu Succession Act under which the right devolves on the plaintiff respondent.
The only contention raised by Mr. Sinha is that the plaintiff had not stated in any part of the pleadings that she was prepared to carry out the services to the performance of which the right to share the offerings is subject and that therefore she was not entitled to a decree.
This contention must be repelled for the simple reason that it was not raised before the High Court.
Besides, there being no repudiation on her part of the obligations to render the services abovementioned, her claim must be regarded for the enforcement of that right coupled with those services and the decree construed accordingly even though it may be silent on the point.
In the result the appeal fails and is dismissed, but the parties are left to bear their own costs throughout.
P.B.R. Appeal dismissed.
| IN-Abs | The plaintiff 's (respondent 's) father and the defendants (appellants) were entitled to receive a defined share in the offerings made at a holy shrine.
On her father 's death the plaintiff claimed his share in the offerings alleging that both under the law of inheritance and by virtue of her father 's will executed in her favour, she was entitled to his share; but the defendants interfered with her right to collect that share.
In the plaintiff 's suit the defendants contended that only members belonging to four specified sub castes were entitled to receive the offerings and the plaintiff having lost her sub caste by reason of her marriage outside those sub castes she was not entitled to her father 's share.
But this argument was rejected by the trial court which held that on the death of the baridar (turnholder) his heirs inherited his right to receive offerings just as they inherited his other property and that therefore, the plaintiff was entitled to the offerings both under the Hindu Succession Act and the will executed by her father.
On appeal a Division Bench of the High Court held that where offerings were received by persons independently of any obligation to render services, they were alienable and attachable and that the custom which restricted the right to a share in the offerings only to members of the four specified subcastes, could not be given effect to in view of the provisions of the Hindu Succession Act and that therefore, the plaintiff was entitled to succeed to the right though she did not belong to any of the sub castes.
On further appeal to this Court it was contended on behalf of the appellant that (1) the right of the baridar was not a transferable right and (2) the right to a share in the offerings and the duties attached to it must be regarded as an office like that of a shebait and cannot be regarded as heritable property.
Dismissing the appeal, ^ HELD: The right of the baridar was a transferable right.
To begin with, the right to a share in the offerings, according to the settlement record prepared for the village and a resolution passed by the Dharmarth Committee, was restricted to the four sub castes, and similarly the baridars did not perform any duties in return.
Sometime later, however, certain obligations, such as to provide permanent servants, to look after visitors and the like, were superimposed on that right.
Though the right to receive a share in the offerings was subject to the performance of those duties none of them 210 was in nature priestly or required a personal qualification.
All of them were of a non religious or secular character which could be performed by the baridar 's agents or servants incurring expense on his account.
When the right to receive the offerings made at a temple is independent of an obligation to render services involving qualifications of personal nature, (such as officiating the worship) such a right is heritable as well as alienable.
[217 B H] Balmukand & ors.
vs Tula Ram & ors., AIR 1928 All. 721 approved.
(a) The right of the baridars cannot be equated with the right and duties of a shebait.
The baridars were not managers of the shrine in the sense that a shebait is in relation to a temple in his charge.
The overall management of the temple vested in the Board of Trustees known as Dharmarth Committee.
[218 E] (b) It is not correct to say that shebaitship is neither more nor less than an office and is not heritable property.
Shebaitship cannot be described as a mere office.
In addition to certain responsibilities it carries with it a definite right to property.
It is well established that in the concept of Shebait, both the elements of office and property, duties and personal interest are mixed up and one element cannot be detached from the other.
Old texts as courts have recognised heriditary office of shebaitship as immovable property.
A B] Angurbala Mullick vs Debabrata Mullick, ; Ram Rattan vs Bajrang Lal & ors. ; followed.
The right to share the offerings being a right coupled with duties other than those involving personal qualifications and being heritable property, it will descend in accordance with the dictates of the Hindu Succession Act in supersession of all customs to the contrary in view of section 4 of that Act.
[220 H] In the instant case, in the light of section 4 of the Hindu Succession Act the requirement that the right could not be exercised by a person not belonging to any of the four sub castes becomes ineffective.
[220 H]
|
Appeal No. 199 of 1955.
Appeal by special leave from the judgment and order dated the 17th day of April 1953 of the Nagpur High Court in Miscellaneous Civil Case No. 53 of 1950.
Nur ud din Ahmad and Naunit Lal, for the appellant.
C. K. Daphtary, Solicitor General of India, G. N. Joshi and B. H. Dhebar, for the respondent.
February section The Judgment of the Court was delivered by BHAGWATI J.
This is an appeal with special leave from the Judgment and Order of the High Court of Judicature at Nagpur on a reference made by the Income tax Appellate Tribunal, Bombay Branch 'A ' under section 66(1) of the Indian Income tax Act XI of 1922 whereby the High Court answered the ref erred question against the appellant.
The appellant, a firm of Messrs Pratapmal Laxmichand of Betul consisted of 7 partners, viz., Misrilal Goti, Meghraj Goti, Panraj Goti, Phulchand, Basantibai, Ratanbai and Gokulchand Goti.
A deed of partnership was executed on the 12th February 1944 by all the partners except Gokulchand Goti who happened to be in the Seoni Jail being a security prisoner under the Defence of India Rules.
He was unable to sign the same in spite of all efforts to obtain his signature in prison.
An application for registration of the firm under section 26 A of the Act for the assessment year 1943 44 was made on the 24th March 1944 personally signed by the other 6 partners of the firm and was accompanied by the deed of partnership which also had been signed by those 6 partners.
The Special Income tax Officer, Nagpur, rejected the application on the ground that the deed itself was not valid inasmuch as it had not been signed 93 by all the partners mentioned in the body and there was no signature of Gokulchand on the deed and the application.
An appeal was taken to the Appellate Assistant Commissioner against this decision of the Special Income tax Officer on the 24th April 1944.
Gokulchand appended his signature to the deed of partnership in Seoni Jail on the 9th January 1945.
The appeal was heard before the Appellate Assistant Commissioner on the 20th March 1947 and he passed an order on the 17th February 1948 cancelling the order of the Special Income tax Officer and directing him to register the firm after obtaining the signature of Gokulchand both on the application for registration and the deed of partnership.
At the instance of the Commissioner of Income tax, C. P. and Berar, an appeal was filed against this order of the Appel late Assistant Commissioner by the Income tax Officer, Spl.
I.T. cum E.P.T. Circle, Nagpur, before the Income tax Appellate Tribunal.
The Tribunal allowed the appeal by its order dated 11/16 October 1948 observing that the Special Income tax Officer was justified in refusing to register the firm as the application for registration was not signed by Gokulchand, that Rule 2(c) of the Indian Income tax Rules, 922, on which the Appellate Assistant Commissioner teems to have relied did not apply and the Appellate Assistant Commissioner was not justified in directing the Income tax Officer "to register the firm after obtaining the signature of Seth Gokulchand both in the application for registration and the deed of partnership".
The appellant applied for a reference to the High Court under section 66(1) of the Act and the Tribunal referred the following question arising out of its order for the opinion of the High Court: "Whether on the facts and in the circumstances of the case the Appellate Assistant Commissioner was legally competent to direct the Income tax Officer to register the firm after obtaining the signature of Seth Gokulchand both in the application for registration and in the deed of partnership".
When the statement of the case was being drawn up by the Tribunal, counsel for the appellant suggested that the words 94 appearing in para 6 of the statement, viz., "No application was submitted to the Appellate Assistant Commissioner seeking his permission under Rule 2(c) of the Indian Income tax Rules" be deleted.
He also suggested that the concluding words in the question referred to the High Court, viz., "after obtaining the signature of Seth Gokulchand both in the application for registration and in the deed of partnership" be deleted.
With regard to the latter suggestion the Tribunal observed that they were unable to delete the same inasmuch as the words sought to be deleted were the concluding words appearing in the Appellate Assistant, Commissioner 's order dated the 17th February, 1948 giving directions to the Income tax Officer and were words which were material to the question before the High Court.
With regard to the first suggestion counsel for the appellant had stated that the appellant had submitted three applications to the Appellate Assistant Commissioner all dated 20th March, 1947 and that it would be wrong to state that no application was submitted to the Appellate Assistant Commissioner.
The allegation made by the appellant was properly investigated subsequently and the Tribunal was satisfied that the appellant did not appear to have put in the application dated 20th March, 1947 as alleged.
This being the position the Tribunal stated that no change in the statement of case was called for as suggested by the appellant.
It was on this statement of case by the Tribunal that the referred question came to be determined by the High Court.
Before the High Court the appellant had applied on the 27th November, 1950 that the three certified copies of the three applications dated 20th March, 1947 made by the appellant to the Appellate Assistant Commissioner with their originals should be sent for by the High Court from the Incomeax Tribunal and an order had been made accordingly.
he High Court was of the opinion that the Appelate Assistant Commissioner should have ordered egistration of the firm provided there was an application before him duly signed by all the partners.
As, 95 however, there was no such application, he could not have directed the Income tax Officer to register the firm after obtaining the signature of Gokulchand on the application and also in the partnership deed .
The High Court accordingly answered the referred question in the negative.
An application under section 66 A(2) of the Act for a certificate for leave to appeal to this Court against that order was dismissed by the High Court but the appellant obtained special leave to appeal against the same from this Court on the 6th December, 1954.
The main question that arises for our determination in this appeal is: What are the powers of the Appellate Assistant Commissioner on the hearing of an appeal against the refusal by the Income tax Officer to register a firm under section 26 A of the Act and Rule 2 of the Indian Incometax Rules, 1922? Section 26 A of the Act provides: " (1) Application maybe made to the Income tax Officer on behalf of any firm, constituted under an instrument of partnership specifying the individual shares of the partners, for registration for the purposes of this Act and of any other enactment for the time being in force relating to income tax or supertax.
(2) The application shall be made by such person or persons, and at such times and shall contain such particulars and shall be in such form, and be verified in such manner, as may be prescribed; and it shall be dealt with by the Income tax Officer in such manner as may be prescribed".
Rule 2 of the Indian Income tax Rules, 1922, which was in force at the relevant period, in so far as is material for the purpose of this appeal, provided: "Any firm constituted under an Instrument of Partnership specifying the individual shares of the partners may, under the provisions of section 26 A of the Indian Income tax Act, 1922 register with the Income tax Officer the particulars contained in the said Instrument on application made in this behalf.
Such application shall be signed by all the partners 96 (not being minis) personally and shall be made (a) before he income of the firm is assessed for any year under section 23 of the Act, or (b). . or (c) with the permission of the Appellate Assistant Commissioner hearing an appeal under section 30 of the Act, before the assessment is confirmed, reduced, enhanced or annulled, or (d) (e) The decision of the Income tax Officer in regard to the invalidity of the deed of partnership inasmuch as it did not bear the signature of Gokulchand was not challenged by the appellant at any stage of the proceedings nor in the statement of case before us.
Counsel for the appellant, however, relying on a passage in the "Law and Practice of Income tax by Kanga and Palkhivala", 3rd Ed., at page 754, urged that it was not necessary that the partnership agree ment should be signed by all the partners and if the agreement had not been signed by one of the partners but that partner had assented to the agreement and put it forward along with the other partners for registration, the agreement would be admissible for registration.
In the first instance, it was not open to the appellant to urge any point which was not taken in the statement of case and even if it was open to him to urge that contention we do not think it necessary to express any opinion on the correctness or otherwise of the statement above referred to in view of the construction which we put on Rule 2 of the Indian Income tax Rules, 1922.
The Rules were framed under section 26 A(2) of the Act and bad statutory force.
Under Rule 2, the application for registration of the firm was to be made to, the Income tax Officer and the particulars contained in the Instrument of Partnership specifying the individual shares of the partners were to be registered with him on an application made in that behalf signed by all the partners (not being minors) personally.
No such application was submitted to the Special Income tax Officer in this case before he 97 made his order on the 18th March 1944, and on the materials as they stood on record then, the order of the Special Income tax Officer was perfectly justified.
No such application signed by all the partners of the firm including Gokulchand was also available before the Appellate Assistant Commissioner when he heard the appeal on the 20th March 1947.
The appellant contended that he had in fact filed in the office of the Appellate Assistant Commissioner on the said 20th March 1947 three applications one of which was such an application signed by all the partners personally including Gokulchand and it was strenuously urged on his behalf that the Appellate Assistant Commissioner passed his order dated the 17th February 1948 ignoring the said application which had been filed in his office.
It was urged that, if the Appellate Assistant Commissioner had before him the said application dated the 20th March 1947 signed by all the partners personally including Gokulchand, it was his duty to direct a registration of the firm himself without anything more inasmuch as the deed of partnership had been signed by Gokulchand on the 9th January 1945 and the application for registration of the firm dated the 20th March 1947 bore his signature.
The direction given by the Appellate Assistant Commissioner to the Income tax Officer to register the firm was, it was contended, therefore proper and we were asked to treat the words "after obtaining the signature of Seth Gokulchand in the application for regis tration and in the deed of partnership" as superfluous.
We are not impressed with this argument.
As appears abundantly clear from the terms of the order made by the Appellate Assistant Commissioner himself and also from the statement of case prepared by the Tribunal, the application signed by all the partners personally including Gokulchand was not before the Appellate Assistant Commissioner.
An application had been made by the appellant before the Tri bunal to amend the statement of case by deleting from para 6 thereof the words "no application was submitted to the Appellate Assistant Commissioner 13 98 seeking his permission under Rule 2(c) of the Indian Income tax Rules" but the same had been rejected by the Tribunal as a result of proper investigation conducted by it subsequently, the Tribunal stating that they were satisfied that the assessee did not appear to have put in an application dated the 20th March 1947 as alleged.
The reference was beard by the High Court on this statement of case prepared by the Tribunal and no steps were taken by the appellant before the High Court for having the statement of case amended by the Tribunal or for having a further statement of case submitted by the Tribunal recording therein the facts alleged by the appellant.
We must, therefore, decide this appeal on the facts stated in the statement of case by the Tribunal and on the basis that the application for registration dated the 20th March 1947 signed by all the partners personally including Gokulchand was not before the, Appellate Assistant Commissioner.
If that was the position, the only power which the Appellate Assistant Commissioner bad under Rule 2(c) was to accord permission to the appellant to make the application in proper form to the Incometax Officer signed by all the partners personally including Gokulchand before the assessment was confirmed, reduced, enhanced or annulled.
The Appellate Assistant Commissioner had, under the Rule, no power to direct the Income tax Officer to register the firm after obtaining the signature of Gokulcband both in the application for registration and in the deed of partnership as he did.
As a matter of fact the appellant did not ask for such permission from the Appellate Assistant Commissioner nor was any revision taken by the appellant before the Commissioner under section 33 A of the Act against the said order of the Appellate Assistant Commissioner.
The appellant contented himself with arguing that the order made by the Appellate Assistant Commissioner was justified and the sole controversy which arose between the parties and was the subject matter of the referred question was whether the Appellate Assistant Commissioner was legally competent to direct the Income 99 tax Officer to register the firm after obtaining the signature of Gokulchand both in the application for registration and in the deed of partnership.
The appellant attempted no doubt to have the words "after obtaining the signature of Seth Gokulchand both in the application for registration and in the deed of partnership" deleted from the referred question.
That attempt, however, failed and no steps were taken by the appellant before the High Court at the hearing of the reference to either have the referred question amended or reframed in order to bring into prominence his contention in regard to the powers of the Appellate Assistant Commissioner.
On the question as framed, the only answer which the High Court could give was that the Appellate Assistant Commissioner was not legally competent to direct the Income tax Officer to register the firm after obtaining the signature of Gokulchand both in the application for registration and in the deed of partnership.
Rule 2(c) above quoted did not empower the Appellate Assistant Commissioner to do anything of the sort and we are of the opinion that the answer given by the High Court in the negative was, therefore, correct.
Counsel for the appellant tried to support his argument by referring to the provisions of the earlier partnership deeds between the several partners of this firm in the years 1929 and 1941 which specifically provided that in the event of retirement, or death of, or relinquishment, of his share by a partner, the partnership will not be dissolved but will be continued, in case of death of any of the partners, by such of the partners as remained and the legal representatives or nominees of the deceased partner and in the case of retirement of any of the partners by such of the partners as remained.
We fail to understand what bearing these clauses have on the determination of the referred question.
In the result, the appeal of the appellant fails and must stand dismissed with costs.
| IN-Abs | The appellant (a firm) consisted of seven partners and a deed of partnership was executed by all the partners except one who happened to be in Jail being a security prisoner under the Defence of India Rules.
An application for registration of the firm under section 26 A of the Indian Income tax Act was made before the Incometax Officer, who, however, rejected it on the ground that the deed of partnership and the application for registration were not signed by all the partners.
On appeal, the Appellate Assistant Commissioner cancelled the order of the Income tax Officer and directed him to register the firm after obtaining the signature of the partner who had not signed before, both on the application for registration and the deed of partnership.
Held, that under Rule 2(c) of the Indian Income tax Rules, 1922, framed under section 26 A(2) of the Indian Income tax Act, the Appellate Assistant Commissioner had only the power to direct registration of the firm if an application duly signed by all the partners had been presented to him before the assessment was confirmed, reduced, enhanced or annulled and that he was not legally 92 competent to direct the Income tax Officer to register the firm after obtaining the signature of the partner who had not signed before.
|
Civil Appeal No. 2010 of 1969.
(From the Judgment and Decree dt.
11 7 68 of the Bombay High Court in Appeal No. 534 of 1960).
Girish Chandra and M. N. Shroff for the appellant.
A. G. Ratnaparkhi for the respondent.
The Judgment of the Court was delivered by KOSHAL, J.
The facts giving rise to this appeal by the two defendants (who are the State of Maharashtra and one of its Executive Engineers) on certificate granted by the High Court of Bombay against its judgment dated 11th July 1968 may be briefly stated.
In the year 1955, defendant No. 1 decided to construct an aqueduct over Kulthi Nala situated in Malegaon Sub Division of Nasik district.
The Executive Engineer, Nasik Irrigation Division, invited tenders for the work which was entrusted to the plaintiff in acceptance of his tender on conditions reduced to writing in the form of exhibit 66.
The estimated cost of the work was Rs. 1,55,854.00 and it was to be completed within 12 months from the date of the written order to commence it which happened to be the 16th of May 1955.
The plaintiff paid a sum of Rs. 1558/ as earnest money and another of Rs. 3896/ as security deposit to defendant No. 1.
Clauses (2) and (3) of the contract in accordance with which the work was to be executed provided as follows: "(2): The time allowed for carrying out the work as entered in the tender shall be strictly observed by the contractor xx xx The work shall throughout the stipulated period of the contract be proceeded with all due diligence (time being deemed to be of the essence of the contract on the part of the contractor) and the contractor shall pay as compensation an amount equal to one per cent or such smaller amount as the Superintending Engineer xx xx xx may decide xx for every day that the work remains uncommenced, or unfinished after the proper dates.
And further to ensure good progress during the execution of the work, the contractor shall be bound, in all cases in which the time allowed for any work exceeds one month, to complete 190 in 1/4 of time 1/10 of the work, in 1/2 of time 4/10 of the work, in 3/4 of time 8/10 of the work xx xx xx xx xx xx" "(3): In any case in which under any clause or clauses of this contract the contractor shall have rendered himself liable to pay compensation amounting to the whole of his security deposit xx xx xx xx or in the case of abandonment of the work owing to serious illness or death of the contractor or any other cause, the Executive Engineer xx xx xx shall have power to adopt any of the following courses: (a) to rescind the contract (of which rescission notice in writing to the contractor under the hand of the Executive Engineer shall be conclusive evidence) and in that case the security deposit of the contractor shall stand forfeited and be absolutely at the disposal of the Government.
(b) xx xx xx xx xx xx (c) xx xx xx xx xx xx In the event of any of the above courses being adopted by the Executive Engineer, the contractor shall have no claim to compensation for any loss sustained by him.
" Clauses (4) and (5) of the contract related to action to be taken when the progress of any particular portion of the work was found unsatisfactory.
Provision was made in the contract for interim payments of running bills submitted by the plaintiff and for final payment to him against a certificate of completion of the work.
Clause (6) of the contract provided for extension of time during which the work was to be completed, in pursuance of applications to be made by the plaintiff.
A provision was made in clause (14) of the contract for extension of time as a consequence of additions to or alteration in the work.
The plaintiff started executing the work and by December 1955, running payments amounting to Rs. 13,967/ in all had been made to him against bills submitted by him.
In the month of March 1956, Shri Y. A. Shinde, defendant No. 2, came to occupy the post of Executive Engineer in Nasik Irrigation Division and called upon the plaintiff to speed up the execution of the work as the progress thereof was not satisfactory.
However, the work continued to be executed at a snail 's pace and on May 9, 1956 the plaintiff made an application 191 (exhibit 54) for extension of the time fixed for completion of the work by a period of six months.
That application was rejected by defendant No. 2 who informed the plaintiff accordingly through a letter dated June 15, 1956 (exhibit 55) which stated inter alia that the reasons put forth by the plaintiff for extension of the time limit were not convincing, that the application had not been received within the time prescribed in that behalf by clause (6) of the contract and that the proportion of the work executed did not conform to the condition contained in clause (2) of the contract, the value of the work executed till then being only Rs. 25,000/ .
The letter further informed the plaintiff that he had become liable to pay compensation under clause (2) of the contract and called upon him to show cause why action should not be taken against him under clause (3) thereof.
Ultimately, by letter dated October 30, 1956 (exhibit 48) the plaintiff was informed that it had been decided to burden him with compensation at the rate of Rs. 5/ per day for the entire period commencing on the 16th of May 1956 and ending with the completion of the work and that if the plaintiff failed to show satisfactory progress within a month of the date of the letter, defendant No. 2 would be compelled to increase the rate of compensation and take suitable penal action against the plaintiff.
The work not having made much progress and the plaintiff having stopped its execution, he was informed by a letter dated January 17, 1957 (exhibit 49) that the contract stood rescinded under clause (3) thereof.
The defendants also forfeited the security deposit which had by then swelled, presumably on account of the addition of interest, to Rs. 4679/ (although this amount has been erroneously described by the High Court as consisting of the earnest money of Rs. 1558/ and the security deposit of Rs. 3896/ ).
In his suit, the plaintiff claimed a refund of the said amount of Rs. 4679/ , another sum of Rs. 2500/ on account of the balance due to him for part execution of the work and still another sum of Rs. 4000/ by way of damages.
The trial court found that the plaintiff had failed to prove that any sum was due to him for execution of the work or by way of damages, but further held that the forfeiture of the security deposit was illegal.
It therefore granted a decree to the plaintiff for the sum of Rs. 4679/ only with interest at 3 per cent per annum from the date of the suit till realisation and also proportionate costs of the suit.
Aggrieved by the decree passed by the trial court, the defendants went up in appeal to the High Court and the plaintiff filed his cross objections to the decree appealed from which was maintained by the 192 High Court in its entirety.
The High Court agreed with the findings of the trial court and on the question of rescission of the contract observed as follows: "In our view in law the contract could not be rescinded subsequent to the expiry of the due date for the performance thereof.
The right to rescind a contract is the right to put it to an end and such right cannot exist after due date for the performance expires.
The right to rescind the contract is the right to accept anticipatory breach thereof by the promissor, i.e., prior to the expiry of the date of the performance of the contract.
This right arises in favour of the promisee under section 39 of the Contract Act.
A contract cannot be abandoned by either side either by a promissor or a promisee after the expiry of the due date for performance thereof.
For the above reasons in our view the abandonment of the work of the contract as mentioned in sub clause (a) of the clause relate to (anticipatory) breach of the contract by the contractor before the due date for the performance thereof.
In this case the Executive Engineer purported to rescind the contract which had become dead some time in August 1956.
He purported to do so on the ground that the contractor had abandoned the contract some time in October 1956.
The Executive Engineer in our view, had no power under clause (3) to rescind the contract having regard to the facts and circumstances which we have already pointed out above.
The forfeiture of the security deposit on the footing that the contract was validly rescinded must be held to be unjustified and untenable.
" It was on the basis of this conclusion that the trial court 's decree for Rs. 4679/ passed in favour of the plaintiff was affirmed.
On the 9th of June 1969 however, the High Court certified the case to be a fit one for appeal by the defendants to the Supreme Court under sub clause (c) of clause (1) of article 133 of the Constitution of India.
At that stage defendant No. 1 agreed to pay the costs of the respondent in the proceedings before the Supreme Court.
Learned counsel for the appellants has challenged the correctness of the observations made by the High Court and reproduced above.
Those observations, according to him, run counter to the tenor of clauses (2) and (3) of the contract governing the execution of the work and we are of the opinion that his criticism thereof is justified.
Although in clause (2) of the contract it was specifically mentioned that time was of the essence of the agreement between the parties, all 193 that was meant was that in case the work was not completed within the time originally specified in that behalf, the plaintiff would be liable to pay such compensation for delay in execution as was fixed by the Superintending Engineer within the limits laid down in the clause.
This becomes clear not only from the provision appearing in clause (2) and stating that "the contractor shall pay as compensation an amount equal to 1 per cent or such smaller amount as the Superintending Engineer may decide for every day that the work remains uncommenced, or unfinished after the proper dates" but also from the contents of clause (3) of the contract, which would become operative only if the plaintiff renders himself liable to pay compensation [in accordance with clause (2)] or abandons the work either on account of serious illness or death or for any other cause and it is then that the contract would become liable to rescission.
Clauses (2) and (3) have to be read together and interpreted with reference to each other and their provisions, read as one single whole, clearly mean that the contract was to continue to be in force till the completion of the work or its abandonment.
The time was of the essence of the contract only in the sense that if the plaintiff completed it within the original period of one year, he would not be liable to pay any compensation but that in case he overstepped the said time limit he would have to compensate the defendants for every day of the delay in completing the work and that the right to rescission would accrue to the defendant No. 2 only when the compensation due exceeded the amount of the security deposit or the plaintiff abandoned the work.
Till the time the contract was rescinded therefore, it was fully in force and the rescission was consequently well founded, being squarely covered by clause (3) of the contract, sub clause (a) of which conferred on the Executive Engineer the right to forfeit the security deposit Far from being illegal, the forfeiture was fully justified and the High Court 's finding to the contrary is liable to be reversed.
In the result the appeal succeeds and is accepted, the decree of the High Court is set aside and the suit of the plaintiff is dismissed in its entirety.
In accordance with the undertaking given by defendant No. 1 on the 9th June 1969 to the High Court when it certified the case to be a fit one for appeal to this Court, the plaintiff shall be entitled to the costs incurred by him in this Court.
In respect of costs in the two courts below, we make no order.
P.B.R. Appeal allowed.
| IN-Abs | Clause (2) of a works contract entered into by the plaintiff (respondent) with the defendant (appellant) stipulated that time was of the essence of the contract, that time (of one year) allowed for carrying out the work shall be strictly observed by the contractor, and that the contractor shall pay compensation at a certain percentage for every day when the work remained unfinished after the proper dates.
One of the three courses open to the defendant under cl.
(3) was to rescind the contract in case the contractor rendered himself liable to pay compensation or abandoned the work owing to serious illness or death of the contractor or any other cause and in that event security deposit of the contractor was to stand forfeited.
It was also provided in that clause that in the event of any of the above courses being adopted by the defendant the contractor shall have no claim to compensation for any loss sustained by him.
The work remained unfinished beyond the stipulated time.
The defendant rejected the contractor 's request for extension of time and eventually rescinded the contract under cl.
(3) and forfeited the security deposit.
In the plaintiff 's suit for refund of security deposit and payment of certain other sums, the trial court, holding that the forfeiture of security deposit was legal, granted a decree for its refund.
On appeal the High Court held that the right to rescind a contract being a right to put an end to it, it could not exist after the date for its performance had expired and that in this case the right of rescission having been exercised after the expiry of the date of contract, the impugned action of the defendant in rescinding the contract was unjustified.
Allowing the appeal, ^ HELD: 1.
The rescission of the contract was well founded and the forfeiture of the security deposit was justified.
[193 F] 2.
Although cl.
(2) specifically mentioned that time was of the essence of the contract, all that was meant was that in case the work was not completed within the originally specified time, the plaintiff would be liable to pay such compensation for delay in execution as was fixed within the limits of that clause.
This is clear not only from clause (2) but also from clause (3).
These two clauses must be read together.
So read, the contract was to continue to be in force till the completion of the work or its abandonment.
Time was of the essence only in the sense that if the plaintiff completed it within the original period of one year, he would not be liable to pay any compensation but in case he overstepped that limit he would have to compensate for every day of delay and that the right 189 to rescission would accrue only when compensation due exceeded the amount of the security deposit or the plaintiff abandoned the work.
Till the time it was rescined, the contract was in force.
[193 A C]
|
N: Criminal Appeal No. 245 of 1975.
Appeal by Special Leave from the Judgement and order dated 25 3 1975 of the Delhi High Court in Criminal Appeal No. 122/72.
Harjinder Singh for the Appellant.
E. C. Agarwala and R. N. Sachthey for Respondent No. 1 V. section Desai, B. P. Maheshwari and Suresh Sethi for Respondent No. 2.
The Judgment of the Court was delivered by KOSHAL, J.
This is an appeal by special leave against a judgment of the High Court of Delhi dated 25th March, 1975 convicting the appellant of an offence under clause (i) of sub section (1) of section 16 read with clause (i) of section 7 of the (hereinafter called the Act) and sentencing him to rigorous imprisonment for six months and a fine of Rs. 1000/ , the sentence in default of payment of fine being rigorous imprisonment for three months.
The facts giving rise to the appeal may be briefly stated.
Food Inspector V. P. Anand, (P.W.2) visited the premises of Messrs Mebrose Ice Cream and Frozen Food Co. (which carries on business in Greater Kailash No.1, a locality of New Delhi and is hereinafter referred to as the Company) on the 22nd May 1970 and bought for 315 purposes of analysis a sample of chocolate ice cream from the appellant who was one of the employees of the Company.
An inventory of the sample was prepared by the Food Inspector and at the foot of the same the appellant made the following endorsement: "A sample of Chocbar Ice Cream (Chocolate Ice Cream) manufactured by Mebrose Ice Cream and Frozen Food Co., M 67, Greater Kailash, given as per above.
This Ice Cream Chocolate is of one lot.
This is prepared of covering Chocolate, vegetable ghee and Ice Cream.
" The sample was forwarded to the Public Analyst who thus details the conclusions arrived at by him on analysis thereof, in report exhibit PE: "Total solids by Weight : 45 per cent.
Protein by weight: 4.4 per cent.
Chocolate: Present.
Butyro refractometer reading at 40 degree C of the fat extracted from ice cream: 49.4.
Baudouin test of the extracted fat: Positive.
Melting point of the extracted fat: 34 degree C." In his report the Public Analyst further stated that in his opinion the sample was adulterated "as the Butyro refractometer reading at 40 degree C was round 6.4 in excess and the Baudouin test was found positive of the extracted fat. . " A complaint was lodged by the Municipal Corporation of Delhi against the appellant, the Company and its managing partner Avtar Singh in respect of an offence under section 7 read with section 16 of the Act.
The trial court acquitted the Company but convicted the other two accused, sentencing each of them to rigorous imprisonment for six months and a fine of Rs. 1000/ , the sentence in default of payment of fine being rigorous imprisonment for four months.
Both the convicts appealed to the Sessions Court and were acquitted by an order dated 9th March 1972 passed by an Additional Sessions Judge.
The Municipal Corporation of Delhi then knocked at the door of the High Court which upheld the acquittal of Avtar Singh but convicted and sentenced the appellant as aforesaid by the impugned judgment, mainly for the reasons reproduced below: "It is established on the record beyond doubt that this endorsement was made by Kishan Chand and it contains an admission that vegetable ghee was used in the preparation of 316 the ice cream sold by him.
The judgment of the learned Additional Sessions Judge reveals that the contention of the defence before him was that Vanaspati was used in the preparation of the relevant ice cream by way of emulsifier but the plea was misconceived because vegetable ghee cannot be made to serve as an emulsifying agent.
A reference to the Prevention of Food Adulteration Rules, 1955 shows that as per Rule 60 'brominated ' vegetable oil is one of the recognised emulsifying and stabilising agents but Rule 61 forbids addition of brominated vegetable oil to milk or cream and without milk and/or cream manufacture of ice cream is inconceivable.
Moreover, the stand of the accused from the very start has been that 'vegetable ghee ' had been used in the preparation of ice cream and not that any 'brominated ' vegetable oil got into the ice cream by way of an emulsifying or stabilising agent.
The evidence would not countenance the contention raised before us.
" 3. Having heard learned counsel for the parties at length we are of the opinion that the sample in question is not shown to have been adulterated within the meaning of the Act.
The case is admittedly governed by the Prevention of Food Adulteration Rules 1955 which have been framed by the Central Government in exercise of the powers conferred on it by section 23 of the Act and which are hereinafter called the Rules.
Rule 60 defines "emulsifying agents" and "stabilising agents" to mean substances which, when added to food, are capable of facilitating a uniform dispersion of oils and fats in aqueous media, or vice versa, and/or stabilising such emulsions.
The rule then proceeds to specify numerous agents of the type mentioned and they include brominated vegetable oils.
Rule 61 declares that no emulsifying or stabilising agents shall be used in any food except where their use is specifically permitted.
A proviso added to the rule states that certain emulsifying or stabilising agents, including brominated vegetable oils, shall not be used in milk and cream.
Appendix B to the Rules specifies the standard of quality of various articles of food.
Milk and milk products are dealt with in that Appendix under Group A.11 which is divided into various items.
Item A.11.01 which is further divided into sub items A 11.01.01 to A 11.01.11 contains definitions and standards of purity of various kinds of milk.
Item A.11.02 defines milk products thus: "MILK PRODUCTS means the products obtained from milk such as cream, malai, curd, skimmed milk curd, 317 chhanna, skimmed milk chhanna, cheese, processed cheese, ice cream, milk ices, condensed milk sweetened and unsweetened, condensed skimmed milk sweetened and unsweetened, milk powder, skimmed milk powder, partly skimmed milk powder, khoa, infant milk food, table butter and deshi butter.
" Then follow definitions of different kinds of milk products in sub items A.11.02.01 to A.11.02.21.
"Cream" is defined as follows in sub item A.11.02.02: "CREAM excluding sterilised cream means the product of cow or buffalo milk or of a combination thereof which contains not less than 25.0 per cent milk fat.
" Chocolate ice cream forms the subject matter of sub item A.11.02.08 which runs thus: "ICE CREAM, KULFI, AND CHOCOLATE ICE CREAM mean the frozen product obtained from cow or buffalo milk or a combination thereof or from cream, and/or other milk products, with or without the addition of cane sugar, eggs, fruits, fruit juices, preserved fruits, nuts, chocolate, edible flavours and permitted food colours.
It may contain permitted stabilizers and emulsifiers not exceeding 0.5 per cent by weight.
The mixture shall be suitably heated before freezing.
The product shall contain not less than 10.0 per cent milk fat, 3.5 per cent protein and 36.0 per cent total solids except that when any of the aforesaid preparations contain fruits or nuts or both, the content of milk fat may proportionately reduced but shall not be less than 8.0 per cent by weight.
"Starch may be added to a maximum extent of 5.0 per cent under a declaration on a label as specified in sub rule (2) of Rule 43. "The standards for ice cream shall also apply to softy ice cream." From the above examination of the provisions of Appendix B to the Rules, it is clearly made out that the standard of purity for each milk product has been separately laid down and that ice cream, kulfi and chocolate ice cream are treated as a class by themselves, which is different, for the purpose of purity from other milk products including cream.
The classification employed leaves no room for doubt that 318 when the proviso to rule 61 states that certain emulsifying and stabilising agents shall not be used in milk and cream, it prohibits the use of those agents only in milk and one of its products, namely, cream and not other milk products such as malai, dahi, cheese, ice cream and chocolate ice cream.
Had the rule making authority meant by the proviso to prohibit the use of the said agents in all milk products, the expression used would have been "shall not be used in milk and milk products" and not "shall not be used in milk and cream".
The prohibition contained in the proviso thus does not apply to ice cream, kulfi, chocolate ice cream covered by sub item A.11.02.08, wherein it is clearly stated that these three milk products may contain permitted stabilisers and emulsifiers not exceeding, 0.5 per cent by weight.
In equating the words "milk and cream" with milk and all its products, the high Court was clearly in error and this is so in spite of the fact that ice cream, kulfi and chocolate ice cream must have milk or cream as a necessary ingredient.
It follows that brominated vegetable oils could have formed a part of the chocolate ice cream sold by the appellant, to the extent 0.5 per cent by weight, without the article being treated as adulterated under the Rules.
Before the appellant could be convicted, therefore, it was incumbent on the prosecution to establish that the sample taken from him contained either brominated vegetable oils or other permitted stabilisers and emulsifiers exceeding 0.5 per cent by weight or that it did not conform to the prescribed standard in some other detail.
Apart from falling into the error of misreading rules 60 and 61, the High Court considered the sample taken from the appellant to be adulterated by reason of the stand he had taken from the very beginning to the effect that he had used "vegetable ghee" in the preparation of the chocolate ice cream and because, according to the High Court, "vegetable ghee" was not brominated vegetable oil.
This is again an erroneous approach to the problem in hand.
It was for the prosecution to prove affirmatively that the sample in, question contained an ingredient which made it adulterated and any stand taken by the accused could hardly be used as evidence, unless its truth was otherwise established which is not the case.
All that was made out from the evidence before the court was that the Butyro refractometer reading at 40 degree C was higher than the maximum prescribed for milk fat by 6.4 and that the Baudouin test was positive.
These two factors indicated that either vanaspati or milk fat to which til oil had been added was one of the ingredients of the sample.
There is not an iota of evidence on the record to show whether or not such til oil was brominated, which means that the prosecution had completely failed to prove that the ingredient objected to by it was a substance other than 319 a brominated vegetable oil or that if it was oil of that description its quantity was in excess of 0.5 per cent by weight.
The Butyro refractometer reading did no doubt except the maximum of the prescribed standard by 6.4 and the Baudouin test was also positive but these factors did not indicate the presence in the sample of brominated vegetable oil beyond the prescribed maximum of 0.5 per cent by weight or of unbrominated vegetable oils.
The sample of chocolate ice cream obtained by the Food Inspector from the appellant not having been shown to be adulterated, the appeal is accepted, the judgment of the High Court in so far as it relates to the appellant is reversed, the conviction recorded against and the sentence imposed upon the appellant by the High Court are set aside and he is acquitted of the charge.
The bail bond executed by him shall stand cancelled.
P.B.R. Appeal allowed.
| IN-Abs | Rule 60 of the Prevention of Food Adulteration Rules, 1955 defines "emulsifying agents" and "stabilising agents" to mean substances which, when added to food, are capable of facilitating a uniform dispersion of oils and fats in acqueous media or vice versa and/or stabilising such emulsions.
One of the agents mentioned, among others, in the rule is brominated vegetable oils.
Rules 61 declares that no emulsifying or stabilising agents shall be used in any food except where they are used as specifically permitted.
The proviso to the rule states that certain emulsifying or stabilising agents including brominated vegetable oils shall not be used in milk and cream.
A food inspector visited an Ice cream factory and collected a sample of chocolate ice cream.
In the inventory of the sample prepared by him it was stated that "this is prepared of covering chocolate, vegetable ghee and ice cream".
The Public Analyst, to whom the sample was sent for analysis, stated that the sample was adulterated "as the butyro refractometer reading at 40 degree C was found 6.4 in excess and the Baudouin test was found positive of the extracted fat.
" The factory, its owner and the employee who sold the ice cream, were prosecuted under the Prevention of Food Adulteration Act.
The trial court acquitted the factory but convicted and sentenced both its owner and the employee.
On appeal the Additional Sessions Judge acquitted both the accused.
On further appeal the High Court acquitted the factory owner but convicted the employee (appellant before this Court).
The High Court pointed out that vegetable ghee could not be made to serve as an emulsifying agent because r. 61 forbids addition of brominated vegetable oil to milk or cream and without milk and/or cream manufacture of ice cream was inconceivable and that the appellant 's stand had been that vegetable ghee had been used and not that any brominated vegetable oil got into the ice cream by way of an emulsifying or stabilising agent.
Allowing the appeal, ^ HELD: 1 (a) The sample of ice cream obtained from the appellant was not shown to have been adulterated within the meaning of the Act and the Rules.
[316 D] (b) The prohibition contained in the proviso to r. 61 does not apply to ice cream, kulfi and chocolate ice cream covered by sub item A.11.02.08, wherein it is clearly stated that these three milk products may contain permitted stabi 314 lisers and emulsifiers not exceeding 0.5 per cent by weight.
Clearly, therefore, brominated vegetable oils could have formed a part of the chocolate ice cream to the extent of 0.5 per cent by weight, without the article being treated as adulterated under the rules.
What the proviso to r. 61 prohibits is the use of certain emulsifying and stabilising agents only in milk and one of its products, namely, cream and not in other milk products such a malai, dahi, cheese, ice cream and chocolate ice cream.
Had the intention of the rule been to prohibit the use of the said agents in all milk products, the expression would have been "shall not be used in milk and milk products" and not "shall not be used in milk and cream".
[318 C E] 2.
It was for the prosecution to prove affirmatively that the sample contained an ingredient which made it adulterated and any stand taken by the accused could hardly be used as evidence, unless its truth was otherwise established.
The prosecution had completely failed to prove that the ingredient objected to by it was a substance other than a brominated vegetable oil or that if it was oil of that description, its quantity was in excess of 0.5% by weight.
The analyst 's report did not indicate the presence in the sample of brominated vegetable oil beyond the prescribed maximum of 0.5% by weight or of unbrominated vegetable, oils.
[318G H]
|
N: Criminal Appeal Nos.
126 127 of 1972.
(From the Judgment and Order dt.
21 4 72 of the Gujarat Court in Criminal Revision Appln.
490 491 of 1971).
section K. Dholakia and R. Ramachandran for the appellants.
section P. Nayar and M. N. Shroff for the respondents.
The Judgment of the Court was delivered by KOSHAL, J.
By this judgment we shall dispose of Criminal Appeals Nos. 126 and 127 of 1972 both of which have been instituted on certificates granted under Article 134(1) (c) of the Constitution of India by the High Court of Gujarat against the judgment dated April 21, 1972 of a Division Bench of that Court upholding the conviction of each of the appellants under section 4 or section 5 of the Bombay Prevention of Gambling Act 1887 (hereinafter referred to as the Bombay Acc) and a sentence of imprisonment coupled with fine.
Appeal No. 126 of 1972 has been filed by eight persons.
Appellant No. 1 has been convicted of an offence under section 4 of the Bombay Act for keeping a common gaming house, while his seven co appellants were found guilty of an offence under section 5 of that Act.
In Criminal Appeal No. 127 of 1972, appellant No. 1 is the same person who figures as appellant No. 1 in the former appeal and the conviction recorded against him is one for an offence under section or, in the alternative, under section 5 of the Bombay Act.
His two co appellants have earned a conviction under the section last mentioned.
The two appeals have arisen from Criminal Revisions Nos.
490 A and 491 of 1971 both of which were dismissed by the High Court through the impugned judgment.
In Appeal No. 126 of 1972, appellant No. 1 was said to be keeping or using house No. 1408 situate in Ward No. 1 of Himatnagar town as a common gaming house and appellants Nos. 2 and 3 were said to have been employed by him for carrying on in that house the business of betting on Worli Matka figures.
On a search by the police, appellants Nos. 2 to 8 were found present in the house from which numerous betting slips and boards indicating the opening and closing figures of Worli Matka betting were recovered.
A personal search of appellants Nos. 2 and 3 yielded counterfoils of the said slips.
The allegations against the three appellants in criminal appeal No. 127 of 1972 were that all of them were found present for the purpose of gaming in the said house which was, as already stated, being rum by appellant No. 1 as a common gaming house.
The only contention raised on behalf of the appellants before the High Court was that the said house had not been proved to be a "common gaming house" within the meaning of the definition of that expression occurring in section 3 of the Bombay Act.
That definition runs thus In this Act, "common gaming house" means (i) in the case of gaming (a) on the market price of cotton, opium or other commodity or on the digits of the number used is stating such price, or (b) on the amount of variation in the market price of any such commodity or on the digits of the number used in stating the amount of such variation, or (c) on the market price of any stock or share or on the digits of the number used in stating such price, or G (d) on the occurrence or non occurrence of rain or other natural event, or (e) on the quantity of rainfall or on the digits of the number used in stating such quantity, or (f) on the pictures, digits or figures of one or more playing cards or other documents or objects bearing numbers, or on the total of such digits 36 or figures, or on the basis of the occurrence or non occurrence of any uncertain future event, or on the result of any draw, or on the basis of the sequence or any permutation or combination of such pictures, digits, figures, numbers, events or draws any house, room or place whatsoever in which such gaming takes place or in which instruments of gaming are kept or used for such gaming: (ii) in the case of any other form of gaming, any house, room or place whatsoever in which any instruments of gaming are kept or used for the profit or gain of the person owning, occupying, using or keeping such house, room or place by way of charge for the use of such house, room or place or instrument or other wise howsoever.
" Clause (i) of the definition is obviously inapplicable to the cases in hand and the plea of the prosecution has throughout been that the house in question squarely falls within clause (ii) thereof.
This plea was challenged before the High Court on behalf of the appellants with the contention that the house abovementioned had not been shown to be kept for use "for the profit or gain of the person owning, occupying . . " because, according to their learned counsel, the profit or gain mentioned in the definition must have a direct relation with the use of the premises or with the instruments of gaming and a mere expectation or probability of profit arising from gaming itself would not be sufficient to bring the place within the definition of a common gaming house.
The High Court noted that there was a clear distinction between the language employed in the two clauses of the definition so that while the element of profit or gain of the person owning or occupying the premises in question was immaterial under clause (i), it was an essential requirement of clause (ii) which deals with forms of gaming not covered by sub clauses (a) to (f) of clause (i).
The High Court therefore analyses the provisions of clause (ii) and formed the opinion that the expression "or otherwise howsoever" occurring therein had the widest amplitude and did not take its colour from the immediately preceding portion of the clause which employs the words "by way, of charge for the use of such house, room or place or instrument".
Discussing the matter further the High Court was of the opinion that the requirement of the expression "for the profit and gain of the person owning, occupying. " was that the purpose of occupying or using the premises must be such profit or gain as meant a probability 37 Or expectation of profit or gain and not necessarily a certainty of it A and that the expression would embrace even a case where the keeper of the premises expected to gain by the process of gaming itself.
In coming to this conclusion, the High Court relied upon two Division Bench judgments of the Bombay High Court reported in Emperor vs Dattatraya Shankar Paranjpe and another(1) and Emperor vs Chimanlal Sankalchand(Z) and rejected as untenable an opinion to the contrary expressed in some Allahabad cases and a single Bench decision of the Bombay High Court in State vs Vardilal Natuchand, (Criminal Appeal No. 551 of 1964 decided on the 14th of January 1965).
The argument raised before the High Court on behalf of the appellants has been reiterated before us by their learned counsel, Shri section K. Dholakia, but on a consideration of the definition extracted above, we cannot agree with him.
It is common ground between the parties that the present case is not covered by clause (i) of the definition so that what has to be considered is the language of clause (ii) thereof.
For the applicability of the clause last mentioned, the following conditions have to be fulfilled: D (1) Instruments of gaming must be kept or used in the premises in question.
(2) The keeping or using of the instruments aforesaid must be for the profit or gain of the person owning, occupying, using or keeping such premises.
(3) Such profit or gain may be by way of charge for the use of the premises or of the instruments or in any other manner whatsoever.
We fully agree with the High Court that the expression "or otherwise howsoever" is of the widest amplitude and cannot be restricted F. in its scope by the words immediately preceding it which lay down that the profit or gain may be by way of charge for the use of the premises.
In this connection we may usefully quote from the judgment of Shah, Acting C.J., who delivered the judgment of the Division Bench in Emperor vs Dattatraya Shankar Paranjpe, (Supra).
"It is essential for the prosecution under this definition to establish that instruments of gaming were kept or used in he house, room or place for profit or gain of the person owning, occupying, using or keeping the house, room or place.
It may be done by establishing that the person did so either by a charge for use of the instruments of gaming or of the house, room or place, or otherwise howsoever.
The (1) 25 Bombay Law Reporter 1089 = A.I.R. 1924 Bombay 184.
(2) 47 Bombay Law Reporter 75 = A.I.R. 1945 Bombay 305.
38 expression "otherwise howsoever" appears to be very com prehensive, and does not suggest any limitation, such as is contended on behalf of the accused." . . . . . . . . . . . . . . . "We have heard an interesting argument on the question as to how far the words justify the somewhat restricted meaning which has been put upon the definition by the learned Judge of the Allahabad High Court; and after a careful consideration of the arguments urged on either side, and with great respect to the learned Judges, I have come to the conclusion that the words of the definition which we have to construe here would not have their full meaning if we were to accept the narrow construction.
I do not think that on a proper construction of the definition the prosecution can be restricted for the purpose of proving that a particular house, room or place is a common gaming house, to the two alternatives mentioned in the case of Lachchi Ram vs Emperor( ').
It is sufficient if the house is one in which instruments of gaming are kept or used for the profit or gain of the person keeping or using such place, i.e., where the person keeping or using the house knows that profit or gain 4 15 Will in all probability result from the use of the instruments of gaming.
The profit or gain may not actually result from such use.
But if profit or gain is the probable and expected result of the game itself and if that is the purpose of keeping or using the instruments, it would be sufficient, in my opinion, to bring the case within the scope of the definition.
At the same time it is clear that the prosecution must establish that the purpose is profit or gain.
This may be done either by showing that the owner was charging for use of the instruments of gaming or for the use of the house, room or place, or in any other manner that may be possible under the circumstances of the case, having regard to the nature of the game carried on in that house.
" The opinion of Shah, Acting C.J., was noted with approval in Emperor vs Chimanlal Sankalchand (supra), the reasoning adopted in which may be reproduced with advantage: "Lachchi Ram 's case was considered by a Division Bench of this Court in Emperor vs Dattatraya (1923) 25 Bombay (1) A.l.
R. 1922 All.
61. 39 Law Reporter (1089) and was dissented from.
It was held that to constitute a common gaming house it was sufficient if it was one in which instruments of gaming were kept or used for the profit or gain of the person keeping or using such place, i.e., where the person keeping or using the house knew that profit or gain would in all probability result from the use of the instruments of gaming.
The profit or gain may not actually result from such use.
But if profit or gain is the probable and expected result of the game itself and if that is the purpose of keeping or using the instruments, it would be sufficient to bring the case within the scope of the definition.
C "It is argued by Mr. Pochaji on behalf of the accused that even in that case it was observed that 'the prosecution must establish that the purpose was profit or gain and that that might be done either by showing that the owner was charging for the use of the instruments of gaming or for the use of the room or place or in any other manner. ' The words 'or in any other manner, ' (which were used there instead of the words appearing at the end of the definition ' 'or otherwise howsoever ') cannot be regarded as restricting the profit or gain of the owner or occupier of the house to profit or gain in a manner ejusdem generis with what pre cedes those words, and hence even the hope of making a profit out of the gambling itself is sufficient to satisfy the requirement of the definition of common gaming house.
It may happen that the occupier of a house may allow it to be used by the public for gambling and he himself may take part in it in the hope of making a profit, although he may not necessarily make it every time.
Such a hope is sufficient to make the house a common gaming house and the occupier liable for keeping such a house.
" We fully agree with the interpretation of the definition of the term "common gaming house" occurring in section 3 of the Bombay Act as propounded in, the two Bombay authorities cited above, as also in the impugned judgment, that interpretation being in conformity with the unambiguous language employed by the legislature.
The opinion to the contrary expressed in Lachchi Ram 's case (supra) and in other decisions is found to be incorrect.
The learned counsel for the appellants concedes that if the interpretation placed on clause (ii) of the definition by the impugned judgment be upheld, the conviction of the appellants in the two appeals 40 is well founded.
However, we may state that there is another good reason for up holding the conviction and that flows from the presumption which has to be raised under section 7 of the Bombay Act which states: "When any instrument of gaming has been seized in any house, room of place entered under section 6 or about the person of any one found therein, and in the case of any other thing so seized if the court is satisfied that the Police Officer who entered such house, room or place had reason able grounds for suspecting that the thing so seized was an instrument of gaming, the seizure of such instrument or thing shall be evidence, until the contrary is proved, that such house, room or place is used as a common gaming house and the persons found therein were then present for the purpose of gaming, although no ' gaming was actually seen by the Magistrate or the Police Officer or by any person acting under the authority of either of them: Provided that the aforesaid presumption shall be made, notwithstanding any defect in the warrant or order in pursuance of which the house, room or place was entered under section 6.
if the Court considers the defect not: to be a material one.
" It is not disputed that instruments of gaming were seized from the premises in question in both the appeals.
That circumstances, according to the section, "shall be evidence, until the contrary is proved, that such house, room or place is used as a comon gaming house and the persons found therein were present for the purpose of gaming, although no gaming was actually seen . " .
The profit or gain mentioned in clause (ii) of the definition and also the other requirements of that clause are a matter of peremptory presumption which has to be raised by the court as soon as the seizure of instruments of gaming from the place in question is proved, as is the case here.
Admittedly, there is no evidence in rebuttal of the presumption which must therefore be raised and which furnishes a good basis for the conviction of the appellants.
In the result both the appeals fail and are dismissed.
P.B.R. Appeals dismissed.
| IN-Abs | The term "common gaming house" has been defined in section 3 of the Bombay `Prevention of Gambling Act, 1887.
Under cl.
(i) of the section a house or place in which any of six different types of gaming enumerated therein takes place or in which instruments of gaming are kept or used for such gaming would fall within the definition.
Clause (ii) of that section states that in the case of any other form of gaming (a) any house, room or place whatsoever in which any instruments of gaming are kept or used (b) for the profit or gain of the person owning, occupying, using or keeping such house, etc., (c) by way of charge for the use of such house, room or instrument or otherwise howsover, would be a common gaming house.
Certain instruments of gaming were seized by the police from the premises of appellant No. 1 in both the appeals.
He was convicted for keeping a common gaming house while the other appellants were convicted of an offence under section 5 of the Act.
On appeal, rejecting the appellants ' contention that a mere expectation or probability of profit arising from gaming, without establishing a direct relation with the use of the premises or with instruments of gaming, would not be sufficient to bring the place within the scope of the definition, the High Court held that the purpose of occupying or using the premises must be such profit or gain as meant a probability or expectation of profit or gain and not necessarily a certainty of it.
F The argument urged before the High Court was reiterated in appeal before this Court.
Dismissing the appeals, ^ HELD: 1.
The expression "or otherwise howsoever" is of the widest amplitude and cannot be restricted to the words immediately preceding it, namely, "for profit or gain. by way of charge for the use of the premises." [37F] 2.
For proving that a particular house, room or place was a common gaming house, it would be sufficient if it was shown that the house was one in which instruments of gaming were kept or were used for the profit or gain of the person keeping or using such place, that is, where the person keeping or using the house knew that profit or gain would in all probability la result from the use of the instruments of gaming.
Profit or gain may not actually result from such use.
Even the hope of making a profit out of the 34 gambling would be sufficient to satisfy the definition.
In given case the occupier of a house may allow it to be used by the public for gambling and he himself may take part in it in the hope of making profit although he may not necessarily make it every time.
Such a hope would be sufficient to make the house a common gaming house and the occupier liable for keeping such a house.
At the same time the prosecution must establish that the purpose of keeping or using the instruments was profit or gain, which may be done either by showing that the owner was charging for use of the instruments of gaming or for the use of the house, room or place or in any other manner that may be possible having regard to the nature of the game carried [38E, 39E F] 3.
The profit or gain and the other requirements mentioned in cl.
(ii) of the definition are a matter of peremptory presumption which has to be raised by the court as soon as seizure of instruments of gaming from the place is proved.
Section 7 which allows a presumption to be raised against the accused, provides that seizure of instruments of gaming from the premises shall be evidence, until the contrary was proved, that they were used as a common gaming house and the persons found therein were present for the purpose of gaming, although no gaming was actually seen.
In the instant case there is no evidence in rebuttal of the presumption.
[40F Gl
|
Civil Appeal No. 2434 of 1977.
Appeal by Special Leave from the Judgment and Order dated 4/5th November, 1976 of the Gujrat High Court in S.A. No. 685/69.
U. R. Lalit (A.C.),1.
N. Shroff and H. section Parihar for the Appellant.
section T. Desai, Vimal Dave and Miss K. Mehta for the Respondent.
The Judgment of the Court was delivered by, KOSHAL, J.
The facts giving rise to this appeal by special leave against a decree dated November 5, 1976 of the High Court of Gujarat 294 may be better appreciated with reference to the following pedigreetable: NARANJI | | Dahyabhai Haribhai | | | | Ranchhodji | | | | Bhimbhai Mohanbhai (died childless in | 1913) | | | Parvatiben=Dayalji Dahyabhai (Plaintiff 8 (Plaintiff 7 | | | | | Bhikhubhai Thakorbhai Nirmalben Padmaben (Plaintiff 5) (Plaintiff 6) (Plaintiff 7) (Plaintiff 10) NARANJI (contd. ) | | Gulabhai Vallabhhai | | Motabhai | | | Nichhabhai= Surbhai | Amba Bai Bai Vijia | (Defendant 1) | | | | | Ghelabhai Lallubhai Chhotubhai Manibhai | (Plaintiff 3) (Plaintiff 4) | | Thakorbhai Ramanbhai (Plaintiff 1) (Plaintiff 2) 2.
In the year 1908 Ranchhodji son of Dahyabhai instituted Civil Suit No. 403 of 1908 against Bhimbhai son of Haribhai, Dayalji and Dahyabhai sons of Mohanbhai, Motabhai son of Gulabbhai, Bai Amba widow of Nichhabhai and Bai Vajia widow of Surbhai, for a partition of the joint Hindu family properties belonging to the parties.
The suit resulted in a decree dated August 18, 1909 which provided, inter alia, that Dayalji and Dahyabhai sons of Mohanbhai, and Motabhai son of Gulabbhai would be full owners of Survey Nos. 31 and 403 and also owners of a half share in Survey Nos. 591, 611, 288 295 and 659/3.
These persons were burdened by the decree with the responsibility to pay an yearly maintenance allowance of Rs. 42/ to Bai Vajia on Magsher Sud 2 of every year and the decree further provided that in the event of default in payment of such allowance continuing for a period of a month after the due date, Bai Vajia would be entitled to take possession of the land above mentioned in lieu of the maintenance awarded to her and would enjoy the income thereof without however being competent to sell, mortgage, bequeath, gift or otherwise transfer the same.
The decree declared that any alienation made by Bai Vajia in contravention of the direction given by the decree in that behalf would be void.
By clause 8 of the decree sons of Mohanbhai as well as Motabhai were also deprived of the right of alienation of the land during the lifetime of Bai Vajia.
Default having been made in the payment of maintenance to Bai Vajia according to the terms of the decree, she took out execution and obtained possession of the land above detailed.
Thereafter Dayalji and Dahyabhai sons of Mohanbhai deposited in court the arrears of maintenance and filed an application with a prayer that the land of which possession had been given to Bai Vajia in execution of the decree be restored to them.
That application was dismissed on the 8th March 1912 and more than 2 1/2 years later, i.e., on 27th October 1914, Dahyabhai son of Mohanbhai instituted Civil Suit No. 576 of 1914 in the court of the Additional Sub Judge, Valsal, for a declaration that the dismissal of his application was null and void and for recovery of possession of the land which Bai Vajia had taken in execution of the decree.
The suit was decreed by the trial court but was dismissed in first appeal on the 13th March 1918.
Bai Vajia continued to enjoy the land till the 21st October 1963 when she made a sale of Survey No. 31 in favour of one Dhirubhai Paragji Desai.
The sale was challenged in Civil Suit No. 110 of 1966 by 10 persons being the heirs of Mohanbhai and Motabhai as shown in the pedigree table above, the defendants being Bai Vajia and the said Dhirubhai Paragji Desai.
It was claimed by the plaintiffs that Bai Vajia had no right to alienate in any manner the land obtained by her in execution as per the terms of the decree, that sub section (1) of section 14 of the (hereinafter referred to as the Act) had no application to her case which was covered by sub section (2) of that section and that the sale by her in favour of defendant No. 2 was null and void.
Bai Vajia contested the suit and contended that the sale was good in view of the provisions of subsection (1) abovementioned which enlarged her limited ownership 296 into full and absolute ownership and that sub section (2) aforesaid did not cover her case.
The suit was decreed by the trial court and Bai Vajia remained unsuccessful in the appeal which she instituted in the court of the District Judge, Bulsar.
A second appeal was filed by her before the High Court of Gujarat and during the pendency thereof she expired when one Dhirubhai Dayalji Desai was substituted for her as her sole heir and legal representative.
The appeal came up for hearing before a learned Single Judge of the High Court who by its judgment dated 5th November, 1976 dismissed it holding that the decree passed in Civil Suit No. 403 of 1908 did not recognise any "pre existing" right of Bai Vajia in the property in dispute.
In coming to this conclusion, the learned Judge followed Naraini Devi vs Smt.
Ramo Devi and others.(1) The legal representative of Bai Vajia is the sole appellant in the appeal before us, the respondents thereto being nine of the plaintiffs and six legal representatives of plaintiff No. 5 as also the purchaser from Bai Vajia who is arraigned as respondent No. 11.
At the outset it was pointed out by Mr. I. N. Shroff, learned counsel for the appellant, that Naraini Devi 's case (supra) has since been over ruled by the decision of this Court in V. Tulasamma & others vs V. Sesha Reddi(2) and we find that this is so.
In the case last mentioned, the facts were these.
The husband of Tulasamma died in the year 1931 in a state of jointness with his step brother V. Sesha Reddi.
A decree for maintenance was passed in favour of Tulasamma against V. Sesha Reddi on June 29, 1946.
On the 30th July 1949, a compromise between the contending parties was certified by the Court executing that decree.
Under the compromise, Tulasamma was allotted certain properties in lieu of maintenance, her right being limited to enjoyment thereof coupled with the specific condition that she would not have any right of alienation whatsoever.
Tulasamma took possession of those properties and continued to enjoy them till the early sixties.
On 12th of April 1960 she leased out some of the properties to two persons and on the 26th of May 1961 made a sale of some others to another person.
V. Sesha Reddi filed a suit on July 31, 1961 for a declaration that the alienations made by Tulasamma were not binding on him and could remain valid only so long as she was alive.
The basis of the action was that Tulasamma acquired a restricted estate under the terms of the compromise and that her interest could not be enlarged under sub section (1) of section 14 of the Act in view of sub section (2) of that section.
The 297 suit was decreed by the trial court whose decision however was reversed in appeal by the District Judge, with a finding that the allotment of properties to Tulasamma by the terms of the compromise had been made in recognition of a "pre existing" right a finding which was reversed by the High Court, who restored the decree passed by the trial court.
The matter came up to this Court in appeal by special leave and Fazal Ali, J., who wrote an exhaustive judgment thus formulated the two points falling for determination: (1) Whether the instrument of compromise under which the properties were given to the appellant Tulasamma before the in lieu of maintenance falls within section 14(1) or is covered by section 14(2) of that Act.
(2) Whether a Hindu widow has a right to property in lieu of her maintenance, and if such a right is conferred on her subsequently by way of maintenance it would amount to mere recognition of a pre existing right or a conferment of new title so as to fall squarely within section 14(2) of the .
Fazal Ali, J., was of the opinion that the resolution of the dispute made it necessary that the real legal nature of the incidents of a Hindu widow 's right to maintenance be considered.
He referred to various works by celebrated authors on Hindu Law and in doing so cited passages from 'Digest of Hindu Law ' by Colebrooke, 'Hindu Law ' by G. section Sastri, 'Hindu Law and Usage ' by Mayne and 'Principles of Hindu Law ' by Mulla and came to the conclusion that the widow 's right to maintenance, though not an indefeasible right to property, is undoubtedly a "pre existing" right.
A survey of various judicial pronouncements was then undertaken by Fazal Ali, J., and as a consideration thereof he arrived at the following propositions : "(1) A Hindu woman 's right to maintenance is a personal obligation so far as the husband is concerned, and it is his duty to maintain her even if he has no property.
If the husband has property then the right of the widow to maintenance becomes an equitable charge on his property and any person who succeeds to the property carries with it the legal obligation to maintain the widow.
298 (2) Though the widow 's right to maintenance is not a right to property but it is undoubtedly a pre existing right in property, i.e., it is a jus ad rem, not jus in rem, and it can be enforced by the widow who can get a charge created for her maintenance on the property either by an agreement or by obtaining a decree from the civil court.
(3) The right of maintenance is a matter of moment and is of such importance that even if the joint property is sold and the purchaser has notice of the widow 's right to maintenance, the purchaser is legally bound to provide for her maintenance.
(4) The right to maintenance is undoubtedly a pre existing right which existed in the Hindu Law long before the passing of the Act of 1937(1) or the Act of 1946,(2) and is therefore, a pre existing right.
(5) The right to maintenance flows from the social and temporal relationship between the husband and the wife by virtue of which the wife becomes a sort of co owner in the property of her husband, though her co ownership is of a subordinate nature.
(6) Where a Hindu widow is in possession of the property of her husband, she is entitled to retain the possession in lieu of her maintenance unless the person who succeeds to the property or purchases the same is in a position to make arrangements for her maintenance.
" Fazal Ali, J., then embarked on a consideration of the scope and meaning of section 14 of the Act in the light of various pronouncements made by this Court as also of the decisions rendered by various High Courts in relation to the points in dispute.
During the course of the discussion he made the following pertinent observations: "It is true that a widow 's claim for maintenance does not ripen into a full fledged right to property, but nevertheless it is undoubtedly right which in certain cases can amount to a right to property where it is charged.
It cannot be said that where a property is given to a widow in lieu of 299 maintenance, it is given to her for the first time and not in lieu of a pre existing right.
The claim to maintenance, as also the right to claim property in order to maintain herself, is an inherent right conferred by the Hindu Law and, therefore, any property given to her in lieu of maintenance is merely in recognition of the claim or right which the widow possessed from before.
It cannot be said that such a right has been conferred on her for the first time by virtue of the document concerned and before the existence of the document the widow had no vestige of a claim or right at all.
Once it is established that the instrument merely recognised the pre existing right, the widow would acquire absolute interest.
Secondly, the Explanation to section 14(1) merely mentions the various modes by which a widow can acquire a property and the property given in lieu of maintenance is one of the modes mentioned in the Explanation.
Subsection (2) is merely a proviso to section 14(1) and it cannot be interpreted in such a manner as to destroy the very concept of the right conferred on a Hindu woman under section 14(1).
Sub section (2) is limited only to those cases where by virtue of a certain grant or disposition a right is conferred on the widow for the first time and the said right is restricted by certain conditions.
In other words, even if by a grant or disposition a property is conferred on a Hindu male under certain conditions, the same are binding on the male.
The effect of sub section (2) is merely to equate male and female in respect of grant conferring a restricted estate.
" Finally, Fazal Ali, J., made a reference to Naraini Devi 's case (supra) to which he himself was a party (apart from Sarkaria, J., who delivered the judgment of the Court) and in relation thereto made the following observations: "This case is no doubt directly in point and this Court by holding that where under an award an interest is created in favour of a widow that she should be entitled to rent out the property for her life time, it was held by this Court that this amounted to a restricted estate under section 14(2) of the 1956 Act.
Unfortunately the various aspects, namely, the nature and extent of the Hindu women 's right to maintenance, the limited scope of sub section (2) which 300 is a proviso to sub section (1) of section 14 and the effect of the Explanation, etc., to which we have adverted in this Judgment, were neither brought to our notice nor were argued before us in that case.
Secondly, the ground on which this Court distinguished the earlier decision of this Court in Badri Parshad vs Smt.
Kanso Devi(1) was that in the aforesaid decision the Hindu widow had a share or interest in the house of her husband under the Hindu Law as it was applicable then, and, therefore, such a share amounted to a pre existing right.
The attention of this Court however, was not drawn to the language of the Explanation to section 14(1) where a property given to a widow at a partition or in lieu of maintenance had been placed in the same category, and therefore, the reason given by this Court does not appear to be sound.
For the reasons that we have already given, after taking an overall view of the situation, we are satisfied that the Division Bench decision of this Court in Naraini Devi 's case (supra) was not correctly decided and is therefore overruled.
" Summarising the conclusions of law which Fazal Ali, J., reached after an exhaustive consideration of the texts and authorities mentioned by him, he enumerated them thus: "(1) The Hindu female 's right to maintenance is not an empty formality or an illusory claim being conceded as a matter of grace and generosity, but is a tangible right against property which flows from the spiritual relationship between the husband and the wife and is recognised and enjoined by pure Shastric Hindu Law and has been strongly stressed even by the earlier Hindu jurists starting from Yajnavalkya to Manu.
Such a right may not be a right to property but it is a right against property and the husband has a personal obligation to maintain his wife and if he or the family has property, the female has the legal right to be maintained therefrom.
If a charge is created for the maintenance of a female, the said right becomes a legally enforceable one.
At any rate, even without a charge the claim for maintenance is doubtless a pre existing right so that any transfer declaring or recognising such a right does not confer any new title but merely endorses or confirms the pre existing right.
301 "(2) Section 14(1) and the Explanation thereto have been couched in the widest possible terms and must be liberally construed in favour of females so as to advance the object of the 1956 Act and promote the socio economic ends sought to be achieved by this long needed legislation. "(3) Sub section (2) of section 14 is in the nature of a proviso and has a field of its own without interfering with the operation of section 14(1) materially.
The proviso should not be construed in a manner so as to destroy the effect of the main provision or the protection granted by section 14(1) or in a way so as to become totally inconsistent with the main provision. "(4) Sub section (2) of section 14 supplies to instruments, decrees, awards, gifts, etc., which create independent and new titles in favour of females for the first time and has no application where the instrument concerned merely seeks to confirm, endorse, declare or recognise pre existing rights.
In such cases a restricted estate in favour of a female is legally permissible and section 14(1) will not operate in this sphere.
Where, however, an instrument merely declares or recognises a pre existing right, such as a claim to maintenance or partition or share to which the female is entitled, the sub section has absolutely no application and the female 's limited interest would automatically be enlarged into an absolute one by force of section 14(1) and the restrictions placed, if any, under the document would have to be ignored.
Thus where a property is allotted or transferred to a female in lieu of maintenance or a share at partition, the instrument is taken out of the ambit of subsection (2) and would be governed by section 14(1) despite any restrictions placed on the powers of the transferee.
"(5) The use of express terms like "property acquired by a female Hindu at a partition", "or in lieu of maintenance" "or arrears of maintenance", etc., in the Explanation to section 14(1) clearly makes sub section (2) inapplicable to these categories which have been expressly excepted from the operation of sub section (2). "(6) The words "possessed by" used by the Legislature in section 14(1) are of the widest possible amplitude and include the state of owning a property even though the owner is not in actual or physical possession of the same.
302 Thus, where a widow gets a share in the property under a preliminary decree before or at the time when the 1956 Act had been passed but had not been given actual possession under a final decree, the property would be deemed to be possessed by her and by force of section 14(1) she would get absolute interest in the property.
It is equally well settled that the possession of the widow, however, must be under some vestige of a claim, right or title, because the section does not contemplate the possession of any rank trespasser without any right or title. "(7) That the words "restricted estate" used in section 14(2) are wider than limited interest as indicated in section 14(1) and they include not only limited interest, but also any other kind of limitation that may be placed on the transferee".
Applying these principles Fazal Ali J., held: "(i) that the properties in suit were allotted to the appellant Tulasamma on July 30, 1949 under a compromise certified by the Court; (ii) that the appellant had taken only a life interest in the properties and there was a clear restriction prohibiting her from alienating the properties; (iii) that despite these restrictions, she continued to be in possession of the properties till 1956 when the Act of 1956 came into force; and (iv) that the alienations which she had made in 1960 and 1961 were after she had acquired an absolute interest in the properties.
" In this view of the matter Fazal Ali, J., allowed the appeal of Tulasamma 's legal representatives.
Bhagwati, J., wrote a separate judgment in Tulasamma 's case and A. C. Gupta, J., agreed with him.
He also allowed the appeal substantially for the same reasons as had weighed with Fazal Ali, J., and in doing so observed: "Now, sub section (2) of section 14 provides that 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 303 instrument or the decree, order or award prescribe a restricted estate in such property.
This provision is more in the nature of a proviso or exception to sub section (1) and it was regarded as such by this Court in Badri Pershad vs Smt.
Kanso Devi.(1) It excepts certain kinds of acquisition of property by a Hindu female from the operation of sub section (1) and being in the nature of an exception to a provision which is calculated to achieve a social purpose by bringing about change in the social and economic position of women in Hindu society, it must be construed strictly so as to impinge as little as possible on the broad sweep of the ameliorative provision contained in sub section (1).
It cannot be interpreted in a manner which would rob sub section (1) of its efficacy and deprive a Hindu female of the protection sought to be given to her by sub section (1).
The language of sub section (2) is apparently wide enough to include acquisition of property by a Hindu female under an instrument or a decree or order or award where the instrument, decree, order or award prescribes a restricted estate for her in the property and this would apparently cover a case where property is given to a Hindu female at a partition or in lieu of maintenance and the instrument, decree, order or award giving such property prescribes limited interest for her in the property.
But that would virtually emasculate sub section (1), for in that event, a large number of cases where property is given to a Hindu female at a partition or in lieu of maintenance under an instrument, order or award would be excluded from the operation of the beneficent provision enacted in sub section (1), since in most of such cases, where property is allotted to the Hindu female prior to the enactment of the Act, there would be a provision, in consonance with the old Sastric law then prevailing, prescribing limited interest in the property and where property is given to the Hindu female subsequent to the enactment of the Act, it would be the easiest thing for the dominant male to provide that the Hindu female shall have only a restricted interest in the property and thus make a mockery of subsection (1).
The Explanation to sub section (1) which includes within the scope of that sub section property acquired by a female Hindu at a partition or in lieu of maintenance would also be rendered meaningless, because there 304 would hardly be a few cases where the instrument, decree, order or award giving property to a Hindu female at a partition or in lieu of maintenance would not contain a provision prescribing restricted estate in the property The social purpose of the law would be frustrated and the reformist zeal underlying the statutory provision would be chilled.
That surely could never have been the intention of the Legislature in enacting sub section (2).
" Bhagwati, J., laid down the nature of the right which a Hindu widow has to be maintained out of the joint family estate in the following terms: "It is settled law that a widow is entitled to maintenance out of her deceased husband 's estate, irrespective whether that estate may be in the hands of his male issue or it may be in the hands of his coparceners.
The joint family estate in which her deceased husband had a share is liable for her maintenance and she has a right to be maintained out of the joint family properties and though, as pointed out by this Court in Rani Bai vs Shri Yadunandan Ram(1) her claim for maintenance is not a charge upon any joint family property until she has got her maintenance determined and made a specific charge either by agreement or a decree or order of a Court, her right is "not liable to be defeated except by transfer to a bonafide purchaser for value without notice of her claim or even with notice of the claim unless the transfer was made with the intention of defeating her right".
The widow can for the purpose of her maintenance follow the joint family property "into the hands of any one who takes it as a volunteer or with notice of her having set up a claim for maintenance".
The courts have even gone to the length of taking the view that where a widow is in possession of any specific property for the purpose of her maintenance, a purchaser buying with notice of her claim is not entitled to possession of that property without first securing proper maintenance for her, vide Rachawa & Ors.
vs Shivayanappa(2) cited with approval in Ranibai 's case (supra).
It is, therefore, clear that under 305 the Sastric Hindu Law a widow has a right to be maintained out of joint family property and this right would ripen into a charge if the widow takes the necessary steps for having her maintenance ascertained and specifically charged in the joint family property and even if no specific charge is created, this right would be enforceable against joint family property in the hands of a volunteer or a purchaser taking it with notice of her claim.
The right of the widow to be maintained is of course not a jus in rem, since it does not give her any interest in the joint family property but it is certainly jus ad rem, i.e., a right against the family property.
Therefore, when specific property is allotted to the widow in lieu of her claim for maintenance, the allotment would be in satisfaction of her jus ad rem, namely, the right to be maintained out of the joint family property.
It would not be a grant for the first time without any pre existing right in the widow.
The widow would be getting the property in virtue of her pre existing right, the instrument giving the property being merely a document effectuating such pre existing right and not making a grant of the property to her for the first time without any antecedent right or title.
There is also another consideration which is very relevant to this issue and it is that, even if the instrument were silent as to the nature of the interest given to the widow in the property and did not, in so many terms, prescribe that she would have a limited interest, she would have no more than a limited interest in the property under the Hindu Law as it stood prior to the enactment of the Act and hence a provision in the instrument prescribing that she would have only a limited interest in the property would be, to quote the words of this Court in Nirmal Chand 's case (supra), "merely recording the true legal position" and that would not attract the applicability of sub section (2) but would be governed by sub section (1) of section 14.
All the three Judges were thus unanimous in accepting the appeal on the ground that Tulasamma 's right to maintenance was a pre existing right, that it was in recognition of such a right that she obtained property under the compromise and that the compromise there fore did not fall within the ambit of sub section (2) of section 14 of the Act but would attract the provisions of sub section (1) thereof coupled with the Explanation thereto.
With respect we find our selves in complete agreement with the conclusions arrived at by 306 Bhagwati and Fazal Ali, JJ., as also the reasons which weighed with them in coming to those conclusions.
Mr. section T. Desai, learned counsel for the plaintiffs respondents, and Mr. U. R. Lalit who very ably assisted the Court at its request, contended that for a Hindu female to be given the benefit of subsection (1) of section 14 of the Act she must first be an owner, albeit a limited owner, of the property in question and that Tulasamma not being an owner at all, the Bench presided over by Bhagwati, J., did not reach a correct decision in holding that the sub section aforesaid covered her case.
We find that only that part of this argument which is interpretative of sub section (1) is correct, namely, that it is only some kind of "limited ownership" that would get enlarged into full ownership and that where no ownership at all vested in the concerned Hindu female, no question of the applicability of the sub section would arise.
We may here reproduce in extenso section 14 of the Act with advantage: "14(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 so ever, 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 prescribed a restricted estate in such property." A plain reading of sub section (1) makes it clear that the concerned Hindu female must have limited ownership in property, which limited ownership would get enlarged by the operation of that sub section.
If it was intended to enlarge any sort of a right which could 307 in no sense be described as ownership, the expression "and not as a limited owner" would not have been used at all and becomes redundant, which is against the well recognised principle of interpretation of statutes that the Legislature does not employ meaningless language.
Reference may also be made in this connection to Eramma vs Verrupanna & others(1) where in Ramaswami, J., speaking on behalf of himself, Gajendragadkar, C.J., and Hidayatullah, J., interpreted the sub section thus: "The property possessed by a female Hindu, as contemplated in the section, is clearly property to which she has acquired some kind of title whether before or after the commencement of the Act.
It may be noticed that the Explanation to section 14(1) sets out the various modes of acquisition of the property by a female Hindu and indicates that the section applies only to property to which the female Hindu has acquired some kind of title, however restricted the nature of her interest may be.
The words "as full owner thereof and not as a limited owner" as given in the last portion of sub section (1) of section 14 clearly suggest that the legislature intended that the limited ownership of a Hindu female should be changed into full ownership.
In other words, section 14(1) of the Act contemplates that a Hindu female who, in the 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.
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. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
It does not in any way confer a title on the female Hindu where she did not in fact possess any vestige of title.
It follows, therefore, that the section cannot be interpreted so as to validate the illegal possession of a female Hindu and it does not confer any title on a mere trespasser.
In other words, the provisions of section 14(1) of the Act cannot be attracted in the case of a Hindu female who is in possession 308 of the property of the last male holder on the date of the commencement of the Act when she is only a trespasser with out any right to property." This interpretation of sub section (1) was cited with approval in Mangal Singh and Others vs Shrimati Rattno & Another(1) by Bhargava, J., who delivered the judgment of the Court and observed: "This case also, thus, clarifies that the expression "possessed by" is not intended to apply to a case of mere possession without title, and that the legislature intended this provision for cases where the Hindu female possesses the right of ownership of the property in question.
Even mere physical possession of the property without the right of ownership will not attract the provisions of this section.
This case also, thus, supports our view that the expression "possessed by" was used in the sense of connoting state of ownership and, while the Hindu female possesses the rights of ownership, she would become full owner if the other conditions mentioned in the section are fulfilled.
The section will, however, not apply at all to cases where the Hindu female may have parted with her rights so as to place herself in a position where she could, in no manner, exercise her rights of ownership in that property any longer." Limited ownership in the concerned Hindu female is thus a sine qua non for the applicability of sub section (1) of section 14 of the Act but then this condition was fully satisfied in the case of Tulasamma to whom the property was made over in lieu of maintenance with full rights of enjoyment thereof minus the power of alienation.
These are precisely the incidents of limited ownership.
In such a case the Hindu female represents the estate completely and the reversioners of her husband have only a spes successionis, i.e., a mere chance of succession, which is not a vested interest and a transfer of which is a nullity.
The widow is competent to protect the property from all kinds of trespass and to sue and be sued for all purposes in relation thereto so long as she is alive.
Ownership in the fullest sense is a sum total of all the rights which may possibly flow from title to property, while limited ownership in its very nature must be a bundle of rights constituting in their totality not full ownership but something less.
When a widow holds the property for her enjoyment as long as she lives, nobody is entitled to deprive her of it or to deal with the property in any manner to her detriment.
The 309 property is for the time being beneficially vested in her and she has the occupation, control and usufruct of it to the exclusion of all others.
Such a relationship to property in our opinion falls squarely within the meaning of the expression "limited owner" as used in sub section (1) of section 14 of the Act.
In this view of the matter the argument that the said sub section did not apply to Tulasammas 's case (supra) for the reason that she did not fulfil the condition precedent of being a limited owner is repelled.
The next contention raised by Mr. Desai and Mr. Lalit also challenged the correctness of the decision in Tulasamma 's case.
They argued that in any case the only right which Tulasamma had prior to the compromise dated July 30, 1949 was a right to maintenance simpliciter and not at all a right to or in property.
For the reasons which weighed with Bhagwati and Fazal Ali, JJ., in rejecting this argument we find no substance in it as we are in full agreement with these reasons and the same may not be reiterated here.
However we may emphasize one aspect of the matter which flows from a scrutiny of subsection (1) of section 14 of the Act and the explanation appended thereto.
For the applicability of sub section (1) two conditions must co exist, namely: (1) the concerned female Hindu must be possessed of property and (2) such property must be possessed by her as a limited owner.
If these two conditions are fulfilled, the sub section gives her the right to hold the property as a full owner irrespective of the fact whether she acquired it before or after the commencement of the Act.
The Explanation declares that the property mentioned in sub section (1) includes both movable and immovable property and then proceeds to enumerate the modes of acquisition of various kinds of property which the sub section would embrace.
Such modes of acquisition are: (a) by inheritance, (b) by devise, (c) at a partition, (d) in lieu of maintenance or arrears of maintenance, (e) by gift from any person, whether a relative or not, before, at or after her marriage, (f) by her own skill or exertion, 310 (g) by purchase, (h) by prescription, (i) in any other manner what so ever, and (j) any such property held by her as "stridhana" immediately before the commencement of this Act.
A reference to the Hindu law as it prevailed immediately before the commencement of the Act would lead one to the conclusion that the object of the Explanation was to make it clear beyond doubt that all kinds of property which fell within the ambit of the term "stridhana" would be held by the owner thereof as a full owner and not as a limited owner.
Reference may in this connection be made to the following enumeration of "Stridhana" in paragraph 125 of Mulla 's Hindu law: (1) Gifts and bequests from relations.
(2) Gifts and bequests from strangers.
(3) Property obtained on partition.
(4) Property given in lieu of maintenance.
(5) Property acquired by inheritance.
(6) Property acquired by mechanical arts (7) Property obtained by compromise.
(8) Property acquired by adverse possession.
(9) Property purchased with stridhana or with savings of income of stridhana.
(10) Property acquired from sources other than those mentioned above.
These heads of property are then dealt with at length by Mulla in paragraphs 126 to 135 of his treatise.
Prior to the commencement of the Act, the Hindu female did not enjoy full ownership in respect of all kinds of "Stridhana" and her powers to deal with it further varied from school to school.
There was a sharp difference in this behalf between Mitakshara and Dayabhaga.
And then the Bombay, Benaras, Madras and Mithila schools also differed from each other on the point.
Succession to different kinds of "Stridhana" did not follow a uniform pattern.
The rights of the Hindu female over "Stridhana" varied according to her status as a maiden, a married woman and a widow.
The source and nature of the property acquired also placed limitations on her ownership and made a difference to the mode of succession thereto.
A comparison of the contents of the Explanation with those of paragraph 125 of Mulla 's Hindu Law would show that 311 the two are practically identical.
It follows that the Legislature in its wisdom took pains to enumerate specifically all kinds of "Stridhana" in the Explanation and declared that the same would form "property" within the meaning of that word as used in sub section (1).
This was done, in the words of Bhagwati, J, "to achieve a social purpose by bringing about change in the social and economic position of women in Hindu society".
It was a step in the direction of practical recognition of equality of the sexes and was meant to elevate women from a subservient position in the economic field to a pedestal where they could exercise full powers of enjoyment and disposal of the property held by them as owners, untrammelled by artificial limitations placed on their right of ownership by a society in which the will of the dominant male prevailed to bring about a subjugation of the opposite sex.
It was also a step calculated to ensure uniformity in the law relating to the nature of ownership of "Stridhana".
This dual purpose underlying the Explanation must be borne in mind and given effect to when the section is subjected to analysis and interpretation, and sub section (2) is not to be given a meaning which would defeat that purpose and negative the legislative intent, if the language used so warrants.
A Combined reading of the two sub sections and the Explanation leaves no doubt in our minds that sub section (2) does not operate to take property acquired by a Hindu female in lieu of maintenance or arrears of maintenance (which is property specifically included in the enumeration contained in the Explanation) out of the purview of sub section (1).
Tulasamma 's case (supra) having, in our opinion been decided correctly, the appeal in hand must succeed as the facts in the latter are on all fours with those in the former.
Mr. Desai did vehemently argue that this was not so inasmuch as by the decree dated August 18, 1909 the ownership of the land in dispute was vested in Dayalji and Dayabhai sons of Mohanbhai and Motabhai son of Gulabbhai while Bai Vajia was only given the right to possess it for her life the ownership remaining all along in the said three persons, but this argument does not find favour with us.
It has to be noted that so long as she lived, Bai Vajia was to have full enjoyment of and complete control over the land, barring any right to alienate it.
Such a right was also taken away from the said three persons.
The arrangement meant that whatever rights existed in relation to the land during the life time of Bai Vajia, were exercisable by her alone and by nobody else.
Not even the said three persons could deal with the land in any manner whatsoever, and if they did, Bai Vajia had the right to have their acts declared null and void during her life time.
After the land 312 was made over to her she became its owner for life although with a limited right and therefore only as a limited owner.
Under the decree the land vested in the said three persons only so long as they were not dispossessed of it at the instance of Bai Vajia in accordance with the terms stated therein.
As soon as Bai Vajia took possession of the land, no rights of any kind whatsoever in relation thereto remained with them and thus they ceased to be the owners for the span of Bai Vajia 's life.
Following Tulsamma 's case we hold that Bai Vajia became a full owner of the land in dispute under the provisions of sub section (1) of section 14 of the Act and that sub section (2) thereof has no application to her case, the land having been given to her as a limited owner and in recognition of her pre existing right against property.
In the result therefore, the appeal succeeds and is accepted.
The judgment and the decree of the High Court are set aside and the suit giving rise to this appeal is dismissed.
In the circumstances of the case, however, we leave the parties to bear their own costs throughout.
S.R. Appeal allowed.
| IN-Abs | As per the decree in a partition suit dated August, 18, 1909 Motabhai and two sons of Mohanbhai being two predecessors in interest of the plaintiffs respondents were burdened with the responsibility of paying an yearly maintenance allowance of Rs. 42/ to Bai Vajia appellant on Magsher Sud 2 of every year.
The decree further provided that in the event of default in payment of such allowance continuing for a period of a month after the due date, Bai Vajia would be entitled to take possession of the land allotted to them under the decree viz. Survey Nos. 31, 403, 591, 611, 288 and 659/3 in lieu of the maintenance awarded to her and would enjoy the income thereof without however being competent to sell, mortgage, bequeath, gift or otherwise transfer the same.
The decree declared that any alienation made by Bai Vajia in contravention of the direction given by the decree in that behalf would be void.
By clause 8 of the decree Motabhai and sons of Mohanbhai were also deprived of the right of alienation of the land during the lifetime of Bai Vajia.
Default having been made in the payment of maintenance to her according to the terms of the decree, the appellant, took out execution and obtained possession of the lands in question, which she continued to enjoy till October 21, 1963 when she made a sale of Survey No. 31 in favour of one D. P. Desai.
The sale was challenged by the plaintiffs in Civil Suit No. 110/66 which was decreed by the trial Court.
The District Court in first appeal confirmed it and the High Court in second appeal upheld the decree of Bai Vajia.
Allowing the appeal of the Legal Representative by special leave.
the Court.
^ HELD: 1.
A combined reading of sub sections (1) and (2) of Section 14 of the and the Explanation following sub section (1) makes it clear, that sub section (2) does not operate to take property acquired by a Hindu female in lieu of maintenance or arrears of maintenance (which is property specifically included in the enumeration contained in this Explanation) out of the purview of sub section (1).
[311 D E] 2.
For the applicability of sub section (1) of Section 14 two conditions must coexist namely.
(1) the concerned female Hindu must be possessed of property; and 292 (2) such property must be possessed by her as a "limited owner".
If these two conditions are fulfilled, the sub section gives her the right to hold the property as a full owner irrespective of the fact whether she acquired it before or after the commencement of the Act.
[309 D F] The Explanation declares that the property mentioned in sub section (1) includes both movable and immovable property and then proceeds to enumerate the modes of acquisition of various kinds of property which the sub section would embrace.
Two such modes are "in lieu of maintenance or arrears of maintenance", and "any such property held by her as Stridhana" immediately before the commencement of the Act.
It, therefore, follows that the Legislature in its wisdom took pains to specify all kinds of "Stridhana" in the Explanation and declared that the same would form "property" within the meaning of that word as used in sub section (i).
This was done "to achieve a social purpose by bringing about change in the social and economic position of women in Hindu Society".
It was a step in the direction of practical recognition of equality of the sexes and was meant to elevate women from a subservient position in the economic field to a pedestal where they could exercise full powers of enjoyment and disposal of the property held by them as owners, untrammelled by artificial limitations placed on their right of ownership by a society in which the will of the dominant male prevailed to bring about a subjugation of the opposite sex.
It was also a step calculated to ensure uniformity in the law relating to the nature of ownership of 'Stridhana '.
This dual purpose underlying the Explanation must be borne in mind and given effect to when the section is subjected to analysis and interpretation, and sub section (2) is not to be given a meaning which would defeat that purpose and negative the legislative intent, if the language used so warrants.
A D] 3.
It is true that it is only some kind of "limited ownership" that would get enlarged into full ownership and that where no ownership at all vested in the concerned Hindu Female, no question of the applicability of subsection (1) of section 14 of the Act, would arise.
[306 B C] 4.
A plain reading of sub section (1) of section 14 of the Act makes it clear that the concerned Hindu female must have limited ownership in property, which limited ownership would get enlarged by the operation of that sub section.
If it was intended to enlarge any sort of a right which could in no sense be described as ownership, the expression "and not as a limited owners", would not have been used at all and becomes redundant, which is against the well known principle of interpretation of statutes that the Legislature does not employ meaningless language.
[306 H, 307 A] Eramma vs Veerappanna and Ors., ; Mangal Singh and Ors.
vs Srimati Rattno & Anr., ; ; reiterated.
Limited ownership in the concerned Hindu female is thus a sine qua non for the applicability of sub section (1) of section 14 of the Act.
In a case where this condition is fulfilled the Hindu female represents the estate completely and the reversioners of her husband have only a spes succession is i.e. a mere chance of 293 succession which is not a vested interest and a transfer of which is a nullity.
The widow is competent to protect the property from all kinds of trespass and to sue and be sued for all purposes in relation thereto so long as she is alive.
Ownership in the fullest sense is a sum total of all the rights which may possibly flow from title to property, while limited ownership in its very nature must be a bundle of rights constituting in their totality not full ownership but something less.
[308 E H] When a widow holds the property for her enjoyment as long as she lives, nobody is entitled to deprive her of it or to deal with the property in any manner to her detriment.
The property is for the time being beneficially vested in her and she has the occupation, control and usufruct of it to the exclusion of all others.
Such a relationship to property falls squarely within the meaning of the expression "limited owner" as used in sub section (1) of Section 14 of the Act.
[308 H, 309A] 6.
In the instant case: Bai Vajia became a full owner of the land in dispute under the provisions of sub section (1) of section 14 of the Act and that sub section (2) thereof has no application to her case, the land having been given to her as a limited owner and in recognition of her pre existing right against property.
So long as she lived, she was to have full enjoyment of and complete control over the land, barring any right to alienate it.
Such a right was also taken away from Motabhai and two sons of Mohanbhai.
The arrangement meant that whatever rights existed in relation to the land during the life time of Bai Vajia were exercisable by her alone and by nobody else.
Not even the said three persons could deal with the land in any manner whatsoever, and if they did, Bai Vajia had the right to have their acts declared null and void during her life time.
After the land was made over to her she became its owner for life although with a limited right and therefore only as a limited owner.
Under the decree the land vested in Motabhai and sons of Mohanbhai only so long as they were not dispossessed of it at the instance of Bai Vajia in accordance with the terms stated therein.
As soon as Bai Vajia took possession of the land, no rights of any kind whatsoever in relation thereto remained with them and thus they ceased to be the owners for the span of Bai Vajia 's life.
[311 G H, 312 A D] V. Tulasamma and Ors.
vs Sesha Reddy, [1977] 3 S.C.R. 261; discussed in extenso and followed.
|
Civil Appeal No. 2036 of 1969.
Appeal by special leave from the Judgment and Order dated 18 12 1968 of the Kerala High Court in W.A. No. 167/67.
Dr. V. A. Sayied Muhammed and K. M. K. Nair for the Appelant.
A. section Nambiar and D. D. Gupta for the Respondents.
The Judgment of the Court was delivered by SARKARIA, J.
This appeal by special leave, directed against a judgment, dated December 18, 1968, of the High Court of Kerala, arises out of these facts: 245 Koyakutty, Respondent herein, entered service of the former, Madras State on May 1, 1943 as temporary Section Writer on probation in the Registration Department.
He did not possess the minimum, general educational qualification prescribed by Rule 29 of the Madras Ministerial Service Rules.
This rule, inter alia, provided that no person shall be eligible for appointment to the service in any post either by direct recruitment or by recruitment by transfer on promotion unless he possesses the minimum general educational qualification prescribed in the Schedule to the General Rules.
The General Rules provided that the passing of the Secondary School Leaving Examination or other equivalent examination shall be the minimum educational qualification for appointment to the Ministerial Service.
The State Government, however, had the power to exempt a person from this qualification.
The Madras Government passed an Order, dated April 15, 1954, (exhibit P II), exempting, him from the said qualification for being appointed as a Lower Division Clerk in the Registration Department.
It will be useful to quote this order in extenso: "The Government consider that in view of the fact that Sri M. B. Koyakutty belongs to a community which is educationally backward, the petitioner should be exempted from the minimum general educational qualification, so as to enable him to be appointed as a Lower Division Clerk in the Registration Department under G.O. MS.
No. 2858 Rev. dt. 2 11 50 in his turn. .
The Governor of Madras accordingly relaxes rules 28 and 29 of the Special Rules for the Madras Ministerial Service in favour of Sri M. B. Koyakutty, a temporary Section Writer in the Registration Department in the Registration District of Palghat in order to enable him to be appointed as a Lower Division Clerk in that department.
Sd/ section K. Chettu, Secretary to Govt.
" As a result of this exemption, Koyakutty was appointed a Lower Division Clerk in the Registration Department on May 19, 1954.
Consequent on the reorganisation of the States in 1956, Koyakutty was allotted to the Kerala State Service as Lower Division Clerk in the Registration Department.
On May 16, 1961, the Government of Kerala issued an Order, in consultation with the Public Service Commission, that "all such 246 persons who did not possess the general minimum educational qualification and were appointed as Lower Division Clerks, after granting them exemption from that qualification", may be allowed to sit for a qualifying test to be conducted by the Commission, and in case they secure a certain minimum percentage of marks, they may be regarded as possessing the minimum general qualification of the S.S.L.C. Standard for purpose of promotion to Upper Division and higher grades or continuance in the Upper Division, as the case may be.
The order further stated that the case of those who have been appointed and are continuing in the Upper Division, they need not be disturbed for the present, but they should be reverted, if they fail to qualify at the next such examination of the Commission.
According to para 3 of the Order, "the minimum marks to be obtained for being declared eligible for promotion to or continuance in the Upper Division etc. . will be issued separately.
" A gradation list of Clerks was prepared by the District Registrar, Palghat, in which Koyakutty was shown at No. 1 among the officiating Lower Division Clerks, while the original respondents 1 and 2 were shown at Nos. 7 and 6, respectively.
In July 1966, two vacancies occurred in the cadre of Upper Division Clerks in the Department.
The original respondents 1 and 2, who were junior to Koyakutty, were promoted against those vacancies as Upper Division Clerks.
Koyakutty thereupon filed a writ petition under Article 226 of the Constitution in the Kerala High Court, praying that the promotion of original respondents 1 and 2 be quashed and a direction be issued requiring the District Registrar, Palghat, and the State of Kerala to consider his claim and to promote him in preference to the original respondents 1 and 2.
Koyakutty 's contention was that under the Rules, seniority should be the basis for promotion; and promotion of his juniors amounted to a denial of equable treatment guaranteed under Article 14 and 16 of the Constitution.
His stand was that the exemption granted to him by the Government, removing the bar from being appointed in the Ministerial Service enured for all purposes.
This contention was rejected by the trial Judge, who held that the exemption granted to Koyakutty was for the limited object of enabling him to be appointed and continued in the post of a Lower Division Clerk and did not remove the bar of minimum educational qualification for his promotion to the post of Upper Division Clerk.
In the result, Koyakutty 's writ petition was dismissed.
247 On appeal by Koyakutty, a Division Bench of the High Court reversed the judgment of the learned Single Judge, and directed the District Registrar, Palghat, and the State Government to treat Koyakutty as eligible for promotion as an Upper Division Clerk and pass necessary orders on that basis.
The Division Bench further directed that Koyakutty 's rank in the cadre of Upper Division Clerks will, also, be determined after he is promoted to that Cadre.
Hence this appeal by the District Registrar, Palghat and the State.
The first question that falls to be considered is, whether in the matter of promotion to the cadre of Upper Division Clerks, the respondent was governed by the Madras Ministerial Service Rules or by the Kerala State and Subordinate Service Rules, 1958 ? The Government of Kerala, on February 25, 1957, issued an Order S(D)S 43405/56/PD to the effect that as an interim arrangement, every officer in the service of the new State would be bound by the Service Rules of Travancore Cochin or Madras, as the case may be, to which he belonged prior to November 1, 1956 until common service rules are framed and issued.
Thereafter, in exercise of the powers under the proviso to Article 309 of the Constitution, the Governor of Kerala in supersession of all rules on the subject, framed the Kerala State and Subordinate Services Rules, 1958.
Part I of these Rules deals with preliminary matters.
Rule 2(16) in Part I defines "Special Rules" as meaning "the rules in Part III applicable to each service or class of service." Such Special Rules have not, however, been framed by the Governor.
Part II contains the General Rules.
Rule 1 in Part II delineates the scope of the General Rules.
It runs thus: "The rules in this Part shall apply to all State and Subordinate Services and the holders of all posts, whether temporary or permanent in any such service, appointed thereto before, or after the date on which these rules come into force as provided in sub rule (b) of rule 1 in Part 1 except to the extent otherwise expressly, provided (a) by or under any law for the time being in force, or (b) in respect of any member of such service by a contract or agreement subsisting between such member and the State Government.
" 248 Rule 2 in the same Part provides: "2. Relation to the Special Rules.
If any provision in the General Rules contained in the Part is repugnant to a provision in the Special Rules applicable to any particular service contained in Part III, the latter shall in respect of that service, prevail over the provision in the General Rules in this Part.
" It will bear repetition that since no Special Rules, as defined in Rule 2(16) of Part I, have so far been framed by the Governor under Article 309 of the Constitution, Rule 2 in Part II has remained otise.
Rule 28 in Part II provides regarding promotion.
Clause (i) of clause (b) of this rule deals with promotion and appointment by transfer to a selection category or Selection Grade in a service.
Such promotion shall be made on the basis of merit and ability, seniority being considered only where merit and ability are approximately equal.
Sub clause (ii) of clause (b) of Rule 28 is captioned: "Promotion and appointment by transfer to higher posts according to seniority".
Its material part, as it stood before the amendment of December 28, 1970, reads as under: "All other promotions or appointments by transfer shall, subject to the provisions of these rules and the special rules, be made in accordance with seniority subject to the person 's fitness for appointment.
" It is contended on behalf of the appellants that by virtue of the Kerala Government Order dated February 25, 1957, referred to earlier, the Special Rules contained in the Madras Ministerial Service Rules, continued to govern the respondent because those Special Rules have not been superseded by the Kerala Rules of 1958.
The point sought to be made out is that the Special Rules, within the meaning of Rule 2 in Part II read with the aforesaid Government Order dated February 25, 1957, will mean the Special Rules contained in the Madras Rules.
A similar argument was raised before the Appellate Bench of the High Court, also, and it was repelled, and, in our opinion, rightly.
Special Rules for the purpose of the Kerala Rules, 1958, will be as defined in Rule 2(16) in Part I.
That definition contemplates that Special Rules in Part III will be framed by the Governor of Kerala.
But, no such rules have so far been framed.
We have, therefore, no hesitation in holding, in agreement with the High Court, that in the matter of promotion as an Upper Division 249 Clerk, the appellant was governed by Rule 28(b)(ii) in Part II.
The alternative contention that has been advanced on behalf of the appellant is that even if Rule 28(b)(ii) was applicable, then also, it was well within the power of the State Government to prescribe a test to judge the fitness of those persons who did not possess the minimum educational qualification and were appointed as Lower Division Clerks on being exempted from that qualification by Government Order.
In this connection, reference has been made to Article 162 of the Constitution, to show what the State Government could do by framing a statutory rule under Article 309, proviso, could well be done by an executive order, the executive power of the State being co extensive with its legislative power.
It is maintained that the power of the Government to prescribe selective test for promotion to higher service has been recognised by this Court in several decisions.
Reference has been made in this connection to the decisions of this Court in B. N. Nagarajan & Ors.
vs State of Mysore & Ors., Union of India etc.
vs Majji Jangamayya etc., State of Jammu & Kashmir vs Triloki Nath Khosa & Ors.
It was further submitted that the possession of the minimum educational qualification, i.e. a certificate of having passed the S.L.C. Examination or any equivalent examination is presumptive proof of the fitness of the holder thereof, for promotion to the cadre of Upper Division Clerks.
Therefore, according to the counsel, there was a reasonable basis for classifying those who did not possess this minimum educational qualification as a category apart from those who possessed such a qualification.
In this context, it is further emphasised that the exemption was granted only for the purpose of being appointed as a Lower Division Clerk, and not for the purpose of further promotion.
As against this, Mr. Nambiar, appearing for the respondents, submits that once the bar of minimum educational qualification was removed for appointment as Lower Division Clerk, further promotion of the respondent was governed by Rule 28(b)(ii), Part I of the Kerala Rules of 1958.
After their appointment, the respondent or others like him who had been exempted from possessing the minimum educational qualification, had become integral members of the same cadre.
They could not be singled out for hostile treatment.
Counsel has submitted that the rule enunciated by this Court in Triloki Nath 250 Khosa 's case (ibid), is not applicable because the facts of that case were entirely different.
Counsel further stated that any executive order issued by the Government, cannot supplant the statutory rules framed by the Governor under Article 309.
Executive instructions can operate only in areas not covered by the rules.
But here the area was fully occupied by the statutory rule 28(b)(ii).
There can be no quarrel with the proposition that if the statutory rules framed by the Governor or any law enacted by the State Legislature under Article 309 is silent on any particular point, the Government can fill up that gap and supplement the rule by issuing administrative instructions not inconsistent with the statutory provisions already framed or enacted.
The Executive instructions in order to be valid must run subservient to the statutory provisions.
In the instant case, however, it could not be said that there was a gap or a void in the statutory provisions in the matter of promotion from the cadre of Lower Division Clerks to that of Upper Division Clerks.
After the enactment of the Kerala Public Services Act of 1968, the position was that by virtue of Section 3 of that Act, the Kerala State Subordinate Services Rules of 1958 framed by the Governor under the proviso to Article 309 of the Constitution were deemed to have been made under the Act and were continued until superseded by rules made under that Act.
As noticed already, no Special Rules relating to Upper Division Clerks have been framed.
The General Rules in Part II will, therefore, be applicable to Upper Division Clerks, also.
It will bear repetition that the preamble to the Rules and Rule 1 in Part II, indicate that all the previous rules have been superseded.
These General Rules do not provide any minimum general educational qualification for promotion to the cadre of Upper Division Clerks from that of Lower Division Clerks.
All that is required by rule 28 (b) (ii) which governs the promotions from the Lower Division to the Upper Division, is that promotions shall be made in accordance with seniority subject to the person 's fitness for appointment.
There is nothing in this sub rule or elsewhere which provides that a member of the Lower Division will be presumed to be unfit for promotion to the Upper Division unless he possesses the minimum general educational qualification, or 251 passes a qualifying test.
It is conceivable that the State Government may prescribe a general test for all Clerks of the Lower Division to judge their fitness for promotion to the Upper Division.
But, such is not the case here.
The respondent and the others like him who were appointed as Lower Division Clerks after granting them exemption from possessing the minimum general educational qualification have been singled out for this discriminatory treatment.
There is nothing on the record to show that the case of the respondent was considered for promotion and he was found unfit.
The ratio of Triloki Nath Khosa 's case (ibid) does not advance the case of the appellant State.
Therein, persons appointed directly and by promotion were integrated into a common class of Assistant Engineers.
Rule 12 provided that Graduates among the Assistant Engineers, shall be eligible for promotion to the cadre of Executive Engineers, to the exclusion of diploma holders.
This rule was a statutory rule.
Its constitutional validity was challenged on the ground that it violated Articles 14 and 16 of the Constitution.
This Court, speaking through Chandrachud J. (as he then was), repelled this contention with the reasoning that the classification of Assistant Engineers into degree holders and diploma holders could not be held to rest on any unreal or unreasonable basis.
The classification was made with a view to achieving administrative efficiency in the Engineering Services.
It will be seen that Triloki Nath 's case, is distinguishable from the one before us, at least, in three important aspects.
Firstly, in that case, the statutory rule in question did not make any discrimination in relation to the source of recruitment, it simply provided that Graduates alone shall go into the higher cadre of Executive Engineers, irrespective of whether they were appointed as Assistant Engineers directly or by promotion.
In the present case, the impugned notification prescribes a qualifying test for promotion, not for all but only for one category of persons with reference to the manner in which they initially entered service.
Secondly, in Triloki Nath 's case the post of the Executive Engineer carries higher responsibility and duties of a supervisory character requiring higher mental equipment and administrative skill.
Thus, there, the classification rested on intelligible differentia having a direct nexus to the object (viz., administrative efficiency), to be achieved.
In the instant case, there is nothing on record to show that the duties discharged by the clerks of the Upper Division are substantially different from those in the Lower Division.
Thirdly, in the instant case the statutory rule does not warrant the classification made by the impugned Government Order.
The primary criterion for promotion to the Upper Division prescribed by Rule 28(b) (ii) in seniority if the person concerned is otherwise not unfit.
The 252 impugned Government Order impinges upon that statutory rule inasmuch as it lays down that even if a Lower Division Clerk who entered service as a result of exemption from possession minimum educational qualification, satisfied the criterion of seniority cum fitness prescribed by this Rule, he shall not be considered for promotion unless he qualifies in the test.
The relevant statutory Rules governing the appellant do not provide any minimum general education qualification for promotion to the Upper Division.
The case in point is Roshal Lal Tandon vs Union of India.
In that case, before the impugned notification was issued, there was only one rule of promotion for both the departmental promotees and the direct recruits, and that rule was seniority cum suitability, and there was no rule of promotion separately made for application to direct recruits.
As a result of the impugned notification, a discriminatory treatment was made in favour of the direct recruits, i.e. existing Apprentice Train Examiners who had already been absorbed in Grade 'D ' by March 31, 1966, because the notification provided that this group of Apprentice Train Examiners should first be accommodated en bloc in Grade 'C ' upto 80 per cent of vacancies reserved for them without undergoing any selection.
Ramaswami J., speaking for a Bench of five learned Judges, held that the impugned notification violated the guarantee under Articles 14 and 16 of the Constitution.
The reason was that once the direct recruits and promotees were absorbed in one cadre, they formed one class and they could not be discriminated against for the purpose of further promotion to the higher Grade 'C '.
In that case, it was not disputed that before the impugned notification was issued there was only one rule of promotion for both the departmental promotees and the direct recruits and that rule was 'seniority cum suitability '.
The impugned notification was discriminatory because in the case of that category who were appointed as Train Examiners by promotion the aforesaid test of 'seniority cum suitability ' prescribed by the rule for further promotion to the higher Grade 'C ' was abandoned and, instead, selection on merit only was adopted.
The principle enunciated in Roshan Lal Tandon vs Union of India applied with greater force to the facts of the present case because here the classification made by the impugned Government Order is not only unfair and irrational but also, virtually amounts to abandonment of the test of seniority cum fitness provided in rule 28 (b) (ii).
The last point for consideration is, whether it was proper for the High Court to issue a positive direction requiring the appellant to 253 promote the respondent to the Upper Division and thereafter to determine his rank in the cadre of Upper Division Clerks.
Ordinarily, the court does not issue a direction in such positive terms, but the peculiar feature of this case is that it has not been disputed that Koyakutty respondent satisfies the two fold criterion for promotion laid down in the statutory rule 28(b)(ii).
Indeed, the District Registrar, Palghat, who was impleaded as respondent 3 in the writ petition, expressly admitted in paragraph 8 of his counter affidavit filed before the High Court, "that the seniority of service is the basis of promotion from the ranks of Lower Division Clerks to the ranks of Upper Division Clerks provided they are fully qualified by passing the departmental tests for the purpose".
It was never the case of the Registrar that Koyakutty was not otherwise fit for promotion.
Indeed, even in the grounds of appeal to this Court, incorporated in the Special Leave Petition, it is not alleged that Koyakutty did not satisfy the criterion of seniority cum fitness prescribed by Rule 28(b)(ii).
The position taken by the appellant, throughout, was that this rule should be deemed to have been "supplemented" by the impugned Government Notification.
It is not correct that the impugned Notification merely "supplements" or fills up a gap in the statutory rules.
It tends to super add or super impose by an Executive fiat on the statutory rules something inconsistent with the same.
Since the existence of both the criteria viz., seniority and fitness for promotion to the Upper Division prescribed by the statutory Rule 28(b)(ii), in the case of Koyakutty was not disputed, the High Court was justified in issuing the direction, it did.
For the foregoing reasons the appeal fails and is dismissed with costs.
| IN-Abs | The respondent, who originally belonged to the Madras Ministerial Service, was allotted to the State of Kerala as a lower division clerk on the reorganisation of States.
On the ground that he belonged to a community which was educationally backward the State Government of Madras appointed him as a lower division clerk relaxing the requirements of r. 29 of the Special Rules for Madras Ministerial Service which prescribed minimum general educational qualification for appointment to service under the State Government.
In 1957 the State Government of Kerala issued an order providing that, until common service rules were framed, every officer in the service of the new State of Kerala would be bound by the service rules of Travancore Cochin or Madras, to which he belonged prior to November 1, 1956.
Thereafter in supersession of all earlier rules the Kerala State and Subordinate Service Rules, 1958 were framed.
Rule 1 of the General Rules in Part II stated that the rules in that part shall apply to all State and Subordinate Services and the holders of all posts appointed before or after the date on which those rules came into force.
The Special Rules contemplated by r. 2(16) of Part I had however, not been framed.
Rule 28(b) (ii) of Part II provided that all promotions or appointments by transfer [other than those mentioned in cl.
(i) of this rule] shall be made in accordance with the seniority, subject to the person 's fitness for appointment.
In 1961, persons who did not possess the general minimum educational qualifications but were appointed as lower division clerks, were allowed to sit for a qualifying test for promotion to upper division clerks.
In the gradation list of officiating lower division clerks prepared, the respondent was shown at No. 1 place.
Even so, when two vacancies of upper division clerks occurred, two persons junior to him in the gradation list were promoted ignoring the respondent.
In his writ petition under article 226 of the Constitution the respondent contended that the exemption granted to him removing the bar of educational qualification enured to him for all purposes, and therefore, promotions of two juniors, ignoring r. 28(b)(ii) under which seniority was the basis for promotion, amounted to denial of equal treatment guaranteed under articles 14 and 16 of the Constitution.
243 A single Judge of the High Court dismissed the petition on the ground that the exemption granted was for the limited purpose of enabling the respondent to be appointed and continued in the post of lower division clerk but that it did not remove the bar of minimum qualification for promotion.
On appeal the division bench reversed the order of the single Judge, and directed the Government to promote him and determine his rank in the cadre of upper division clerks.
On appeal to this Court it was contended on behalf of the appellant that (1) the Special Rules contemplated by r. 2 of Part I read with the State Government 's order of 1957, were the Special Rules contained in the Madras Ministerial Service Rules; (2) even if r. 28(b)(ii) was applicable it was well within the power of the State Government to prescribe a test to judge the fitness of persons who were exempted from the minimum educational qualifications when appointed as lower division clerks and (3) there was a reasonable basis for classifying those persons who did not possess the minimum educational qualification as a category apart from those who possessed such a qualification.
Dismissing the appeal, ^ HELD: 1 (a) The Special Rules, for the purposes of Kerala Rules of 1958, would be as defined in r. 2(16) of Part I.
That definition contemplated that Special Rules would be framed by the Governor but no such rules had been framed.
[248 H] (b) In the matter of promotion as on upper division clerk the respondent was governed by r. 28(b)(ii) in Part II.
[249 A] 2.
It cannot be said that the impugned notification merely "supplemented" or filled up a gap in the statutory rules.
It tended to superimpose or super add by an executive flat on the statutory rules something inconsistent with the same.
If the statutory rules framed by the Governor or any law enacted under article 309 is silent on any particular point, the government can fill up that gap and supplement the rule by issuing administrative instructions not inconstant with the statutory provisions already framed or enacted.
[253 D; 250 C] In the instant case, however, it could not be said that there was a gap in the statutory provisions in the matter of promotion from the cadre of lower division clerks to that of upper division clerks.
3(a) The classification made by the impugned government order was not only unfair and irrational but also, virtually amounted to abandonment of the test of seniority cum fitness provided in r. 28(b)(ii).
[252 G H] (h) By virtue of section 3 of the Kerala Public Services Act, 1968, the 1958 Rules were deemed to have been made under the Act and were continued until superseded by rules made under that Act.
No Special Rules relating to upper division clerks having been made the General Rules in Part II would be applicable to upper division clerks, also.
[250 E] (c) The 1958 Rules superseded all earlier rules.
The General Rules did not provide any minimum general educational qualification for promotion to 244 the cadre of upper division clerks.
There is nothing in r. 28(b)(ii) or elsewhere, which provides that a lower division clerk would be presumed to be unfit for promotion to upper division unless he possessed the minimum general educational qualification or passed the qualifying test.
[250 G H] There is nothing to show that the respondent was considered for promotion but was found unfit.
[251 B] (d)(i) The impugned notification prescribed the qualifying test for promotion, not for all, but only for one category of persons with reference to the manner in which they initially entered service.
The respondent and others like him, appointed as lower division clerks after granting them exemption, had been singled out for this discriminatory treatment.
[251 F] (d)(ii) There is nothing on record to show that the duties discharged by the clerks of the upper division were substantially different from those in the lower division.
[251 G H] (iii) The statutory rule did not warrant the classification made by the impugned order.
It impinged upon the statutory rule inasmuch as it laid down that even if a lower division clerk who entered service as a result of exemption from possessing minimum educational qualification satisfied the criterion of seniority cum fitness prescribed by this rule, he shall not be considered for promotion unless he qualified in the test.
The relevant rule did not provide any minimum general educational qualification for promotion to upper division.
[252 A B] Roshan Lal Tandon vs Union of India, ; ; followed.
State of Jammu & Kashmir vs Triloki Nath Khosa & Ors. ; ; held inapplicable.
Though ordinarily the court would not issue a direction requiring the government to promote an aggrieved employee and thereafter determine his rank in the cadre, in the peculiar facts of this case the respondent satisfied the two fold criterion for promotion laid down in r. 28(b)(ii) and since the existence of both the criteria for promotion were not in dispute the High Court was justified in issuing the direction, it did.
[253 A B; E]
|
N: Criminal Appeal Nos.
270 271 of 1977.
From the Judgment and Order dated 10 5 1977 of the Madras High Court in W.P. No. 429 and Crl.
R.P. No. 50/77.
K. K. Venugopal, N. A. Subramaniam, C. section Vaidyanathan, Mrs. Shanta Venugopal, K. R. Chowdhary and Mrs. Veena Devi Khanna for the Appellant.
section N. Kackar, Sol.
(In Crl.
A. No. 270) R. B. Datar and R. N. Sachthey, for the Respondent.
V. P. Raman, Adv.
Genl and A. V. Rangam for the State of Tamil Nadu.
260 The Judgment of the Court was delivered by FAZAL ALI, J.
These two appeals by certificate are directed against a common order of the Madras High Court dated 10th May, 1977 dismissing the applications filed before the High Court by the appellant for quashing the order of the Special Judge, Madras dated 4th January, 1977 refusing to discharge the appellant under section 239 of the Code of Criminal Procedure (hereinafter referred to as the Code).
The facts of the case have been detailed in the judgment of the High Court and it is not necessary for us to repeat the same all over again.
However, in order to understand the points in issue, it may be necessary to give a resume of the important stages through which the case has passed and the constitutional points argued before us.
The appellant, M. Karunanidhi, was a former Chief Minister of Tamil Nadu and was the petitioner before the High Court in the applications filed by him before the High Court.
On 15 6 1976 a D.O. letter was written by the Chief Secretary to the Government of Tamil Nadu to the Deputy Inspector General of Police, CBI requesting him to make a detailed investigation into certain allegations against the appellant and others who were alleged to have abused their official position in the matter of purchase of wheat from Punjab.
A first information report was accordingly recorded on 16 6 1976 and four months later sanction under section 197 of the Code was granted by the Governor of Tamil Nadu for the prosecution of the appellant under sections 161, 468 and 471 of the Indian Penal Code and section 5(2) read with section 5 (1)(d) of the Prevention of Corruption Act (hereinafter referred to as the Corruption Act).
Thereafter, the police submitted a charge sheet against the appellant for the offences mentioned above and alleged that the appellant had derived for himself pecuniary advantage to the extent of Rs. 4 to Rs. 5 lakhs from Madenlal Gupta for passing favourable orders in respect of some firms.
The case was registered before the Special Judge and the necessary copies of the records were furnished to the appellant.
The appellant on appearing before the Special Judge filed an application for discharging him under section 239 of the Code on the ground that the prosecution against him suffered from various legal and constitutional infirmities.
The Special Judge, however, after hearing counsel for the parties rejected the application of the appellant as a result of which the appellant filed two applications in the High Court for quashing the proceedings and for setting aside the order of the Special Judge refusing to discharge the appellant.
As indicated 261 above, the High Court rejected the applications of the appellant but granted a certificate for leave to appeal to this Court and hence these appeals before us.
As far back as 30th December, 1973 the Madras Legislature had passed an Act known as The Tamil Nadu Public Men (Criminal Misconduct) Act, 1973 hereinafter referred to as the State Act.
The State Act was passed after obtaining the assent of the President of India.
This State Act was, however, amended by Act 16 of 1974 and the President 's assent was received on 10th April, 1974.
According to the provisions of the State Act the statute was brought into force by virtue of a notification with effect from 8 5 1974.
According to the allegations made against the appellant, the acts said to have been committed by him fell within the period November 1974 to March, 1975.
On 31 1 1976 by virtue of the provisions of Article 356 President 's rule was imposed in the State of Tamil Nadu and the Ministry headed by the appellant was dismissed and a Proclamation to his effect was issued on the same date.
The High Court decided the petitions of the appellant on 10 5 1977 and granted a certificate for leave to appeal to this Court on 27 7 1977.
Subsequently, however, the State Act was repealed and the President 's assent to the repealing of the State Act was given on 6 9 1977.
Thus, it is manifest that by the time the appeal has reached this Court and was taken up for hearing the State Act no longer exists.
Consequently, some of the constitutional points raised by the learned counsel for the appellant before the Court do not survive for consideration before us.
Faced with this situation, Mr. Venu Gopal, learned counsel for the appellant has raised only two points before us.
In the first place, he submitted that even though the State Act was repealed on 6 9 1977 during the time that it was in force, it was wholly repugnant to the provisions of the Code, the Corruption Act and the Criminal Law Amendment Act and by virtue of Article 254(2) of the Constitution of India the provisions of the aforesaid Central Acts stood repealed and could not revive after the State Act was repealed.
The constitutional position, it is submitted, was that even though the State Act was repealed the provisions of the Central Acts having themselves been protanto repealed by the State Act when it was passed could not be pressed into service for the purpose of prosecuting the appellant unless those provisions were re enacted by the appropriate legislature.
A number of grounds were raised by counsel for the appellant in support of the first plank of his argument that the State Act was repugnant to the provisions of the Central Acts as a result of which the former was rendered void.
262 Secondly, it was argued that even assuming that the State Act has ceased to exist and the Central Acts apply to the facts of the present case, the appellant cannot be prosecuted under any of the sections of the Penal Code or the Corruption Act, because being the Chief Minister of the State at the relevant time he was not a public servant as defined in section 21 clause (12) of the Indian Penal Code.
The argument was that by virtue of the position that the appellant enjoyed as Chief Minister there was no relationship of master and servant between him and the Government and he was acting as a constitutional functionary and, therefore, could not be described as a public servant as contemplated by section 21(12) of the Penal Code.
We propose to deal with the two arguments separately.
We would first deal with the question of repugnancy as raised by learned counsel for the appellant.
It is true that the State Act was passed by the Legislature of Tamil Nadu and the assent of the President was obtained on 30th December, 1973.
By virtue of the provisions of Article 254 (2) of the Constitution since the assent of the President had been given the State Act was to prevail over the Central Acts so far as the State of Tamil Nadu was concerned, but the serious question to be considered is as to whether or not there was a real repugnancy resulting from an irreconcilable inconsistency between the State Act and the Central Acts.
Article 254 of the Constitution runs thus: "254.
Inconsistency between laws made by Parliament and laws made by the Legislatures of States: (1) If any provision of a law made by the Legislature of a State is repugnant to any provision of a law made by Parliament which Parliament is competent to enact, or to any provision of an existing law with respect to one of the matters enumerated in the Concurrent List, then, subject to the provisions of clause (2), the law made by Parliament, whether passed before or after the law made by the Legislature of such State, or, as the case may be, the existing law, shall prevail and the law made by the Legislature of the State shall, to the extent of the repugnancy, be void.
(2) Where a law made by the Legislature of a State with respect to one of the matters enumerated in the Concurrent List contains any provision repugnant to the provisions of an earlier law made by Parliament or an existing law with respect to that matter, then, the law so made by the Legislature of such State shall, if it has been reserved for the consideration of the President and has received his assent, prevail in that State: 263 Provided that nothing in this clause shall prevent Parliament from enacting at any time any law with respect to the same matter including a law adding to, amending, varying or repealing the law so made by the Legislature of State".
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.
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.
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 264 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.
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 Constitution.
It is neither alleged or argued that Parliament has at any time after the State Act was passed proceeded to pass any law as contemplated by the Proviso to Article 254.
As, however, the State law has already been repealed and the President 's assent to the said repeal has been received as far back as 6 9 1977 we are concerned only with the limited question as to whether if the State law had repealed or overruled the provisions of the Central law what will be the position after the State law itself ceases to exist.
It is true that the doctrine of eclipse would not apply to the constitutionality of the Central law and the only question we have to determine is whether there was such an irreconcilable inconsistency between the State Act and the Central Acts that the provisions of the Central Act stood repealed and unless re enacted the said provisions cannot be invoked even after the State Act was itself repealed.
In order, however, to enter into the domain of repugnancy of the two Acts we have to consider the relevant provisions of the Central Acts and of the State Act.
The High Court has on a very careful and cautious analysis of the various provisions of the two Acts come to a clear finding that there is no repugnancy between the State Act and the Central Acts, but the State Act merely creates a new and distinct offence which in its nature and purport is essentially different from the offences contemplated by the Indian Penal Code and the Corruption Act.
It has been pointed out by the High Court as also 265 by the Solicitor General that not only the ingredients of the offences created by the State Act are different from those of the Central Act, but even the procedure is different.
It was further argued by the Solicitor General that there is absolutely no repugnancy between the two Acts and both can operate in their respective fields.
In order to appreciate this question, we would briefly refer to the scheme of the State Act.
Section 2 defines certain dignitaries like Commissioner, Additional Commissioner, Government, Public man, public servant.
Clause (a) of section 2 defines 'Commissioner ' thus: " 'Commissioner ' or "Additional Commissioner" means the Commissioner of Inquiries or an Additional Commissioner of Inquiries, as the case may be, appointed under section 4".
Clause (c) of section 2 defines 'public man ' thus: "Public man" means (i) any person who is or has been the Chief Minister or any other Minister of the State; (ii) a person who is or has been a Member of the Legislative Assembly or of the Legislative Council of the State; or (iii)a person who is or has been a Mayor or Deputy Mayor of the Municipal Corporation of Madras or of Madurai or Chairman of any Standing or Subject or other Committee constituted or deemed to be constituted under the Madras City Municipal Corporation Act, 1919 (Tamil Nadu Act IV of 1919) or the Madurai City Municipal Corporation Act, 1971 (Tamil Nadu Act 15 of 1971) as the case may be; (iv) a person who is or has been the Chairman or Vice Chairman of a Municipal Council or Chairman of any Standing or Subject or other Committee constituted or deemed to be constituted under the Tamil Nadu District Municipalities Act, 1920 (Tamil Nadu Act V of 1920) or any other law for the time in force; (v) a person who is or has been the Chairman or Vice Chairman of a Panchayat Union Council or Chairman or President of any Standing or Subject or other Committee of such council constituted or deemed to be 266 constituted under the Tamil Nadu Panchayats Act, 1958 (Tamil Nadu Act XXXV of 1958), or any other law for the time being in force; (vi) a person other than a Government servant who is or has been the Chairman of (a) any corporation (not being a local authority) established by or under a State or Provincial Act and owned or controlled by the State Government; (b) any Government company within the meaning of section 617 of the (Central Act 1 of 1956), in which not less than fifty one per cent of the paid up share capital is held by the State Government, or any company which is a subsidiary of a company in which not less than fifty one per cent of the paid up share capital is held by the State Government".
It may be noticed here that the concept of public man as contemplated by the State Act differs in certain respects from that of a public servant as contemplated by section 21(12) of the Penal Code.
To begin with, under the State Act a public man clearly includes the Chief Minister or any other Minister of the State as also a member of the State Legislative Assembly or Legislative Council.
Secondly, the word 'public man ' appearing in Section 2(c) clearly excludes a Government servant, unless he falls within the categories of (a), (b) and (c) of clause (vi) of section 2 of the State Act.
This is a basic departure from the provisions of the Penal Code where the word 'public servant ' has been used in the widest possible sense so as to include not only Government servants who are receiving salary from the Government, but also other dignitaries who are in the pay of the Government.
Section 3 clauses (1), (2) and (3) define criminal misconduct which is almost the same as defined by the provisions of the Corruption Act and the Penal Code (sections 5(2) and 5(1) (d) of the Corruption Act and section 161 of the Indian Penal Code).
It may, however, be noted here that the State Act does not make sections 468 and 471 of the Indian Penal Code any offence under this Act.
Section 4 prescribes the procedure for appointment of a high 267 powered tribunal for the purpose of holding investigation into the allegations made against any public man.
Sections 4 and 5 run thus: "4.
Appointment of Commissioner of Inquiries and Additional Commissioner of Inquiries: (1) For the purpose of conducting investigation in accordance with the provisions of this Act, the Government shall, on the recommendation of the Chief Justice of the High Court appoint, by notification, a person to be known as Commissioner of Inquiries and one or more persons to be known as Additional Commissioner of Inquiries.
(2) The Commissioner shall be a person who is, or who is qualified for appointment as, or who has been, a Judge of a High Court and an Additional Commissioner shall be a person who is, or who is qualified for appointment as, or who has been, a District Judge.
(3) Every person appointed as the Commissioner or Additional Commissioner shall, before entering upon his office, make and subscribe before the Chief Justice of the High Court or some person appointed in that behalf by him an oath for affirmation in the form set out for the purpose in the First Schedule.
(4) The Additional Commissioner shall be subject to the administrative control of the Commissioner, and in particular, for the purpose of convenient disposal of investigations under this Act, the Commissioner may issue such general or special directions as he may consider necessary to the Additional Commissioner; Provided that nothing in this sub section shall be construed to authorise the Commissioner to question any finding conclusion or recommendation of an Additional Commissioner.
x x x x x 5.
Term of office and other conditions of service of Commissioner and Additional Commissioner: x x x x x (4) There shall be paid to the Commissioner and the Additional Commissioner such salaries as are specified in the Second Schedule.
268 (5) The allowances and pension payable to, and other conditions of service of, the Commissioner or Additional Commissioner shall be the same as admissible (a) to a Judge of a High Court in the case of the Commissioner, (b) to a District Judge in the case of an Additional Commissioner: Provided that the allowances and pension payable to, and other conditions of service of, the Commissioner or an Additional Commissioner shall not be varied to his disadvantage after his appointment".
Another important provision which is contained in the State Act but not in the Central Acts is a provision regarding limitation.
Under section 8 which was introduced by section 2 of the Tamil Nadu Amending Act 16 of 1974 it is provided that the Commissioner or the Additional Commissioner shall not investigate any complaint involving criminal misconduct which is made after the expiry of 5 years from the date on which the criminal misconduct complained against was alleged to have been committed or after the expiry of one year from the date on which the public man ceased to be such public man.
The provisions of section 8 may be extracted thus: "6.
Limitation for preferring complaints: (1) The Commissioner or an Additional Commissioner shall not investigate or cause to be investigated any complaint involving criminal misconduct if the complaint is made: (i) after the expiry of five years from the date on which the criminal misconduct complained against was alleged to have been committed; or (ii) after the expiry of one year of the date on which the public ceases to be such public man, Whichever is later.
(2) Notwithstanding anything contained in sub section (1), the Commissioner or an Additional Commissioner shall not investigate or cause to be investigated any complaint involving criminal misconduct, the complaint is made after the expiry of one year from the date on which the action complained against becomes known to the complainant".
269 Similarly section 10 of the State Act confers plenary powers on the Commissioner or the Additional Commissioner to prescribe a procedure for conducting an investigation in respect of a complaint and runs thus: "10.
Procedure in respect of investigation of criminal misconduct: (1) The procedure for conducting any investigation in respect of a complaint of criminal misconduct against any public man shall be such as the Commissioner or the Additional Commissioner considers appropriate in the circumstances of the case.
(2) Subject to the provisions of sub section (1), where any complaint of criminal misconduct against a public man is received by the Commissioner or Additional Commissioner, the Commissioner or Additional Commissioner shall make or cause to be made a preliminary investigation to find out whether there is any prima facie case against the public man in respect of the allegation of criminal misconduct: x x x (3) Where the Commissioner or Additional Commissioner gives a finding under sub section (2) that there is no prima facie case against the public man in respect of the allegation of criminal misconduct, he shall dismiss the complaint after briefly recording his reasons for doing so: Provided that the Commissioner or Additional Commissioner shall not dismiss any complaint under this sub section, unless the complainant has been given an opportunity of being heard, if such complainant has not already been heard under clause (a) of the proviso to sub section (2).
x x x x" Under clause (3) of section 10 the Commissioner or the Additional Commissioner is empowered to dismiss the complaint if he is satisfied that no prima facie case against the public man has been made out, but such an order of dismissal can be made only after the complainant has been given an opportunity of being heard.
Section 11 is also a new provision as compared to the Central Acts which provides for grant of compensatory costs to the public man if the allegation made against him are found to be false, frivolous or vexatious to the knowledge of the complainant.
270 Section 12 gives a right of appeal to a Division Bench of the High Court against any order passed by the Commissioner or Additional Commissioner under sub section (1) of section 11 granting compensatory costs to the public man and runs thus: "Appeal against an order under section 11: (1) Against any order passed by the Commissioner or Additional Commissioner under sub section (1) of section 11, the complainant may, within such period as may be prescribed, appeal to a Special Appellate Tribunal consisting of two Judges of the High Court nominated from time to time by the Chief Justice in that behalf".
Section 14 provides the procedure for examination of witnesses, receiving of affidavits, issuing of commissions etc.
Section 15 provides an enhanced punishment of seven years for criminal misconduct as compared to the punishment provided by the Corruption Act.
Section 16 provides for prosecution of a complainant if his complaint is found to be false, frivolous and vexatious and such a complainant is liable to be punished for a term which may extend to three years and fine, but such a prosecution can be launched only with the previous sanction of the Commissioner.
Section 16 runs thus: "16.
Punishment for false, frivolous or vexatious complaint: (1) Notwithstanding anything contained in this Act, every person who makes a false, frivolous or vexatious complaint against a public man under this Act, shall on conviction be punished with imprisonment for a term which may extend to three years and shall also be liable to fine".
A careful analysis, therefore, of the various provisions of the State Act leads to the irresistible inference that the State Act was passed with a view to afford sufficient protection to a public man by enjoining a summary inquiry or investigation by a high and independent Tribunal of the status of a High Court Judge or a Senior District Judge to instill confidence in the people and to prevent public man from being prosecuted on false, frivolous and vexatious allegations.
Although the ingredients of criminal misconduct as defined in section 5(1) (d) of the Corruption Act are substantially the same in the State Act as in the Central Acts but here also the punishment is much severer in the case of the State Act than the one contained in the Central Acts.
It is, therefore, manifest that the State Act does not contain any provision which is repugnant to the Central Acts, but is a sort of comple 271 mentary Act which runs pari passu the Central Acts mentioned above.
After the investigation by the Commissioner under the State Act is complete and a report is submitted, section 18 of the State Act provides thus: "18.
Report of the Commissioner and Additional Commissioner: (1) Where as a result of any detailed investigation under sub section (4) of section 10 in respect of a complaint of criminal misconduct against a public man, the Commissioner or an Additional Commissioner is of opinion, (a) that it is expedient in the interest of justice that the public man against whom criminal misconduct has been alleged, should be prosecuted for an offence under section 15; or (b) that the allegation has not been substantiated, he shall record a finding to that effect stating his reasons therefor and report the same to the Government.
(2) In cases falling under clause (a) of sub section (1), the public man shall be prosecuted and tried under section 6 of the Criminal Law (Amendment) Act, 1952 (Central Act 46 of 1952)".
The State Act enjoins that the public man concerned will have to be prosecuted under the Criminal Law (Amendment) Act of 1952.
Thus, far from there being any inconsistency, the provisions of the Criminal Law (Amendment) Act are directly applied to a public man by the State Act after the preliminary investigation by the Commissioner is over.
It seems to us that what the State Act does is merely to create different and distinct offences and not to over rule any provisions of the Central Act.
It was, however, strongly contended by Mr. Venu Gopal that the provisions contained in the State Act run counter to those of the Central Acts in respect of the following matters: 1.
The procedure for investigation of the offences by a Central agency as contemplated by the Corruption Act is dispensed with and is instead invested in a Commissioner appointed under the State Act.
The provision under the Prevention of Corruption Act regarding the grant of sanction under section 197 of the Code to the accused is given a complete go by and instead a Commissioner is appointed to hold a regular 272 inquiry for himself and then to submit his report.
Thus, an accused who has been tried under the State Act is deprived of protection afforded to every Government servant regarding grant of a sanction by the appointing authority.
It is thus suggested that the protection, if any, given by the State Act is purely illusory.
In order, however, to understand the argument of the learned counsel for the appellant, it may be necessary to consider the question of repugnancy in a little broader perspective.
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.
That such an inconsistency is absolutely irreconcilable.
That the inconsistency between the provisions of the two Acts is of such a 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.
In Colin Howard 's Australian Federal Constitutional Law, 2nd Edition the author while describing the nature of inconsistency between the two enactments observed as follows: "An obvious inconsistency arises when the two enactments produce different legal results when applied to the same facts".
In the case of Hume vs Palmer Knox, C.J. observed as follows: "The rules prescribed by the Commonwealth Law and the State law respectively are for present purposes substantially identical, but the penalties imposed for the contravention differ. . . .
In these circumstances, it is I think, clear that the reasons given by my brothers Issacs and Starke for the deci 273 sions of this Court in Union Steamship Co. of New Zealand vs Commonwealth(1) and Clyde Engineering Co. vs Cowburn establish that the provisions of the law of the State for the breach of which the appellant was convicted are inconsistent with the law of the Commonwealth within the meaning of sec.
109 of the Constitution and are therefore invalid".
Issacs, J. observed as follows: "There can be no question that the Commonwealth Navigation Act, by its own direct provisions and the Regulations made under its authority, applies upon construction to the circumstances of the case.
It is inconsistent with the State Act in various ways, including (1) general supersession of the regulations of conduct, and so displacing the State regulations, whatever those may be; (2) the jurisdiction to convict, the State law empowering the Court to convict summarily, the Commonwealth Law making the contravention an indictable offence, and therefore bringing into operation sec.
80 of the Constitution, requiring a jury; (3) the penalty, the State providing a maximum of $ 50 the Commonwealth Act prescribing a maximum of $ 100, or imprisonment, or both; (4) the tribunal itself".
Starke, J. observed as follows: "It is not difficult to see that the Federal Code would be 'disturbed or deranged ' if the State Code applied a different sanction in respect of the same act.
Consequently the State regulations are, in my opinion, inconsistent with the law of the Commonwealth and rendered invalid by force of sec.
109 of the Constitution".
In a later case of the Australian High Court in exhibit Parte Mclean(3) Issacs and Starke, JJ.
while dwelling on the question of repugnancy made the following observation: "In Cowburn 's case (supra) is stated the reasoning for that conclusion and we will now refer to those statements without repeating them.
In short, the very same conduct by the same persons is dealt with in conflicting terms by the Commonwealth and State Acts.
A Court, seeing that, has 274 no authority to inquire further, or to seek to ascertain the scope or bearing of the State Act.
It must simply apply sec.
109 of the Constitution, which declares the invalidity protanto of the State Act".
Similarly Dixon, J. observed thus: "When the Parliament of the Commonwealth and the Parliament of a State each legislate upon the same subject and prescribe what the rule of conduct shall be, they make laws which are inconsistent, notwithstanding that the rule of conduct is identical which each prescribes, and sec.
109 applies.
That this is so is settled, at least when the sanctions they impose are diverse Hume vs Palmer (supra)".
In the case of Zaverbhai Amaidas vs The State of Bombay(1) this Court laid down the various tests to determine the inconsistency between two enactments and observed as follows "The important thing to consider with reference to this provision is whether the legislation is 'in respect of the same matter '.
If the later legislation deals not with the matters which formed the subject of the earlier legislation but with other and distinct matters though of a cognate and allied character, then Article 254 (2) will have no application.
The principle embodied in section 107 (2) and Article 254 (2) is that when there is legislation covering the same ground both by the Centre and by the Province, both of them being competent to enact the same, the law of the Centre should prevail over that of the State".
"It is true, as already pointed out, that on a question under Article 254 (1) whether an Act of Parliament prevails against a law of the State, no question of repeal arises; but the principle on which the rule of implied repeal rests, namely, that if subject matter of the later legislation is identical with that of the earlier, so that they cannot both stand together, then the earlier is repealed by the later enactment, will be equally applicable to a question under Article 254(2) whether the further legislation by Parliament is in respect of the same matter as that of the State law".
In the case of Ch.
Tika Ramji & Ors.
vs The State of Uttar Pradesh & Ors.(2) while dealing with the question of repugnancy 275 between a Central and a State enactment, this Court relied on the observations of Nicholas in his Australian Constitution, 2nd Ed.
p.303, where three tests of inconsistency or repugnancy have been laid down and which are as follows: "(1) There may be inconsistency in the actual terms of the competing statutes R. Brisbane Licensing Court(1).
(2) Though there may be no direct conflict, a State law may be inoperative because the Commonwealth law, or the award of the Commonwealth Court, is intended to be a complete exhaustive code Clyde Engineering Co. Ltd. vs Cowburn (supra).
(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 Victoria vs Commonwealth(2) Wenn vs Attorney General(3) This Court also relied on the decisions in the case of Hume vs Palmer as also the case of Ex Parte Mclean (supra) referred to above.
This Court also endorsed the observations of Sulaiman, J. in the case of Shyamakant Lal vs Rambhajan Singh (4) where Sulaiman, J. observed as follows: "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".
In the case of Om Prakash Gupta vs State of U.P.(5) where this Court was considering the question of the inconsistency between the two Central enactments, namely, the Indian Penal Code and the Prevention of Corruption Act held that there was no inconsistency and observed as follows: "It seems to us, therefore, that the two offences are distinct and separate.
This is the view taken in Amarendra 276 Nath Roy vs The State(1) and we endorse the opinion of the learned Judges, expressed therein.
Our conclusion, therefore, is that the offence created under section 5 (1) (c) of the Corruption Act is distinct and separate from the one under section 405 of the Indian Penal Code and, therefore, there can be no question of section 5 (1) (c) repealing section 405 of the Indian Penal Code.
If that is so, then, Article 14 of the Constitution can be no bar".
Similarly in the case of Deep Chand vs The State of Uttar Pradesh & Ors.
(2) this Court indicated the various tests to ascertain the question of repugnancy between the two statutes and observed as follows: "Repugnancy between two statutes may thus be ascertained on the basis of the following three principles: (1) Whether there is direct conflict between the two provisions; (2) Whether Parliament intended to lay down an exhaustive code in respect of the subject matter replacing the Act of the State Legislature; and (3) Whether the law made by Parliament and the law made by the State Legislature occupy the same field".
In the case of Megh Raj and Ors.
vs Allah Rakhia & Ors.(3) where Varadachariar, J. speaking for the Court pointed out that where as in Australia a provision similar to section 107 of the Government of India Act, 1935 existed in the shape of section 109 of the Australian Constitution, there was no corresponding provision in the American Constitution.
Similarly, the Canadian cases have laid down a principle too narrow for application to Indian cases.
According to the learned Judge, the safe rule to follow was that where the paramount legislation does not purport to be exhaustive or unqualified there is no inconsistency and in this connection observed as follows: "The principle of that decision is that where the paramount legislation does not purport to be exhaustive or unqualified, but itself permits or recognises other laws restricting or qualifying the general provision made in it, it can 277 not be said that any qualification or restriction introduced by another law is repugnant to the provision in the main or paramount law".
"The position will be even more obvious, if another test of repugnancy which has been suggested in some cases is applied, namely, whether there is such an inconsistency between the two provisions that one must be taken to repeal the other by necessary implication" In the case of State of Orissa vs M. A. Tulloch & Co. (1) Ayyangar J. speaking for the Court observed as follows: "Repugnancy arises when two enactments both within the competence of the two Legislatures collide and when the Constitution expressly or by necessary implication provides that the enactment of one Legislature has superiority over the other then to the extent of the repugnancy the one supersedes the other.
But two enactments may be repugnant to each other even though obedience to each of them is possible without disobeying the other.
The test of two legislations containing contradictory provisions is not, however, the only criterion of repugnancy, for if a competent legislature with a superior efficacy expressly or impliedly evinces by its legislation an intention to cover the whole field, the enactments of the other legislature whether passed before or after would be overborne on the ground of repugnance.
Where such is the position, the inconsistency is demonstrated not by a detailed comparison of provisions of the two statutes but by the mere existence of the two pieces of legislation".
In the case of T. section Balliah vs T. section Rangachari(2) it was pointed out by this Court that before coming to the conclusion that there is a repeal by implication, the Court must be satisfied that the two enactments are so inconsistent that it becomes impossible for them to stand together.
In other words, this Court held that when there is a direct collision between the two enactments which is irreconcilable then only repugnancy results.
In this connection, the Court made the following observations: "Before coming to the conclusion that there is a repeal by implication, the Court must be satisfied that the two enactments are so inconsistent or repugnant that they cannot 278 stand together and the repeal of the express prior enactment must flow from necessary implication of the language of the later enactment.
It is therefore necessary in this connection to scrutinise the terms and consider the true meaning and effect of the two enactments".
"The provisions enacted in section 52 of the 1922 Act do not alter the nature or quality of the offence enacted in section 177, Indian Penal Code but it merely provides a new course of procedure for what was already an offence.
In a case of this description the new statute is regarded not as superseding, nor repealing by implication the previous law, but as cumulative".
"A plain reading of the section shows that there is no bar to the trial or conviction of the offender under both enactments but there is only a bar to the punishment of the offender twice for the same offence.
In other words, the section provides that where an act or omission constitutes an offence under two enactments, the offender may be prosecuted and punished under either or both the enactments but shall not be liable to be punished twice for the same offence".
On a careful consideration, therefore, of the authorities referred to above, the following propositions emerge: 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.
That there can be no repeal by implication unless the inconsistency appears on the face of the two statutes.
That where the two statutes occupy a particular field, there is room or possibility of both the statutes operating in the same field without coming into collision with each other, no repugnancy results.
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 to operate in the same field.
279 In the light of the propositions enunciated above, there can be no doubt that the State Act creates distinct and separate offences with different ingredients and different punishments and it does not in any way collide with the Central Acts.
On the other hand, the State Act itself permits the Central Act, namely, the Criminal Law (Amendment) Act to come into its aid after an investigation is completed and a report is submitted by the Commissioner or the Additional Commissioner.
It was contended however by Mr. Venu Gopal that by virtue of the fact that the State Act has obtained the assent of the President, it will be deemed to be a dominant legislation, and, therefore, it would overrule the Central Acts.
Doubtless, the State Act is the dominant legislation but we are unable to agree with Mr. Venu Gopal that there are any provisions in the State Act which are irreconcilably or directly inconsistent with the Central Acts so as to overrule them.
Last but not the least there is a very important circumstance which completely and conclusively clinches the issue and takes the force out of the argument of Mr. Venu Gopal on the question of repugnancy.
It would be seen that in the original State Act, section 29 ran thus: "Act to overrule other laws, etc.
The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any custom, usage or contract or decree or order of a court or other authority".
This section underwent an amendment which was brought about by Tamil Nadu Act 16 of 1974 which substituted a new section 29 for the old one.
The new section which was substituted may be extracted thus: "Saving The provisions of this Act shall be in addition to, and not in derogation of, any other law for the time being in force, and nothing contained herein shall exempt any public man from any proceeding by way of investigation or otherwise which might, apart from this Act, be instituted against him".
This amendment received the assent of the President on 10th April, 1974 and was published in the Tamil Nadu Government Gazette Extraordinary dated 16th April, 1974.
We have already shown that although the State Act was passed as far back as 30th December, 1973 it received the assent of the President on the 10th April, 1974 that is to say, on the same date as Act 16 of 1974.
The Act was however brought into force on the 8th May, 1974 when the new section 29 280 which had already replaced the old section and had become a part of the statute.
Therefore, for all intents and purposes the State Act cannot be read in isolation, but has to be interpreted in conjunction with the express language contained in section 29 of the State Act.
This section has in unequivocable terms expressed the intention that the State Act which was undoubtedly the dominant legislation would only be "in addition to and not in derogation with any other law for the time being in force" which manifestly includes the Central Acts, namely, the Indian Penal Code, the Corruption Act and the Criminal Law (Amendment) Act.
Thus, the Legislature about a month before the main Act came into force clearly declared its intention that there would be no question of the State Act colliding with the Central Acts referred to above.
The second part of section 29 also provides that nothing contained in the State Act shall exempt any public man from being proceeded with by way of investigation or otherwise under a proceeding instituted against him under the Central Acts.
It is, therefore, clear that in view of this clear intention of the legislature there can be no room for any argument that the State Act was in any way repugnant to the Central Acts.
We have already pointed out from the decisions of the Federal Court and this Court that one of the important tests to find out as to whether or not there is repugnancy is to ascertain the intention of the legislature regarding the fact that the dominant legislature allowed the subordinate legislature to operate in the same field pari passu the State Act.
Craies in his Interpretation on Statute Law 6th Ed.
p. 369 observes as follows: "Many earlier statutes contain clauses similar in effect to the general rule, but without the confusing words as to contrary intention.
These statutes, of some of which a list is given below, seem not to be affected by the above rule, save so far as it enables the revisers of the statute book to excise the particular clauses.
In accordance with this rule, penalties imposed by statute for offences already punishable under a prior statute are regarded as cumulative or alternative and not as replacing the penalty to which the offender was previously liable.
" Such an intention is clearly discernible from the provisions of section 29 of the State Act.
Mr. Venu Gopal tried to rebut this argument on the ground that section 29 would have no application where the inconsistency between the dominant statute and the subordinate statute is direct and complete.
We have already found on a discussion of 281 the various provisions of the State Act that there is no direct inconsistency at all between the State Act and the Central Acts, and this affords a sufficient answer to the argument of Mr. Venu Gopal.
Having, therefore, given our anxious consideration to the import and ambit of section 29 it seems to us that the provisions of section 29 would be presumptive proof of the fact that there is no repugnancy between the State Act and the Central Acts nor did either the legislature or the President intend to create any repugnancy between these Acts as a result of which the criticism regarding the repugnancy is completely obliterated in the instant case and we, therefore, hold that the State legislature never intended to occupy the same field covered by the Central Acts.
It was also contended by Mr. Venu Gopal that if the Central Acts being repugnant to the State Act are pressed into service even after the repeal of the State Act, the Central Acts would stand repealed hence the prosecution of the appellant would be hit by Article 20(3) of the Constitution, i.e. the appellant cannot be prosecuted for an ex post facto offence.
On our findings in this case that there is no inconsistency between the State Act and the Central Acts the application of Article 20(3) of the Constitution to the facts of this case does not arise at all.
We, therefore, find ourselves in complete agreement with the view taken by the High Court that the State Act creates new and distinct offences and is not in any way repugnant to any provisions of the Central Acts and consequently overruled the first limb of the argument of counsel for the appellant.
Similarly the contention of Mr. Venu Gopal as to whether or not the prosecution of the appellant would be violative of Article 14 of the Constitution is not available to the appellant, and consequently the learned counsel gave up this point and in our opinion very rightly because since the State Act has now been repealed the question of the prosecution of the appellant hereafter under the State Act does not arise at all, and, therefore, the question of two remedies being open to the prosecution which they may elect at their own option does not arise in this case.
The appellant can be prosecuted only under the Corruption Act and the Penal Code and under no other Act at the moment.
Moreover, it was obviously wrong to say that the earlier Central Law became violative of Article 14 as soon as the State law was enacted.
This brings us to the second limb of the argument of the learned counsel for the appellant which relates to the import and connotation of the term 'public servant ' appearing in section 21(12) of the Indian 282 Penal Code.
Clause 12 of section 21 which is the relevant provision so far as the present case is concerned runs thus : "21.
The words 'public servant ' denote a person falling under any of the descriptions hereinafter following namely: X X X Twelfth Every person (a) in the service or pay of the Government or remunerated by fees or commission for the performance of any public duty by the Government: X X X It was vehemently contended by Mr. Venu Gopal that having regard to the constitutional and public duties of a Chief Minister or a Minister he cannot be deemed to be a public servant in any sense of the term.
He further contended that the entire clause (12) (a) should be read as a whole and cannot be severed into two limbs in as much as the words 'in the service or pay of the Government ' are used as synonyms.
It was further contended that the words 'in the service or pay of the Government ' clearly connote the relationship of master and servant a relationship which is completely beyond the concept of the position of a Minister or a Chief Minister.
We, however, agree that so far as the first part of clause (12) (a) is concerned, namely "in the service of the Government ' undoubtedly signifies a relationship of master and servant where the employer employs the employee on the basis of a salary or remuneration.
But we are of the opinion that so far as the second limb 'in the pay of the Government ' is concerned, that appears to be of a much wider amplitude so as to include within its ambit even public servant who may not be a regular employee receiving salary from his master.
In other words, we think that even a Minister or a Chief Minister will be clearly covered by the expression 'person in the pay of the Government '.
Mr. Venu Gopal, however, relied on the meaning of the words "in the pay of ' as appearing in the various dictionaries.
In Shorter Oxford English Dictionary the expression 'in the pay of ' is defined thus "To give money, etc., in return for something or in discharge of an obligation.
Of a thing or action.
To yield an adequate return.
To give money or other equivalent value for".
Similarly 'Payer ' is defined thus: "One who pays a sum of money".
283 In Webster 's Third New International Dictionary the expression 'in the pay of ' is indicated to mean: "Compensate, remunerate, satisfy, reimburse, indemnify, recompense, repay.
Pay is a general term, lacking particular connotation but sometimes bluntly stressing the purchase of service, pay a machinist high wages".
"Wages, salary remuneration".
In Webster 's New World Dictionary the expression 'in the pay of ' is thus defined: "Stresses the idea of payment for a service rendered, but it often also carries an implication of reward (a bumper crop remunerated the farmer for his labors)".
In Words and Phrases, Permanent Edition Vol.
31A p. 176 the meaning of the word 'pay ' is given thus: "Pay" is remuneration, wages or salary.
To remunerate; to recompense, to give any pay".
In Venkataramaya 's Law Lexicon Vol.
II p.1122 the expression 'to pay money ' has the following connotation: "To pay money is to pay it in respect of a right which some person has to receive it".
In Corpus Juris Secundum Vol.
70 at page 200 the word 'pay ' if used as a noun is defined as remuneration, wages, compensation, salary and the following observations are also made: "To noun 'pay ' has been held equivalent to, or synonymous with, 'compensation ', salary and wages and has been compared with, or distinguished from, 'allowance ' and 'consideration '".
A careful analysis of the meanings assigned to the word 'pay ' in the various dictionaries and the texts referred to above would clearly reveal that the expression 'in the pay of ' connotes that a person is getting salary, compensation, wages or any amount of money.
This by itself however does not lead to the inference that a relationship of master and servant must necessarily exist in all cases where a person is paid salary.
This aspect of the matter would become crystal clear if we examine the nature and the constitutional position and status of a Minister or a Chief Minister.
284 Article 164 of the Constitution runs thus: "Other provisions as to Ministers: (1) The Chief Minister shall be appointed by the Governor and the other Ministers shall be appointed by the Governor on the advice of the Chief Minister, and the Ministers shall hold office during the pleasure of the Governor: Provided that in the States of Bihar, Madhya Pradesh and Orissa, there shall be a Minister in Charge of tribal welfare who may in addition be in charge of the welfare of the Scheduled Castes and backward classes or any other work".
This Article clearly shows that a Chief Minister is appointed by the Governor and having been appointed by the Governor it is manifest that he is subordinate to the Governor.
Even in section 52 (1) of the Government of India Act, 1935 which preceded our Constitution the provision was worded thus: "52 (1) The Governor of a Governor 's province may, by notification, appoint ministers, not being members of his executive council or other officials to administer transferred subjects, and any ministers so appointed shall hold office during his pleasure: There may be paid to any minister so appointed in any province the same salary as is payable to a member of the executive council in that province, unless a smaller salary is provided by vote of the legislative council of the province".
In this section also it was the Governor who alone had the power to choose the ministers.
In fact, in Article 164 the word 'appointment ' is much higher than the concept of a person being chosen.
Article 164(5) provides for the salary and allowances of Ministers and runs thus: "164 (5) The salaries and allowances of Ministers shall be such as the Legislature of the State may from time to time by law determine and, until the Legislature of the State so determines, shall be as specified in the Second Schedule".
Under this provision the Ministers on being appointed by the Governor are entitled to such salaries and allowances as the Legislature of the State may determine from time to time and until this is done, the emoluments will be such as are specified in the Second 285 Schedule.
As however all the Legislatures of the States as also Parliament have already passed Acts providing for the salaries and emoluments of the Chief Minister and the Ministers the specification of their emoluments in the Second Schedule to the Constitution have been deleted.
Article 167 lays down the duties of the Chief Minister and runs thus: "167.
Duties of Chief Minister as respects the furnishing of information to Governor etc.
It shall be the duty of the Chief Minister of each State (a) to communicate to the Governor of the State all decisions of the Council of Ministers relating to the administration of the affairs of the State and proposals for legislation; (b) to furnish such information relating to the administration of affairs of the State and proposals for legislation as the Governor may call for; (c) if the Governor so requires, to submit for the consideration of the Council of Ministers any matter on which a decision has been taken by a Minister but which has not been considered by the Council".
It is, therefore, clear that by virtue of the provisions contained in Article 167, the Chief Minister undoubtedly performs a public duty of the nature as enjoined by clauses (a) to (c) of Article 167.
It is also clearly provided in the Constitution that the Chief Minister or the Ministers are entitled to salaries or allowances obviously in lieu of public duties that they perform.
The salaries given to the Chief Minister or the Ministers are given from the Government funds, and therefore, there will be no difficulty in holding that the Ministers are in the pay of the Government inasmuch as they receive their salaries, remunerations or wages from the Government.
Mr. Venu Gopal, however, submitted that no analogy can be drawn between the constitutional provisions and the provisions contained in the Government of India Act because the constitutional position of a Chief Minister under the Constitution was not the same as under the Government of India Act where the Governor enjoyed vast and plenary powers and was not bound by the advice of the Council of Ministers as the Governor is under our Constitution.
It is not necessary to probe into this aspect of the matter, because the Constitution clearly lays down that the Governor appoints the Chief Minister and being the appoint 286 ing authority he is also the dismissing authority.
We are not at all concerned in the instant case as to the circumstances under which the Governor can appoint or dismiss the Chief Minister.
Once it is conceded that the Governor appoints the Chief Minister who is paid a salary according to a statute made by the legislature from the Government funds, the Chief Minister becomes a person in the pay of the Government so as to fall squarely within clause (12) of section 21 of the Penal Code.
There is another circumstance to show that a Chief Minister or a Minister is undoubtedly a public servant which was relied upon by the High Court in repelling the argument of Mr. Venu Gopal.
Section 199 of the Code runs thus: "199 (2) Notwithstanding anything contained in this Code, when any offence falling under Chapter XXI of the Indian Penal Code is alleged to have been committed against a person who, at the time of such commission is the President of India, the Vice President of India, the Governor of a State, the Administrator of a Union Territory or a Minister of the Union or of a State or of a Union territory, or any other public servant employed in connection with the affairs of the Union or of a State in respect of his conduct in the discharge of his public functions a Court of Session may take cognizance of such offence, without the case being committed to it, upon a complaint in writing made by the Public Prosecutor".
The use of words 'other public servants ' following a Minister of the Union or of a State clearly show that a Minister would also be a public servant as other public servants contemplated by section 199 (2) of the Code are the Code being a statute complimentary and allied to the Penal Code can be looked into for the purpose of determining the real meaning and import of the words 'public servant ' as used in the aforesaid section.
The Solicitor General placed reliance on the decision of this Court in the case of Dattatraya Narayan Patil vs State of Maharashtra(1) where this Court had held in a slightly different context that a Minister was a public servant.
Mr. Venu Gopal has, however, distinguished this decision on the ground that this Court proceeded on the assumption that it was not disputed before the Court that the Minister was a Public Servant and the case having been decided on the concession 287 of the parties cannot be relied upon by the Solicitor General.
In that case to which two of us (Untwalia and Fazal Ali, JJ.) were parties to the judgment, the following observations were made: "The duty assigned to a public servant by his master, be it be under a statute or by an executive order, will assume the character of public duty, provided the duty assigned is not illegal or against public policy.
Will it make any difference in the case of a Minister? In our judgment, not. The Minister is a public servant not disputed".
These observations no doubt fortify our opinion that the Chief Minister is a public servant which is based on the reasons that we have already given and which are different from those given in the case cited before us.
In the case of Emperor vs Sibnath Banerji & Ors.(1) the Privy Council clearly held that it was not in a position to accept the suggestion of the counsel that the Minister was not subordinate to the Governor.
This was the precise argument which had been put forward by Mr. Venu Gopal when he contended that the Chief Minister is not subordinate to the Governor.
The Privy Council observed as follows in this connection: "So far as it is relevant in the present case, their Lord ships are unable to accept a suggestion by counsel for the respondents that the Home Minister is not an officer subordinate to the Governor within the meaning of s.49 (1), and so far as the decision in Emperor vs Hemendra Prosad Ghoshe (19) I.L.R. decides that a Minister is not such an officer their Lordships are unable to agree with it.
While a Minister may have duties to the Legislature, the provisions of s.51 as to the appointment, payment and dismissal of Ministers, and s.59 (3) and (4) of the Act of 1935, and the Business Rules made by virtue of s.59, place beyond doubt that the Home Minister is an officer subordinate to the Governor".
We find ourselves in complete agreement with the view taken by the Privy Council.
In fact the case of the Privy Council referred to above was noticed and relied upon by this Court in the case of Rao 288 Shiv Bahadur Singh & Anr.
vs The State of Vindhya Pradesh(1) where this Court observed as follows: "Clause 9 of section 21 Indian Penal Code shows that every officer in the service or pay of the Crown for the performance of any public duty is a 'public servant '.
The decision of the Privy Council in King Emperor vs Sibnath Banerji(2) is decisive to show that a Minister under the Government of India is 'an officer ' subordinate to the Governor.
On the same reasoning there can be no doubt that the Minister of Vindhya Pradesh would be an 'Officer of the State of Vindhya Pradesh.
Therefore, prior to the passing of ordinance No. XLVIII of 1949 and on the view that the Indian Penal Code with necessary adaptation mutatis mutandis was in force at least in the Rewa portion of Vindhya Pradesh (if not in the entirety of Vindhya Pradesh) the first appellant was a public servant as defined in section 21, Indian Penal Code, as adapted.
The amendment of the said section brought about therefore no substantial change in the position of the first appellant".
In the case of Namdeo Kashinath Aher vs H. G. Vartak & Anr(3) Deshpande, J. Observed as follows: "Whatever be the practical and actual position, the fact remains that it is the Governor who can accept the resignation of the Ministry or Minister and it is the Governor again who can dismiss or remove the Minister from office.
Under section 3(60) of the , the word 'State Government ' has been defined.
Clause (c) of section 3(60) is applicable to the present case and therefore the State Government is to mean the Governor for the purpose of the present case.
The result therefore is that accused No.1 is a public servant who can be said to be removable only by the State Government, meaning thereby the Governor, and I do not find any difficulty in coming to the conclusion that the second requirement of Section 197, Cr.
P.C. also is fully satisfied as far as accused No.1 is concerned".
289 In the case of section Tara Singh vs Director Consolidation of Holdings, Punjab, Jullundur & Ors.(1) the Punjab High Court took the same view and observed as follows: "It follows from the above conclusion that under Article 154 (1) of the Constitution the Governor may act directly or through his subordinate officers.
In the present case he has acted through the Development Minister.
The question arises whether he could so act.
Obviously the executive authority carries on the business of the Government and part of this business is the power given to the State Government under section 42 of the Consolidation Act.
Under Article 166 (3) of the Constitution the Governor can allocate this business to any Minister he likes. .
Moreover there can be no doubt that a Minister is subordinate to the Governor.
The Governor is the executive head of the State and this position he does not share with the Chief Minister or any other Minister.
He allocates his executive duties to various Ministers under Article 166 (3) of the Constitution.
He appoints a Minister albeit on the advice of the Chief Minister and the Minister holds office during his pleasure.
Therefore it is open to a Governor under the Constitution to dismiss an individual Minister at his pleasure.
In these circumstances there can be no doubt that a Minister is to be considered as an officer subordinate to the Governor".
We find ourselves in complete agreement with the view taken and the reasons given by the Punjab High Court in the aforesaid case.
To the same effect is a decision of the J & K High Court in the case of Bakshi Ghulam Mohd. vs G. M. Sadiq & Ors(2) where Anant Singh, J. observe as follows: "A Minister of a State is paid from its public exchequer, and he is paid for doing public duty and, in my opinion, a Minister is a 'public officer ' within the meaning of Sec. 80 as defined in Sec. 2 (17) (h) of the Civil Procedure Code".
The opinion expressed by the learned Judge is clearly in consonance with the view that we have taken in this case.
290 Three facts, therefore, have been proved beyond doubt: 1.
That a Minister is appointed or dismissed by the Governor and is, therefore, subordinate to him whatever be the nature and status of his constitutional functions.
That a Chief Minister or a Minister gets salary for the public work done or the public duty performed by him.
That the said salary is paid to the Chief Minister or the Minister from the Government funds.
It is thus incontrovertible, that the holder of a public office such as the Chief Minister is a public servant in respect of whom the Constitution provides that he will get his salary from the Government Treasury so long he holds his office on account of the public service that he discharges.
The salary given to the Chief Minister is coterminous with his office and is not paid like other constitutional functionaries such as the President and the Speaker.
These facts, therefor, point to one and only one conclusion and that is that the Chief Minister is in the pay of the Government and is, therefore, a public servant within the meaning of section 21 (12) of the Penal Code.
For the reasons given above, we are satisfied that a Chief Minister or a Minister is undoubtedly a public servant as defined in section 21(12) (a) of the Penal Code and the view taken by the High Court on this point was absolutely correct in law.
The result is that all the contentions raised by Mr. Venu Gopal, counsel for the appellant fail and the appeals are dismissed.
The case before the Special Judge will now proceed to its ultimate end according to law.
N.V.K. Appeals dismissed.
| IN-Abs | In December 1973, the Madras Legislature passed an Act known as the Tamil Nadu Public Men (Criminal Misconduct) Act, 1973 after obtaining the assent of the President.
The State Act was amended by Act 16 of 1974 and the President 's assent was received on April 10, 1974.
The provisions of the State Act were brought into force with effect from May 8, 1974.
The State Act was repealed and the President 's assent to the repealing Act was given on September 6, 1977.
The Act provided for the investigation in respect of a complaint of criminal misconduct against any 'public man by a Commissioner or the Additional Commissioner of Inquiries appointed for this purpose.
The word 'public man ' had been given a specific connotation in section 2(c) of the Act and clearly excluded a Government servant.
The appellant was the former Chief Minister of the State of Tamilnadu.
On June 15, 1976 the Chief Secretary to the State Government requested the Central Bureau of Investigation to make a detailed investigation into certain allegations that the appellant and others were alleged to have abused their official position in the matter of purchase of wheat from Punjab.
With the State Governor 's sanction a charge sheet was filed after investigation for the prosecution of the appellant under sections 161, 468 and 471 IPC and section 5(2) read with section 5(1) (d) of the Prevention of Corruption Act for allegedly having derived pecuniary advantage to the extent of Rs. 4 to 5 lakhs for passing favourable orders in respect of some firms.
The appellant applied for discharge under section 239 Cr.
P.C. on the ground that the prosecution against him suffered from various legal and constitutional infirmities.
On the application being rejected, the appellant applied to the High Court for quashing the proceedings and for setting aside the order of the Special Judge refusing to discharge him.
The High Court rejected the applications.
255 In the appeals to this Court, it was contended on behalf of the appellant: (1) Even though the State Act was repealed, the provisions of the Central Acts having themselves been protanto repealed by the State Act when it was passed could not be pressed into service for the purpose of prosecuting the appellant unless these provisions were re enacted by the appropriate legislature.
(2) It was contended that even assuming that the State Act had ceased to exist and the Central Acts applied, the appellant cannot be prosecuted under any of the sections of the Penal Code or the Corruption Act, because by virtue of the position that the appellant enjoyed as Chief Minister, there was no relationship of master and servant between him and the Government and he was acting as a constitutional functionary, and therefore could not be described as a 'public servant ' as contemplated by section 21(12) of the Penal Code.
(3) The provisions contained in the State Act run counter to those of the Central Acts in respect of the following matters; (a) The procedure for investigation of the offences by a Central Agency as contemplated by the Corruption Act is dispensed with and is instead invested in a Commissioner appointed under the State Act.
(b) The provisions under the Prevention of Corruption Act regarding the grant of sanction under section 197 of the Code to the accused is given a complete go by and instead a Commissioner is appointed to hold a regular inquiry for himself and then to submit his report.
An accused who has to be tried under the State Act is thus deprived of the protection afforded to every Government servant regarding grant of a sanction by the appointing authority.
Therefore the protection if any, given by the State Act is purely illusory, and (4) By virtue of the fact that the State Act has obtained the assent of the President, it will be deemed to be a dominant legislation, and therefore it would over rule the Central Acts.
Dismissing the appeals, ^ HELD: 1.
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).
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.
[263 D E] 2.
In such matters repugnancy may result from the following circumstances: (i) 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.
256 (ii) 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 cl.
(2) of article 254.
(iii) 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 lay 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, being purely incidental or inconsequential.
(iv) Where, however, a law made by the State Legislature on a subject covered by the Concurrent List is inconsistent with or repugnant to a previous law made by Parliament, then such a law can be protected by obtaining the assent of the President under Art 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 over rule 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.
[263 F 264 D] 3.
A careful analysis, therefore, of the various provisions of the State Act leads to the irresistible inference that the State Act was passed with a view to afford sufficient protection to a public man by enjoining a summary inquiry or investigation by a high and independent Tribunal of the status of a High Court Judge or a Senior District Judge to instil confidence in the people and to prevent public men from being prosecuted on false, frivolous and vexatious allegations.
Although the ingredients of criminal misconduct as defined in section 5(1) (d) of the Corruption Act are substantially the same in the State Act as in the Central Acts but here also the punishment is much severer in the case of the State Act than the one contained in the Central Acts.
It is, therefore, manifest that the State Act does not contain any provision which is repugnant to the Central Acts, but is a sort of complementary Act which runs pari passu the Central Act.
[270 G 271 A] 4.
Prima facie, there does not appear to be any inconsistency between the State Act and the Central Acts.
Before any repugnancy can arise, the following conditions must be satisfied: (i) That there is a clear and direct inconsistency between the Central Act and the State Act; (ii) that such an inconsistency is absolutely irreconcilable; (iii) that the inconsistency between the provisions of the two Acts is of such a 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.
[272D E] 5.
(1) In order to decide the questions of repugnancy it must be shown that the two enactments contain inconsistent and irreconcilable provisions, 257 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 to operate in the same field.
[278 F H] Hume vs Palmer, ; ; Union Steamship Co. of New Zealand vs Commonwealth, ; ; Clyde Engineering Co. vs Cowburn, ; exhibit Parte McLean; , ; Zavarbhai Amaidas vs State of Bombay, [1955] 1 SCR 799; Ch.
Tika Ramji & Ors.
vs The State of U.P. & Ors. ; Shyamakant Lal vs Rambhajan Singh, ; Om Prakash Gupta vs State of U.P., ; ; Deep Chand vs State of UP & Ors.
[1959] 2 Supp.
SCR 8, Megh Raj & Ors.
vs Allah Rakhia & Ors.
AIR 1942 FC 27; State of Orissa vs M. A. Tulloch & Co. ; ; T. section Balliah vs T. section Rangachari; , ; referred to.
Colin Heward 's Australian Federal Constitution Law 2nd Edn.
Nicholas Australian Constitution 2nd Edn.
p. 303 referred to.
There can be no doubt that the State Act creates distinct and separate offences with different ingredients and different punishments and it does not in any way collide, with the Central Acts.
On the other hand, the State Act itself permits the Central Act, namely, the Criminal Law (Amendment) Act to come to its aid after an investigation is completed and a report is submitted by the Commissioner or the Additional Commissioner.
[279 A B] 6.
Doubtless, the State Act is the dominant legislation but there are no provisions in the State Act which are irreconcilably or directly inconsistent with the Central Acts so as to over rule them.
[279 C] The original section 29 of the State Act underwent an amendment which was brought about by Tamil Nadu Act 16 of 1974 which substituted a new section 29 for the old one.
This amendment received the assent of the President on 10th April, 1974 and was published in the Tamil Nadu Government Gazette Extra ordinary, dated 16 April, 1974.
Although the State Act was passed as far back as 30 December, 1973 it received the assent of the President on the 10 April, 1974 that is, on the same date as Act 16 of 1974.
The Act was however brought into force on the 8 May, 1974 when the new section 29 which had already replaced the old section and had become a part of the statute.
Therefore, for all intents and purposes the State Act cannot be read in isolation, but has to be interpreted in conjunction with the express language contained in section 29 of the State Act.
The legislature has in unequivocal terms expressed the intention that the State Act which was undoubtedly the dominant legislation would only be "in addition to and not in derogation with any other law for the time being in force" which manifestly includes the Central Acts, namely, the Indian Penal Code, the Corruption Act and the Criminal Law (Amendment) Act.
Thus, the Legislature about a month before the main Act came into force clearly declared its intention that there would be no question of the State Act colliding with the Central Acts referred to above.
The second part 258 of section 29 also provides that nothing contained in the State Act shall exempt any public man from being proceeded with by way of investigation or otherwise under a proceeding instituted against him under the Central Acts.
It is, therefore, clear that in view of this clear intention of the legislature there can be no room for any argument that the State Act was in any way repugnant to the Central Acts.
[279 D 280 D] 7.
The provisions of section 29 would be presumptive proof of the fact that there is no repugnancy between the State Act and the Central Acts nor did either the legislature or the President intend to create any repugnancy between these Acts as a result of which the criticism regarding the repugnancy is completely obliterated in the instant case and we, therefore, hold that the State legislature never intended to occupy the same field as covered by the Central Acts.
[281 B] 8.
So far as the first part of cl.
(12) (a) is concerned, namely 'in the service of the Government undoubtedly signifies a relationship of master and servant where the employer employs the employee on the basis of a salary or remuneration.
However, the second limb of the clause, 'in the pay of the Government ' is concerned, that appears to be of a much wider amplitude so as to include within its ambit even a public servant who may not be a regular employee receiving salary from his master.
A Minister or a Chief Minister will be clearly covered by the said expression.
[282 E F] A careful analysis of the meanings assigned to the word 'pay ' in the various dictionaries and the texts would clearly reveal that the expression 'in the pay of ' connotes that a person is getting salary, compensation, wages or any amount of money.
This by itself however does not lead to the inference that a relationship of master and servant must necessarily exist in all cases where a person is paid salary.
[283 G H] Shorter Oxford English Dictionary; Websters Third New International Dictionary: Websters New World Dictionary: Words and Phrases, Permanent Edition Vol.
31A p. 176.
Venkataramaya 's Law Lexicon Vol.
11 p. 1122.
Corpus Juris Secundum Vol.
70 p. 200; referred to.
By virtue of the provisions contained in article 167, the Chief Minister undoubtedly performs a public duty of the nature as enjoined by clauses (a) to (c) of article 167.
It is also clearly provided in the Constitution that the Chief Minister or the Ministers are entitled to salaries or allowances obviously in lieu of public duties that they perform.
The salaries given to the Chief Minister or the Ministers are given from the Government funds, and, therefore, there will be no difficulty in holding that the Ministers are in the pay of the Government inasmuch as they receive their salaries, remunerations or wages from the Government.
[285 E F] Once it is conceded that the Governor appoints the Chief Minister who is paid a salary according to a statute made by the legislature from the Government funds, the Chief Minister becomes a person in the pay of the Government so as to fall squarely within cl.
(12) of section 21 of the Penal Code.
[286 B] 259 10.
The use of the words 'other public servants ' following a Minister of the Union or of a State clearly show that a Minister would also be a public servant as other public servants contemplated by section 199(2) of the Code and the Code being a statute complementary and allied to the Penal Code can be looked into for the purpose of determining the real meaning and import of the words 'public servant ' as used in the aforesaid section [286 F] Dattatraya Narayan Patil vs State of Maharashtra, [1975], Supp.
SCR 145; Emperor vs Sibnath Banerji & Ors., AIR 1945 PC 156; Rao Shiv Bahadur Singh & Anr.
vs The State of Vindhya Pradesh, ; ; referred to.
section Tara Singh vs Director Consolidation of Holdings, Punjab, Jullundur & Ors.
AIR 1958 Pub. 302, Bakshi Ghulam Mohd. vs G. M. Sadiq & Ors., AIR 1968 J & K 98; approved.
Three facts that have been proved beyond doubt: (i) That a Minister is appointed or dismissed by the Governor and therefore, subordinate to him whatever be the nature and status of his constitutional function.
(ii) That a Chief Minister or a Minister gets salary for the public work done or the public duty performed by him.
(iii) That the said salary is paid to the Chief Minister or the Minister from the Government funds.
[290A B] 12.
It is thus incontrovertible, that the holder of a public office such as the Chief Minister is a public servant in respect of which the Constitution provides that he will get his salary from the Government Treasury so long he holds his office on account of the public service that he discharges.
The salary given to the Chief Minister is coterminus with his office and is not paid like other constitutional functionaries such as the President and the Speaker.
These fact, therefore, point to one and only one conclusion and that is that the Chief Minister is in the pay of the Government and is, therefore, a public servant within the meaning of section 21(12) of the Penal Code.
[290 C D]
|
Civil Appeal No. 504 of 1979.
Appeal by Special Leave from the Judgment and Order dated 22 12 1978 of the High Court of Madras at Madras in Appeal No. 408/72.
K. Rajendra Chaudhary for the Appellant.
A. T. M. Sampath for the Respondent.
A. V. Rangam for the Intervener.
The Judgment of the Court was delivered by KAILASAM, J.
Special Leave Petition (Civil) No. 1021 of 1979 is filed by the plaintiff in the suit O.S. No. 83 of 1969 on the file of the Subordinate Judge, Devakottai, against the two orders passed by the High Court of Judicature at Madras in Appeal No. 408 of 1972 holding that the suit had not been properly valued for court fee and directing the petitioner to pay court fee on the valuation of Rs. 9,74,598.35 and requiring that the deficit court fee both on the plaint and the memorandum of appeal be paid within six weeks from the date of the order.
On hearing the petitioner we directed notice to the respondents calling upon them to show cause why special leave should not be granted and the appeal allowed and remitted to the High Court for disposal of all the issues.
On hearing the respondents we granted Special Leave Petition and the appeal is thus heard.
The appellant filed the suit praying for a decree against the respondent/defendant to render true and correct account of all the transactions of the respondent as the petitioner 's agent from 22nd January, 1965 and also of all the amounts received by him as the agent of the petitioner including the amount recovered by him from Alagappa Chettiar and pay to the petitioner the amount found due on such rendition of accounts.
In the written statement filed by the defendant it was con 387 tended that the suit is not properly valued and proper court fee has not been paid.
The trial court framed an issue as to whether the suit had been properly valued and proper court fee had been paid.
It answered the issue holding that the plaint has been properly valued and proper court fee has been paid.
The suit was dismissed by the trial court on the ground that the plaintiff has not proved that the defendant is liable to account and that the suit was barred by limitation, On an appeal by the plaintiff to the High Court, the High Court found that the plaint made it clear that apart from the money which the defendant is liable to pay to the plaintiff as his agent, the plaintiff has quantified the amount at Rs. 9,74,598.35 as payable by the defendant to him which is made clear in allegations in paragraphs 6,7,8 and 9 of the plaint and therefore the plaintiff ought to have valued the suit at Rs. 9,74,598.35.
As the appeal was disposed of on the ground that the plaint had not been properly valued we are concerned in this petition in determining whether the conclusion arrived at by the High Court is correct.
The High Court has passed its conclusion on a reference to paragraph 6,7,8 and 9 of the plaint.
We will now consider the pleadings in the case.
In paragraph 5 it is stated that on 22nd January, 1965, the plaintiff executed a General Power of Attorney at Karaikudi authorising the defendant to transact all his business, sell his properties, receive the sale price and other monies etc.
This paragraph refers to the General Power of Attorney executed by the plaintiff in favour of the defendant on 22nd January, 1965.
The terms of the power of attorney will be referred to in due course.
Paragraphs 6, 7, 8 and 9 of the plaint which have been relied on by the High Court may be set out : "6.
On 27 3 1963, the Plaintiff and the Defendant retired from the said partnership and the other two brothers continued the business under the same name, Alagappa taking on the shares of the plaintiff and Defendant and all their assets in the firm for a consideration of his paying $ 6,50,000/ equivalent to Rs. 16,12,000/ at the rate of Rs. 248/ per 100 Dollars to each of them, so that Alagappa became entitled to 3/4 share and Annamalai to 1/4 share in the continuing firm.
As the Plaintiff 's agent and on behalf of the Plaintiff, the Defendant on or about 13 4 1965 received from Alagappa $ 6,50,000/ equivalent to Rs. 16,12,000/ at the rate of 248 rupees per 100 Dollars for the 1/4th share of the Plaintiff in the said firm taken over by Alagappa.
The Defendant from Madras has sent to the Plaintiff at Kottaiyer Rs. 25,000/ on 25 10 1965, Rs. 1,30,750/ on 388 7 2 1966, Rs. 25,311.65 on 7 2 1965 (Rs. 25,000/ plus Rs. 311.65 for interest) and Rs. 4,36,340/ on 11 8 1967.
The Defendant as Plaintiff 's agent is bound to render true and correct account to the Plaintiff of all the amounts received by him in the course of the agency, to wit, from 22 1 1965 the amounts received from Alagappa.
In paragraphs 6 and 7 the plaint refers to the plaintiff and the defendant retiring from the partnership and Alagappa taking the shares of the plaintiff and the defendant for a consideration of his paying equivalent to Rs. 16,12,000/ to each of the plaintiff and the defendant.
In paragraph 7 it is stated that the defendant as plaintiff 's agent received Rs. 16,12,000/ .
Paragraph 8 refers to certain payments which the plaintiff received from the defendant.
Paragraph 9 of the plaint states that the defendant as plaintiff 's agent is bound to render true and correct account to the plaintiff of all the amounts received by him in the course of agency, to wit, from 22nd January, 1965 the amounts received from Alagappa.
It may be noted that the reliefs sought for is for rendering true and correct account to the plaintiff of all the amounts received by him in the course of the agency.
The Power of Attorney was given on 22nd January, 1965 and thus the relief is not confined to the amount payable by Alagappa alone.
In paragraph 10 which is not taken note of by the High Court the plaintiff alleged that on 2nd September, 1967 and 4th October, 1967, the plaintiff wrote to the defendant requiring him to send the accounts of the agency.
These letters were refused.
Again on 5th December, 1967, the plaintiff issued a lawyer 's notice to render accounts and for payment of the amounts due from him.
This notice was also returned.
The defendant did not render any accounts.
At this stage reference may be made to the Power of Attorney executed by the plaintiff in favour of the defendant on 22nd January, 1965.
The plaintiff by the Power of Attorney dated 22nd January, 1965, constituted the defendant as his Attorney and authorised the defendant to act for the plaintiff.
It is sufficient to state that the power authorises in general the defendant to manage all the affairs of the plaintiff.
Paragraph 3 of the Power of Attorney empowers the defendant to pay and settle all the debts of the plaintiff and obtain full and effectual receipts and releases for the same.
Paragraph 5 empowers the defendant amongst other things to sign and execute any discharge or release in connection with Charges or Bills of Sale.
Paragraph 10 gives the power to the defendant to charge or mortgage any of the plaintiff 's property and paragraph 11 to borrow such sums of money and upon such terms as the Attorney shall deem expedient.
Paragraph 19 confers the power 389 on the defendant to invest moneys upon mortgages or charges of land etc.
In short there can be no dispute that complete power of management is given to the defendant and the defendant could, in exercising this power, discharge debts, invest moneys on behalf of the plaintiff etc.
When the plaintiff in paragraph 7 of the plaint demanded the agent to render true and correct account to the plaintiff of all the amounts received by him in the course of agency i.e. by virtue of the power conferred on 22nd January, 1965, the plaintiff is entitled to know as to what amounts the defendant received during the course of his management and what amounts he had invested or otherwise dealt with.
At the date of the plaint the plaintiff was not aware as to the amount of moneys that were due by the defendant to him.
The letters and the lawyer 's notice sent by the plaintiff to the defendant were unanswered.
If the defendant had invested or otherwise dealt with moneys according to the power conferred on him nothing would be due to the plaintiff on accounts being taken.
The relief claimed for in the plaint in paragraph 14(a) of the plaint is for directing the defendant to render true and correct account of all transactions made by the defendant as the plaintiff 's agent from 22nd January, 1965 and also for all the amounts received by the defendant on the plaintiff 's behalf as his agent including the amount recovered by him from Alagappa and pay the plaintiff what may be found due to him.
This paragraph makes it clear that what was required was not only an account of the amount recovered by the defendant from Alagappa but also an account of all the transactions of the defendant as the plaintiff 's agent from 22nd January, 1965.
A reading of the written statement also makes it clear that the plaint was understood by the defendant as a suit for accounting of his management as a power of attorney agent.
In paragraph 7 of the written statement the defendant states that out of 6,50,000 dollars got for the plaintiff 's one fourth share, 40,000 dollars were invested in fixed deposit in plaintiff 's name with the Indian Overseas Bank, Kuala Lumpur and 10,000 dollars in plantiff 's V. CT.
M. Accounts on 10th April, 1965.
On the same day the remaining 6,00,000 dollars were invested with Alagappa Chettiar himself who had credited the amount in plantiff 's name in his accounts.
If the defendant was able to prove these contentions the accounts as required by the plaintiff would have been satisfactorily rendered and very little would have been due by the defendant to the plaintiff on accounting.
The High Court was in error in coming to the conclusion that the plaint is clear that apart from the money which the defendant is liable to pay to him as his agent the plaintiff has quantified the amount at Rs. 9,74,598.35 as payable by the defendant to him.
In our view, the plaint has been misread.
Though paragraphs 6, 7 and 8 refer to the transactions in which the 390 plaintiff is entitled to Rs. 16,12,000, paragraphs 10,11 and 14(a) make it clear that the suit was for accounting not only regarding Rs. 16,12,000 but also for the management by the defendant as power of attorney agent.
The power, as already noted, confers a right on the defendant to invest moneys.
If the defendant has shown in the written statement itself is able to establish that in the course of his management he had invested moneys according to the power conferred on him, he would have properly accounted for his management.
In the written statement the defendant himself had pleaded that the moneys which he received from Alagappa have been remitted to the plaintiff by investment and otherwise.
The conclusion arrived at by the High Court is, therefore, unsupportable.
The provision relating to the levy of court fee for a suit on accounts is found in section 7(iv) (f) of the Court Fees ' Act, 1870 which runs as follows: "7.
The amount of fee payable under this Act in the suits next hereinafter mentioned shall be computed as follows: (i) x x x (ii) x x x (iii) x x x (iv) In suits (a) x x x (b) x x x (c) x x x (d) x x x (e) x x x (f) for accounts According to the amount at which the relief sought is valued in the plaint or memorandum of appeal.
In all such suits the plaintiff shall state the amount at which he values the relief sought.
" Reading this provision by itself the amount of court fee payable in suits for accounts is according to the amount at which the relief sought is valued in the plaint or memorandum of appeal.
The plaintiff is required to state the amount at which he values the relief sought.
In suits for accounts it is not possible for the plaintiff to estimate correctly the amount which he may be entitled to for, as in the present case, when the plaintiff asks for accounting regarding the management by a power of attorney agent, he might not know the state of affairs of the defendant 's management and the amount to which he would be entitled to on accounting.
But it is necessary that the amount at which he 391 values the relief sought for should be a reasonable estimate.
Section 35(1) of the Tamil Nadu Court Fees and Suits Valuation Act, XIV, of 1955, is as follows: "In a suit for accounts, fee shall be computed on the amount sued for as estimated in the plaint.
" Sub section (2) of section 35 provides: "Where the amount payable to the plaintiff as ascertained in the suit is in excess of the amount as estimated in the plaint, no decree directing payment of the amount as so ascertained shall be passed until the difference between the fee actually paid and the fee that would have been payable had the suit, comprised the whole of the amount as ascertained, is paid.
If the additional fee is not paid within such time as the Court may fix, the decree shall be limited to the account to which the fee paid extends.
" While section 35(1) permits the plaintiff to pay the court fee on the amount estimated by him sub section (2) safeguards against the loss of revenue for it requires that no decree for any amount in excess of the amount as estimated in the plaint shall be passed unless the difference between the fee actually paid and the fees that would have been payable had the suit comprised the whole of the amount as ascertained, is paid.
But here again it is necessary that the plaintiff should give a fair estimate of the amount for which he sues.
Order 7, Rule 11, of the Civil Procedure Code, requires the court to return the plaint if the relief claimed is undervalued.
Order 7, Rule 11, runs thus: "11.
The plaint shall be rejected in the following cases: (a) x x x (b) where the relief claimed is undervalued, and the plaintiff on being required by the Court to correct the valuation within a time to be fixed by the Court, fails to do so;" (c) x x x (d) x x x This section casts a duty on the Court to reject the plaint when the relief claimed is undervalued.
If on the materials available before it the Court is satisfied that the value of relief as estimated by the plaintiff in a suit for accounts is undervalued the plaint is liable to be rejected.
It is therefore necessary that the plaintiff should take care that the valuation is adequate and reasonable taking into account the circumstances of the case.
In coming to the conclusion that the suit is undervalued the court will have to take into account that in a suit for 392 accounts the plaintiff is not obliged to state the exact amount which would result after the taking of the accounts.
If he cannot estimate the exact amount he can put a tentative valuation upon the suit for accounts which is adequate and reasonable.
The plaintiff cannot arbitrarily and deliberately undervalue the relief.
A full Bench of the Andhra Pradesh High Court in a decision in Chillakuru Chenchurami Reddy vs Kanupuru Chenchurami Reddy, after elaborate consideration of the case law on the subject has rightly observed that there must be a genuine effort on the part of the plaintiff to estimate his relief and that the estimate should not be a deliberate under estimation.
On a consideration of the entire circumstances of the case we are not satisfied that the estimate of the relief as given by the plaintiff is inadequate or unreasonable or a deliberate under estimation.
In the result, we allow the appeal set aside the judgment of the Madras High Court and remit it back to the High Court for disposal of all the issues arising in the appeal.
The cost will abide by the result.
N.V.K. Appeal allowed.
| IN-Abs | The power of attorney by which the plaintiff constituted the defendant as his agent, authorised the defendant amongst other things to discharge debts and invest moneys on behalf of the plaintiff.
In the suit filed by the plaintiff, the relief claimed was for directing the defendant to render true and correct accounts of all transactions entered into by him and for amounts received by him on behalf of the plaintiff.
In his written statement the defendant gave details of amounts invested by him in banks and other relevant details.
An issue whether the suit had been properly valued and proper court fee had been paid was answered by the trial court in favour of the plaintiff.
On appeal by the plaintiff, the High Court held that since the plaintiff had quantified the amount payable by the defendant, the suit should have been valued on the basis of amount quantified and that not having been done, the suit had not been properly valued.
Allowing the appeal, ^ HELD: (1) The estimate of the relief as given by the plaintiff was adequate and reasonable and was not an under estimate.
[392C] (2) The High Court was in error in holding that the plaint was clear, that apart from the money which the defendant was liable to pay to him as his agent the plaintiff had quantified the amount payable by the defendant.
The suit was not only for accounting of the amounts received but also for an account of the transactions of the defendant as power of attorney agent.
Had the defendant been able to establish that in the course of his management he had invested moneys according to the power of attorney, he would have properly accounted for his management.
The defendant himself had stated that the suit was for accounting of his management as power of attorney agent.
He pleaded that the moneys had been remitted to the plaintiff by investment or otherwise.
[389H 390B] (3) The amount of the court fee payable in suits for accounts as provided for in section 7(iv)(f) of the Court Fees Act, 1870 is according to the amount at which relief sought is valued in the plaint or memorandum of appeal.
In a suit for accounts it is not possible for the plaintiff to estimate correctly the amount which he may be entitled to because in a suit in which the plaintiff asks for accounting regarding the management by a power of attorney agent he might not know the state of affairs of the defendant 's management and the amount to which he would be entitled to on accounting.
[390G H] 386 (4) Even where section 35 of the Tamil Nadu Court Fees and Suits Valuation Act, 1955 is applicable, it is necessary that the plaintiff should give a fair estimate of the amount for which he seeks relief.
Order VII R. 11 CPC casts a duty on the court to reject a plaint when the relief claimed is under valued.
[391 D E] Chillakuru Chenchurami Reddy vs Kanupuru Chenchurami Reddy, I.L.R. , approved.
(5) Before coming to the conclusion that the suit is under valued the court will have to take into account that in a suit for accounts the plaintiff is not obliged to state the exact amount which would result after taking all the account.
If he cannot estimate the exact amount he can put a tentative valuation upon the suit for accounts which is adequate and reasonable.
The plaintiff cannot arbitrarily and deliberately under value the relief.
All that is required is that there must be a genuine effort on the part of the plaintiff to estimate his relief and the estimate should not be a deliberate under estimation.
[391 H 392 B]
|
Civil Appeal No. 1626 of 1973.
Appeal by Special Leave from the Judgment and Order dated 16 9 1971 of the Calcutta High Court in Appeal from Original Decree No. 209/66.
section N. Andley, K. C. Sharma, Prem Malhotra and Uma Datta for the appellant.
342 L. N. Sinha, G. section Chatterjee, D. N. Mukherjee and D. P. Mukherjee for the Respondent.
The Judgment and Order of the Court was delivered by KAILASAM, J.
This appeal is by plaintiff 1, legal representatives of plaintiff 2 and plaintiff 3 by certificate granted by the High Court Calcutta against its judgment dismissing the suit.
The suit was filed by the plaintiffs for the declaration of each of the plaintiffs ' title to the extent of 1/4th share each and in all 3/4th for all the plaintiffs of the suit property and the premises with the findings that the suit property and the premises were purchased in co ownership awarding the plaintiffs and the defendants equal 1/4th share each in terms of the agreement dated 2.4.1960 and for partition of the suit property and premises in equal 1/4th share each and for a decree of Rs. 45,000 with further accruals by way of receipt of further rent till full realisation of the claim.
In the alternative a decree for accounts of the dissolved partnership on declaration of dissolution of the same and partition of the suit property and premises in equal 1/4th share to each of the plaintiffs and the defendant by metes and bounds.
The defendant in his written statement denied the claim of the plaintiff and contended that the suit property was never purchased in co ownership or that the plaintiffs were entitled to 3/4th share.
He contended that plaintiffs 2 and 3 advanced Rs. 10,000 each as loan and that they had no claim to the property he having purchased the property in court auction as the absolute owner.
The trial court decreed the suit.
The defendant preferred an appeal to the High Court which accepted the appeal and dismissed the suit.
The facts of the case may be shortly stated.
The suit property in Darjeeling belonged to one Harbhajan Singh Wesal.
He executed a mortgage in favour of the Calcutta National Bank Ltd. The bank instituted a suit against Harbhajan Singh Wesal for recovery of Rs. 1,82,403 11 3 and for enforcement of the mortgage.
Pending suit the Calcutta National Bank was wound up and the High Court of Calcutta passed a decree against Harbhajan Singh and appointed the Official Liquidator of the Calcutta National Bank as Receiver of the mortgaged property including the suit properties.
On 5 9 1959 a final decree was passed directing the sale of the mortgaged property including the suit properties at Darjeeling by public auction subject to confirmation by the Court.
The defendant Prafulla Kumar Chatterjee was interested in buying the property in Darjeeling.
He was negotiating with the Receiver for 343 the purchase of Darjeeling properties.
On 10.6.1959 he received a letter from D. N. Mukherjee advocate advising him to give an offer to the Receiver and on 22.6.59 the defendant obtained an engineering estimate and made an offer to the Receiver to purchase the property for Rs. 32,000.
On 20.11.59 an advertisement appeared in the newspaper by P.W. 1, K. K. Kshetry, Solicitor of the bank, for auction of the suit property.
The property was auctioned on 15th December, 1959 and the defendant offered the highest bid for Rs. 30,000.
On the same day the defendant deposited Rs. 7,500/ .
While the sale was awaiting confirmation by the High Court a higher offer was made by one Baidyanath Garsi and thereupon the defendant offered Rs. 40,000 which was accepted by the court and the sale in favour of the defendant was confirmed by the the High Court for a sum of Rs.40,000 on 19.1.60.
The defendant deposited a sum of Rs. 2,500 in addition to Rs. 7,500 that had already been deposited.
The defendent was granted three months ' time for depositing the balance sum of Rs. 30,000.
The defendant did not have funds to pay the balance of Rs. 30,000 and had to raise the amount.
On 2.4.1960 an agreement was entered into between the three plaintiffs and the defendant.
The suit by the plaintiffs is mainly based on this agreement P 45 dated 2.4.60.
The agreement is signed by the three plaintiffs as well as by the defendant.
According to the recital in the agreement the parties after learning from the notification in the newspaper of the sale of the suit property agreed between themselves to call the bid jointly in co ownership in the name of the defendant and that in pursuance of the agreement the defendant was deputed to call the bid.
The agreement further states that accordingly the defendant was sent to Calcutta and the bid at the auction which was finally knocked down on 19.1.60 for a sum of Rs. 40,000 in the name of the defendant.
The agreement also provided that the plaintiffs and the defendants would be entitled to equal shares in the property.
Another term of the agreement provided that the conveyance shall be drawn in the joint names of the parties by obtaining leave from the High Court.
On 7.4.60 the defendant executed two receipts Exs. 22 and 22A in favour of the second and the third plaintiffs respectively.
It is recited in the receipt that the defendant received a sum of Rs. 10,000 as the share of the purchase price of the property sold in public auction by the Official Liquidator in pursuance of the agreement amongst themselves.
Though the receipt was typed in Darjeeling on 7.4.60 the defendant signed the receipt at Calcutta on 11 4 60.
In the meantime on 8.4.60 the defendant filed an application in the High Court of Calcutta praying that the time for completion of the sale be extended by three months from 19 4 60 and the conveyance be executed in 344 favour of the three plaintiffs and himself.
On 11 4 60 a sum of Rs. 30,000 was paid to M.R. Kshetry.
The request for the conveyance to be made in favour of the three plaintiffs and the defendant was given up and the court directed the execution of the conveyance in favour of the defendant alone.
On 17 6 60 a conveyance was executed by the Registrar of the High Court and the Receiver in favour of the defendant alone in pursuance of the order of the court dated 11 4 60.
On 2 1 61 the plaintiffs served a notice on the defendant calling upon him to partition the property and deliver their shares and render accounts.
On 3 6 61 the plaint in the suit was filed.
The plaintiffs apart from oral evidence very strongly rely on three documents to prove that they are joint owners and are entitled to 3/4th share in the suit property.
The first document is the agreement between the parties dated 2.4.60.
The second are two receipts dated 7.4.60 issued by the defendant in favour of plaintiffs 2 and 3.
The third document is the application filed by the defendant on 8 4 60 in the High Court praying that the conveyance may be effected in favour of the three plaintiffs and himself.
The case for the plaintiffs is that between 20th and 23rd November, 1959 there was an advertisement in the newspapers by the Official Receiver announcing the sale of the suit property.
According to the plaintiffs the three plaintiffs and the defendant mutually agreed to call the bid jointly in co ownership in the name of the defendant and to purchase the property in equal shares contributing equally the bid money and the other costs as might be incurred for the conveyance of the property.
It was further agreed that the plaintiffs and defendant would have equal share in the property.
According to the plaintiffs in pursuance of the agreement the defendant was sent to Calcutta where he bid on 15.12.59 for Rs. 30,000 and the bid was confirmed by the High Court on 19.1.60 for a sum of Rs. 40,000.
Out of the bid money a sum of Rs. 7,500 was paid to the Receiver on 15.12.59 and a sum of Rs. 2,500 on 19 1 60 and the balance of Rs. 30,000 on 11 4 60.
In the meantime it is stated that the plaintiffs and the defendants considered it advisable to have the verbal agreement between them reduced to writing and thus the agreement dated 2.4.60 came into existence.
After the full bid money was paid, the plaintiffs contributing equally, a deed of conveyance was executed on 17 6 60 and registered at Darjeeling.
According to the mutual agreement the parties were entitled as co sharers to enjoy and occupy the suit property in co ownership and were also entitled to income from them.
It was further agreed that the defendant would manage the joint property for the co owners of the property and the defendant would realise the rents for and on behalf of the parties with liability to pay the respective shares 345 to each of the plaintiffs.
The defendant, on the other hand, submitted that he was trying to purchase the suit property from the previous owner Harbhajan Singh by private negotiations before the proceeding was started for auction sale.
The defendants efforts to purchase the property from the owner proved abortive and he decided to purchase the suit property in the auction sale when the property was advertised for sale.
As the defendant was not acquainted with the procedure of court 's sale he approached the first plaintiff for legal service and the first plaintiff gave directions as to how the defendant should proceed.
The defendant denied that he was sent by the plaintiffs to Calcutta for calling the bid.
According to him he went of his own accord, attended the public auction on 15.12.59 and offered Rs. 30,000 for purchasing the property and when the bid was accepted he paid Rs. 7,500 and that money belonged to him alone.
Eventually, the sale was confirmed in favour of the defendant for Rs. 40,000 and he paid a sum of Rs. 2,500 in court to make up Rs. 10,000 i.e. One fourth of the bid amount all by himself As the defendant had to pay the balance of Rs. 30,000 and as he was in short of funds he approached the first plaintiff who was his lawyer and asked for his advice.
As the time for payment of balance amount was fast approaching the defendant frantically tried to find a person who could advance him temporary loan of Rs. 20,000 which amount he needed for completing the purchase.
As he was not successful he requested the first plaintiff to find from amongst his clients persons who could make temporary advance of the amount.
According to the defendant in the first week of April, 1960 the first plaintiff informed the defendant that two of his clients, namely plaintiff Nos. 2 and 3, were agreeable to advance the requisite amount but in view of the provisions of Bengal Money Lenders ' Act they were not willing to advance the amount unless some sort of safeguards were provided for and the transaction was not described as loan.
The first plaintiff drafted a document in the form of an agreement and the defendant signed it under the advice and suggestion of the first plaintiff on the understanding that the document was not intended to be acted upon and was only to remain as a security for the loan and that the recitals in the said document do not represent the real nature of the transaction.
The defendant admitted that plaintiffs 2 and 3 advanced to the defendant a sum of Rs. 10,000 each by way of loan and the defendant had to sign in their favour the documents acknowledging the receipt of the loan.
The defendant denied that the plaintiffs and the defendant contributed equally for payment of the bid money or in defraying the incidental costs in equal shares.
The defendant asserted that he alone paid the entire bid money and bore all the incidental expenses and that there was never any co ownership or co 346 partnership.
He submitted that as the conveyance was executed exclusively in his favour the plaintiffs had no right to the property.
The plaintiffs have sought to prove that the parties after learning from the notification in the newspaper of the sale of the property agreed between themselves to call the bid jointly in co ownership in the name of the defendant and in pursuance of that agreement the defendant paid the deposit.
Further it is the plaintiffs ' case that in pursuance of the agreement the defendant was sent to Calcutta where he bid at the auction which was finally knocked down for the benefit of all.
The plaintiffs ' claim that they contributed 1/4th of the price of the property and the expenses i.e. Rs. 13,500 each.
Further, it was contended by the plaintiffs that the bid by the defendant was for the benefit of the three plaintiffs and the defendant and that it was agreed that the conveyance should also be in favour of all of them.
It is seen from the evidence that the defendant was interested in buying the property alone before the advertisement appeared in the newspapers on 20 11 59 and 23 11 59.
The defendant received exhibit V a letter dated 10 6 59 from D. N. Mukherjee advocate, advising him to give an offer to the Receiver so that he can place the matter to the court for an order for sale by private negotiation.
Soon after, the defendant obtained an engineering estimate of the value of the property under exhibit M and in accordance with the valuation wrote exhibit L on 22.6.59 to K. K. Kshetry offering Rs. 32,000 for the property.
On 15 12 79 the defendant went to Calcutta by himself and made a bid for Rs. 30,000 and deposited Rs. 7,500 of his money.
The plaintiffs admit that the entire deposit was made by the defendant but pleaded that it was agreed that on accounts being taken the expenses will be shared by the plaintiffs.
Due to a third party making a higher offer the defendant had to raise the bid for Rs. 40,000.
It is also not in dispute that the defendant by himself paid Rs. 2,500 over Rs. 7,500 already paid to make 1/4th of the bid amount.
The bid for Rs. 40,000 was made by the defendant alone.
On behalf of the plaintiffs it is stated that 2 or 3 days after the advertisement appeared the defendant went to the first plaintiff and told him that he did not have sufficient funds and requested the first plaintiff to join him to purchase the property and that 2 or 3 days later plaintiff 3 and son of plaintiff 2 came to first plaintiff and expressed their desire to purchase the property and the plaintiff advised them to purchase the property jointly with the defendant in shares.
Plaintiff 3, Daluram Agarwala, deposing as P.W. 5 does not support this case.
In cross examination P.W. 5 stated that on November 24 or 25, 1959 he and one N. K. Aggarwala, who is the son of plaintiff No. 2, went to see the first 347 plaintiff.
It was decided among them that the property would be purchased in the names of all the four of them, the plaintiffs and the defendant.
He would further say that the defendant on return from Calcutta towards the end of December, 1959 stated that the property had been purchased in the names of three plaintiffs and the defendant.
It is thus the case of P.W. 5 that the defendant was sent by all the three plaintiffs to bid on their behalf and that the defendant bid on behalf of all of them.
P.W. 7, the son of the second plaintiff, would state that it was agreed that the property would be bought in the name of the defendant and that there was no talk that it would be purchased in the names of all the four of them.
It is rather inexplicable as to how plaintiffs 2 and 3 who wanted to buy the property separately for themselves agreed to purchase jointly for the benefit of all of them.
It is also difficult to accept the plea that palintiffs 2 and 3 went to the first plaintiff who is an advocate and there agreed to purchase the property in equal shares between the defendant, first plaintiff and themselves.
The second plaintiff had an office in Calcutta and the Calcutta office had a Munim and three other partners in whom they had complete confidence.
In the circumstances it is strange that they wanted the first plaintiff to be a co sharer so that he could attend to all the legal questions.
There is no explanation as to why plaintiffs 2 and 3 who were independant businessmen would join to purchase the property.
The explanation that the agreement was arrived at to keep the bid low is purile.
The evidence discloses that the plaintiffs were taking active part in the transaction after 2.4.1960 while between November, 1959 when the advertisement appeared and the date of agreement, there was comparative quiet, which fact probablises that the plaintiffs were not taking any part in the activities of the defendant regarding the bid in the court auction of the property.
The dealings of plaintiffs 2 and 3 show that they were dealing with the defendant at arms ' length insisting on passing of a receipt for their payment of Rs. 20,000 and accompanying the defendant and paying the money to the Receiver themselves.
It is highly improbable that they would have deputed the first defendant to go and bid on their behalf.
There is no explanation as to why their share of the bid of Rs. 30,000 or the subsequent bid for Rs. 40,000 was not paid by them.
The story that before the defendant bid for the property for Rs. 30,000 there was an agreement between the plaintiffs and the defendant that the bid should be on behalf of all of them cannot be accepted.
The next question that arises is whether the plaintiffs have proved their case that plaintiffs 1, 2 and 3 each of them paid Rs. 13,500, Rs. 10,000 being their share of the bid money and Rs. 3,500 towards expenses.
The two receipts Exs.
22 and 22A are acknowledgements by 348 the defendant of receipt of Rs. 10,000 from each of the plaintiffs 2 and 3.
The defendant admits that he did receive Rs. 10,000 from each of the plaintiffs 2 and 3 but his case is that it is a loan.
There can be no doubt that the defendant was paid Rs. 10,000 by each of the plaintiffs 2 and 3.
The case of the plaintiffs is that they paid in addition Rs. 3,500 each towards expenses.
There is no receipt for this extra payment.
But the plea on behalf of plaintiffs 2 and 3 is that the son of the second plaintiff paid Rs. 27,000 to the Receiver Kshetry personally representing the share of plaintiffs 2 and 3 of Rs. 13,500 each.
We find it difficult to accept the story for plaintiffs 2 and 3 were reluctant to part with Rs. 10,000 each without receipt even though the first plaintiff assured that there was no need for a receipt.
In fact the money was not parted with by them till the second plaintiff 's son accompanied the defendant to Calcutta and paid it in person to the Receiver.
In such circumstances, it is not possible to accept the plea of plaintiffs 2 and 3 that they did not insist on a receipt for payment of Rs. 3,500 each.
In this connection, the evidence of P.W. 1 Kshetry that out of the sum of Rs. 30,000 paid in cash Rs. 27,000 was handed over to him by Narendra Kumar Aggarwal and only the balance was paid by the defendant was relied on by the plaintiffs to show that the share of plaintiffs 2 and 3 of Rs. 13,500 each was paid.
According to the defendant second plaintiff 's son Narendra gave him Rs. 20,000 and he had Rs. 10,000 and he and Narendra counted Rs. 30,000 and handed over the sum of Rs. 30,000 to Kshetry, in the presence of the Judge.
On the evidence the High Court came to the conclusion that the money was counted by Narendra and the defendant before it was paid to Kshetry and if Narendra handed to the Solicitor a sum of Rs. 27,000 after counting, the inference that Rs. 27,000 belonged to plaintiffs is not justified.
We agree with the view taken by the High Court.
We therefore find that plaintiffs 2 and 3 have not proved that they paid Rs. 3,500 each towards the expenses.
The evidence relating to payment by the first plaintiff is even worse.
According to the first plaintiff, who examined himself as P.W. 2, on 2nd April, 1960 when the agreement was signed he paid Rs. 10,000 as his share of purchase price and Rs. 2,500 towards cost, Rs. 12,500 in all in cash to the defendant.
He did not consider it necessary to take a receipt in view of the signed agreement which he thought was sufficient acknowledgment of the liability by the defendant.
The first plaintiff was cross examined about the availability of the sum with him.
He admitted that he had no accounts and that the payment of Rs. 12,500 is not recorded any where.
The first plaintiff would add that he paid another Rs. 1,000 by issuing a cheque in favour of the third plaintiff with a direction that the third plaintiff should pay the 349 sum of Rs. 1,000 to the defendant towards expenses.
A cheque was no doubt drawn by the first plaintiff in favour of the third plaintiff but there is nothing to indicate that this amount was to be paid to the defendant.
The third plaintiff did not obtain any receipt from the defendant.
The High Court rightly rejected the plea on behalf of the first plaintiff that the proceeds of the cheque were paid to the defendant.
On the record there is hardly any acceptable evidence for establishing the payment of Rs. 13,500 by the first plaintiff to the defendant or the payment of Rs. 3,500 each by the plaintiffs 2 and 3 to the defendant.
There is no explanation by the plaintiffs as to how the conveyance came to be registered in the name of the defendant only when the agreement was that it should be taken in the name of the three plaintiffs and the defendant jointly.
The agreement contemplated taking of the conveyance in the names of the three plaintiffs and the defendant and in fact the application made by the defendant to the court prayed that the sale be confirmed in favour of the three plaintiffs and the defendant and the conveyance issued in their joint names.
But the application for confirmation in the joint names was not pressed and the conveyance was ultimately made in favour of the first defendant alone.
There is no explanation as to why the plaintiffs did not insist on the bid being confirmed in the names of all of them and the conveyance issued in their joint names.
Equally on the side of the defendant there is no explanation as to why the signed the agreement which povided that the sale should be for the benefit of all of them and as to why he applied to the court praying for the confirmation of the sale in favour of all of them.
Neither has the defendant denied receipt of Rs. 10,000 from each of the plaintiffs 2 and 3.
There is no provision for payment of interest by the defendant to plaintiffs 2 and 3 for the sums advanced.
If it had been loan simpliciter there could be no explanation for absence of provision for payment of interest.
On a close analysis of the evidence led on behalf of the plaintiffs and the defendant we agree with the High Court that neither the version of the plaintiffs nor that of the defendant discloses the entire truth.
The conclusion we arrive at on the evidence is that the plaintiffs have failed to prove any prior agreement before the defendant made his bids for Rs. 30,000 and later for Rs. 40,000 and paid the deposits amounting to Rs. 10,000 by himself.
Plaintiffs 2 and 3 have failed to prove that they have paid Rs. 3,500 each towards expenses in addition to payment of Rs. 10,000 by each of them which is admitted.
The first plaintiff has totally failed in proving that he had paid any part of the consideration.
On the side of the defendant there is no explanation as to why he subscribed to the 350 agreement agreeing to share the property along with the three plaintiffs and for his applying to the court for confirmation of the sale in favour of all of them.
Neither is there any explanation by him as to why plaintiffs 2 and 3 advanced Rs. 20,000 without interest.
Taking all the circumstances into account we feel the irresistible inference is that the defendant having made the bid by himself later on found himself badly in need of money to pay the balance of the bid amount.
In trying to find the money he sought the help of the plaintiffs and received payment of Rs. 20,000 from plaintiffs 2 and 3.
The crucial question is whether this amount was received merely as a loan as contended by the defendant or given on the agreement that plaintiffs 2 and 3 should be entitled to a share each.
The conduct of the defendant shows that while he badly needed the money he was not willing to share the property with them for the amount.
Equally plaintiffs 2 and 3 wanted the share in the property for the money advanced by them.
It is clear that the money was not advanced as a loan.
It may be that the plaintiffs 2 and 3 were insisting on a hard bargain but it cannot be denied in the circumstances in which the defendant was placed that he had accepted it.
The condition insisted upon by plaintiffs 2 and 3 might not have been fair but the agreement arrived at in the circumstances cannot be said to be due to undue influence.
The relief to which the plaintiffs are entitled to under the agreement cannot be denied.
The High Court after observing that plaintiffs 2 and 3 who are businessmen would not have lent a large sum of money without charging interest and that it is not likely that the plaintiffs would have been so charitable towards the defendant who was a stranger was of the view that it was not necessary to examine the defendant 's financial position and record a finding on the point for the purpose of appeal.
While holding that the defendant 's version also does not disclose the entire truth the High Court held that would not help the plaintiffs who have to prove the case they set up in the plaint.
On the short ground that the agreement dated 2nd April, 1960 does not reflect the true nature of the transaction the High Court held that the suit must fail.
We are of the view that if the amount was not advanced as a loan but paid towards acquiring of a share in the property the relief cannot be denied.
In the circumstances, the plaintiffs 2 and 3 are entitled to 1/4th share each in the property on their payment of their share of the expenses i.e. Rs. 3,500 each.
The defendant has been in possession of the property ever since the purchase and the plaintiffs are entitled to their share of the rents collected by the defendant.
We estimate the share of the rents collected for each of the plaintiffs at Rs. 25,000.
The result is the appeal is allowed to the extent that there will be a decree for partition and separate possession of 1/4th share 351 each of plaintiffs 2 and 3.
Plaintiffs 2 and 3 will pay to the defendant Rs. 3,500 each and interest at 10 per cent per annum from the date of the conveyance and receive Rs. 25,000 each from the defendant towards their share of the rent collected upto date.
The first plaintiff will not be entitled to any relief and the suit so far as he is concerned is dismissed.
There will be no order as to costs.
Before we conclude we will shortly refer to the question of law raised by Mr. L. N. Sinha on behalf of the defendant.
He submitted that as the title in the property vested in the defendant by confirmation of the court sale and later by a registered conveyance, the plaintiffs cannot seek relief on the unregistered agreement exhibit 4 as conveying any title to them.
This point was not taken in any of the courts below but learned counsel submitted that because it is a pure question of law not involving any investigation of facts and as it goes to the root of the matter the court may permit the point to be taken.
In support of his contention that a pure question of law in the circumstances can be taken for the first time in this Court he relied on the decisions of this Court in Yaswant Deorao Deshmukh vs Walchand Ramchand Kothari(1), Raja Sri Sailendra Narayan Bhanja Deo vs The State of Orissa (2), Seth Badri Prasad and others vs Seth Nagarmal and others(3), State of Uttar Pradesh & Anr.
vs Anand Swarup(4) and T. G. Appanda Mudaliar vs State of Madras(5).
As the point raised is a pure question of law not involving any investigation of the facts, we permitted the learned counsel to raise the question.
The plea of the learned counsel is that as the title has vested in him by virtue of the confirmation of the sale and the registered conveyance the plaintiff cannot rely on the unregistered agreement.
In support of his contention the learned counsel relied on the decision of the Privy Council in G. H. C. Ariff vs Jadunath Majumdar Bahadur(6) and Maritime Electric Co. Ltd. vs General Dairies Ltd.(7).
In G. H. C. Ariff vs Jadunath Majumdar Bahadur it was doubted whether the English equitable doctrine can be applied so as to modify the effect of an Indian statute.
The court expressed itself thus:". .but that an English equitable doctrine affecting the provisions of an English statute relating to the right to sue upon a contract, should be applied by analogy to such a statute as the Transfer of Property Act and with such a result as to create without any writing an interest which the statute says can only 352 be created by means of a registered instrument, appears to their Lordships, in the absence of some binding authority to that effect, to be impossible".
The Court further observed: "Their Lordships do not understand the dicta to mean that equity will hold people bound as if a contract existed, where no contract was in fact made: nor do they understand them to mean that equity can override the provisions of a statute and (where no registered document exists and no registrable document can be procured) confer upon a person a right which the statute enacts shall be conferred only by a registered instrument." In Meritime Electric Co. Ltd. vs General Dairies Ltd. (supra) the court observed: ". where as here the statute imposes a duty of a positive kind, not avoidable by the performance of any formality, for the doing of the very act which the plaintiff seeks to do, it is not open to the defendant to set up an estoppel to prevent it".
The decisions are clear that the plaintiffs cannot succeed in displacing the title of the defendant on the basis of the unregistered agreement.
But this will not help the defendant as the suit is based on the plea that the suit property and the premises were purchased in co ownership i.e. on a claim that the plaintiffs were the real owners of the property.
The claims of the plaintiffs as a real owner is not based on the unregistered agreement alone.
On the pleadings in the case the question of law raised cannot result in the suit being dismissed as not maintainable.
The second question the learned counsel raised was that the suit is barred under section 66 of the Civil Procedure Code.
The trial court overruled the plea on the ground that although the sale in question is a court sale it is not according to the rules prescribed by the Civil Procedure Code but only according to the Rules of the Calcutta High Court on the original Side.
The learned counsel submitted that the purpose of section 66, Civil Procedure Code, applies equally to court sales conducted under Rules of Civil Procedure Code as well as those conducted under the High Court Rules.
Reliance was placed on a decision of the Privy Council in Bishun Dayal vs Kesho Prasad and Anr.(1) where the only case pleaded by the plaintiff was that the person through whom he claimed derived his right to half of the village from the auction purchase having been made in part on his behalf by the auction purchaser, it was held that the claim was barred by section 66, Civil Procedure Code, inasmuch as no case independent of auction purchase and basing title upon subsequent possession was put forward in the plaint.
Section 66 of the Civil Procedure Code runs as follows: "66(1).
No suit shall be maintained against any person claiming title under a purchase certified by the Court in such 353 manner as may be prescribed on the ground that the purchase was made on behalf of the plaintiff or on behalf of some one through whom the plaintiff claims." (2).
x x x x x section 66 prohibits any person claiming that a purchase certified by the court in such manner as may be prescribed in favour of a person was made on behalf of the plaintiff.
In order to invoke the prohibition it is necessary to establish that the person against whom the suit cannot be maintained is a person claiming title under a purchase certified by the court in such manner as may be prescribed.
A certificate by the court for the purchase in the manner prescribed is therefore essential.
The word "prescribed" is defined under section 2(16) of the Civil Procedure Code as meaning prescribed by Rules.
The provisions as to grant of a certificate by a court under a purchase is prescribed in Order 21.
Order 21, Rules 64 to 73 prescribe the procedure relating to sale generally while Rules 82 to 108 prescribe the procedure relating to sale of immovable property.
When the court makes an order confirming the sale under order 21, Rule 92, the sale becomes absolute.
After the sale becomes absolute under Rule 94 the court shall grant a certificate specifying the properties sold and the name of the person who at the time of the sale is declared to be the purchaser.
Such certificate is required to bear the day and the date on which the sale became absolute.
The certificate by the court referred to in sec.
66 is a certificate under order 21, Rule 94.
The procedure envisaged for sale generally and sale of immovable property under Order 21 is sale by a public auction.
Sale by a court through the Receiver appointed by court is not contemplated under these provisions.
In a sale by a Receiver a certificate to the purchaser under Order 21, Rule 94, is not given by the Court.
Therefore, the prohibition under sec.
66 cannot be invoked in the case of a sale by the Receiver.
A Receiver is appointed under Order 40, Rule 1, and a property can be sold by the Receiver on the directions of the court even by private negotiations.
The requirement of section 66 of the C.P.C. is a certificate by the court as prescribed.
In this case the conveyance exhibit 5 was in accordance with the original side Rules of the High Court.
In the view we have taken that section 66 is not applicable to sale by Receiver it is not necessary to go into the question whether a sale by the Receiver under the Rules of the Calcutta High Court would come within the purview of section 66.
Section 66 refers to execution of sales only and has no application to a sale held by a Receiver.
In this view the objection raised by the learned counsel for the defendant has to be rejected.
354 ORDER When the Judgment was delivered in Court on 16th January, 1979, allowing the appeal to the extent that there will be a decree for partition and separate possession of one fourth share each of plaintiffs 2 and 3, the parties expressed their desire to agree amongst themselves and divide the properties finally and report a settlement to that effect and prayed that the Court may be pleased to pass a decree in terms of the compromise.
Leave was granted to the parties to enter into a compromise and report the matter to the Court for the passing of the decree in terms of the compromise.
Accordingly the parties have entered into a compromise and have filed the compromise memo along with plans for passing of the final decree.
Accordingly we direct that a decree be passed in terms of the compromise.
S.R. Appeal allowed.
| IN-Abs | The plaintiffs appellants filed a suit against the defendants respondents claiming their title on an unregistered document to the suit property and premises purchased by the latter through a sale by the Receiver under the orders of the Court, on the ground that they were co owners thereof by virtue of the said document.
The trial court decreed the suit but the High Court, on appeal, accepted the appeal and dismissed the suit.
Allowing the appeal by certificate, the Court ^ HELD: 1.
A pure question of law on the facts and circumstances of a case can be taken for the first time in the Supreme Court.
[351 B C] (a) In the instant case, the plea that "as the title has vested in the respondent by virtue of the confirmation of sale and the registered conveyance, the plaintiffs appellants cannot rely on an unregistered document" is a pure question of law not involving any investigation of the facts.
[351C E] Yaswant Deorao Deshmukh vs
Walchand Ramchand Kothari; , @ 861; Raja Sri Sailendra Narayan Bhanja Rao vs State of orissa ; ; Seth Badri Prasad and ors v Seth Nagarmal and ors.
, [1959] Suppl.
1 S.C.R. 769 @ 773; State of U.P and Anr v Anand Swarup ; ; T. A A Appanda Mudaliar vs State of Madras ; ; applied.
In a suit against the purchaser on the ground that the purchase was made on behalf of plaintiff or on behalf of some one through whom the plaintiff claims, the plaintiff cannot succeed in displacing the title of the defendant on the basis of the unregistered agreement,[352 C] on the pleadings, in the instant case, the question of law raised cannot result in the suit being dismissed as not maintainable.
The claim of the appellant as a real owner was not based on the unregistered agreement alone.
341 The suit was based on the plea that the suit property and the premises were purchased in ownership (i.e.) on the claim that the appellants plaintiffs were the real owners of the property.[352 C D] G. H. C. Ariff vs Jadunath Mazumdar Bahadur, A.I.R. , Meritime Electric Co. Ltd. vs Genral Dairies Ltd., A.I.R. 1937 PC 114; referred to.
Section 66 of the Civil Procedure Code prohibits any person claiming that a purchase certified by the Court in such manner as may be prescribed in favour of a person was made on behalf of the plaintiff.
In order to invoke the prohibition it is necessary to establish that the person against whom the suit cannot be maintained is a person claiming title under a purchase certified by the Court in such manner as may be prescribed.
A certificate by the Court for the purchase in the manner prescribed is, therefor, essential.
[353 B C] The word "prescribed" is defined under section 2(16) of the Civil Procedure Code, as meaning prescribed by Rules.
The provision as to grant of a certificate by a court under a purchase is prescribed in Order 21.
Order 21, Rules 64 to 73 prescribe the procedure relating to sale generally while Rules 82 to 103 prescribe the procedure relating to sale of immovable property.
When the Court makes an order confirming the sale under Order 21, Rule 92, the sale becomes absolute.
After the sale becomes absolute under Rule 94 the Court shall grant a certificate specifying the properties sold and the name of the person who at the time of the sale is declared to be the purchaser.
Such certificate is required to bear the day and the date on which the sale became absolute.
[353 C E] The certificate by the Court referred to in Section 66 C.P.C. is a certificate under Order 21, Rule 94.
The procedure envisaged for sale generally and sale of immovable property under Order 21 is sale by a public auction.
Sale by a Court through the Receiver appointed by Court is not contemplated under these provisions.
In a sale by a Receiver a certificate to the purchaser under Order 21, Rule 94, is not given by the Court.
Therefore, the prohibition under Sec. 66 cannot be invoked in the case of a sale by the Receiver.
A Receiver is appointed under Order 40 Rule 1, and a property can be sold by the Receiver on the directions of the Court even by private negotiations.
The requirement of Sec. 66 of the C.P.C., is a certificate by the Court as prescribed.
Since Section 66 is not applicable to sales by Receiver it is not necessary to go into the question whether a sale by the Receiver under the Rules of the Calcutta High Court would come within the purview of section 66.
Section 66 refers to execution of sales only and has no application to a sale held by a Receiver.
In this case, the conveyance exhibit 5 was in accordance with the original side Rule of the High Court.
[353 E G]
|
Civil Appeal Nos.
1806 1808 of 1969.
From the Judgment and Order dated 30 5 1969 of the Punjab and Haryana High Court in Executive Second Appeals Nos.
1131 1133 of 1968.
H.K. Puri and V.K. Bahl for the Appellant.
Janardhan Sharma and Jitendra Sharma for the Respondent The Judgment of the Court was delivered by DESAI, J.
These appeals by certificate under Article 133(1) (c) of the Constitution granted by the High Court of Punjab & Haryana arise from three Execution Petitions filed by the present appellants for executing three decrees obtained by one Neki (since deceased) in three 224 suits bearing Nos. 313, 360 and 369 of 1961 filed by him for pre emption, to recover physical possession of the lands involved in the suits.
The decrees in favour of Neki were confirmed finally by this Court in Civil Appeals Nos.
1148, 1656 and 2341 of 1966 decided on 25th January 1968.
The Judgment of this Court is reported in Hazari & Ors.
vs Neki & Ors.(1) The facts which ultimately resulted in decrees for pre emption in favour of Neki are fully set out at pages 834 835 of the reported judgment and repeating the same would merely add to the length of this judgment.
Suffice to state that there is no dispute that decrees for pre emption were passed in favour of Neki against the original vendor Dhara Singh and his vendees Hazari and others and the satisfaction of the condition in the decrees of pre emption for payment or deposit of the amounts as directed by the Court within the stipulated time is not questioned in the present proceedings.
It appears that the trial court decreed the suits for pre emption in favour of Neki on 7th November 1962 simultaneously imposing the condition to deposit certain amounts in the three suits by or before 3rd December 1962.
The various amounts were duly deposited in the three decrees by Neki, the decree holder, on 3rd December 1962.
Soon thereafter, on 5th December 1962 Neki sold the lands in respect of which he got the decrees to Zila Singh and others, the present appellants.
The present appellants are subsequent vendees but they will be referred to as the appellants in this judgment.
The former vendees would be referred to as 'first vendees ', the sale in whose favour gave rise to the cause of action for pre emption in favour of Neki against the original vendor Dhara Singh.
After the sale in favour of the present appellants, they applied to be joined as parties to the appeals preferred by the first vendees against the decrees for pre emption which were then pending in the High Court and the Court directed by its order dated 13th July, 1963 that the present appellants be joined as parties to the appeals subject to just legal exceptions.
The appellants then filed Execution Applications Nos. 295, 296, 297/64 seeking to execute the decrees to recover actual possession of the lands purchased by them from Neki.
Original Vendor Dhara Singh and the first vendees filed their objections challenging the right of the present vendees to execute the decrees.
Principal contention raised was that the sale deed of lands in favour of the appellants did not envisage assignment of the decrees and that the right of pre emption being a personal right, the decrees could not be assigned and, therefore, the present appellants who were subsequent vendees from pre emptor Neki, were not entitled and had no locus standi to execute 225 the decrees granted in favour of Neki.
The executing court after examining the relevant provisions contained in section 47 and Order XXI, Rule 16, of the Code of Civil Procedure rejected the objections raised by the first vendees and held that the present appellants were entitled to execute the decrees and directed warrant for possession to be issued.
The first vendees preferred three appeals being Nos.
25/14, 26/14 and 27/14 of 1968 to the District Court at Rohtak.
The learned Additional District Judge who heard these appeals, by a common order rejected the appeals and confirmed the order of the trial Court observing that the pre emptor having deposited the purchase price as directed by the Court, in accordance with the terms of the decrees, his title to the lands was perfected from the date of deposit as provided in Order XX, Rule 14 (1)(b), C.P.C., the appellants as purchasers of lands from the pre emptor in whose favour the decrees for pre emption including the one for possession had become final, were entitled to recover possession under section 146 C.P.C. Hazari, Amar Singh and Bhan Singh the first vendees preferred three Execution Second Appeals Nos.
1131,1132 and 1133/68 to the High Court of Punjab & Haryana.
When these appeals came up before a learned single Judge of the High Court it was contended that in view of the decision in Ram Singh & Ors.
vs Gainda Ram & Ors, The assignee of a holder of a decree for pre emption cannot seek the assistance of the Court for executing the decree for pre emption because the decree is a personal one and, therefore, non assignable.
On behalf of the present appellants who were respondents before the High Court, reliance was placed on the decision in Satyanarayana vs Arun Naik and Ravi Parkash and Anr.
vs Chunilal & Ors.
The learned single Judge had certain reservations about the correctness of the decision in Ram Singh 's case and, therefore, he considered it prudent to refer the matter to a Division Bench.
The matter ultimately had to be referred to a Full Bench because there was another decision in Mehrkhan and Shah Din vs Ghulam Rasul, which also required reconsideration.
That is how the matter came before a Full Bench.
The Full Bench formulated the question for its consideration as under: "Whether the purchaser of land from a pre emptor of which the pre emptor has become the owner in pursuance of a pre emption decree after complying with the 226 provisions of Order XX, Rule 14 Civil Procedure Code could execute the decree in order to obtain possession of the land purchased by him.
" All the three Judges of the Full Bench wrote separate opinions.
D. K. Mahajan, J. was of the opinion that assuming that a decree of pre emption is a personal decree, the transferees of the land from the pre emptor whose title was perfected by deposit as envisaged in O. XX, Rule 14 (1) (b) were entitled to execute the decree granted by the Court in favour of the pre emptor and can seek assistance of the Court for recovering actual possession from the first vendees who had no right to continue in possession, apart from O. XX, Rule 16 under section 146 C.P.C. P. C. Pandit, J. and H. R. Sodhi, J., the other two members of the Full Bench were of the opinion that the right of pre emption being a personal right, a decree for pre emption will be a personal decree and is not assignable and even if title to the land passed to the vendees who purchased the land from the pre emptor after the pre emptor complied with the provisions contained in Order XX, Rule 14 yet they would not be entitled to execute the decree for possession because decree is not assigned and section 146 would not help the present appellants.
In accordance with this majority opinion, the appeals preferred by the first vendees were allowed and the applications for execution filed by the present appellants were dismissed.
The High Court granted a certificate under Article 133 (1) (c) of the Constitution because in its opinion the question involved in the appeals was of considerable importance and was likely to arise frequently and that it deserved to be decided finally by the Supreme Court.
Mr. Janardan Sharma, learned counsel for the respondents urged that looking to the scheme of sections 4, 6 and 15 of the Punjab Pre emption Act, 1930, it is incontrovertible that foundation of the right of pre emption being close personal relationship, it is a personal right and can be exercised only by the person in whom it vests under the law and if in exercise of such right such a qualified person seeks to pre empt a sale by instituting an action in a Court of law, the resultant decree would be a personal decree.
Urged Mr. Sharma further that if the decree is a personal one, obviously it cannot be assigned and the assignee gets no interest in a decree so as to enable him to execute the decree.
The question whether the right of pre emption conferred by the provisions of Punjab Pre emption Act, 1913, is a personal right or it creates an interest in the property is 227 no more res integra and is concluded by a decision of this Court between the very parties who are parties to the present appeals, in an earlier round of litigation wherein the first vendees, the present respondents had challenged the right of Neki deceased pre emptor to obtain a decree for pre emption.
Apart from the fact that the point is concluded by a decision of a Bench of three Judges of the Court, it is inter partes and, therefore, binding on the respondents whom Mr. Janardan Sharma represents and at the instance of the respondents it cannot be re opened or re examined.
As the matter calls for no examination at the hands of the Court it would suffice to quote what has been held in Hazari & Ors.
vs Neki & Ors.
Ramaswami, J. speaking for the Court, observed as under: "In support of these appeals, learned counsel put forward the argument that the right of pre emption claimed by Neki deceased plaintiff was a personal right which died with him upon his death and the legal representatives of Neki were not entitled to be granted a decree for pre emption.
The argument was that the statutory right of pre emption under the Punjab Act was not a heritable right and no decree for pre emption should have been passed by the lower court in favour of the legal representatives as representing the estate of Neki.
We are unable to accept the argument put forward by the appellants.
It is not correct to say that the right of pre emption is a personal right on the part of the pre emptor to get the re transfer of the property from the vendee who has already become the owner of the same.
It is true that the right of pre emption becomes enforceable only when there is a sale but the right exists antecedently to the sale, the foundation of the right being the avoidance of the inconveniences and disturbances which would arise from the introduction of a stranger into the land.
The correct legal position is that the statutory law of pre emption imposes a limitation or disability upon the ownership of a property to the extent that it restricts the owner 's right of sale and compels him to sell the property to the person entitled to pre emption under the statute.
In other words, the statutory right of pre emption though not amounting to an interest in the land is a right which attaches to the land and which can be enforced against a purchaser by the person entitled to pre empt." Mr. Janardan Sharma, however, sought to distinguish the position under a voluntary inter vivos transfer and an involuntary 228 transfer such as by way of inheritance and urged that in this case Neki having sold the lands to the present appellants by sale inter vivos they cannot enjoy the fruits of the decree.
This distinction is immaterial as far as the present case is concerned because the question in terms disposed of by the Court is that Neki having complied with Order XX, Rule 14, had become the owner of the lands and his legal representatives on his death were rightly substituted in the proceedings.
The contention, therefore, that decree in a suit for pre emption is a personal decree and creates no interest in land, the subject matter of pre emption, must accordingly fail.
The next contention is that the deed evidencing the sale of lands Ext.
D 1 dated 15th February, 1963 merely transferred the lands but does not purport to assign the decree, then in the absence of such an assignment the purported assignee cannot execute the decree in view of the provision contained in Order XXI, Rule 16, and therefore, the execution applications at the instance of the present appellants are not maintainable.
The Additional District Judge did not decide the contention whether the Execution Applications at the instance of the present appellants, namely, subsequent transferees were maintainable under O. XXI, Rule 16, because in his opinion the present appellants were entitled to execute the decree under section 146 of the Code of Civil Procedure.
The majority view of the High Court is that the subsequent transferees, the present appellants, were not entitled to execute the decree under O. XXI, Rule 16 because the decree for pre emption being a personal one cannot be assigned and alternatively if it could be assigned, as a matter of fact, it has not been assigned and therefore the applications for execution at their instance are not maintainable.
They were further of the view that section 146 would not assist the appellants as provisions contained in O. XXI, Rule 16 being a specific contrary provisions, section 146 cannot be invoked.
Order XXI, Rule 16 permits an execution of a decree at the instance of an assignee by transfer of a decree, the assignment may be in writing or by operation of law and if such an application is made, the court to which an application is made shall issue a notice to the transferor of the decree and the judgment debtor and the decree cannot be executed until the Court heard their objections, if any, to its execution.
Section 47 C.P.C. provides that all questions arising between the parties to the suit in which the decree was passed, or their representatives, relating to the execution, discharge or satisfaction of the decree shall be determined by the court executing the decree and not by a separate suit.
Explanation appended to 229 section 47 provides that for the purposes of that section amongst others a purchaser at a sale in execution of the decree is deemed to be a party to the suit.
It would have been interesting to examine the question whether the purchaser of land from a pre emptor in whose favour a decree for pre emption has been passed and who subsequent to the decree complied with the requirement of Order XX, Rule 14 and thereby perfected his title would be, on the analogy of a purchaser at a sale in execution of a decree, a party to the suit or at any rate the representative of the decree holder or a successor in interest of the decree holder, but as we are of the opinion that the applications for execution filed by the present appellants are maintainable under section 146 C.P.C. the larger question need not be decided in these appeals.
Section 146 reads as under: "Save as otherwise provided by this Code or by any law for the time being in force, where any proceeding may be taken or application made by or against any person, then the proceeding may be taken or the application may be made by or against any person claiming under him." Shorn of unessentials the section provides that where some proceeding could be taken or application could be made by a person under the Code of Civil Procedure any other person claiming under him is entitled to make and maintain such an application.
The limitation on the exercise of this right is to be found in the expression, 'save as otherwise provided by this Code '.
It would mean that if the Code permits a proceeding to be taken or an application to be made by a party, then in the absence of a provision to the contrary, section 146 would enable any one claiming under such person as well to make the same application.
The object behind the section appears to be to facilitate the exercise of right by a person claiming under the person whose right to maintain an application is beyond dispute.
Section 146 came in for consideration in Jugal kishore Saraf vs Raw Cotton Co. Ltd. In that case the facts were that the plaintiffs in a pending suit for recovery of debt transferred to another person all book and other debts due to them including the debt involved in the suit.
The transferees did not apply to be joined as parties in the pending suit and the suit continued in the name of the original plaintiffs and ended in a decree.
Subsequently the 230 transferees as decree holders applied for execution of the decree against the judgment debtor and upon a notice being issued, a contention was raised that the application was not maintainable under Order XXI, Rule 16.
One submission was that even if the application for execution was not maintainable under O. XXI, Rule 16, it would certainly be maintainable at the instance of the transferees of the original debt under section 146.
Accepting this contention Das, J. observed that a person may conceivably become entitled to the benefits of a decree without being a transferee of the decree by assignment in writing or by operation of law.
In that situation the person so becoming the owner of the decree may well be regarded as a person claiming under the decree holder.
It was further held in that case that the transferees of the debt derived their title to the debt by transfer from the transferors and when the decree was passed in relation to decree they must also be regarded as persons claiming under the transferors and accordingly they would be entitled to make an application for execution under section 146 of the Code of Civil Procedure.
Bhagwati, J. in a separate and concurring judgment on this point observed that the only meaning that can be assigned to the expression 'save as otherwise provided by this Code ' in sec.
146 is that if a transferee of the decree can avail himself of the provision contained under Order XXI, Rule 16 by establishing that he is such a transferee he must only avail himself of that provision.
But if he fails to establish his title as a transferee by assignment in writing or by operation of law within the meaning of O. XXI, Rule 16 there is nothing in that provision which prohibits him from availing himself of section 146 if the provision of that section can be availed of by him.
It would thus appear that if the sale deed in respect of land on its proper construction would show that the decree itself was assigned obviously the application for execution would be maintainable under O. XXI, Rule 16.
But if the appellants do not fall within the four corners of O. XXI, Rule 16 and they appear not to fall within the four corners of it, because though the land, the subject matter of the decree is sold to appellants, the decree itself is not assigned, they would nonetheless be able to maintain application for execution under section 146 as persons claiming under the decree holder.
The respondents cannot have both the ways.
If the deed evidenced transfer of decree by assignment then O. XXI, Rule 16 would be attracted but if, as it appears, there is no transfer of decree by assignment, the lands having been sold by the decree holder after perfecting his title and purchased by the present appellants they would be persons claiming under the original pre emptor decree holder Neki and if Neki could have made an application for 231 execution of the decree as decree holder, the present appellants, as purchasers of land from Neki would certainly be claiming under Neki and, therefore, their application for execution would certainly be maintainable under section 146.
In this connection it would be advantageous to refer to Smt.
Saila Bala Dassi vs Smt.
Nirmala Sundari Dassi and Another(1) wherein it has been in terms held that section 146 was introduced for the first time in Civil Procedure Code 1908 with the object of facilitating the exercise of rights by persons in whom they came to be vested by devolution or assignment and being a beneficent provision should be construed liberally so as to advance justice and not in a restricted or technical sense.
Viewed from this angle the present appellants must succeed because they purchased land from pre emptor Neki and the validity of sale being now beyond dispute, they are persons claiming under Neki whose right to execute the decree was never disputed and, therefore, appellants claiming under the vendor Neki would be able to maintain an application for execution under section 146 of the Code of Civil Procedure.
Appellants are thus entitled to execute the decree for possession.
Accordingly these three appeals are allowed and the decision of the High Court dated 30th May, 1969 in Execution Appeals Nos. 1131, 1132 and 1133 of 1968 is set aside and the decision of the Additional District Judge dated 15th July, 1968 is restored, but in the circumstances of the case there would be no order as to costs.
N.V.K Appeals allowed.
| IN-Abs | The original vendor of the lands in dispute sold them to the first vendee.
In the meantime three decrees for pre emption were passed in favour of the pre emptor and against the vendor and his vendees.
After satisfying the conditions imposed in the decrees regarding deposit of certain sums of money the pre emptor sold the lands to the appellants.
In the execution petition filed by the appellants the original vendor as well as the first vendees filed their objections challenging the right of the appellants to execute the decrees on the ground that the right of pre emption being a personal right of the pre emptor, the decrees could not be assigned and that the present appellants being subsequent vendees from the pre emptor were not entitled to execute the decrees granted in his favour.
Rejecting the objections of the first vendees the executing court held that the appellants were entitled to execute the decrees.
On appeal the Additional District Judge held that the pre emptor having complied with the directions contained in the decree his title to the lands was perfected and that the appellants were entitled to recover possession under section 146, CPC.
In execution second appeals of the first vendees the High Court held that the right of pre emption being a personal right, the decree for pre emption would be a personal decree and was not assignable and even if the pre emptor had complied with the provisions of Or.
XX r. 14 CPC, the appellants would not be entitled to execute the decree for possession because the decree was not assigned and section 146 would not help the present appellants.
Allowing the appeals, ^ HELD: 1(i) The question whether the right of pre emption was a personal right or it created an interest in property was concluded by the decision of this Court between the same parties in an earlier round of litigation.
The earlier litigation being inter partes and, therefore, binding on the respondents, it cannot be reopened or re examined at the instance of the respondents.
[226 H 227 B] (ii) The contention that decree in a suit for pre emption is a personal decree and creates no interest in land must fail.
[228 B] (iii) The distinction between a voluntary inter vivos transfer and an involuntary transfer such as by way of inheritance is immaterial as for as the present case is concerned because the question in terms disposed of by 223 this Court in the earlier case is that the pre emptor having complied with O. XX, r. 14 had become the owner of the lands and his legal representatives on his death were rightly substituted in the proceedings.
[227 H 228 A] Hazari & Ors.
vs Neki & Ors.
, ; ; referred to.
Section 146 CPC provides that where some proceedings could be taken or application could be made by a person under the Code of Civil Procedure any other person claiming under him is entitled to make and maintain such an application.
The only limitation on the exercise of this right is in the expression, 'save as otherwise provided by this Code, ' occurring in the section.
[229 E] 3.
If the assignee of a decree can avail himself of the provisions contained under Or.
XXI R. 16 by establishing that he is such an assignee he must only avail himself of that provision.
But if he fails to establish his title as a transferee by assignment in writing or by operation of law within the meaning of Or.
XXI r. 16, there is nothing in that provision which prohibits him from availing himself of section 146 if the provision of that section can be availed of by him.
[230 E] Jugal Kishore Saraf vs Raw Cotton Co. Ltd., ; ; referred to.
In the instant case though the sale deed in respect of land would show that the decree itself was not assigned, the lands having been sold by the decree holder after perfecting his title and purchased by the present appellants, they would be persons claiming under the original pre emptor decree holder and if he could have made an application for execution of the decree as decree holder, the applications for execution by the present appellants would be maintainable under section 146, and they are therefore entitled to execute the decrees for possession.
[231 C D] Smt.
Saila Bala Dassi vs Smt.
Nirmala Sundari Dassi & Anr., ; ; referred to.
|
ition No. 57 of 1979.
Mrs. K. Hingorani for the Petitioners.
Lal Narain Sinha, U. P. Singh and section N. Jha for the Respondent.
section V. Gupte, Attorney General, R. N. Sachthey for the Attorney General.
The Order of the Court was delivered by BHAGWATI, J. The Government of Bihar has filed before us a note containing the proposed clarification of paragraph 2(e) of the Government Order dated 9th February, 1979, pursuant to the suggestion made by us in our order dated 19th February, 1979.
This clarification states in paragraph one that where the police investigation in a case has been delayed by over two years, the Superintendent of Police will see to it that the investigation is completed expeditiously and final report or charge sheet is submitted by the police as quickly as possible and the responsibility to ensure this has been laid personally on the Superintendent of Police.
We are glad to note that the State Government has responded to our suggestion but we are not at all sure whether it is enough merely to provide that the investigation would be completed expeditiously and the final report or charge sheet submitted as quickly as possible.
We are of the view that a reasonable time limit should be set by the State Government within which these steps should be taken, so that no further delay is occasioned in the submission of the final report or charge sheet.
We fail to see how any police investigation can take so long as two years and if police investigation cannot be completed within two years, then there must be something radically wrong with the police force in the State of Bihar.
It appears that there are a number of cases where police investigation has not been completed for over two years and persons have been in jail as under trial prisoners for long periods.
This is a shocking state of affairs so far as the administration of law and order is concerned.
We would, therefore, suggest that in those cases where police investigation has been delayed by over two years, the final report or charge sheet must be submitted by the police within a further period of three months and if that is not done, the State Government might well withdraw such cases, because if after a period of over two years plus an additional period of three months, the police is not able to file a charge sheet, one can reasonably assume that there is no case against the arrested persons.
395 The Government of Bihar has also filed a counter affidavit made by Mr. Mrinmaya Choudhry, Assistant Inspector General of Prisons (1), Bihar setting out the particulars in regard to 18 under trial who have been ordered to be released by us on their personal bond.
The particulars given in this counter affidavit make very distressing reading.
It appears from this counter affidavit that there are quite a few women prisoners who are in jail without even being accused of any offence, merely because they happen to be victims of an offence or they are required for the purpose of giving evidence or they are in "protective custody".
The expression 'protective custody ' is a euphemism calculated to disguise what is really and in truth nothing but imprisonment.
It is an expression intended to appease the conscience.
It cannot be gainsaid that women who have been kept in jail under the guise of 'protective custody ' have suffered involuntary deprivation of liberty for long periods without any fault on their part.
We may point out that this so called 'protective custody ' is nothing short of a blatant violation of personal liberty guaranteed under Article 21 of the Constitution, because we are not aware of any provision of law under which a woman can be kept in jail by way of "protective custody" or merely because she is required for the purpose of giving evidence.
The Government in a social welfare state must set up rescue and welfare homes for the purpose of taking care of women and children who have nowhere else to go and who are otherwise uncared for by the society.
It is the duty of government to protect women and children who are homeless or destitute and it is surprising that the Government of Bihar should have come forward with the explanation that they were constrained to keep women in 'protective custody ' in jail because a welfare home maintained by the State was shut down.
We direct that all women and children who are in the jails in the State of Bihar under 'protective custody ' or who are in jail because their presence is required for giving evidence or who are victims of offence should be released and taken forthwith to welfare homes or rescue homes and should be kept there and properly looked after.
We also find from the counter affidavit that Bhola Mahto was in jail from 23rd November, 1968 until 16th February, 1979 when he was released on his personal bond pursuant to the directions given by us by our order dated 5th February, 1979.
He is accused in a case under Section 363 & 368 of the Indian Penal Code and he was committed to the court of Sessions on 13th September, 1972 but his sessions trial has not yet commenced.
It is amazing that a sessions 396 trial of a person committed to the court of sessions as far back as 13th September 1972 should not have been commenced for about seven years.
We direct that the Sessions Judge, Patna should forward to this Court through the High Court of Patna an explanation as to why the sessions trial of Bhola Mahto has not yet commenced.
This is also a matter to which we would invite the attention of the High Court of Patna.
The same may be said also of Ram Sagar Mistry who was admitted in jail on 28th March, 1971 and committed to the Court of Sessions on 28th June, 1972 on a charge under section 395 of the Indian Penal Code but whose trial has not yet commenced before the Court of Sessions though a period of more than six years has elapsed since the date of his commitment and a period of eight years since the date of his imprisonment.
The counter affidavit shows that Babloo Rai who is reported to be a Naxalite is in jail since 15th May, 1975.
He is alleged to be involved in five cases which are set out in the counter affidavit.
So far as he is concerned, it will be open to him to make an application to the Magistrate before whom he is produced, for being released on bail or on his personal bond and the Magistrate will deal with his application in accordance with broad guidelines laid down by us in our judgment dated 12th February, 1979.
We are not at all sure on reading the counter affidavit whether the under trial prisoners whose particulars are given there, are being produced periodically before the Magistrate as required by the proviso to Section 167(2) of the Code of Criminal Procedure, 1973.
We should like to know from the Government in a proper affidavit to be filed before us on or before 3rd March, 1979 whether these under trial prisoners were periodically produced before the Magistrate in compliance with the requirement of the proviso to Section 167(2).
The proviso to Section 167(2) says that the Magistrate may authorise the detention of the accused person beyond the period of 15 days if he is satisfied that adequate grounds exist for doing so.
We hope and trust that in these cases the Magistrates concerned did not act mechanically but applied their mind and satisfied themselves that adequate grounds existed for remanding these persons to judicial custody from time to time over a period varying from two to ten years, though we fail to see how the Magistrates could possibly have been satisfied about the existence of adequate grounds for remanding these persons to judicial custody for such long periods of time ranging from two to ten years for the purpose of police investigation.
This is also a matter which we would like the High Court of Patna to consider after making a detailed inquiry.
397 The Government of Bihar has also filed before us a list giving particulars of the under trial prisoners who are confined in 17 jails in Bihar for more than 18 months as on 1st February, 1979.
The chart shows that there are under trial prisoners confined in these jails for long periods of time and sometimes even exceeding the maximum punishment which could be awarded to them even if they are found guilty of the offences charged against them.
To take an example, we find at Item 30 one Lambodar Gorain has been in Ranchi Jail since 18th June, 1970 for an offence under Section 25 of the Arms Act for which the maximum punishment is two years, with the result that he has been in jail as an under trial prisoner for 8 1/2 years for an offence for which even if convicted, he could not have been awarded more than two years ' imprisonment.
There are many such cases in the chart, but it is not possible to identify them easily from the chart because the chart contains a large number of names of under trial prisoners.
We would, therefore, direct the Government of Bihar to submit to us on or before 3rd March, 1979 a revised chart showing yearwise break up of the particulars of the under trial prisoners in these jails after dividing them broadly into two categories, one of minor offences and the other of major offences.
Our attention has also been drawn to Section 468 of the Code of Criminal Procedure 1973 which in sub section (1) provides that except as otherwise provided elsewhere in the Code, no court shall take cognizance of an offence of the category specified in sub section (2) after the expiry of the period of limitation and under sub section (2) the period of limitation provided is six months, if the offence is punishable with fine only, one year if the offence is punishable with imprisonment for a term not exceeding one year and three years if the offence is punishable with imprisonment for a term exceeding one year but not exceeding three years.
It would, therefore, be seen that the under trial prisoners against whom charge sheets have not been filed by the police within the period of limitation provided in sub section (2) of Section 468 cannot be proceeded against at all and they would be entitled to be released forthwith, as their further detention would be unlawful and in violation of their fundamental right under Article 21.
We, therefore, direct the Government of Bihar to scrutinise the cases of under trial prisoners charged with offences which are punishable with fine only or punishable with imprisonment for a term not exceeding one year or punishable with imprisonment for a term exceeding one year but not exceeding three years and release such of them who are not liable to be proceeded against by reason of the period of limitation having expired.
This direction shall be carried out by the Government of Bihar within a 398 period of six weeks from today and compliance reports containing particulars shall be submitted to this Court, first at the end of four weeks and then at the end of the next two weeks.
We also find from section 167(5) of the Code of Criminal Procedure, 1973 that 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 interest of justice the continuation of the investigation beyond the period of six months is necessary.
We are not at all sure whether this provision has been complied with, because there are quite a few cases where the offences charged against the under trial prisoners are triable as summons cases and yet they are languishing in jail for a long number of years far exceeding six months.
We, therefore, direct the Government of Bihar to inquire into these cases and where it is found that the investigation has been going on for a period of more than six months without satisfying the Magistrate that for special reasons and in the interest of justice the continuation of the investigation beyond the period of six months is necessary, the Government of Bihar will release the under trial prisoners, unless the necessary orders of the Magistrate are obtained within a period of one month from today.
We would also request the High Court to look into this matter and satisfy itself whether the Magistrates in Bihar have been complying with the provisions of section 167(5).
We adjourn the hearing of the Writ Petition to 5th March, 1979 and on that date, we shall proceed to hear and dispose of the Writ Petition on merits on the various questions arising for determination.
| IN-Abs | At the further hearing of the case on release of under trials in the State of Bihar, ^ HELD: (a)(i) The expression 'protective custody ' is an euphemism calculated to disguise what is really and in truth nothing but imprisonment.
It is an expression intended to appease the conscience.
This so called 'protective custody ' is nothing short of a blatant violation of personal liberty guaranteed under article 21 of the Constitution, because there is no provision of law under which a woman can be kept in jail by way of 'protective custody ' or merely because she is required for the purpose of giving evidence.
[395C D] (ii) The Government in a social welfare state must set up rescue and welfare homes for the purpose of taking care of women and children who have nowhere else to go and who are otherwise uncared for by society.
[395E] (b) The under trial prisoners against whom charge sheets have not been filed by the police within the period of limitation provided for in sub section (2) of section 468 cannot be proceeded against at all and they would be entitled to be released forthwith, as their further detention would be unlawful and in violation of their fundamental right under article 21.
[397 G] (c) The provision of section 167(5) of the Code of Criminal Procedure 1973 requiring the investigating officer to satisfy the Magistrate on the necessity of continuation of the investigation beyond a period of six months has not been complied with, because there are quite a few cases where the offences charged against the under trial prisoners are triable as summons cases and yet they are languishing in jail for a long number of years far exceeding six months.
[398C] And the Court directed that: (a) All women and children in the jails in the State of Bihar under 'protective custody ' should be released and taken forthwith to welfare homes or rescue homes and should be kept there and properly looked after.
[395F] (b) The State Government should scrutinise the cases of under trial prisoners and release such of them who are not liable to be proceeded against by reason of the period of limitation provided in section 468 Cr.
P.C. having expired.
[397H] (c) The State Govt.
should inquire into those cases where the investigation has been going on for a period of more than six months without the satisfaction 394 of the Magistrate as envisaged in section 167(5) and to release the under trials unless the necessary orders of the Magistrate are obtained within one month.
[398D E]
|
Appeal No. 235 of 1954.
On Appeal by Special Leave from the Judgment and Order dated the 26th day of February 1953 of the Bombay High Court in Appeal No. 120 of 1952 arising out of the Order dated the II the day of September, 1952 of the said High Court in its Ordinary Original Jurisdiction in Misc.
Application No. 216 of 1952.
M.C. Setalvad, Attorney General of India (B. Sen and R. H. Dhebar, with him) for the appellant.
Sri Narain Andley, J. B. Dadachanji and Rajinder Narain, for the respondent.
20 1956.
January 17.
The Judgment of the Court was delivered by IMAMJ.
By an order dated 12th May 1952, hereinafter referred to as the impugned order the Government of the State of Bombay requisitioned under section 5 of the Bombay Land Requisition Act, 1948 (Bombay Act XXXIII of 1948), hereinafter referred to as the Requisition Act, the premises specified therein.
The impugned order, so far as it is relevant to the present appeal, stated, "Now, therefore, in exercise of the powers conferred by sub section (1) of section 5 of the Bombay Land Requisition Act, 1948 (Bombay Act XXXIII of 1948) the Government of Bombay is pleased to requisition the said part of the building for a public purpose, namely, for housing an Officer of the State Road Transport Corporation which is a public utility service".
The respondent filed a writ application under Article 226 of the Constitution in the Bombay High Court and the application was beard by Tendolkar, J. who set aside the impugned order.
Against his decision the appellant appealed and a Division Bench of the said Court affirmed the decision of Tendolkar, J.
The present appeal is by special leave against the decision of the High Court.
The principal ground upon which the impugned order was set aside was that the requisition was not for a public purpose and therefore could not have been validly made under section 5 of the Requisition Act.
On behalf of the appellant, the Attorney General has urged that in the circumstances of the present case, the requisition was for a public purpose and the impugned order had been wrongly set aside by the High Court.
In support of his submission he relied upon certain provisions of the (LXIV of 1950), hereinafter referred to as the Act, the decision of the Privy Council in the case of Hamabai Framjee Petit vs Secretary of State for India in Council(1) and the decisions of this Court in (1) [1914] L.R. 42 I.A. 44.
21 The State of Bombay vs Bhanji Munji and Another(1) and The State of Bombay vs Ali Gulshan (Civil Appeal No. 229 of 1953) decided on the 4th of October 1955(2).
On the other hand, Mr. Andley, on behalf of the respondent, contended that to requisition the premises to house an employee of the State Road Transport Corporation, hereinafter referred to as the Corporation, could not be regarded as a public purpose because that was a matter in which the general interest of the community was not directly and vitally concerned.
He urged that although their Lordships of the Privy Council rightly approved the observations of Batchelor, J. concerning the expression 'public purpose ', they erred in their decision in Hamabai 's case.
In any event, Hamabai 's case could be distinguished as in that case there was a scheme for constructing houses for Government servants generally and not procuring residential accommodation for one particular individual.
The validity of the impugned order was also questioned by him on the ground that nothing had been established to prove that by housing an officer of the Corporation in the requisitioned premises the needs or the purposes of the Corporation would be served or that it would contribute to the efficiency of the officer concerned.
Before Tendolkar, J. two points bad been raised (1) that no enquiry, as required by section 5 of the Requisition Act, was held and (2) that the impugned order was invalid as the requisition was not for a public purpose.
The former question was decided against the respondent while the latter was decided in his favour.
In appeal, the first point does not appear to have been put forward as there is no reference to it in the judgments of the learned Judges of the Division Bench.
In this Court the only point argued was as to whether the requisition was for a public purpose or not.
Before proceeding to consider that question it is necessary to make some reference to the purpose for which the Corporation is established, its compo.
sition, the extent of control exercised by the State Government over it and its activities.
(1) (2) ; 22 It was not disputed before us that the Corporation is a public utility concern and is governed by the provisions of the Act.
The purpose for which the Corporation was created may be gathered from the provisions of section 3 of the Act which enables a State Government to establish a Road Transport Corporation having regard to the advantages offered to the public, trade and industry by the development of road transport, the desirability of coordinating any form of road transport with any other form of transport and the desirability of extending and improving the facilities for road transport in any area and of providing an efficient and economical system of road transport service.
The Corporation consists of a Chairman and members appointed by the State Government who are removable by that authority.
Where capital is subscribed by the issue of shares under section 23 of the Act provision is made for the representation of the share holders in the Corporation and the manner in which they are to be elected in accordance with rules to be framed under the Act.
Its Chief Executive Officer or General Manager and its Chief Accounts Officer are to be appointed by the State Government.
The other officers and servants are to be appointed by the Corporation but the conditions of appointment and service and the scales of pay shall be determined by regulations made under the Act subject to the provisions of section 34, which authorises the State Government to issue directions and general instructions to the Corporation and these instructions may include directions relating to the recruitment and conditions of service.
The Corporation is under the effective control of the State Government.
In addition to what has already been mentioned when referring to the composition of the Corporation, the capital of the Corporation may be provided by the Central and State Governments in such proportion as is agreed between them.
When no such capital is provided, the Corporation may raise capital, as is authorised by the State Government, by issue of shares.
These shares are guaran 23 teed by that Government.
The budget of the Corporation has to be submitted to the State Government for approval and its accounts are to be audited by an auditor appointed by that Government.
The balance of the net profits, after providing for various matters mentioned in section 30 of the Act, is to be made over to the State Government for the purpose of road development.
The Corporation can be superseded by the State Government or that Government may, after an enquiry under section 36, authorize a person by notification in the official Gazette to take over the Corporation and administer its affairs during the period the notification is in force.
The activities of the Corporation are manifold in pursuit of which there is a statutory duty to so exercise its powers as to provide, secure or promote the provision of an efficient, adequate, economical and properly coordinated system of road transport in the State or part of it and in any extended area (vide section 18 of the Act).
The powers of the Corporation are stated in section 19 of the Act.
These powers, although not exhaustive, cover a wide field.
Particular reference need be made only to some of them.
Section 19(1) provides: "Subject to the provisions of this Act, a Corporation shall have power: (a). . . . (b). . . . (c)to provide for its employees suitable conditions of service including fair wages, establishment of provident fund, living accommodation, places for rest and recreation and other amenities".
Section 19(2) excluding the explanation to clause (a) and some clauses with which we are not immediately concerned, states, "Subject to the provisions of this Act, the powers conferred by subsection (1) shall include power: (a) to manufacture, purchase, maintain and repair rolling stock, vehicles, appliances, plant, equipment or any other thing required for the purpose of any of the activities of the Corporation referred to in sub section (1).
24 (b) to acquire and hold such property, both movable and immovable, as the Corporation may deem necessary for the purpose of any of the said activities and to lease, sell or otherwise transfer any property held by it.
(d) to purchase by agreement or to take on lease or under any form of tenancy any land and to erect thereon such buildings as may be necessary for the purpose of carrying on its undertaking.
" The provisions of the Act read as a whole lead us to the conclusion that if the premises specified in the impugned order had been requisitioned for the Corporation, the requisition would have been for a public purpose.
Indeed the learned Judges of the High Court were of this opinion and Mr. Andley did not contend to the contrary.
According to him, in this case., the requisition was not for the Corporation but for an employee of the Corporation and for his convenience which could not be a public purpose.
The expression 'public purpose ' has been considered in many cases and it is unnecessary to refer to them except the three cases cited by the Attorney General.
In Hamabai 's case(1) the observation of Batchelor, J. to the effect "General definitions are, I think, rather to be avoided where the avoidance is possible, and I make no attempt to define precisely the extent of the phrase 'public purposes ' in the lease; it is enough to say that, in my opinion, the phrase, whatever else it may mean, must include a purpose, that is, an object or aim, in which the general interest of the community, as opposed to the particular interest of individuals, is directly and vitally concerned" received the approval of the Privy Council.
Their Lordships, however, rejected the contention that there cannot be a 'public purpose ' in taking land if that land when taken is no it in some way or other made available to the public at large.
This contention had been raised because the Government had resumed lands, which had been the subject of a lease and a sana , the terms of which permitted the Government to resume the lands for any public purpose, with a view to erect (1) [1914] L.R. 42 I.A. 44.
25 thereon dwelling houses for the use of Government officials as their private residence on adequate rent.
The concluding portion of the judgment of the Privy Council is important and needs to be quoted.
It stated, "But here, so far from holding them to be wrong, the whole of the learned judges, who are thorough conversant with the conditions of Indian life, say that they are satisfied that the scheme is one which will redound to public benefit by helping the Government to maintain the efficiency of its servants.
From such a conclusion their Lordships would be slow to differ, and upon its own statement it commends itself to their judgment".
In Bhanji Munji 's case(1) the requisition was for housing a person having no housing accommodation.
After considering the affidavits, the facts and the circumstances of the case, Bose, J .
observed "The Constitution authorizes requisition for a public purpose.
The purpose here is finding accommodation for the homeless.
If, therefore, a vacancy is allotted to a person who is in fact homeless, the purpose is fulfilled".
In Ali Gulshan 's case(2) the requisition was for the purpose of housing a member of the staff of a foreign Consulate.
This Court held that the requisition was for a State purpose, which it is needless to say must be regarded as a public purpose.
An examination of these and other cases leads us to the conclusion that it is impossible to precisely define the expression 'public purpose '.
In each case all the facts and circumstances will require to be closely examined in order to determine whether a 'public purpose ' has been established Prima facie the Government is the best judge as to whether 'public purpose ' is served by issuing a requisition order, but it is not the sole judge.
The courts have the jurisdiction and it is their duty to determine the matter whenever a question is raised whether a requisition order is or is not for a 'Public purpose '.
The cases of Hamabai, Bbanji Munji and Ali Gulshan are merely illustrative.
In each of them primarily the person directly and vitally concerned would be the person to whom the residential accommodation would be (1) [1955] 1 S.C.R. 777.
(2) ; , 4 26 allotted with which prima facie the general interest of the community would not be directly concerned at all.
We must regard Hamabai 's case as a decision to the ,effect that the general interest of the community was directly and vitallyconcerned with the efficiency of the Government servants because it would be to its benefit to have such servants and, therefore, providing living accommodation for them was a public purpose.
The decision in Bhan Munji 's case must be read as one in which the general interest of the community was directly and vitally concerned with pre vention of lawlessness and disease and to house the homeless in order to avoid such a contingency was a public purpose.
In Ali Gulshan 's case a State purpose was served because the State Government was interested in its own trade or commerce and in the efficient discharge of his duties by a foreign Consul who would be concerned with such trade or commerce.
In the present case it is possible to construe the impugned order as a requisition on behalf of the Corporation as it does not name any individual for whom the requisition is being made.
In other words the requisitioned premises were at the disposal of the Corporation to house one of its officers to be named later on.
Apart from that, there is a statutory power in the Corporation under section 19 (1) (c) of the Act to provide living accommodation for its employees and under section 14 the Corporation appoints such number of its officers and servants as it considers necessary for the efficient performance of its functions.
It may be assumed, therefore, that the Corporation appoints only such officers as are needed for the efficient discharge of its functions and that the State Government was requested to requisition some premises as living accommodation for one of them whose posting at Bombay was necessary.
Indeed the affidavit of Mr. Nadkarni, Accommodation Officer of the Government of Bombay, states that the official of the Corporation has to perform his duties in Bombay.
Having regard to the provisions of section 19 (2) (a) and (b) of the Act, the power in the Corporation 27 to provide living accommodation for its employees must be regarded, as one of its statutory activities undersection 19(1).
Theword 'acquire ' may include the power to purchase by agreement but is wide enough to enable the Corporation to request the State Government to acquire property under the Land Acquisition Act (I of ] 894) in order to provide living accommodation for its employees.
The activities of the Corporation under section 19 (1) are so interlinked with its successful functioning as a Road Transport Corporation that requisitioning or acquisition of property to advance and ensure those activities must be regarded as for a public purpose.
It would not be sufficient to merely establish the Corporation.
It has to have an adequate and efficient staff, living accommodation forwhom would be an absolute need of the Corporation.
Its officers have to be efficient in the discharge oftheir duties, for upon them depends the successful working of the road transport system upon which the public must rely and thus it would be directly and vitally concerned with the efficiency of 'the employees of the Corporation.
It was suggested that a line must be drawn somewhere, otherwise there was no guarantee to what lengths the powers of requisition might be exercised by the Government.
It is sufficient to say that each case would have to be decided upon the facts and the circumstances ap pearing therein.
Here the Corporation is a public utility concern and the general interest of the community is directly and vitally concerned with its activities and its undertaking.
A breakdown in the Organisation of the Corporation, leading to dislocation of the road transport system would create a chaotic condition to the detriment of the interest of the community.
Providing living accommodation for its employees is a statutory activity of the Corporation and it is essential for it to provide such accommodation in order to ensure an efficient working of the road transport system and it must, therefore, be held that the impugned order was validly passed under the Requisition Act.
In the result the appeal is allowed and the decision 28 of the High Court is set aside.
Costs in the appeal in this Court shall be paid by the appellant to the respondent as directed by the order granting Special Leave.
Each party, however, will bear his own costs in the High Court.
| IN-Abs | In exercise of the powers conferred by sub section (1) of section 5 of the Bombay Land Requisition Act, 1948 the Government of Bombay requisitioned by an order dated 12th May 1952, the premises specified therein, for a public purpose, namely, for bousiing an officer of the State Road Transport Corporation which is a public utility service.
On a writ application under article 226 of the Constitution filed by the respondent the requisition order was set aside by the Bombay High Court on the ground that the requisition was not for a public purpose and therefore could not have been made under section 5 of the Requisition Act.
On appeal by special leave to the Supreme Court.
19 Held (1) that in the circumstances of the present case the requisition was for a public purpose and the impugned order had been wrongly set aside by the High Court; (2) the phrase 'Public purpose ' includes a purpose, that is, an object or aim, in which the general interest of the community, as opposed to the particular interest of individuals is directly and vitally concerned.
It is impossible to define precisely the expression 'public purpose '.
In each case all the facts and circumstances will require to be closely examined to determine whether a public purpose has been established; (3) the Corporation has power to provide for its employees suitable conditions of service including. . . living accommodation, places for rest and recreation and other amenities vide section 19(1) (c) of the Road Transport Corporation Act, 1950; (4) the provisions of the Road Transport Corporation Act read as a whole lead to the conclusion that if the premises specified in the impugned order had been requisitioned for the Corporation, the requisition would have been for a public purpose; (5)in the present case the Corporation is a public utility concern and the general interest of the public is directly and vitally concerned with its activities and undertaking.
Providing living accommodation for its employees is a statutory activity of the Corporation and it is essential for it to provide such accommodation in order to ensure efficient working of the road transport system and therefore the impugned order was validly passed under the Requisition Act.
Hamabai Framjee.
Petit vs Secretary of State for India in Council ([1914] L.R. 42 I.A. 44), The State of Bombay vs Bhonji Munji and Another ([1955] 1 S.C.R. 777) and The State of Bombay vs Ali Gulshan ([1955] 2 S.C.R. 867), referred to.
|
: Criminal Appeal No. 70 of 1979.
Appeal by Special Leave from the Judgment and order dated 1 2 1978 of the Calcutta High Court in Criminal Appeal No. 273 of 1976 and death Reference No. 4/76.
H. C. Mittal (Amicus Curiae) for the Appellant.
G. section Chatterjee for the Respondent.
The following Judgments were delivered: CHINNAPPA REDDY, J. "The murderer has killed.
It is wrong to kill.
Let us kill the murderer".
That was how a Mr. Bonsall of Manchester (quoted by Arthur Koestler in his 'Drinkers of Infinity '), in a letter to the Press, neatly summed up the paradox and the pathology of the Death Penalty.
The unsoundness of the rationale of the demand of death for murder has been discussed and exposed by my brother Krishna Iyer, J., in a recent pronouncement in Rajendra Prasad vs State of Uttar Pradesh(1).
I would like to add an appendix to what has been said there.
The dilemma of the Judge in every murder case, "Death or life imprisonment for the murderer ?" is the question with which we are faced in this appeal.
The very nature of the penalty of death appears to make it imperative that at every suitable opportunity life imprisonment should be preferred to the death penalty.
"The penalty of death differs from all other forms of criminal punishment, not in degree but in kind.
It is unique in its total irrevocability.
It is unique in its rejection of rehabilitation of the convict as a basic purpose of criminal justice.
And, it is unique finally in its absolute renunciation of all that is embodied in our concept of humanity" (per Stewart J., in Furman vs Georgia) (2).
"Death is irrevocable, life imprisonment is not.
Death, of course, makes rehabilitation impossible, life imprisonment does not" (per Marshall, J., in Furman vs Georgia).
Theories of punishment, there are many reformative, preventive, retributive, denunciatory and deterrent.
Let us examine which cap fits capital punishment.
The reformative theory is irrelevant where 360 death is the punishment since life and not death can reform.
The preventive theory is unimportant where the choice is between death and life imprisonment as in India.
The retributive theory is incongruous in an era of enlightenment.
It is inadequate as a theory since it does not attempt to justify punishment by any beneficial results either to the society or to the persons punished.
It is, however, necessary to clear a common misunderstanding that the retributive theory justifies the death penalty.
According to the retributivist society has the right and the duty to vindicate the wrong done to it and it must impose a punishment which fits the crime.
It does not mean returning of evil for evil but the righting of a wrong.
It implies the imposition of a just but no more than a just penalty and automatically rules out excessive punishment and, therefore, capital punishment.
According to a modern exponent of the retributive theory of justice "capital punishment. . is with out foundation in a theory of just punishment.
Indeed one could go further and assert that capital punishment is antithetical to the purposes and principles of punitive sanctions in the law.
Requital, when properly understood in terms of a concept of just law, undoubtedly does have a legitimate role in punishment.
However, neither requital nor punishment in general is a returning of evil for evil, and, therefore, I see no support for the demand that a murder (or an act of treason, or some other serious offence) be paid for with a life".
The Biblical injunction 'an eye for an eye and a tooth for a tooth ' is often quoted as if it was a command to do retributive justice.
It was not.
Jewish history shows that it was meant to be merciful and set limits to harsh punishments which were imposed earlier including the death penalty for blasphamy, Sabbath breaking, adultery, false prophecy, cursing, striking a parent etc.
And, as one abolitionist reminds us, who, one may ask, remembers the voice of the other Jew: "Whoever shall smite on thy right cheek, turn to him the other also ?".
The denunciatory theory of punishment is only a different shade of the retributive theory but from a sternly moral plain.
Lord Denning advanced the view before the Royal Commission on Capital Punishment: "The punishment inflicted for grave crimes should adequately reflect the revulsion felt by the great majority of citizens for them.
It is a mistake to consider the objects of punishment as being deterrent or reformative or preventive and nothing else.
The ultimate justification of any punishment is not that it is a deterrent but that it is the emphatic denunciation by the community of a crime, and from this point of view there are some murders which in the present state of opinion demand the most emphatic denunciation of all, namely the 361 death penalty" . "The truth is that some crimes are so outrageous that society insists on adequate punishment, because the wrong doer deserves it, irrespective of whether it is a deterrent or not".
The implication of this statement is that the death penalty is necessary not because the preservation of society requires it but because society demands it.
Despite the high moral tone and phrase, the denunciatory theory, as propounded, is nothing but an echo of the retributive theory as explained by Stephen who had said earlier: "The criminal law stands to the passion of revenge in much the same relation as marriage to the sexual appetite".
The denunciatory theory is as inadequate as the retributive theory since it does not justify punishment by its results.
As Prof. Hart points out the idea that we may punish offenders not to prevent harm or suffering or even the reptition of the offence but simply as a means of emphatically expressing our condemnation, is uncomfortably close to human sacrifice as an expression of righteousness.
And, the question remains: "Why should denunciation take the form of punishment".
The deterrent theory may now be considered.
It is important to notice here that the question is not whether the penalty of death has deterrent effect on potential murderers but whether it deters more effectively than other penalties say, a sentence of imprisonment for a long term ? Is Capital Punishment the most desirable and the most effective instrument for protecting the community from violent crime ? What is the evidence that it has a uniquely deterrent force compared with the alternative of protracted imprisonment ? If the death penalty really and appreciably decreases murder, if there is equally no effective substitute and if its incidents are not injurious to society, we may well support the death penalty.
But all studies made on the subject, as I will presently point out, appear to have led to the conclusion that the death penalty is inconsequential as a deterrent.
Sir James Fitz James Stephen, a great Victorian Judge and a vigorous exponent of the deterrent theory said in his Essay on Capital Punishment: "No other punishment of death.
This is one of those committing crimes as the punishment of death.
This is one of those propositions which it is difficult to prove simply because they are in themselves more obvious than any proof can make them.
It is possible to display ingenuity in arguing against it, but that is all.
The whole experience of mankind is in the other direction.
The threat of instant death is the one to which resort has always been made when there was an absolute necessity of producing some results.
No one goes to certain inevitable death except by compulsion.
Put the 362 matter the other way, was there ever yet a criminal who when sentenced to death and brought out to die would refuse the offer of a commutation of a sentence for a severest secondary punishment? Surely not.
Why is this? It can only be because 'all that a man has will be given for his life".
In any secondary punishment however terrible, there is hope; but death is death; its terrors cannot be described more forcibly".
Stephen 's statement was admittedly a dogmatic assertion since he himself stated that it was a proposition difficult to prove though according to him, self evident.
The great fallacy in the argument of Stephen has been pointed out by several criminologists.
Stephen makes no distinction between a threat of certain and imminent punishment which faces the convicted murderer and the threat of a different problamatic punishment which may or may not influence a potential murderer.
Murder may be unpremeditated, under the stress of some disturbing emotion or it may be premeditated after planning and deliberation.
Where the murder is premeditated any thought of possibility of punishment is blurred by emotion and the penalty of death can no more deter than any other penalty.
Where murder is premeditated the offender disregards the risk of punishment because he thinks there is no chance of detection.
What weighs with him is the uncertainty of detection and consequent punishment rather than the nature of the punishment.
The Advisory Council on the Treatment of Offenders appointed by the Government of Great Britain stated in their report in 1960 "We were impressed by the argument that the greatest deterrent to crime is not the fear of punishment, but the certainty of detection".
Prof. Hart countered Stephen 's argument with these observations: 'This (Stephen 's) estimate of the paramount place in human motivation of the fear of death reads impressively but surely contains a suggestio falsi and once this is detected its congency as an argument in favour of the death penalty for murder vanishes for there is really no parallel between the situation of a convicted murderer over the alternative of life imprisonment in the shadow of the gallows and the situation of the murderer contemplating his crime.
The certainty of death is one thing, perhaps for normal people nothing can be compared with it.
But the existence of the death penalty does not mean for the murderer certainty of death now.
It means not very high probability of death in the future.
And, futurity and uncertainty, the hope of an escape, rational or irrational fastly diminishes the difference between death and imprisonment as deterrent, and may diminish to vanishing point.
The way in which the convicted 363 murderer may view the immediate prospect of the gallows after he has been caught must be a poor guide to the effect of this prospect upon him when he is contemplating committing his crime".
A hundred and fifty years ago a study was made by the Joint Select Committee appointed by the General Assembly of Connecticut and they reported "Your Committee do not hesitate to express their firm belief that a well devised system of imprisonment, one which should render the punishment certain and perpetual would be far more effectual to restrain from crime than punishment of death".
One of the most comprehensive enquiries ever undertaken on the subject was that made by the Royal Commission on Capital Punishment.
The Commission visited several countries of Europe and the United States, addressed questionnaires to many other countries in search of information and examined celebrated experts and jurists.
The Commission 's conclusions are of significance.
They said: "There is no clear evidence in any of the figures we have examined that the abolition of Capital Punishment has led to an increase in the homicide rate, or that its reintroduction to a fall. prima facie the penalty of death is likely to have a stronger effect as a deterrent to normal human beings than any other form of punishment and there is some evidence (though no convincing statistical evidence) that this is in fact so.
But its effect does not operate universally or uniformly and there are many offenders on whom it is limited and may often be negligible.
It is accordingly important to view this question in just perspective and not to base a penal policy in relation to murder on exaggerated estimates of the uniquely deterrent force of the death penalty".
Prof. Thorsten Sellin who made a serious and through study of the entire subject in the United States on behalf of the American Law Institute stated his conclusion: "Any one who carefully examines the above data is bound to arrive at the conclusion that the death penalty, as we use it, exercises no influence on the extent or fluctuating rate of capital crime.
It has failed as a deterrent".
In 1962 statistics were compiled and a report was prepared at the instance of the United Nations Economic and Social Council on the question of Capital Punishment, the laws and practices relating thereto and the effects of capital punishment and the abolition thereof on the rate of criminality.
According to the report all the information available appeared to confirm that neither total abolition of the death penalty nor its partial abolition in regard to certain crimes only had 364 been followed by any notable rise in the incidence of crime which was previously punishable with death.
Late Prime Minister Bhandarnaike of Sri Lanka suspended the death penalty in 1956.
A Commission of Inquiry on Capital Punishment was appointed and it reported "If the experience of the many countries which have suspended or abolished capital punishment is taken into account there is in our view, cogent evidence of the unlikelihood of this 'hidden protection '.
It is, therefore, our view that the statistics of homicide in Ceylon when related to the social changes since the suspension of the death penalty in Ceylon and when related to the experience of other countries tend to disprove the assumption of the uniquely deterrent effect of the death penalty, and that in deciding on the question of reintroduction or abolition of the capital punishment reintroduction cannot be justified on the argument that it is a more effective deterrent to potential killers than the alternative of protracted imprisonment".
It is a tragic irony that Prime Minister Bhandarnaike who suspended the Capital Punishment in Ceylon was murdered by a fanatic and in the panic that ensued death penalty was reintroduced in Ceylon.
In the United States of America several studies have been made but 'the results simply have been inconclusive '.
The majority Judges of the United States Supreme Court who upheld the constitutionality of the death penalty in the State of Georgia in Gregg vs Georgia(1) were compelled to observe "Although some of the studies suggest that the death penalty may not function as a significantly greater deterrent than lesser penalties, there is no convincing empirical evidence supporting or refuting this view".
In the same case the minority Judges Brennan, J., and Marshall, J., were convinced that 'capital punishment was not necessary as a deterrent to crime in our society '.
In India no systematic study of the problem whether the death penalty is a greater deterrent to murder than the penalty of life imprisonment has yet been undertaken.
A few years ago I made a little research into the matter and studied the statistics relating to capital crime in several districts of Andhra Pradesh from 1935 to 1970.(2) The pattern was most eratic but it can be boldly asserted that the figures do not justify a conclusion that the death penalty has been a deterrent, but, then, the figures do not also lead inevitably to the conclusion that the death penalty has not been deterrent.
One of the complicating factors is the discretion given to Judges to inflict 365 death penalty or imprisonment for life (about which more later) which destroys the utility of any study based on statistics.
The most reasonable conclusion is that there is no positive indication that the death penalty has been deterrent.
In other words, the efficacy of the death penalty as a deterrent is unproven.
"The death penalty, rather than deterring murder, actually deters the proper administration of criminal justice".(1) There is the absolute finality and irrevocability of the death penalty.
Human justice can never be infallible.
The most conscientious judge is no proof against sad mistakes.
Every criminal lawyer of experience will admit that cases are not unknown where innocent persons have been hanged in India and elsewhere.
And, it is not the only way the death penalty strikes at the administration of criminal justice.
Some Judges and Juries have an abhorrence of the death penalty that they would rather find a guilty person not guilty than send even a guilty person to the gallows.
The refusal of Juries to convict persons of murder because of the death penalty is a well known phenomenon throughout the world.
A perusal of some of the judgments of the Superior Courts in India dealing with cases where Trial Courts have imposed sentences of death reveals the same reluctance to convict because the result would otherwise be to confirm the sentence of death.
Thus a guilty person is prevented from conviction by a possibility that a death penalty may otherwise be the result.
That is not all.
There is yet a more 'grievous injury ' which the death penalty inflicts on the administration of Criminal Justice.
It rejects reformation and rehabilitation of offenders as among the most important objectives of Criminal Justice, though the conscience of the World Community speaking through the voices of the Legislature of several countries of the world has accepted reformation and rehabilitation as among the basic purposes of Criminal Justice.
Death penalty is the brooding giant in the path of reform and treatment of Crime and Criminals, "inevitably sabotaging any social or institutional programme to reformation '.
It is the 'fifth column ' in the administration of criminal justice.
There is also the compelling class complexion of the death penalty.
A tragic by product of social and economic deprivation is that the "have nots" in every society always have been subject to greater pressure to commit crimes and to fewer constraints than their more affluent fellow citizens.
So, the burden of capital punishment falls more frequently upon the ignorant, the impoverished and the underpriviledged.
In the words of Marshall, J., "Their impotence leaves them 366 victims of a sanction that the welthier, better represented, just as guilty person can escape.
So long as the capital sanction is used only against the forlorn, easily forgotten members of society, legislators are content to maintain the status quo because change would draw attention to the problem and concern might develop.
Ignorance is perpetuated and apathy soon becomes its mate and we have today 's situation".
As a matter of historical interest it may be mentioned here that when in 1956, in Great Britain, the House of Commons adopted a resolution "That this House believes that the death penalty for murder no longer accords with the needs or the true interests of a civilised society, and calls on Her Majesty 's Government to introduce forthwith legislation for its abolition or for its suspension for an experimental period", and the death penalty Abolition Bill was introduced, 'from the hills and forests of darkest Britain they came: the halt, the lame, the deaf, the obscrue, the senile and the forgotten the hereditary peers of England, united in their determination to use their medieval powers to retain a medieval institution",(1) and the bill was torpedoed by the House of Lords.
Capital Punishment was however abolished in Great Britain in 1966.
There is finally the question whether the death penalty conforms to the current standards of 'decency '.
Can there be any higher basic human right than the right to life and can anything be more offensive to human dignity than a violation of that right by the infliction of the death penalty.
Brennan, J., observed in Furman vs Georgia(2) "In comparison to all other punishments today. the deliberate extinguishment of human life by the State is uniquely degrading to human dignity. death for whatever crime and under all circumstances is truly an awesome punishment.
The calculated killing of a human being by the State involves, by its very nature, a denial of the executed person 's humanity. as executed person has indeed lost the right to have rights".
Senor Tejera of Uruguay in the debate in the United Nations said "A death penalty is an anachronism in the twentieth Century and it is significant that no one in the committee has defended it.
It is the duty of the United Nations to promote progress and to protect man from the prejudices and barbarity surviving from the past".
In a large number of countries in the world where the murder rate is higher than in India, the death penalty has been abolished.
In most Latin American countries, in Argentina, Brazil, Columbia, Costa 367 Rica, Ecuador, Maxico, Panama, Peru and Uruguas, Venezuala, in European countries, in Austria, Belgium, Denmark, Germany, Italy, Netherlands, Norway, Sweden, and Switzerland, in Iceland, in Israel, in many Australian States and in many of the States in the United States of America, death sentence has been abolished.
It is in the light of the right to life as a basic concept of human dignity, in the context of the unproven efficacy of the death penalty as a deterrent and in the background of modern theories of criminology based upon progress in the fields of science, medicine, psychiatry and sociology and in the setting of the march of the movement for abolition of Capital Punishment, that Judges in India are required to decide which sentence to impose in a case of murder, death or imprisonment for life? Judges in India have the discretion to impose or not to impose the death penalty.
It is one of the great burdens which Judges in this country have to carry.
In the past, the reasons which weighed in the matter of awarding or not awarding the sentence of death varied widely and there was certainly room for complaint that there was an unequal application of the law in the matter of imposition of the sentence of death.
The varying outlook on the part of Judges was well brought out a few years ago by two decisions of the Andhra Pradesh High Court.
In the first case, while confirming the conviction of certain "Naxalites" for murder, the judges set aside the sentence of death and awarded life imprisonment instead.
That the murder was not for any personal motive but was in pursuit of some mistaken ideology was the reason which weighed with the judges for substituting the sentence of life imprisonment for the sentence of death.
Within a few months this view was subjected to severe criticism by two other Judges, who, in the second case confirmed the sentence of death.
Realising that discretion, even judicial, must proceed along perceptive lines, but, conscious, all the same, that such discretion cannot be reduced to formulae or put into pigeon holes, this Court has been at great pains eversince Ediga Annamma to point the path along which to proceed.
In the latest pronouncement of this Court in Rajendra Prasad vs State of Uttar Pradesh (supra) several relevant principles have been enunciated to guide the exercise of discretion in making the choice between the penalties of death and life imprisonment.
I express my agreement with the elucidation of the principles in Rajendra Prasad vs State of Uttar Pradesh.
(supra).
Section 302 Indian Penal Code prescribes death or life imprisonment as the penalty for murder.
While so, the Code of Criminal Procedure instructs the Court as to its application.
The changes which 368 the Code has undergone in the last 25 years clearly indicate that Parliament is taking note of contemporary criminological thought and movement.
Prior to 1955, Section 367(5) of the Code of Criminal Procedure 1898 insisted upon the Court stating its reasons if the sentence of death was not imposed in a case of murder.
The result was that it was thought that in the absence of extenuating circumstances, which were to be stated by the Court, the ordinary penalty for murder was death.
In 1955, sub section (5) of Section 367 was deleted and the deletion was interpreted, at any rate by some Courts, to mean that the sentence of life imprisonment was the normal sentence for murder and the sentence of death could be imposed only if there were aggravating circumstances.
In the Code of Criminal Procedure of 1973, there is a further swing towards life imprisonment.
Section 354(3) of the new Code now provides: "When the conviction is for an offence punishable with death or, in the alternative imprisonment for life or imprisonment for a term of years, the judgment shall state the reasons for the sentence awarded, and, in the case of sentence of death, the Special reasons for such sentence." So, the discretion to impose the sentence of death or life imprisonment is not so wide, after all.
Section 354(3) has narrowed the discretion Death Sentence is ordinarily ruled out and can only be imposed for 'Special reasons ', Judges are left with the task of discovering 'Special reasons '.
Let us first examine if the Code of Criminal Procedure gives any clue leading to the discovery of 'Special reasons '.
Apart from Section 354(3) there is another provision in the Code which also uses the significant expression 'special reasons '.
It is Section 361.
Section 360 of the 1973 code re enacts, in substance, Section 562 of the 1898 Code and provides for the release on probation of good conduct or after admonition any person not under twenty one years of age who is convicted of an offence punishable with fine only or with imprisonment for a term of seven years or less, or any person under twenty one years of age or any women who is convicted of an offence not punishable with death or imprisonment of life, if no previous offence is proved against the offender, and if it appears to the Court, having regard to the age, character or antecedents of the offender, and to the circumstances in which the offence was committed, that it is expedient that the offender should be released on probation of good conduct or after admonition.
If the Court refrains from dealing 369 with an offender under Section 360 or under the provisions of the Probation of Offenders Act, or any other law for the treatment, training, or rehabilitation of youthful offenders, where the Court could have done so, Section 361, which is a new provision in the 1973 Code makes it mandatory for the Court to record in its judgment the 'special reasons ' for not doing so.
Section 361 thus casts a duty upon the Court to apply the provisions of Section 360 wherever it is possible to do so and, to state "special reasons" if it does not do so.
In the context of Section 360, the "special reasons" contemplated by Section 361 must be such as to compel the Court to hold that it is impossible to reform and rehabilitate the offender after examining the matter with due regard to the age, character and antecedents of the offender and the circumstances in which the offence was committed.
This is some indication by the Legislature that reformation and rehabilitation of offenders, and not mere deterrence, are now among the foremost objects of the administration of criminal Justice in our country.
Section 361 and Section 354(3) have both entered the Statute Book at the same time and they are part of the emerging picture of acceptance by the Indian Parliament of the new trends in criminilogy.
We will not, therefore, be wrong in assuming that the personality of the offender as revealed by his age, character, antecedents and other circumstances and the tractability of the offender to reform must necessarily play the most prominent role in determining the sentence to be awarded.
Special reasons must have some relation to these factors.
Criminal justice is not a computer machine.
It deals with complex human problems and diverse human beings.
It deals with persons who are otherwise like the rest of us, who work and play, who laugh and mourn, who love and hate, who yearn for affection and approval, as all of us do, who think, learn and forget.
Like the rest of us they too are the creatures of circumstance.
Heredity, environment, home neighborhood, upbringing, school, friends, associates, even casual acquaintenances, the books that one reads, newspapers, radio and TV, the economics of the household, the opportunities provided by circumstances and the calamities resulting thereform, the success and failure of one 's undertakings, the affairs of the heart, ambitions and frustrations, the ideas and ideologies of the time, these and several other ordinary and extra ordinary incidents of life contribute to a person 's personality and influence his conduct.
Differently shaped and differently circumstanced individuals react differently in given situations.
A Judge has to balance the personality of the offender with the circumstance the situations and the reactions and choose the appropriate 370 sentence to be imposed.
A judge must try to answer a myried questions such as was the offence committed without premeditation or was it after due deliberation ? What was the motive for the crime ? Was it for gain ? Was it the outcome of a village feud ? Was it the result of a petty, drunken, street brawl, or a domestic bickering between a hapless husband and a helpless wife ? Was it due to sexual jealousy ? Was the murder committed under some stress, emotional or otherwise ? What is the background of the offender ? What is his social and economic status? What is the level of his education or intelligence? Do his actions betray a particularly callous indifference towards the welfare of society or, on the other hand, do they show a great concern for humanity and are in fact inspired by such concern ? Is the offender so perpetually and constitutionally at war with society that there is no hope of ever reclaiming him from being a menace to society ? Or is he a person who is patently amenable to reform ? Well, may one exclaim with Prof. Vrij "What audacity is involved in these three tasks: to interpret life, explain an act, predict the latest inclination of a human mind." 'Special reasons ', we may, therefore say, are reasons which are special with reference to the offender, with reference to constitutional and legislative directives and with reference to the times, that is, with reference to contemporary ideas in the fields of Criminology and connected sciences.
Special reasons are those which lead inevitably to the conclusion that the offender is beyond redemption, having due regard to his personality and proclivity, to the legislative policy of reformation of the offender and to the advances made in the methods of treatment etc.
I will not attempt to catalogue and 'Special reasons '.
I have said enough and perhaps more than what I intended, to indicate what according to me should be the approach to the question.
Whatever I have said is but to supplement what my brother Krishna Iyer has already said in Rajendra Prasad vs State of U.P.(1) Coming to the case before us, our brothers Jaswant Singh and Kailasam, JJ.
, ordered 'notice confined to the question of sentence only. ' At the last hearing we granted special leave to appeal on the question of sentence.
The appellant was convicted by the learned Additional Sessions Judge, Alipore, for the murder of his son and sentenced to death.
The High Court of Calcutta confirmed the conviction and sentence.
The reason given by the learned Sessions Judge for giving the sentence of death was that the murder was 'cruel and 371 brutal ' and that the facts show the 'grim determination ' of the accused to kill the deceased.
The Sessions Judge made no reference to the motive of the accused for the commission of the murder.
The High Court while confirming the sentence observed that the accused had previously murdered his wife, suspecting her infidelity and suspecting that the deceased in the present case was not his own son, that the sentence of imrisonment imposed on him for the murder of his wife had no sobering affect and that he had murdered his own son without any mercy or remorse and that he, therefore, deserved no mercy.
We do not think that either the Sessions Judge or the High Court made the right approach to the question.
The Sessions Judge was wrong in imposing the sentence of death without even a reference to the reason why the appellant committed the murder.
The observation of the High Court that the appellant deserved no mercy because he showed no mercy smacks very much of punishment by way of retribution.
We have examined the facts of the case.
We find some vague evidence to the effect that the appellant suspected that the deceased was not his own son and that he used to get angry with the deceased for not obeying him.
There is also vague evidence that he had killed the mother of the deceased and had suffered sentence of imprisonment for that offence.
From the vague evidence that is available we gather that the appellant was a moody person who had for years been brooding over the suspected infidelity of his wife and the injustice of having a son foisted on him.
We do not think that the mere use of adjectives like 'cruel and brutal ' supplies the special reasons contemplated by Section 354(3) Criminal Procedure Code.
In the light of the principles enunciated in Rajendra Prasad vs State of U.P.,(1) and in the light of what we have said earlier, we do not think that there are any 'special reasons ' justifying the imposition of the death penalty.
We accordingly allow the appeal as regards sentence, set aside the sentence of death and impose in its place the sentence of life imprisonment.
KRISHNA IYER, J.
I have had the advantage of reading the Judgment of my learned brother, Shri Justice Chinnappa Reddy.
I wholly agree with his reasoning and conclusion.
Indeed, the ratio of Rajendra Prasad etc.
vs State of Uttar Pradesh etc.(1), if applied to the present case, as it must be, leads to the conclusion that death sentence cannot be awarded in the circumstances of the present case.
Counsel for the State, if I recollect aright, did state that in view of the criteria laid 372 down in Rajendra Prasad 's case the State did not propose to file any written submissions against commutation to life imprisonment.
I concur with my learned brother and direct that the appeal, confined to sentence, be allowed and the alternative of life imprisonment imposed.
| IN-Abs | The appellant was convicted by the Additional Session 's Judge Alipore for the murder of his son and sentenced to death.
The reason given by the Sessions Judge was that the murder was "cruel and brutal" and that the facts showed the "grim determination" of the accused to kill the deceased.
The Sessions Judge made no reference to the motive of the accused for the commission of the murder.
The High Court while confirming the conviction and sentence observed that the accused had previously murdered his wife, suspecting her infidelity that the sentence of imprisonment imposed on him for the murder of his wife had no sobering effect, that he suspected that the deceased in the present case was not his own son and so he murdered him without any mercy or remorse, and that he, therefore deserved no mercy.
Allowing the appeal by special leave limited to the question of sentence, the Court ^ HELD: 1.
There were no "special reasons" justifying the imposition of the death penalty.
[371 F] (a) The Sessions Judge was wrong in imposing the sentence of death without even a reference to the reason why the appellant committed the murder.
[371 C] (b) The observation of the High Court that the appellant deserved no mercy because he showed no mercy smacks very much of punishment by way of retribution.
[371 C] (c) From the evidence, it is clear that the appellant was a moody person who had for years been brooding over the suspected infidelity of his wife and the injury of having a son foisted on him.
The mere use of adjectives like "cruel and brutal" does not supply the special reasons contemplated by section 354(3) of the Criminal Procedure Code, 1973.
[371D E] Rajendra Prasad vs State of Uttar Pradesh, ; , applied.
"Special reasons" are reasons which are special with reference to the offender, with reference to constitutional and legislative directives and with reference to the times, that is, with reference to contemporary ideas in the fields of criminology and connected sciences.
Special reasons are those which lead inevitably to the conclusion that the offender is beyond redemption, having due regard to his personality and proclivity, to the legislative 356 policy of reformation of the offender and to the advances made in the methods of treatment etc.
Section 354(3) of the 1973 Code has narrowed the discretion of sentence for murder.
Death sentence is ordinarily ruled out and can only be imposed for "Special reasons".
Judges are left with the task of discovering "special reasons".
[368 D E, 370E F] (a) Apart from Section 354(3), there is another provision in the Code which also uses the significant expression "Special reasons".
It is Section 361, Section 360 of the 1973 Code re enacts, in substance, Section 562 of the 1898 Code and provides for the release on probation of good conduct or after admonition any person not under twenty one years of age who is convicted of an offence punishable with fine only or with imprisonment for a term of seven years or less, or any person under twenty one years of age or any woman who is convicted of an offence not punishable with death or imprisonment for life, if no previous offence is proved against the offender, and if it appears to the Court having regard to the age, character or antecedents of the offender, and to the circumstances in which the offence was committed, that it is expedient that the offender should be released on probation of good conduct or after admonition.
If the Court refrains from dealing with an offender under Section 360 or under the provisions of the Probation of Offenders Act, or any other law for the treatment, training, or rehabilitation of youthful offenders, where the Court could have done, so, Section 361, which is a new provision in the 1973 Code makes it mandatory for the Court to record in its judgment the "Special reasons" for not doing so.
Section 361 thus casts a duty upon the Court to apply the provisions of Section wherever it is possible to do so and, to state "special reasons" if it does not do so.
[368F H, 369A B] (b) In the context of Section 360, the "Special reasons" contemplated by Section 361 must be such as to compel the Court to hold that it is impossible to reform and rehabilitate the offenders, after examining the matter with due regard to the age, character and antecedents of the offender and the circumstances in which the offence was committed.
This is some indication by the legislature that reformation and rehabilitation of offenders, and not mere deterrence are now among the foremost objects of the administration of criminal justice in our country.
Section 361 and Section 354(3) have both entered the Statute Book at the same time and they are part of the emerging picture of acceptance by the Indian Parliament of the new trends in criminology.
Therefore, the personality of the offender as revealed by his age, character, antecedents and other circumstances and the tractability of the offender to reform must necessarily play the most prominent role in determining the sentence to be awarded.
Special reasons must have some relation to these factors.
[369B E] 3.
Criminal justice is not a computer machine.
It deals with complex human problems and diverse human beings.
It deals with persons who are otherwise like the rest of us, who work and play, who laugh and mourn, who love and hate, who yearn for affection and approval, as all of us do, who think learn and forget.
Like the rest of us they too are the creatures of circumstances.
Heredity, environment, home neighbourhood, upbringing, school, friends, associates, even casual acquaintences, the books that one reads, newspapers, radio and TV, the economics of the household, the oppor 357 tunities provided by circumstances and the calamatics resulting therefrom the success and failure of one 's undertakings the affairs of the heart, ambitions and frustrations, the ideas and ideologies of the time, these and several other ordinary and extra ordinary incidents of life contribute to a person 's personality and influence his conduct.
Differently shaped and differently circumstanced individuals react differently in given situations.
A judge has to balance the personality of the offender with the circumstances the situations and the reactions and choose the appropriate sentence to be imposed.
A judge must try to answer a myriad question such as was the offence committed without premeditation or was it after due deliberation ? What was the motive for the crime ? Was it for gain ? Was it the outcome of a village feud ? Was it the result of a petty drunken, street brawl, or a domestic bickering between a helpless husband and a helpless wife ? Was it due to sexual jealousy ? Was the murder committed under some, stress, emotional or otherwise ? What is the background of the offender ? What is his social and economic status ? What is the level of his education or intelligence ? Do his actions betray a particularly callous indifference towards the welfare of society, or on the other hand, do they show a great concern for humanity and are in fact inspired by such concern ? Is the offender so perpetually and constitutionally at war with society that there is no hope of ever reclaiming him from being a menace to society ? Or is he a person who is patently amenable to reform ? [369 E H, 370 A C] (a) Judges in India have the discretion to impose or not to impose the death penalty.
It is one of the great burdens which judges in this country have to carry.
In the past, the reasons which weighed in the matter of awarding or not awarding the sentence of death varied widely and there was certainly room for complaint that there was unequal application of the law in the matter of imposition of the sentence of death.
[367C D] (b) There cannot be any higher basic human right than the right to life and there can not be anything more offensive to human dignity than a violation of that right by the infliction of the death penalty.
It is in the light of the right to life as a basic concept of human dignity, in the context of the unproven efficacy of the death penalty as a deterrent and in the background of modern theories of criminology based upon progress in the fields of science, medicine, psychiatry and sociology and in the setting of the march of the movement for abolition of Capital Punishment, that Judges in India are required to decide which sentence to impose in a case of murder, death or imprisonment for life? [366D, 367B C] Furman vs Georgia, 33 Lawyers Edn.
2nd Series 346 referred to.
(c) Realising that discretion, even judicial, must proceed along perceptive lines, but, conscious, all the same that such discretion cannot be reduced to formulate or put into pigeon holes, this Court has been at great pain ever since Ediga Annamma to point out the path along which to proceed.
In the latest pronouncement of this Court in Rajendra Prasad vs State of Uttar Pradesh, several relevant principles have been enunciated to guide the exercise of discretion in making the choice between the penalties of death and life imprisonment.
[367F G] Ediga Annamma vs State of A.P. , Rajendra Prasad vs State of U.P. ; referred to.
358 4.
Among the several theories of punishment the reformative theory is irrelevant where death is the punishment since life and not death can reform; the preventive theory is unimportant where the choice is between death and life imprisonment as in India; the retributive theory is incongruous in an era of enlightenment and inadequate as a theory since it does not attempt to justify punishment by any beneficial results either to the society or to the person punished.
Equally, the denunciatory theory is as inadequate as the retributive theory since it does not justify punishment by its results.
[359H, 360A B, 361B] 5.
(a) The very nature of the penalty of death makes it imperative that at every suitable opportunity life imprisonment should be preferred to the death penalty.
[359E] Furman vs Georgia, ; Edn. 346; relied on.
(b) All studies made on the subject whether capital punishment is the most desirable and most effective instrument for protecting the community from violent crime than other penalties say, a sentence of imprisonment for long terms, have led to the conclusion that the death penalty is inconsequential as a deterrent.
[361 F] (c) There is no positive indication that the death penalty has been deterrent.
In other words, the efficacy of the death penalty as a deterrent is unproven.
[365A] 6.
The death penalty, rather than deterring murder, actually deters the proper administration of criminal justice.
[365 A B] (a) There is the absolute finality and irrevocability of the death penalty.
Human justice can never be infallible.
The most conscientious judge is no proof against any mistakes.
Cases are unknown where innocent persons have been hanged in India and elsewhere.
[365B C] (b) Some Judges and Jurists have an abhorrence of the death penalty that they would rather find a guilty person not guilty than send even a guilty person to the gallows.
The refusal of juries to convict persons of murder because of the death penalty is a well known phenomenon throughout the world.
A perusal of some of the judgments of the Superior Courts in India dealing with cases where Trial Courts have imposed sentence of death reveals the same reluctance to convict because the result would otherwise be to confirm the sentence of death.
Thus a guilty person is prevented from conviction by a possibility that a death penalty may otherwise be the result.
[365C D] (c) Yet a more 'grievious injury ' which the death penalty inflicts on the administration of Criminal Justice is that it rejects reformation and rehabilitation of offenders as among the most important objectives of Criminal Justice, though the conscience of the World Community speaking through the voices of the Legislature of several countries of the world has accepted reformation and rehabilitation as among the basic purposes of Criminal Justice.
Death penalty is the brooding giant in the part of reform and treatment of Crime and Criminals, 'inequitably sabotaging any social or institutional programme to reformation '.
It is the 'fifth column ' in the administration of criminal justice.
[365E G] (d) There is also the compelling class complexion of the death penalty.
A tragic by product of social and economic deprivation is that the 'have nots ' 359 in every society always have been subject to greater pressure to commit crimes and to fewer constraints than their more affluent fellow citizens.
So, the burden of capital punishment falls more frequently upon the ignorant, the improverished and the underprivilege.
[365 G H]
|
N: Criminal Appeal No. 154 of 1972.
From the Judgment and Order dated 12 11 1971 of the Allahabad High Court in Criminal Revision No. 865 of 1970.
Shiv Pujan Singh for the Appellant.
D.P. Uniyal and M. V. Goswai for the Respondent.
The Judgment of the Court was delivered by CHINNAPPA REDDY J.
Jorma who was convicted by the learned Sessions Judge, Dehradun under Section 302 Indian Penal Code and 449 sentenced to suffer imprisonment for life, was directed by the High Court of Allahabad to be released on bail on furnishing bail to the satisfaction of the District Magistrate, Dehradun.
The District Magistrate (Judicial) Dehradun ordered Jorma to execute a personal bond in a sum of Rs. 5,000/ and to furnish two sureties in a sum of Rs. 10,000/ each.
Ram Lal the present appellant was one of the persons who executed a surety bond.
Another, Abdul Jabbar, also executed a surety bond.
By some oversight no personal bond was taken from Jorma nor was his signature taken on the reverse of the bonds executed by the two sureties as appeared to have been usually done.
Jorma jumped bail and the sureties were unable to produce him when required to do so.
The District Magistrate, Dehradun, therefore, forfeited the surety bonds and issued a warrant of attachment against the sureties under Section 514 of the Code of Criminal Procedure, 1898.
The appellant preferred an appeal to the High Court of Allahabad against the order of forfeiture.
Before the High Court it was submitted that the surety bond executed by the appellant could not be forfeite when no personal bond had been taken from the accused who had been released on bail.
The High Court over ruled the submission of the appellant and confirmed the order of forfeiture.
The appellant has filed this appeal on a certificate granted by the High Court under Article 134(1)(c) of the Constitution.
Shri Shiv Pujan Singh, learned Counsel for the appellant submitted that the question of forfeiting the surety bond for the failure of the accused to appear would arise only if the accused himself had executed a personal bond for his appearance.
He submitted that someone must be primarily bound before the surety could be bound and his bond forfeited.
He invited our attention to Section 499 of the Code of Criminal Procedure, 1898, and form No. 42 of the forms in Schedule V.
He relied on the decisions in Brahma Nand Misra vs Emperor, (1), and Sailash Chandra Chakraborty vs The State(2).
A reference was also to Bakaru Singh vs State of U.P. (3) On the other hand the learned Counsel for the State urged that the bond to be executed by the surety was independent of the bond to be executed by the accused and there was no impediment in the way of the forfeiture of the surety bond even in the absence of a personal bond executed by the accused.
He relied upon the decisions in Abdul Aziz & Anr.
vs Emperor(4), and Mewa Ram & Anr.
vs State (5).
450 Section 499(1) of the Code of Criminal Procedure Code 1898 was in the following terms: "Before any person is released on bail or released on his own bond, a bond for such sum of money as the police officer or Court, as the case may be, thinks sufficient shall be executed by such person, and, when he is released on bail, by one or more sufficient sureties conditioned that such persons shall attend at the time and place mentioned in the bond, and shall continue so to attend until otherwise directed by the police officer or Court, as the case may be".
Now, this provision contemplated the execution of a bond by the accused, and by the sureties.
The provision did not imply that a single bond was to be executed by the accused and the sureties, as it were, to be signed by the accused and counter signed by the sureties.
Form No. 42 of Schedule V, Code of Criminal Procedure, 1898, was as follows: "XLII bond and bail bond on a preliminary Inquiry before a Magistrate.
(See Sections 496 and 499) I, (name), of (place), being brought before the Magistrate of (as the case may be charged with the offence of, and required to give security for my attendance, in his Court and at the Court of Session, if required, do bind myself to attend at the Court of the said Magistrate on every day of the preliminary inquiry into the said charge, and, should the case be sent for trial by the Court of Session, to be, and appear, before the said Court when called upon to answer the charge against me; and, in case of my making default, herein, I bind myself to forfeit to Government the sum of rupees Dated this day of 19 (Signature) I hereby declare myself (or we jointly and severally declare ourselves and each of us) surety (or sureties) for the said (name) that he shall attend at the Court of on every day of the preliminary inquiry into the offence charged against him, and, should the case be sent for trial by the Court of Session, that he shall be, and appear, before the said Court to answer the charge against him, and, in case of his 451 making default therein, I bind myself (or we bind ourselves) to forfeit to Government the sum of rupees Dated this day of 19 (Signature)" The undertaking to be given by the accused as may be seen from form No. 42 of Schedule V was to attend the Court on every day of hearing and to appear before the Court whenever called upon.
The undertaking to be given by the surety was to secure the attendance of the accused on every day of hearing and his appearance before the Court whenever called upon.
The undertaking to be given by the surety was not that he would secure the attendance and appearance of the accused in accordance with the terms of the bond executed by the accused.
The undertaking of the surety to secure the attendance and presence of the accused was quite independent of the undertaking given by the accused to appear before the Court whenever called upon, even if both the undertakings happened to be executed in the same document for the sake of convenience.
Each undertaking being distinct could be separately enforced.
It is true that before a person is released on bail he must execute a personal bond and, where necessary, sureties must also execute bonds.
There can be no question of an accused being released on bail without his executing a personal bond.
But it does not follow therefrom that if a person is released by mistake without his executing a personal bond the sureties are absolved from securing his attendance and appearance before the Court.
The responsibility of the surety arises from the execution of the surety bond by him and is not contingent upon execution of a personal bond by the accused.
Nor is the liability to forfeiture of the bond executed by the surety contingent upon the execution and the liability to forfeiture of the personal bond executed by the accused.
The forfeiture of the personal bond of the accused is not a condition precedent to the forfeiture of the bonds executed by the sureties.
The Calcutta High Court in Sailash Chandra Chakraborty vs The State (supra) and single Judge of the Allahabad High Court in Brahma Nand Misra vs Emperor, (supra) proceeded on the assumption that the bond executed by the accused and the sureties was single and indivisible and if the accused did not join in the execution of the bond, the bonds executed by the sureties alone were invalid.
We do not find any warrant for this assumption in Section 499 of the Criminal Procedure Code of 1898.
We are afraid that there has been some confusion of thought by the importation of the ideas of 'debt ' and 'surety ' from the civil law.
As pointed out in Abdul Aziz & Anr.
vs Emperor(supra) under Section 499 Criminal Procedure Code, the surety did not guarantee the payment of any sum of money by the person accused 452 who was released on bail but guaranteed the attendance of that person and so the fact that the person released on bail himself did not sign the bond for his attendance did not make the bond executed by the surety an invalid one.
In Mewa Ram & Anr.
vs State (supra) the difference between a surety under the Code of Criminal Procedure and a surety under the Civil Law was pointed out and the view taken in Abdul Aziz & Anr.
vs Emperor (supra) was reiterated.
We agree with the view expressed in Abdul Aziz & Anr.
vs Emperor, and Mewa Ram & Anr.
vs State (supra).
In Bakaru Singh vs State of U.P., (supra) the question presently under consideration did not arise.
The question which was considered in that case was whether it was necessary that the personal bond of the accused should be executed on the other side of the bond executed by the surety on the same paper.
It was held that it was not necessary.
And, it was pointed out that the mere fact that form No. 42, Schedule V Criminal Procedure Code, printed the contents of the two bonds, one to be executed by the accused and the other by the surety together, did not mean that both the bonds should be on the same sheet of paper.
To the extent that it goes the decision helps the State and not the appellant.
For the reasons stated above, the appeal is dismissed.
N.V.K. Appeal dismissed.
| IN-Abs | Dismissing the appeal, ^ HELD: Section 499(1) of the Cr.
P.C., which contemplated the execution of a bond by the accused and by the sureties, did not imply that a single bond was to be executed by both the accused and the sureties, signed by the accused and counter signed by the sureties.
An undertaking of the surety in Form 42, Schedule V to secure the attendance of the accused was quite independent of the undertaking given by the accused to appear before the court whenever called upon, even if both the undertakings of the surety and the accused happened to be executed in the same document for the sake of convenience.
Each under taking being distinct can be separately enforced.
[450 C, 451 B D] The fact that an accused would not be released on bail without his executing a personal bond does not mean that if a person is released by mistake without his executing a personal bond, the sureties are absolved from securing the attendance of the accused and his appearance before the court.
The sureties ' responsibility arises from the exeeution of the surety bond and is not contingent upon execution of a personal bond by the accused.
Nor is the liability to forfeiture of the bond executed by the surety contingent upon the execution and the liability to forfeiture of the personal bond executed by the accused.
The forfeiture of the personal bond of the accused is not a condition precedent to the forfeiture of the bonds executed by the sureties.
[451 E F] Abdul Aziz & Anr.
vs Emperor, AIR 1946 All. 116; Mewa Ram & Anr.
vs State, AIR 1953 All. 481; approved.
Bakaru Singh vs State of U.P., ; ; distinguished.
Brahma Nand Misra vs Emperor, AIR 1939 All. 682; Sailesh Chandra Chakraborty vs The State, AIR 1963 Cal.
309; over ruled.
|
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.
| IN-Abs | Two joint stock companies entered into agreements with a former Princely State for the grant of agricultural land on payment of fair and equitable land revenue.
Later the two companies formed into a partnership firm.
On the merger of the State with the Union of India, the Assessing Authority under the U.P. Agricultural Income tax Act issued notices to the two companies to submit their returns of agricultural income, which the companies did.
In writ petitions filed by the companies challenging the assessment orders, the High Court accepted the contention that since the lands were neither assessed to land revenue nor were they assessed to any local rate or cess as required by section 2(a) of the Act, they were not assessable to agricultural income tax and remanded the cases to the Assessing Authority for determination of this question.
Before the Assessing Authority, on remand the companies raised for the first time the contention that since no notice had been issued to the firm of which they were partners, the assessment was invalid.
The Assessing Authority rejected this contention.
He also held that the lands satisfied the requirements of s.2(a).
In writ petitions filed by the two companies a single Judge of the High Court upheld the contention that the Assessing Authority committed an error of law in assessing the two partners without assessing the firm.
This view was affirmed by a Division Bench on appeal.
On further appeal to this Court it was contended that in the absence of a prohibition in the Act, the two companies could be validly assessed to tax without assessing the firm.
Allowing the appeal, ^ HELD: 1.
The Assessing Authority was not in error in assessing tax on the returns submitted by the two companies and therefore the argument that assessment of the companies, without assessing the firm, was not legal, is without substance.
[425 H 426 A] 2. "Person" defined in the section means an individual and includes a firm or a company.
[423 G] 3.
There is nothing in the Act prohibiting the Assessing Authority from proceeding against individuals forming a partnership.
Section 18 enables the authorities, while proceeding with assessment of a firm or a company, not to 420 determine the tax payable by the firm or the company but to proceed to determine the agricultural income of each member of the firm.
The provisions do not apply to a case where the returns were submitted by the partners and the assessment made on that basis.
The section would be applicable if assessment proceedings against a firm are stopped and the share of the individual is to be determined under the provisions of section 18.
[424 F] 4.
The well established position under the Income Tax Act (Central Act) with regard to assessment of firms is that where a firm has not made a return it is open to the department to assess a partner directly in respect of his share of the firm 's income without resorting to the machinery provided under the Act and without making an assessment on the firm, the only prohibition being against double taxation.
[424 H] C.I.T. vs Murlidhar Jhawar & Purna Ginning & Pressing Factory, SC; referred to.
Secondly, the plea that assessment proceedings ought to have been taken against the firm, was not taken by them in the first instance either before the Assessing Authority or before the High Court.
This plea cannot be allowed to be taken at a later stage.
The assessees submitted their returns on the basis of their respective incomes.
[425 F 426 A] 6.
The Assessing Authority has correctly come to the conclusion that the agreement between the parties provided for payment of land revenue.
[426 F G]
|
Civil Appeal No. 1998 of 1969.
Appeal by Special Leave from the Judgment and Decree dated 3 10 1968 of the Punjab and Haryana High Court in L.P.A. No. 348/64.
V. C. Mahajan, Mrs. Urmila Kapoor and Mrs. Shobha Dikshit for the Appellants.
Hardev Singh for the Respondent.
465 The Judgment of the Court was delivered by SARKARIA, J.
This appeal by special leave is directed against a judgment, dated October 3, 1968, of the High Court of Punjab and Haryana.
The facts leading to this appeal are that the appellants are partners of a firm, Bharat Industries, Chheharta.
By a Notification, dated May 15, 1946, the Chheharta Municipal Committee levied a profession tax under Section 61(1)(b) of the Punjab Municipal Act, 1911.
Initially, the tax was Rs. 15/ per annum and was levied on all the partners of the said firm.
By a Notification, dated July 4, 1958, the annual tax for trade, profession or calling for the owner of a factory registered under the Indian Factories Act, was raised to Rs. 200/ per annum and each of the six partners of the said firm were assessed to annual tax of Rs. 200/ by the Municipal Committee.
On October 30, 1960, the appellants filed a suit for permanent injunction restraining the defendant Committee from realising the profession tax demanded by it per letters Nos.
15 to 20, dated May 31, 1960, amounting to Rs. 1,200/ .
The appellants challenged the validity of the assessment contending that construed in the light of the definition given in section 2(40) of the Punjab General Clauses Act, the term "person" occurring in section 6(1)(b) of the Punjab Municipal Act, 1911, includes a 'firm ' and since the trade carried on by the 'firm ' is one, the tax could be levied only on the firm, and not on the partners individually.
On these premises, it was pleaded that the Municipal Committee in levying the tax on the individual partners had exceeded its statutory powers under Section 61(1)(b) of the Municipal Act.
The trial court dismissed the suit.
On appeal by the plaintiffs, the Additional District Judge, Amritsar, reversed the judgment of the trial court and decreed the suit.
The Municipal Committee carried a further appeal to the High Court.
The learned Single Judge, who heard the appeal, affirmed the judgment and decree of the first appellate court, on the reasoning which may be summed up as under: The term "person" in Section 61(1)(b) of the Municipal Act, interpreted in the light of the definition given in Section 2(40) of the Punjab General Clauses Act, includes a 'partnership '.
Under clause (b) of Section 61(1) of the Municipal Act, the basis on which the liability to pay tax arises, is the trade, profession or business; and if the 466 trade and business is one carried on by several persons collectively in partnership, then the partnership alone, and not the individual partners, are liable to pay the tax; that the liability on the partners will fall twice which is not contemplated by the scheme and language of the Municipal Act, even though all the partners are jointly and severally liable to any tax for the partnership business.
In support of his conclusion that the tax was on trade and not on persons, the learned Judge by way of analogy, referred to clauses (a), (c), (d), (e) and (f) of sub Section (1).
He also referred to two Madras decisions in The Municipal Commissioners of Nagapatam vs Sadaya Pillay(1) and Davies vs President of the Madras Municipal Commission(2): and found himself in entire agreement with the reasoning of the learned Judges in those cases.
Aggrieved, the Municipal Committee preferred a Letters Patent Appeal.
The Appellate Bench of the High Court held that to import the definition of the term "person" occuring in Section 2(40) of the Punjab General Clauses Act into Section 61(1) (b) of the Municipal Act, will be repugnant to the subject.
In the opinion of the Bench, under the scheme of the statute in question, the tax cannot be levied on a firm or factory as such, but only on the individual owners of the factory or of the firm.
On this reasoning, the Bench reached the conclusion "that under Section 61(1) (b) of the Act, it is the individual who is to be assessed and is liable to pay the tax mentioned therein and so the assessment as well as the demand of the tax from each of the plaintiffs does not suffer from any legal infirmity.
" The Bench further held that since the Committee in imposing the tax on the appellants herein, has not acted outside the provisions of the statute, "it would, on the basis of the judgment of the Supreme Court in Firm Seth Radha Kishan (Deceased) represented by Hari Kishan & Ors.
vs Administrator Municipal Committee, Ludhiana,(3) which also dealt with the provisions of the Municipal Act, follow that the impugned assessment could only be questioned under the provisions of Sections 84 and 86 of the Act, and the jurisdiction of the Civil Court in respect of tax levied or the assessment made is excluded".
In the result, the appeal was allowed and the trial court 's decision dismissing the suit was restored.
Before us, Mr. V. K. Mahajan, learned counsel for the plaintiffs appellants, has adopted the reasons given by the learned Single Judge of the High Court.
In support of his contentions, he has relied upon the 467 aforesaid Madras decisions.
His argument is that if the interpretation placed by the Appellate Bench of the High Court is allowed to stand, it will lead to anamolous and unconstitutional results.
Mr. Mahajan concedes that the individual partners are also 'persons ' within the meaning of clause (b) of Section 61(1).
He, however, maintains that the firm, also, is a 'person ' within the contemplation of this provision and as such, liable to be taxed; that if in respect of the one trade, which is being carried on by the firm, apart from each of the individual partners, the firm, also is separately assessed to Rs. 200/ per annum, not only the incidence of the tax will fall twice, the total liability therefor will far exceed the ceiling of Rs. 250/ per annum fixed by Article 276(2) of the Constitution.
In these premises, it is contended that an interpretation of Section 61(1) (b), which may lead to unconstitutional on irrational results should be eschewed.
With regard to the question of jurisdiction it is contended that since the Municipal Committee had in the exercise of its powers clearly acted beyond its jurisdiction, the suit was maintainable in the Civil Court.
Section 61(1)(b) of the Municipal Act, so far as material for this case, reads as under: "Subject to any general or special orders which the State Government may make in this behalf, and the rules, any committee may, from time to time for the purposes of this Act, and in the manner directed by this Act, impose in the whole or any part of the municipality any of the following taxes, namely: (1) (a). . . . (i) to (iii) . . . . (b) a tax on persons practising any profession or art or carrying on any trade or calling in the municipality.
Explanation.
A person in the service or person holding an office under the State Government or the Central Government or a local or other public authority shall be deemed to be practising a profession within the meaning of this sub section.
" From a plain reading of the extracted provision, it is clear that a tax leviable under clause (b) is, in terms, a tax on "persons".
The expression "persons" undoubtedly includes natural persons.
The class of such taxable persons has been indicated by the Legislature with reference to their occupational activity.
Thus, in order to be authorised, a tax under clause (b) of Section 61(1) must satisfy two conditions: 468 First, it must be a tax on "persons".
Second such persons must be practising any profession or art or carrying on any trade or calling in the municipality.
There can be no dispute that the appellants are "persons" and, as such, satisfy the first condition.
Even the learned counsel for the appellants has candidly conceded that the individual partners are also "persons" within the meaning of the said clause (b).
Controversy thus becomes narrowed down into the issue; Whether persons collectively doing business in partnership, in the municipality, fulfil the second condition ? That is to say, do such persons "carry of any trade or calling in the municipality" within the contemplation of clause (b) ? In our opinion, for reasons that follow, the answer to this question must be in the affimative. 'Partnership ' as defined in Section 4 of the , is the relation between persons who have agreed to share the profits of a business carried on by all or any of them for the benefit of all.
The Section further makes it clear that a firm or partnership is not a legal entity separate and distinct from the partners.
Firm is only a compendious description of the individuals who compose the firm.
The crucial words in the definition of 'partnership ' are those that have been underlined.
They hold the key to the question posed above.
They show that the business is carried on by all or any of the partners.
In the instant case, admittedly, all the plaintiff appellants are carrying on the business in partnership.
All the six partners are sharing the profits and losses.
All the partners are jointly and severally responsible for the liabilities incurred or obligations incurred in the course of the business.
Each partner is considered an agent of the other.
This being the position, it is not possible to hold that each of the six partners is not carrying on a trade or calling within the purview of clause (b) of Section 61(1) of the Municipal Act.
At the most, it can be said that each of these six persons is severally as well as collectively carrying on a trade in the Municipality.
There is nothing in the language of Section 61 or the scheme of the Municipal Act which warrants the construction that persons who are carrying on a trade in association or partnership with each other cannot be individually taxed under clause (b) of Section 61(1).
On the contrary, definite indication is available in the language and the scheme of this statute that such partners can be taxed as persons in their individual capacity.
As noticed already, clause (b) makes it clear in no uncertain terms that this is a tax on 'persons. ' Its incidence falls on individuals, who belong to a class practising any profession or art; or carrying on a trade or calling in the municipality.
469 To hold that persons who are collectively carrying on a trade in the municipality cannot be taxed individually, would be to read into the statute words which are not there.
There are no words in clause (b) or elsewhere in the statute which, expressly or by necessary implication, exclude or exempt persons carrying on a trade collectively in the municipality from being taxed as individuals.
To attract liability to a tax under this clause, it is sufficient that the person concerned is carrying on a trade in the municipality, irrespective of whether such trade is being carried on by him individually or in partnership with others.
Thus, both the conditions necessary for levying a tax under clause (b) of subsection (1) of Section 61 of the Municipal Act existed in this case.
The appellants are "persons" and they are carrying on a trade in Chheharata Municipality.
In the view we take, we do not think it necessary to go further into the question, whether the definition of 'person ' given in Section 2(40) of the Punjab General Clauses Act, can be imported into the statute under consideration, so as to include a contractual firm, also, within the purview of the expression 'persons ' used in clause (b) of Section 61(1).
Indeed, the entire effort to import the definition of 'person ' given in the General Clauses Act, into Section 61(1)(b) of the Municipal Act, is directed to find a foundation for the argument, that the construction adopted by the High Court could lead to double taxation and even unconstitutional results.
But in the instant case, nothing of this kind has happened.
The firm has not been assessed.
No question of double taxation or exceeding the Constitutional ceiling of Rs. 250/ fixed by Article 276(2) of the Constitution, arises on the facts of the present case.
The arguments advanced on behalf of the appellants on this aspect of the matter are merely hypothetical, and speculative.
This takes us to the second question, whether the Civil Court had jurisdiction to hear and determine the suit.
Section 84(1) of the Punjab Municipal Act provides that "an appeal against the assessment or levy of any. tax under this Act, shall lie to the Deputy Commissioner or to such other officer as may be empowered by the State Government in this behalf".
Then, there is a proviso to this sub section which says that when the Deputy Commissioner or such other officer, as aforesaid, is or was, when the tax was imposed, a member of the Committee, the appeal shall lie to the Commissioner of the Division.
Sub section (2) is important.
It provides: "84(2).
If, on the hearing of an appeal under the section, any question as to the liability to, or the principle of assessment of, a tax arises, on which the officer hearing the appeal entertains reasonable dobut, he may, either of his own 470 motion or on the application of any person interested, draw up a statement of the facts of the case and the point on which doubt is entertained, and refer the statement with his own opinion on the point for the decision of the High Court.
" Section 86 mandates that "no objection shall be taken to any valuation or assessment, nor shall the liability of any person to be assessed or taxed be questioned, in any other manner or by any other authority than is provided in this Act.
" From a conjoint reading of sections 84 and 86, it is plain that the Municipal Act, gives a special and particular remedy for the person aggrieved by an assessment of tax under this Act, irrespective of whether the grievance relates to the rate or quantum of tax or the principle of assessment.
The Act further provides a particular forum and a specific mode of having this remedy which analogous to that provided in Section 66 (2) of the Indian Income tax Act, 1922.
Section 86 forbids in clear terms the person aggrieved by an assessment from seeking his remedy in any other forum or in any other manner than that provided in the Municipal Act.
It is well recognised that where a Revenue Statute provides for a person aggrieved by an assessment thereunder, a particular remedy to be sought in a particular forum, in a particular way, it must be sought in that forum and in that manner, and all other forums and modes of seeking it are excluded.
Construed in the light of this principle, it is clear that sections 84 and 86 of the Municipal Act bar, by inevitable implication" the jurisdiction of the Civil Court where the grievance of the party relates to an assessment or the principle of assessment under this Act.
In the view we take, we are fortified by the decision of this Court in Firm Seth Radha Kishan vs Administrator, Municipal Committee, Ludhiana, (supra) wherein sections 84 and 86 of this very Punjab Municipal Act, 1911 came up for consideration.
Therein, the Municipal Committee, Ludhiana, imposed a terminal tax on Sambhar salt and assessed the appellant, therein, to a sum of Rs. 5,893/ towards that tax at the rate of Rs. 10/ per maund under item 69 of the Government Notification by which the terminal tax was imposed.
The assessee filed a suit against the Municipal Committee in the Civil Court, contending that Sambhar salt ought to have been assessed at the rate of 3 pies per maund under item 68, that he had been illegally assessed under item 69 at the higher rate, and claimed refund of the amount paid by him, with interest.
The Committee, inter alia, contended that Sambhar salt was not common salt, and the Civil Court had no jurisdiction to entertain the suit.
The trial court held that Sambhar salt was common salt within the meaning of item 68 of the Schedule, that 471 the imposition of tax on it under item 69 of the Schedule was illegal, and, therefore, the Civil Court had jurisdiction to hear and determine the suit by virtue of section 9 of the Code of Civil Procedure.
On appeal, the High Court held that the Civil Court had no jurisdiction, and dismissed the suit.
The assessee came in appeal to this Court by certificate granted by the High Court, and contended that since the impugned levy was not made under the Municipal Act but in derogation thereof, the Civil Court had jurisdiction to entertain and determine the suit.
Delivering the judgment of the Court, Subba Rao, J. (as he then was) repelled this contention, observing that the rate of the tax to be levied depended upon the character of the salt, and it was not possible to say that in ascertaining this fact the authorities concerned travelled outside the provisions of the Municipal Act, even if they wrongly applied item 69 of the schedule; that the mistake in applying the wrong item of the Schedule to the tax could be corrected only in the manner prescribed by the Act, and the aggrieved person cannot file a suit in the Civil Court in that regard, the Civil Court 's jurisdiction having been excluded by the provisions of Sections 84 and 86 of the Act.
The Court distinguished that class of cases where the Municipal Committee in levying a tax or committing an Act, clearly acts outside or in abuse of its powers under the Municipal Act, and explained that it is only in such cases, the bar to the jurisdiction of the Civil Court would not apply.
Can the case before us be said to belong to that class of cases where the Municipal Committee in levying a Tax acts beyond or in abuse of its powers under the Act ? The answer to this question must be in the negative.
By no stretch of imagination, can it be said in the facts and circumstances of the case, that in assessing the appellants, individually, and not collectively, to the tax in question, the Municipal Committee abused its powers under the Act.
We have already discussed and held that in levying this tax, the Municipal Committee did not travel beyond or act contrary to the provisions of Section 61(1)(b) of the Act.
In short, the present case is one where the Municipal Committee acted "under the Act".
It follows, therefore, that the Civil Court 's jurisdiction to entertain and decide the suit was barred, even if the dispute raised therein related to the principle of assessment to be followed.
For the foregoing reasons, the appeal fails and is dismissed with costs.
V.D.K. Appeal dismissed.
| IN-Abs | Under section 61(1)(b) of the Punjab Municipal Act, 1911 the respondent by its Notification dated May 15, 1946 levied a profession tax of Rs. 15/ per annum on each of the partners of a firm.
Bharat Industries Chheharta i.e. the appellants in the appeal.
By the Notification dated July 4, 1958 the tax was raised to Rs. 200/ per annum.
The validity of the demand made by the respondent at the rate of Rs. 200/ from each of the partners of the firm was challenged, pleading that the Municipal Committee in levying the tax on the individual partners had exceeded its statutory powers under section 61(1)(b) of the Municipal Act in as much as the term 'person ' occurring in section 61(1)(b) of the Punjab Municipal Act, 1911, construed in the light of the definition given in section 2(40) of the Punjab General Clauses Act included a 'firm ' and since the trade carried on by the firm is one, the tax could be levied only on the firm, and not on the partners individually.
The Trial Court dismissed the suit.
First appellate court reversed the decree and the High Court in Second Appeal confirmed it.
A Letters Patent Appeal, preferred by the respondent was allowed and the Trial Court 's decision dismissing the suit was restored.
Dismissing the appeal by special leave, the Court ^ HELD: 1.
It is clear, from a plain reading of Section 61(1)(b) that a tax leviable under clause (b) is in terms, a tax on 'persons ', which expression includes natural persons.
Its incidence falls on individuals, who belong to a class practising any profession or art, or carrying on a trade or calling in the municipality.
To hold that persons who are collectively carrying on a trade in the municipality cannot be taxed individually, would be to read into the statute words which are not there.
There are no words in clause (b) or elsewhere in the statute which expressly or by necessary implication, exclude or exempt persons carrying on a trade collectively in the municipality from being taxed as individuals.
To attract liability to a tax under this clause it is sufficient that the person concerned is carrying on a trade in the municipality, irrespective of whether such trade is being carried on by him individually or in partnership with others.
[467G, 468H, 469A B] 2 'Partnership ' as defined in Section 4 of the , is the relation between persons who have agreed to share the profits of a business carried on by all or any of them for the benefit of all.
A firm or partnership is not a legal entity separate and distinct from the partners.
Firm 464 is only a compendious description of the individuals who compose the firm.
The business being carried on by all or any of the partners, all of them are jointly and severally responsible for the liabilities incurred in the course of the business as each one is considered as an agent of the other.
Such partners can be taxed as persons, in their individual.
[468 D H] 3.
In order to be authorised a tax under clause (b) of Section 61(1) must satisfy two conditions: First, it must be a tax on persons.
Second, such persons must be practising any profession or art or carrying on any trade or calling in the municipality.
Both the conditions necessary for levying a tax under clause (b) of sub section (1) of Section 61 of the Municipal Act existed in this case.
The appellants are 'persons ' and they are carrying on a trade in Chheharata Municipality.
[467H, 468A C] 4(i) Where a Revenue Statute provides for a person aggrieved by an assessment thereunder, a particular remedy to be sought in a particular forum, in a particular way, it must be sought in that forum and in that manner, and all other forums and modes of seeking it are excluded.
[470D E] (ii) From a conjoint reading of sections 84 and 86, it is plain that the Municipal Act, gives a special and particular remedy for the person aggrieved by an assessment of tax under this Act, irrespective of whether the grievance relates to the rate or quantum of tax or the principle of assessment.
The Act further provides a particular forum and a specific mode of having this remedy, which is analogous to that provided in Section 66(2) of the Indian Income tax Act, 1922 Section 86 forbids in clear terms the person aggrieved by an assessment from seeking his remedy in any other forum or in any other manner than that provided in the Municipal Act.
Therefore, Sections 84 and 86 of the Municipal Act bar by inevitable implication, the jurisdiction of the Civil Court where the grievance of the party relates to an assessment or the principle of assessment under the Act.
[470B D, E F] (iii) In the facts and circumstances of the case, it is clear (a) that in assessing the appellants individually, and not collectively to the tax in question, the Municipal Committee did not abuse its powers under the Act, (b) in levying the profession tax it did not travel beyond or act contrary to the provisions of sections 61(1)(b) of the Act, and (c) that the Committee acted under the Act.
The Civil Courts jurisdiction, therefor, to entertain and decide the suit was barred.
[471E G] Firm Seth Radhakishan vs Administrator, Municipal Committee, Ludhiana ; followed.
|
N: Criminal Appeal No. 105 of 1975.
Appeal by Special Leave from the Judgment and Order dated 6 8 1974 of the Delhi High Court in Criminal Revision No. 58 of 1973.
Frank Anthony, K. C. Dua and O. P. Soni for the Appellants.
J. Sorabjee, Additional Soli.
General, B. P. Maheshwari and Suresh Sethi for the Respondents.
The Judgment of the Court was delivered by FAZAL ALI, J.
This appeal by special leave is directed against the Judgment of the Delhi High Court convicting the appellant under section 7/16 of the , read with Section 2(ix) clause (a) & (g) of the Act and sentenced to rigorous imprisonment of six months and a fine of Rs. 1,000/ .
This order was passed by the High Court in a revision filed by the Municipal Corporation of Delhi against the Order of the Trial Court which convicted the appellant under section 7/15 of the read with Section 2(ix) (k) of the Act and sentenced him to imprisonment till the rising of the Court and a fine of Rs. 500/ , a revision against this order to the Sessions Judge was unsuccessful and hence a further revision was taken by the Delhi Administration before the High Court.
The facts of the case are detailed in the Judgment of the High Court and the Magistrate and we need not repeat the same all over again.
The food Inspectors, namely, one Mr. James and Mr. Sinha took samples of a preparation called Para Excellant and Para Asli from the shop of the appellant who according to the Food Inspectors sold these preparations as saccharin, a fact which is not admitted by the appellant.
The Trial Court after considering the evidence and the report of the Chemical Examiner found that the case of mis branding under section 2(ix) (a) & (g) was not made out by the Prosecution, but it was certainly mis branding as contemplated by section 2(ix) (k) of the Act.
He, accordingly convicted the appellant as indicated above.
Mr. Frank Anthony, Learned Counsel for the appellant has submitted that the High Court was wrong in law in interfering with the Order of the Magistrate, firstly, because the findings of fact by the 553 Magistrate was binding on the High Court in revision and secondly, because the High Court took a legally erroneous view of the law on the interpretation of Section 2(ix) (a) & (g) of the .
We have heard learned counsel for the parties and have perused the judgment of the High Court and we are of the opinion that the contentions raised by the learned counsel for the appellant is well founded and must prevail.
We have perused the original label which described the preparation sold to the food inspectors.
There is nothing to show that the appellant in any way tried to give an impression to the purchaser that either saccharin or some preparation of the type of saccharin was being sold so as to amount to misbranding as contemplated by Section 2(ix) (a) & (g) of the Act.
All that the appellant purported to convey under the label was that the preparation sold was as sweet as saccharin but not as bitter as saccharin.
This was intended merely to lay emphasis on the sweetness of the preparation when it was compared to the sweetness of saccharin.
When the label clearly described the fact that the preparation was not as bitter as saccharin it clearly intended to convey that it was neither something like saccharin nor saccharin itself, in any form or of any type.
Mr. Sorabjee appearing for the respondent submitted that the use of the word saccharin itself amounts to mis branding and gives the impression that the preparation sold was saccharin or something akin to saccharin.
We are unable to agree with this contention.
In the facts and circumstances of the present case and the contents of the label and the description of the preparation, we are satisfied that there was no misbranding, nor was there any attempt on the part of the appellant to sell his preparation as saccharin or some sort of saccharin.
Section 2.(ix) (a) runs as follows: "Misbranded" an article of food shall be deemed to be misbranded (a) "If it is an imitation of, or is a substitute for, or resembles in a manner likely to deceive, another article of food under the name of which it is sold, and is not plainly and conspicuously labelled so as to indicate its true character.
" According to the Additional Solicitor General of India, the sale, by the appellant, of the preparation clearly falls within (iii) clause of sub section (a), that is to say the preparation resembles saccharin so as to deceive a person who wanted to purchase the article of food 554 known as saccharin.
After having examined the label, its description and the contents of the tin and packets, sold to the food inspectors, we are unable to find any evidence of any intention on the part of the appellant to sell a preparation which resembles saccharin in any respect.
The words, as sweet as saccharin were merely meant to convey one of the qualities of the preparation itself and not the quality of saccharin at all.
That, by itself, would not attract the provision of Section 2(ix) (a) of the Act.
It was, then submitted that in one of the labels under the directions it was mentioned that the preparation was para saccharin which also shows that the appellant intended to pass on the preparation as some sort of saccharin.
In the first place, the use of the word para saccharin appears to be a mistake in the facts of the present case because this word is completely absent from the Hindi portion of the directions contained in the same label.
Secondly, the word para saccharin would not indicate that the preparation sold was saccharin in any form or of any kind.
It was just a way of describing it because according to the manufacturers the preparation was as sweet as saccharin.
This was mentioned because saccharin being 500 times sweeter than sugar, the manufacturer wanted to convey that the preparation was also much sweeter than sugar and could be used for preparing soda water bottles.
It is obvious that if any person who purchased the preparation was not conversent with the English language, he would not be misled at all.
Having regard to these circumstances we are of the opinion that the case of the appellant does not fall within the clauses (a) & (g) of Section 2(ix) of the Act and the High Court erred in law in convicting the appellant for misbranding under these provisions.
For the reasons given above, the appeal is allowed.
The order of the High Court is set aside and the sentence of imprisonment of six months is also set aside and the fine is reduced to Rs. 500/ .
In other words, the order of the Trial Court Magistrate is hereby restored.
The appeal is accordingly allowed.
N.V.K. Appeal allowed.
| IN-Abs | The appellant was a manufacturer of a preparation called Para Excellent and Para Asli The outer label of the package describe the contents as "as sweet as saccharin".
Under the directions for use it was mentioned on the label that the preparation was para saccharin.
The appellant was prosecuted under s.2(ix)(a) and (g) of the for misbranding the goods and for selling it as saccharin.
While the trial court convicted and sentenced the appellant to imprisonment and a fine on the ground that though a case of misbranding under section 2(ix) (a) and (g) had not been made out, it was a case of misbranding contemplated by section 2(ix) (k), the High Court, in revision, enhanced the sentence and fine under sections 7 and 16 read with section 2(ix)(a) and (g) of the Act.
On behalf of the prosecution it was contended in the appellant 's appeal to this Court that the use of the word saccharin gave the impression that the preparation was saccharin or something akin to it and it was, therefore, a case of misbranding punishable under the Act.
Allowing the appeal.
^ HELD :1.
There is nothing on the facts of the case to show that the appellant in any way tried to give an impression to the purchasers that either saccharin or some preparation of the type of saccharin was being sold so as to amount to misbranding as contemplated by section 2(iv)(a) and (g) of the Act.
Nor was there an attempt to sell the preparation as saccharin or some kind of saccharin.
When the label described that the preparation was as sweet as saccharin it merely laid emphasis on the sweetness of the preparation when compared to the sweetness of the saccharin.
Similarly when the label described the preparation was not as bitter as saccharin it was intended to convey that it was neither something like saccharin nor saccharin itself in any form or of any type.
[553 C D] 2.
Nor again was there any evidence of intention on the part of the appellant to sell a preparation which resembles saccharin in any respect.
The words "as sweet as saccarin" were merely meant to convey one of the qualities of the preparation itself and not the quality of saccharin.
That by itself would not attract the provisions of section 2(ix)(a) of the Act.
[554 B] 3.
The use of the word para saccharin appears to be a mistake.
In the Hindi portion of the directions contained in the label the words "para Saccharin" were not used.
Secondly the word "para saccharin" would not indicate that 552 the preparation sold was saccharin in any form or of any kind.
It was just a way of describing the contents because the preparation was "as sweet as saccharin. ' The manufacturer wanted to convey that the preparation wasa also much sweeter than sugar and could be used for preparing soda water.
[554 C D]
|
Civil Appeal Nos.
2170 2172 of 1972 Appeals by Special Leave from the Judgment and Order dated 22 7 1971 of the Mysore High Court in T.R.C. Nos. 3, 4 and 5 of 1967.
B. B. Ahuja and Miss A. Subhashini for the Appellant.
section T. Desai, I. N. Shroff and H. section Parihar for the Respondents.
The Judgment of the Court was delivered by UNTWALIA J.
These are three appeals by special leave filed by the Commissioner of Wealth Tax, Mysore from the Judgment of the Mysore (now Karnataka) High Court.
The assessee is the Dowger Maharani of Gondal.
Her husband, His Highness Bhojjrajji Maharaja Saheb of Gondal, died intestate on 31.7.1952 leaving considerable moveable and immoveable properties.
Certain disputes and differences arose after his death between his two sons namely Maharaja Vikramsinghji and his younger brother Shivaraj Singhji in respect of the assets left by the late Maharaja Saheb.
The younger brother was contemplating legal proceedings against his elder brother.
Their mother intervened.
The idea of litigation, thereupon, was dropped because the assessee gave a letter dated 14.5.1953 to Shivaraj Singhji stating therein: "Your father had expressed in the presence of many people that he will give you rupees fifty lakhs.
To keep up his words and promise and also that I should get peace of mind I am writing to you that if your brother Vikramsinghji Maharaja of Gondal does not give you the full amount, then you 547 must get the balance of amount from me.
That is my sincere desire.
I will also press Vikram that the should give you the amount of Rs. fifty lakhs.
Vikram Singhji paid only Rs. 20,00,000/ to Shivaraj Singhji.
The latter, therefore, claimed the balance amount of Rs. 30,00,000/ from the assessee on the basis of her letter dated 14.5.1953.
On or about 12.9.1959, pursuant to her commitment made in the letter aforesaid, the assessee transferred War Stock valued at Rs. 11,00,000/ to Shivaraj Singhji and also agreed to hand over certain ornaments in full settlement of his claim.
The ornaments were however not given.
That led to disputes between the mother and the son but eventually they were also settled on 22.2.1962 which settlement was evidenced by a document setting out all the relevant facts of the history of the dispute.
By virtue of this settlement a sum of Rs. 10,00,000/ was paid by the assessee to Shivaraj Singhji.
The assessee 's wealth was assessed to wealth tax under the Wealth Tax Act, 1957 for the three assessment years in question viz. 1960 61, 1961 62 and 1962 63.
The corresponding valuation dates of the said assessment years are 31.12.1959, 31.12.1960 and 31.12.1961.
It would be noticed that the assessee, under the arrangement arrived at between the parties, became liable to pay the balance of the amount of Rs. 30,00,000/ to Shivaraj Singhji as vikramsinghji, out of the sum of Rs. 50,00,000/ mentioned in the letter dated 14.5.1953, paid only Rs. 20,00,000/ The assessee succeeded in wiping off her liability to the extent of Rs. 11,00,000/ on 12.9.1959 by transfer of War Stock.
The balance of the liability, i.e., Rs. 19,00,000/ remained due and continued to be due on all the three valuation dates aforesaid.
It could be wiped off by a further settlement only in February, 1962.
In respect of the three assessment years in question, however, a question arose as to whether while assessing the net wealth of the assessee within the meaning of clause (m) of section 2 of the Wealth Tax Act the said sum of Rs. 19,00,000/ was to be deducted.
The Wealth tax Tribunal held in favour of the assessee.
At the instance of the Revenue for all the three years a common question of law was referred to the High Court for its opinion.
The questions being in identical terms it would suffice to quote the question with respect to the assessment year 1960 61.
It reads as follows: "Whether on the facts and circumstances of the case, the sum of Rs. 19 lakhs could constitute a debt owed by the assessee and deductible under the Wealth Tax Act from the value of the total assets as on 31.12.1959?" 548 The High Court has answered the question in the affirmative, in favour of the assessee and against the department.
Hence this appeal.
Mr. Ahuja appearing in support of the appeal contended that by the letter dated 14.5.1953 no debt was created as the undertaking given by the assessee to her son agreeing to pay the deficit in respect of Rs. 50,00,000/ on his elder brother 's failure to pay any portion of the sum was an agreement without consideration and hence under section 25 of the Contract Act it was void and was not saved by any of the exceptions mentioned therein.
He, therefore, contended that it was not an enforceable liability on any of the valuation dates and could not be deducted from the valuation of the assessee 's wealth.
In our opinion the argument is not sound.
Taking the totality of the facts as found by the Tribunal and mentioned in the impugned judgment of the High Court it was a case of family settlement or family arrangement which is binding on the parties concerned.
The assessee agreed to purchase peace for the family, and to pay to her son the amount which fell short of Rs. 50,00,000/ if her elder son did not pay any portion thereof.
It is well established that such a consideration is a good consideration which brings, about an enforceable agreement between the parties.
Section 25 of the Contract Act does not hit this.
It may be further pointed out that even if it be held that the letter dated 14.5.1953 had not the effect of bringing about the family arrangement and any binding agreement between the parties, their subsequent conduct upto 12.9.1959 brought about a concluded family arrangement.
Vikramsinghji paid Rs. 20,00,000/ .
Out of the balance of Rs. 30,00,000/ the assessee discharged her liabilities to the extent of Rs. 11,00,000/ and reiterated her obligation to pay the balance of Rs. 19,00,000/ in the shape of ornaments.
That was not honoured.
Shivaraj Singhji had a right to enforce the family arrangement against his mother, as arrived at partly in writing and partly orally as evidenced by the conduct of the parties.
The assessee would have been bound to pay Rs. 19,00,000/ if a suit had been filed against her by Sivaraj Singhji as he had refrained going to the law court from against his brother on her bringing about the family arrangement.
Mr. Ahuja then submitted that at best the undertaking given by the assessee in her letter dated 14.5.1953 was a contingent contract within the meaning of section 31 of the Contract Act.
Even so, under section 32 such a contract becomes enforceable by law when future even contemplated in the contingent contract has happened.
In this case the cotingency was the liability of the mother to pay a certain sum of money 549 on the failure by her elder son to pay Rs. 50,00,000/ or any part there of.
This did happen sometime between 14.5.1953 and 12.9.1959.
In that view of the matter, if not earlier the liability of the mother became enforceable by law on the latter date.
Learned counsel for the appellant cited three decisions of this Court to support his argument viz. Kesoram Industries and Cotton Mills Ltd. vs Commissioner of Wealth Tax (Central) Calcutta;(1) Standard Mills Co. Ltd. vs Commissioner of Wealth Tax, Bombay(2) and Bombay Dyeing and Manufacturing Co. Ltd. vs Commissioner of Wealth Tax, Bombay City I(3).
None of them is quite apposite on the point at issue before us.
In the case of Kesoram Industries it was held that "debt owed" within the meaning of section 2(m) of the could be defined as the liability to pay in praesenti or in futuro an ascertainable sum of money.
It was held that a liability to pay income tax was a present liability though the tax became payable after it was quantified in accordance with ascertainable data.
Subba Rao J., as he then was, delivering the majority opinion said at page 780 : "The said decisions also accept the legal position that a liability depending upon a contingency is not a debt in praesenti or in futuro till the contingency happened.
But if there is a debt the fact that the amount is to be a scertained does not make it any the less a debt if the liability is certain and what remains is only the quantification of the amount.
In short, a debt owed within the meaning of section 2(m) of the can be defined as a liability to pay in praesenti or in futuro an ascertainable sum of money.
The other two decisions of this Court were concerned with the question as to whether the liability of the assessee to pay gratuity to its employees on determination of employment was a mere contingent liability which arose only when the employment of the employee was determined by death, incapacity, retirement or resignation and whether it could be deducted as a debt in computing the net wealth of the assessee.
The answer given was against the assessee.
In the present case we have held that the liability of the assessee was created by the family arrangement arrived at between the parties and even if it was a contingent liability the contingency did happen and the assessee became liable 550 to pay the amount as a debt before 12.9.1959, which is anterior to the relevant valuation dates.
The sum of Rs. 19,00,000/ was a subsisting debt on the said valuation dates.
For the reasons stated above, we hold that there is no merit in this appeal.
It is accordingly dismissed with costs.
N.K.A Appeal dismissed.
| IN-Abs | The respondent 's wealth was assessed to Wealth Tax under the Wealth Tax Act, 1957 for three assessment years 1960 61, 1961 62 and 1962 63 the corresponding valuation dates being 31 12 1959, 31 12 1960 and 31 12 1961.
On 14th May, 1953 the assessee wrote a letter to her younger son stating that his late father expressed the wish that he (the second son) should be paid Rs. 50 lakhs out of the family properties and that to keep his promise and also to get peace of mind, if his elder brother did not pay the sum of Rs. 50 lakhs, she would pay such balance that remains unpaid.
The elder brother paid Rs. 20 lakhs.
The balance liability of Rs. 19 lakhs remained due and continued to be due on all the three aforesaid valuation dates.
It was finally wiped off in February, 1962.
On the question "whether, while assessing the net wealth of the respondent within section 2(m) of the Wealth Tax Act, the sum of Rs. 19 lakhs was to be deducted" as debt owed by her, the Wealth Tax Tribunal held in favour of the respondent.
The High Court held that the sum of Rs. 19 lakhs constituted a debt owed by the assessee and was deductible under the Wealth Tax Act from the value of the total assets as on 31 12 1959.
On appeal to this Court, the appellant argued (i) that the letter dated 14 5 1953 created no debt as the undertaking given by the respondent to her son on his elder brother 's failure to pay any portion of the sum was an agreement without consideration and hence it was void and therefore it was not enforceable at law on any of the valuation dates and could not be deducted; (ii) that the undertaking given by the respondent in her letter dated 14 5 1953 was a contingent contract within the meaning of section 31 of the Contract Act.
Dismissing the appeal, ^ HELD: (1) Taking the totality of facts it was a case of family settlement or family arrangement which was binding on the parties.
The respondent agreed to purchase peace for the family and to pay to her younger son the amount which fell short of Rs. 50 lakhs if her elder son did not pay any portion thereof.
It is well established that such a consideration is good consideration which brings an enforceable agreement between the parties and is not hit by section 25.
Even if it be held that the letter dated 14 5 1953 had not the effect of bringing about the family arrangement or any binding arrangemen bewteen the parties, their subsequent conduct upto 12th September 1959 brought a concluded family arrangement.
The respondent paid Rs. 11 lakhs and reiterated her obligation to pay the balance in the shape of ornaments.
546 That was not honoured by reason of which the younger son had a right to enforce the family arrangement against his mother.
The respondent would have been bound to pay the balance if a suit had been filed against her as he had refrained from going to the law court against his brother on her bringing about the family arrangement.
[548 C G] (2) Assuming that it was a contingent contract within the meaning of section 31 of the Contract act, such a contract under section 32 of the Contract Act, becomes enforceably by law when the future event contemplated in the contingent contract had happened.
The contingency in this case was the liability of the mother to pay a certain sum of money on the failure by the elder son to pay Rs. 50 lakhs or any part thereof.
In that view, the liability of the mother became enforceable by law on the latter date, if not earlier.[548 G H, 549] Kesoram Industries and Cotton Mills Ltd. vs Commissioner of Wealth Tax (Central), Calcutta, 59 I.T.R. 767; Standard Mills Co. Ltd. vs Commissioner of Wealth Tax, Bombay, ; and Bombay Dyeing and Manufacturing Co. Lt. vs Commissioner of Wealth Tax, Bombay City I, , distinguished and held inapplicable.
|
ition No. 57 of 1979.
K. Hingorani for the Petitioners.
U. P. Singh for the Respondent.
534 The Order of the Court was delivered by BHAGWATI, J.
This writ petition again comes up for hearing before us pursuant to the directions given by us on 26th February, 1979(1) and today three additional counter affidavits have been filed on behalf of the respondents: one by Mrinmaya Choudhri, Assistant Inspector General of Prisons: the other by Bageshwari Prasad Pande, Superintendent of the Patna Central Jail and the third by Pradip Kumar Ganguly, Superintendent of the Muzafferpur Central Jail.
Mrinmaya Choudhri has in his affidavit given particulars of the under trial prisoners in 48 jails in the State of Bihar in addition to the particulars of the undertrial prisoners in 17 jails already submitted on 26th February, 1979.
We directed the State of Bihar by our order dated 26th February, 1979 to file a revised chart showing a year wise break up of the under trial prisoners after making a division into two broad categories viz. minor offences and major offences but this direction has not yet been carried out by the State of Bihar.
Mrinmaya Choudhri has, however, assured us in his affidavit that several steps regarding the different directions given by the Court are being promptly implemented but due to shortage of time it has not been possible complete the same by 3rd March, 1979.
We direct that the State of Bihar will file within three weeks from to day a revised chart in regard to the under trial prisoners in all the 65 jails in a manner which would clearly show year wise as to what is the date from which each of them is in jail after making a broad division into two categories of minor offences and major offences.
We are glad to note that so far as women under 'protective custody ' are concerned, the State has assured us in the affidavit of Mrinmaya Choudhri that necessary steps for transferring women under "protective custody ' in jails to the institutions run by the welfare department have been taken and directions to that effect are issued by the Government.
We hope and trust that this direction given by us in our earlier order dated 26th February, 1979 will be carried out by Government and compliance report submitted to us within the prescribed time.
Though we directed the State of Bihar by our order dated 26th February, 1979 to intimate to the court by a proper affidavit to be filed on or before 3rd March, 1979 whether the under trial prisoners whose particulars were given in the counter affidavit filed on 26th February, 1979 were periodically produced before the Magistrates in compliance with the proviso to section 167(2), we find that the only averment made by Bageshwari Prasad Pande in his affidavit in response to this direction is that petitioners Nos. 1, 2, 3, 4, 5, 6, 7, 8, 9 and 17 confined in the Patna Central Jail prior to their release were 535 regularly produced before the courts "as and when required by the courts".
This averment does not at all constitute compliance with the direction given by us.
We would like to know from the State of Bihar in a proper affidavit to be filed within two weeks from today whether the under trial prisoners who were directed to be released by us on their personal bond were periodically produced before the Magistrates in compliance with requirement of the proviso to section 167(2).
We would suggest that the State should furnish to this Court the dates on which these under trial prisoners were remanded to judicial custody from time to time by the Magistrates, so that we can satisfy ourselves that the requirement of the proviso was complied with.
We also find an averment in the affidavit of Pradeep Kumar Ganguly that Petitioners Nos.
10, 11, 12, 13, 15, 16 and 18 who were previously confined in the Muzaffarpur Central Jail prior to their release were regularly produced before the Court "as and when required by the courts".
This averment, as we have pointed out, is wholly unsatisfactory and it does not inform the Court as to what were the dates on which these under trial prisoners were remanded from time to time by the Magistrates.
It is only if these particulas are furnished to us that we can satisfy ourselves in regard to compliance with the requirement of the proviso to section 167(2) and we would, therefore, direct the State of Bihar to furnish these particulars to us in an affidavit to be filed within two weeks from today.
We should also like to have the particulars in regard to the dates on which remand orders were made from time to time by the Magistrates in regard to under trial prisoners at items Nos. 4, 5, 6, 7, 8, 13, 21, 22, 24, 28, 29, 30, 43, 56, 69, 71, 72, 79, 85, 92, 96, 97, 101, 129, 133, 136 to 142, 165 to 167, 170 to 174, 177, 191, 199, 210, and 236 in the list of under trial prisoners in Ranchi Central Jail submitted on behalf of the respondents.
These under trial prisoners have been in jail for a period of over six to seven years and we would like to satisfy ourselves that the requirement of the proviso to section 167(2) was complied with in their case.
The affidavit giving these particulars should be filed by the State Government within three weeks from today.
There are quite a larg number of under trial prisoners who are languishing in jail for long periods of time and it is not possible for us to examine the individual cases of these under trial prisoners for the purpose of satisfying ourselves in regard to compliance with the proviso to section 167(2), but we woudl request the High Court of Patna to pick out a few names from the lists of under trial prisoners which have been filed before us by the State of Bihar on 26th February, 1979 and 5th March, 1979 and satisfy itself 536 whether these under trial prisoners have been periodically remanded from time to time by the Magistrates as required by the proviso to section 167(2).
We would direct the State of Bihar to furnish copies of these lists of under trial prisoners to the Chief Justice of the Patna High Court within ten days from today.
We find from the lists of under trial prisoners filed before us on behalf of the State of Bihar that the under trial prisoners whose names are set out in the chart filed by Mrs. Hingorani to day have been in jail for periods longer than the maximum term for which they could have been sentenced; if convicted.
This discloses a shocking state of affairs and betrays complete lack of concern for human values.
It exposes the callousness of our legal and judical system which can remain unmoved by such enormous misery and suffering resulting from totally unjustified deprivation of personal liberty.
It is indeed difficult for us to understand how the State Government could possibly remain oblivious to the continued incarceration of these under trial prisoners for years without even their trial having commenced.
The judiciary in the State of Bihar also cannot escape its share of blame because it could not have been unware of the fact that thousands of under trial prisoners are languishing in jail awaiting trial which never seems to commence.
We fail to see how the continued detention of these under trial prisoners mentioned in the list of Mrs. Hingorani can be justified when we find that they have already been in jai for a period longer than what they would have been sentenced to suffer, if convicted.
They have in fact some jail term to their credit.
We, therefore, direct that these under trial prisoners whose names and particulars are given in the list filed by Mrs. Hingorani should be released forthwith as continuance of their detention is clearly illegal and in violation of their fundametal right under Article 21 of the Constitution.
Then there are several under trial prisoners who are charged with offences which are bailable but who are still in jail presumably because no application for bail has been made on their behalf or being too poor they are unable to furnish bail.
It is not uncommon to find that under trial prisoners who are produced before the Magistrates are unaware of their right to obtain release on bail and on account of their poverty, they are unable to engage a lawyer who would apprise them of their right to apply for bail and help them to secure release on bail by making a proper application to the Magistrate in that behalf.
Sometimes the Magistrates also refuse to release the undertrial prisoners produced before them on their personal bond but insist on monetary bail with sureties, which by reason of their poverty 537 the under trial prisoners are unable to furnish and which, therefore, effectively shuts out for them any possibility of release from pretrial detention.
This unfortunate situation cries aloud for introduction of an adequate and comprehensive legal service programme, but so far, these cries do not seem to have evoked any response.
We do not think it is possible to reach the benefits of the legal process to the poor, to protect them against injustice and to secure to them their constitutional and statutory rights unless there is a nation wide legal service programme to provide free legal services to them.
It is now well settled, as a result of the decision of this Court in Maneka Gandhi vs Union of India(1) that when Article 21 provides that no person shall be deprived of his life or liberty except in accordance with the procedure established by law, it is not enough that there should be some semblance of procedure provided by law, but the procedure unnder which a person may be deprived of his life or liberty should be 'reasonable, fair and just '.
Now, a procedure which does not make available legal services to an accused person who is too poor to afford a lawyer and who would, therefore, have to go through the trial without legal assistance, cannot possibly be regarded as 'reasonable fair and just.
It is an essential indegredient of reasonable, fair and just procedure to a prisonel who is to seek his liberation through the court 's process that he should have legal services available to him.
This Court pointed out in M. H. Hoskot vs State of Maharashtra (2).:"Judicial justice, with procedural intricacies, legal submissions and critical examination of evidence, leans upon professional expertise; and a failure of equal justice under the law is on the cards where such supporteve skill is absent for one side.
Our judicature, moulded by Anglo American models and our judicial process, engineered by kindred legal technology, compel the collaboration of lawyer power for steering the wheels of equal justice under the law".
Free legal services to the poor and the needy is an essential element of any 'reasonable, fair and just ' procedure.
It is not necessary to quote authorative pronouncements by judges and jurists in support of the view that without the service of a lawyer an accused person would be denied 'reasonable, fair and just ' procedure.
Black, J., observed in Gidian vs Wainwright(3): "Not only those precedents but also reason and reffection require us to recognise that in our adversary system of criminal justice, any person haled into court, who is too poor to hire a lawyer cannot be assured a fair trial unless counsel is provided for him.
This seems to us to be an obvious 538 truth.
Governments, both State and Federal quite properly spend vast sums of money to establish machinery to try defendants accused of crime.
Lawyers to prosecute are every where deemed essential to protect the public 's interest in an orderly society.
Similarly, there are few defendants charged with crime who fail to hire the best lawyers they can get to prepare and present their defences.
That government hires lawyers to prosecute and defendants who have the money hire lawyers to defend are the strongest indications of the widespread belief that lawyers in criminal courts are necessties, not luxuries.
The right of one charged with crime to counsel may not be deemed fundamental and essential to fair trials in some countries, but is in ours.
From the very beginning, our state and national constitutions and laws have laid great emphasis on procedural and substantive safeguards designed to assure fair trials before impartial tribunals in which every defendant stands equal before the law.
This noble idea cannot be realised if the poor man charged with crime has to face his accusers without a lawyer to assist him.
" The philosophy of free legal service as an essential element of fair procedure is also to be found in the following passage from the judgment of Douglas, J. in Jon Richard Argersinger vs Raymond Hamlin(1) "The right to be heard would be, in many cases of little avail if it did not comprehend the right to be heard by counsel.
Even the intelligent and educated layman has small and sometimes no skill in the science of law, if charged with crime, he is incapable, generally of determining for himself whether the indictment is good or bad.
He is unfamiliar with the rules of evidence.
Left without the aid of counsel he may be put on trial without a proper charge and convicted upon incompetent evidence, or evidence irrelevant to the issue or otherwise inadmissible.
He lacks both the skill and knowledge adequately to prepare his defence, even though he has a perfect one.
He requires the guiding hand of counsel at every step in the proceedings against him.
Without it, though he be not guilty, he faces the danger of conviction because he does not know how to establish his innocence.
If that be true of men of intelligence, 539 how much more true is it of the ignorant and illiterate or those of feeble intellect.
The right of one charged with crime to counsel may not be deemed fundamental and essential to fair trials in some countries but it is in ours.
From the very beginning our state and national constitutions and laws have laid great emphasis on procedural and substantive safeguards designed to assure fair trials before impartial tribunals in which every defendant stands equal before the law.
This noble ideal cannot be realized if the poor man charged with crime has to face his accusers without a lawyer to assist him.
Both Powell and Gideon involved felonies.
But their rationale has relevance to any criminal trial, where an accused is deprived of his liberty.
x x x x x x The court should consider the probable sentence that will follow if a conviction is obtained.
The more serious the likely consequences, the greater is the probability that a lawyer should be appointed. .
The court should consider the individual factors peculiar to each case.
These, of course would be the most difficult to anticipate.
One relevant factor would be the competency of the individual defendent to present his own case.
(emphasis added)" We may also refer to Article 39A the fundamental constitutional directive which reads as follows: "39A. Equal justice and free legal aid: The State shall secure that the operation of the legal system promotes justice, on a basis of equal opportunity, and shall, in particular, provide free legal aid, by suitable legislation or schemes or in any other way, to ensure that opportunities for securing justice are not denied to any citizen by reason of economic or other disabilities.
(emphasis added)" This Article also emphasises that free legal service is an inalienable element of 'reasonable, fair and just ' procedure for without it a person suffering from economic or other disabilities would be deprived of the opportunity for securing justice.
The right to free legal services is, therefore, clearly an essential ingredient of 'reasonable, fair and just, procedure for a person accused of an offence and it must be held implicit in the guarantee of Article 21.
This is a constitutional right of every accused person who is unable to engage a lawyer and secure legal services on account of reasons such as poverty, indigence or incommunicado situation and the State is under a mandate to provide a lawyer to an accused person if the circumstances of the case and the 540 needs of justice so required, provided of course the accused person does not object to the provision of such lawyer.
We would, therefore, direct that on the next remand dates, when the under trial prisoners, charged with bailable offences, are produced before the Magistrates, the State Government should provide them a lawyer at its own cost for the purpose of making an application for bail, provided that no objection is raised to such lawyer on behalf of such under trial prisoners and if any application for bail is made, the Magistrates should dispose of the same in accordance with the broad outlines set out by us in our judgment dated 12th February, 1979.
The State Government will report to the High Court of Patna its compliance with this direction within a period of six weeks from today.
There are also various under trial prisoners who have been in jail for periods exceeding one half of the maximum punishment that could be awarded to them, if convicted, for the offences with which they are charged.
To take an example, Budhu Mahli, who is at item No. 1 in the list of undertrial prisoners in Ranchi Central Jail has been in jail since 21st November, 1972 for offences under Section 395 of the Indian Penal Code and Section 25 of the Indian Arms Act.
The maximum punishment for the offence under Section 395 of the Indian Penal Code is 10 years while that for the offence under Section 25 of the Indian Arms Act is much less.
Yet Budhu Mahli has been in jail as an under trial prisoner for over six years.
So also Jairam Manjhi, Somra Manjhi, Jugal Munda and Gulam Munda at Item Nos.
2 to 7 in the list of under trial prisoners confined in Ranchi Central Jail have been in jail as under trial prisoners from 21st February, 1974 that is, for a period of over five years for the offence under Section 395 of the Indian Penal Code which is punishable with a maximum term of imprisonment of ten years.
There are numerous other instances which can easily be gleaned from the lists of under trial prisoners filed on behalf of the State of Bihar, where the under trial prisoners have been in jail for more than half the maximum term of imprisonment for which they could be sentenced, if convicted.
There is no reason why these undetrial prisoners should be allowed to continue to languish in jail, merely because the State is not in a position to try them within a reasonable period of time.
It is possible that some of them, on trial may be acquitted of the offences charged against them and in that event, they would have spent several years in jail for offences which they are ultimately found not to have committed.
What faith would these people have in our system of administration of justice ? Would they not carry a sense of frustration and bitterness against a society which keeps them in jail for so many years for offences which they did not commit ? It is, therefore, absolutely essential that persons accused of offences 541 should be speedily tried, so that in cases where bail, in proper exercise of discretion, is refused, the accused persons have not to remain in jail longer than is absolutely necessary.
Since there are several undertrial prisoners who have been in jail for periods longer than half the maximum term of imprisonment for which they could if convicted, be sentenced, we would direct that on the next remand dates when they are produced before the Magistrates or the Sessions Courts, the State Government should provide them a lawyer at its own cost for the purpose of making an application for bail and opposing remand provided that no objection is raised to such lawyer on their behalf and if any application for bail is made, the Magistrates or the Sessions Courts, as the case may be should dispose of the same in accordance with the broad guidelines indicated by us in our judgment dated 12th February, 1979.
The State Government will comply with this direction as far as possible within a period of six weeks from today and submit report of compliance to the High Court of Patna.
We may also take this opportunity of impressing upon the Government of India as also the State Governments, the urgent necessity of introducing a dynamic and comprehensive legal service programme with a view to reaching justice to the common man.
Today, unfortunately, in our country the poor are priced out of the judicial system with the result that they are losing faith in the capacity of our legal system to bring about changes in their life conditions and to deliver justice to them.
The poor in their contract with the legal system have always been on the wrong side of the law.
They have always come across "law for the poor" rather than "law of the poor".
The law is regarded by them as something mysterious and forbidding always taking something away from them and not as a positive and constructive social device for changing the socio economic order and improving their life conditions by conferring rights and benefits on them.
The result is that the legal system has lost its credibility for the weaker sections of the community.
It is, therefore, necessary that we should inject equal justice into legality and that can be done only by dynamic and activist scheme of legal services.
We may remind the Government of the famous words of Mr. Justice Brennan "Nothing rankles more in the human heart than a brooding sense of injustice.
Illness we can put up with.
But injustice makes us want to pull things down.
When only the rich can enjoy the law, as a doubtful luxury, and the poor, who need it most, cannot have it because its expense puts it beyond their reach, the threat to the continued existence of free democracy is not imaginary but very real, because 542 democracy 's very life depends upon making the machinery of justice so effective that every citizen shall believe in an benefit by its impartiality and fairness." And also recall what was said by Leeman Abbot years ago in relation to affluent America.
"If ever a time shall come when in this city only the rich can enjoy law as a doubtful luxury, when the poor who need it most cannot have it, when only a golden key will unlock the door to the courtroom, the seeds of revolution will be sown, the fire brand of revolution will be lighted and put into the hands of men and they will almost be justified in the revolution which will follow.
" We would strongly recommend to the Government of India and the State Governments that it is high time that a comprehensive legal service programme is introduced in the country.
That is not only a mandate of equal justice implicit in Article 14 and right to life and liberty conferred by Article 21, but also the compulsion of the constitutional directive embodied in Article 39A.
We find from the counter affidavit filed on behalf of the respondents that no reasons have been given by the State Goverment as to why there has been such enormous delay in bringing the under trial prisoners to trial.
Speedy trial is, as held by us in our earlier judgment dated 26th February, 1979, an essential ingredient of 'reasonable, fair and just ' procedure guaranteed by Article 21 and it is the constitutional obligation of the State to device such a procedure as would ensure speedy trial to the accused.
The State cannot be permitted to deny the constitutional right of speedy trial to the accused on he ground that the State has no adequate financial resources to incur the necessary expenditure needed for improving the administrative and judicial apparatus with a view to ensuring speedy trial.
The State may have its financial constraints and its priorities in expenditure, but, as pointed out by the Court in Rhem vs Malclm(1): "The law does not permit any Government to deprive its citizens of constitutional rights on a plea of poverty".
It is also interesting to notice what Justice, then Judge, Blackmum said in Jackson vs Bishop(2): "Humane considerations and constitutional requirements are not, in this day, to be measured by dollar considerations. " 543 So also in Holt vs Sarver(1), affirmed in 442 F. Supp. 362, the Court, dealing with the obligation of the State to maintain a Penitentiary System which did not violate the Eighth Amendment aptly and eloquently said "Let there be no mistake in the matter; the obligation of the Respondents to eliminate existing unconstitutionalities does not depend upon what the Legislature may do, or upon what the Governor may do, or, indeed upon what Respondents may actually be able to accomplish.
If Arkansas is going to operate a Penitentiary System, it is going to have to be a system that is countenanced by the Constitution of the United States.
" The State cannot avoid its constitutional obligation to provide speedy trial to the accused by pleading financial or administrative inabiltiy.
The State is under a constitutional mandate to ensure speedy trial and whatever is necessary for this purpose has to be done by the State.
It is also the constitutional obligation of this Court as the guardian of the fundamental rights of the people, as a sentinel on the qui vive, to enforce the fundamental right of the accused to speedy trial by issuing the necessary directions to the State which may include taking of positive action, such as augmenting and strengthening the investigative machinery, setting up new courts, building new court houses, providing more staff and equipment to the courts, appointment of additional judges and other measures calculated to ensure speedy trial.
We find that in fact the courts in the United States have adopted this dynamic and consructive role so far as the prison reform is concerned by utilising the activist magnitude of the Eighth Amendment.
The courts have ordered substantial improvements to be made in a variety of archaic prisons and jails through decisions such as Hot vs Sarver (supra), Jones vs Wittenberg(2), Newman vs Alabama(3) and Gates vs Collier(4).
The Court in the last mentioned case asserted that it "has the duty of fashioning a decree that will require defendants to eliminate the conditions and practices at Parchman here in above found to be violative of the United State 's constitution" and in discharge of this duty gave various directions for improvement of the conditions of those confined in the State Penitentiary.
The powers of this Court in protection of the Constitutional rights are of the widest amplitude and we do not see why this 544 Court should not adopt a similar activist approach and issue to the State directions which may involve taking of positive action with a view to securing enforcement of the fundamental right to speedy trial.
But in order to enable the Court to discharge this constitutional obligation, it is necessary that the Court should have the requisite information bearing on the problem.
We, therefore, direct the State of Bihar to furnish to us within three weeks from today particulars as to the location of the courts of magistrates and courts of sessions in the State of Bihar together with the total number of cases pending in each of these courts as on 31st December, 1978 giving yearwise breakup of such pending cases and also explaining why it has not been possible to dispose of such of those cases as have been pending for more than six months.
We would appreciate if the High Court of Patna also furnishes the above particulars to us within three weeks from today since the High Court on its administrative side must be having records from which these particulars can be easily gathered.
We also direct the State of Bihar to furnish to us within three weeks from today particulars as to the number of cases where first information report have been lodged and the cases are pending investigation by the police in each sub division of the State as on 31st December, 1978 and where such cases have been pending investigation for more than six months, the State of Bihar will furnish broadly the reasons why there has been such delay in the investigative process.
The writ petition will now come up for hearing and final disposal on 4th April, 1979.
We have already issued notice to the Supreme Court Bar Association to appear and make its submissions on the issue arising in the writ petition since they are of great importance.
We hope and trust that the Supreme Court Bar Association will respond to the notice and appear to assist the Court at the hearing of the writ petition.
| IN-Abs | At the resumed hearing of the petition for release of under trials in the State of Bihar.
^ HELD: (1) The procedure under which a person may be deprived of his life or liberty should be 'reasonable fair and just. ' Free legal services to the poor and the needy is an essential element of any 'reasonable fair and just 'procedure.
A prisoner who is to seek his liberation through the court 's process should have legal services available to him.
[537 C, D] Meneka Gandhi vs Union of India, [1978] 1 SCC 248; M.H. Hoskot vs State of Maharashtra, ; ; Gideon vs Wainwright; , ; 9 L. ed.
at 799; John Richard Argersinger vs Raymond Hamlin, ; 35 L. ed.
2d 530 at 535 36; referred to (2) Article 39A also emphasises that free legal service is an inalienable element of 'reasonable, fair and just 'procedure for without it a person suffering from economic or other disabilities would be deprived of the opportunity for securing justice.
The right to free legal service is therefore, clearly an essential ingredient of 'reasonable, fair and just ' procedure for a person accused of, an offence and it must be held implicit in the guarantee of article 21.
This is a constitutional right of every accused person who is unable to engage a lawyer and secure legal services, on account of reasons such as poverty, indigence or incommunicado situation and the State is under a mandate to provide a lawyer to an accused person if the circumstances of the case and the needs of justice so require, provided of course the accused person does not object to the provision of such lawyer.
[539 F 540 A] (3) The poor in their contact with the legal system have always been on the wrong side of the law.
They have always come across "law for the poor" rather than "law of the poor".
The law is regarded by them as something mysterious and forbidding always taking something away from them and not as a positive and constructive social device for changing the socio economic order and improving their life conditions by conferring rights and benefits on them.
The result is that the legal system has lost its credibility for the weaker sections of the community.
It is, therefore, necessary to inject equal justice into legality and that can be done only by a dynamic and activist scheme of legal services.
[541 E F] 533 4.
The urgent necessity of introducing a dpnamic and comprehensive legal services programme impressed upon the Government of India as also the State Governments.
That is not only a mandate of equal justice implicit in article 14 and right to life and liberty conferred by article 21 but also the compulsion of the constitutional directive embodies in article 39A. [542 D] 5.
The State cannot avoid its constitutional obligation to provide speedy trial to the accused by pleading financial or administrative inability.
The State is under a constitutional mandate to ensure speedy trial and whatever is necessary for this purpose has to be done by the State.
It is also the constitutional obligation of this Court, as the guardian of the fundamental rights of the people as a sentinel on the qui vive, to enforce the fundamental right of the accused to speedy trial by issuing the necessary directions to the State which may include taking of positive action, such as augmenting and strengthening the investigative machinery, setting up new courts, building new court houses, appointment of additional judges and other measures calculated to ensure speedy trial.
[543 D E] (6) The courts in the United States have adopted a dynamic and constructive role in regard to prison reform by utilising the activist magnitude of the Eighth Amendment.
The courts have ordered substantial improvements to be made in a variety of archaic prisons and jails through its decisions.
[543 F] Rhem vs Malclm, , Jackson vs Bishop, 571, Holl vs Sarver, ; ; Jones vs Wittenberg, ; Newman vs Alabama, ; Gates vs Collier, 349 F. Suppl. 881; referred to.
(7) The powers of this Court in protection of the Constitutional rights are of the widest amplitude and this Court should adopt an activist approach and issue to the State, directions which may involve taking of positive action with a view to securing enforcement of the fundamental right to speedy trial.
But in order to enable the court to discharge this constitutional obligation, it is necessary that the court should have the requisite information bearing on the problem.
[543 H 544 A] Directed that: (a) On the next remand dates when the under trials are produced before the Magistrates or the Sessions Courts the State Government should provide them a lawyer at its own cost for the purpose of making an application for bail and opposing remand provided that no objection is raised to such a lawyer on their behalf.
[540 B] (b) The State Government and High Court to furnish particulars as to the location of the courts of magistrates and courts of sessions in the State of Bihar together with the total number of cases pending in each of these courts as on 31st December, 1978 giving year wise break up of such pending cases and also explaining why it has not been possible to dispose of such of those cases as have been pending for more than six months.
[544 D]
|
les tax could be imposed retrospectively.
Therefore, even though in this case the tax was levied retrospectively by a validation ordinance, the respondent would be deemed to have entered the trade and carried it on the basis that it would be liable to pay sales tax.
[571 D] 569 (b) Even assuming that the respondent carried on the trade thinking that it would not be liable to pay sales tax, the area of concensuality still left for the purpose of agreeing to the final terms of the transactions between the respondent and its retail dealers was quite sufficient for the application of the ratio of Vishnu Agencies.
[571 F G] & CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2028 of 1974.
Appeal by Special Leave from the Order dated 6 9 1975 of the Punjab and Haryana High Court in L.P.A. No. 516/73.
Hardev Singh and R. section Sodhi for the Appellants.
L. N. Sinha, P. P. Singh and E. C. Agarwala for the Respondent.
The Judgment of the Court was delivered by UNTWALIA J.
The respondent company in this appeal by special leave has a Distillery and Brewery at Jammu.
It maintains wholesale depots at various places in the State of Punjab, the main depot being at Ludhiana.
As a whole seller it supplied Indian made foreign liquor to permit holders on the permits issued by the respective Excise and Taxation Officers, the competent authorities under the Punjab Excise Act and the Rules framed thereunder.
Sales tax under the Punjab General Sales Tax Act, 1948 was imposed in respect of the sales aforesaid by an order of assessment dated the 30th November, 1972.
The respondent, thereupon filed a Writ Petition in the High Court for the quashing of the said order and to restrain the appellants from recovering the amount of Rs. 46,396.22 paise from the petitioner.
The main ground of attack on the imposition of sales tax was that the alleged sales were not sales in the eye of law as the respondent had no volition in the distribution of liquor which was received from the manufacturing concern at Jammu.
The prices were fixed by the competent authorities and the respondent had to charge the fixed price from its retailers holding L 2, L 4, L 5 and L 10 licences.
The respondent company holds L 1 licence which is meant for whole sale dealers.
The State contested the application and in its counter asserted that the excise trade like many other trades, or even more, had to be regulated and controlled by various Rules and Regulations and in spite of all the restrictions placed thereby an area was still left where the whole seller and the retail purchaser had to arrive at an agreement by their volition.
According to the case of the appellants "the quality and brand of Foreign Liquor, lifting of the specified quantity in bulk liter or in instalments, the size of packages (i.e. Bottles, pints, or Nips) and mode of payment (cash or credit or part payment) and 570 the prices, are the matters which are decided by the petitioner and his purchasers and there is no law or rule restricting the volition or liberty of the petitioner in this respect.
" Following a Division Bench decision of the Punjab & Haryana High Court in Jagatjit Distilling and Allied Industries Ltd. vs The State(1) a learned single Judge of that Court allowed the writ application and quashed the assessment order.
A Letters Patent appeal from the said order was dismissed in limine.
Hence this appeal.
This case, in our opinion, is squarely covered by a recent decision of this Court delivered by a Bench of seven Judges in M/s Vishnu Agencies (Pvt.) Ltd. etc.
vs Commercial Tax Officer and others etc.(2) The High Court in the case of Jagatjit Distilling and Allied Industries Ltd. (supra) had mainly relied upon two decisions of this Court to hold that the transactions in that case were not sales.
The said decisions are M/s New India Sugar Mills Ltd. vs Commissioner of Sales Tax, Bihar(3) and Chittar Mal Narain Das vs Commissioner of Sales Tax U.P.(4).
In the case of Vishnu Agencies (supra) the former case was considered in paragraph 36 to 39 of A.I.R. volume at pages 463 464 and it was held that the view expressed in the majority judgment was not good law and the one contained in the minority judgment was approved.
Chittar Mal 's case was also considered in paragraph 44 45 at page 467 and it was distinguished on the ground that the said decision "can be justified only on the view that clause 3 of the Wheat Procurement Order envisages compulsory acquisition of wheat by the State Government from the licensed dealer.
" But then the criticism in that case of the Full Bench decision of the Allahabad High Court in Commr.
Sales tax, U.P. vs Ram Bilas Ram Gopal(5) "which held while construing cl. 3 that so long as there was freedom to bargain in some areas the transaction could amount to a sale though effected under compulsion of a Statute" was not endorsed.
It is, therefore, plain that to that extent Chittar Mal 's case is also not good law.
The decision of the High Court in Jagatjit 's case is no longer good law.
We have examined the various relevant provisions of the Punjab Excise Act and the Rules framed thereunder.
We find that an area of agreement sufficient enough for the parties to cover by their volition to bring the transactions in question within the ambit of sales was left in the field.
Broadly speaking the stand taken on behalf of the 571 appellants in their counter was correct, except that in regard to the fixation of price we assume in favour of the respondent company that the price had been fixed, as usually it is so in the excise trade.
Even so the decision of this Court in Vishnu Agencies (supra) and the various other previous decisions reviewed therein justifies in law the imposition of sales tax by the impugned order in question.
Mr. Lal Narayan Sinha tried to distinguish the decision in Vishnu Agencies (supra) by pointing out that sales tax for the period in question was imposed by the Punjab General Sales Tax (Amendment and Validation) Ordinance, 1972 which was promulgated on the 15th November, 1972 with retrospective effect.
The respondent company, counsel submitted, cannot be said to have entered into the trade and carried it on during this period by a volition as it did not know that sales tax would be chargeable for this period and, therefore, it had not realised sales tax from its customers.
He drew our attention to paragraph 33 of the judgment of this Court in Vishnu Agencies at page 461.
In our opinion the argument of the learned counsel is not sound and for two reasons.
Firstly, it is well settled and it was not disputed that sales tax could be imposed retrospectively.
That being so the respondent company will be deemed to have entered the trade and carried it on the basis that it would be liable to pay sales tax.
Secondly, even assuming it was not so, what has been pointed out in the begining of paragraph 33 as a primary fact of willingness to trade in the commodity strictly on the terms of Control Orders is only one of the reasons which led to the decision that an area of agreement between the parties was left to their consensus.
In our opinion such a part of the area as the one hinted at is not very important and does not form the whole and sole basis of the conclusions arrived at in the case of Vishnu Agencies.
Even assuming in favour of the respondent company that it did not carry on the trade thinking that it would be liable to pay sales tax, the area of consensuality still left in the field for the purpose of agreeing to the final terms of the transactions between the company and its retail dealers was quite sufficient for the application of the ratio of Vishnu Agencies.
Having considered all that was submitted on behalf of the respondent company we find that there is no escape from the conclusion in this case that the transactions in question were sales exigible to sales tax.
For the reasons stated above, we allow this appeal with costs in this Court only.
The judgment and order of the High Court are set aside.
P.B.R. Appeal allowed.
| IN-Abs | The sales tax authorities levied tax on the sales of liquor effected by the respondent who was a wholesaler in that commodity.
Impugning the levy, the respondent contended in the High Court that when it sold liquor against permits issued by the authorities there was no volition because the price and the quantity of goods to be sold and the person to whom sold were all fixed and therefore there was no sale in the eye of law which would attract tax.
The Department, on the other hand, contended that even when goods were sold against a permit there was still an area of volition in that the parties could decide on the quality and brand of liquor, the quantity, whether in bulk or in instalments, the size of the package and so on, all of which showed that there was no restraint on the volition of the parties and therefore there was sale which attracted tax.
A single judge of the High Court, following a decision of the Division Bench of the same High Court in Jagatjit Distilling and Allied Industries Ltd. vs The State [28 STC 709], quashed the order of assessment.
A Division Bench dismissed the appeal in limine.
Allowing the State 's appeal ^ HELD: The transactions were sales exigible to tax.
[571 G] 1.
The decision of this Court in Vishnu Agencies (Pvt.) Ltd. vs Commercial Tax Officer, ; justifies imposition of sales tax on the sale of liquor on permits.
A conspectus of the provisions of the Punjab Excise Act and the Rules shows that there is an area of agreement sufficient enough for the parties to bring, by their volition, the impugned transactions within the ambit of sales.
[570 G; 571 A] Vishnu Agencies (P) Ltd. etc.
vs Commercial Tax Officer Jagatjit Distilling and Allied Industries Ltd. vs The State, 28 STC 709 overruled.
|
Civil Appeal No. 503 of 1978.
Appeal by Special Leave from the Judgment and order dated )76 of the Punjab and Haryana High Court at Chandigarh in L.P.A. No. 484/74.
section K. Mehta, J. section Chawla, P. N. Puri and P. Balakrishnan for the Appellant B;shamber Lal (for State) and Hardev Singh for the RR 1 4 and 6.
521 P. N. Lekhi and Girish Chandra for Respondent No. 17.
The Judgment of the Court was delivered by CHANDRACHUD, C.J.
The appellant, Gurdial Singh Fijji, was selected for the Punjab Civil Service (Executive Branch) in 1953 and was appointed as an Executive Magistrate on June 8, 1954.
Respondents 8 to 15 are also members of the same Service, namely, the P.C.S., but they were selected and appointed to that Service after the appellant.
They are all governed, in the matter of conditions of their service, by the Punjab Civil Service (Executive Branch) Rules 1930, as amended from time to time by the competent authority.
The appellant was confirmed in the cadre on May 8, 1958 while respondents 8 to 15 were confirmed on diverse dates thereafter.
In the gradation list circulated by the Government from time to time, respondents 8 to 15 were shown as junior to the appellant.
In the year 1966, as a result of the reorganisation of the erst while State of Punjab, the appellant and respondents 8 to 16 were allocated to the State of Punjab.
In 1966 67 an adverse entry was made in the confidential record of the appellant while he was working under one Shri Sewa Singh, District and Sessions Judge, Amritsar.
That entry was communicated to the appellant whereupon, he made a representation against it but that has still not been disposed of, for one reason or another.
The State Government forwarded the representation to Shri Sewa Singh, who declined to express his views upon it unless asked by the High Court to do so.
Nothing further has been done in the matter and no decision has yet been taken on the question whether the adverse entry was justified and whether the various contentions raised by the appellant in his representation are well founded.
The appellant worked in various capacities after 1966 67, earning good reports all along.
He was permitted to cross the first efficiency bar under an order of the State Government dated June 14, 1966 and the second efficiency bar on July 20, 1971.
By an order dated July 3, 1971 published in the Punjab Government Gazette on July 23, the Government promoted respondents 8 to 12 to the selection grade of the Punjab Civil Service cadre.
Respondent 15 was similarly promoted on December 19, 1970, respondent 16 on January 1, 1971 and respondents 13 and 14 on July 27, 1971.
On March 14, 1972, the appellant was also promoted to the selection grade with effect from January 15, 1972.
He made a representation to the Government against the orders promoting res 522 pondents to the selection grade prior to him but it was rejected by an order dated June 20, 1973.
A Committee consisting of respondents 2 to 7 was constituted under Regulation 3 of the Indian Administrative Service (Appointment by Promotion) Regulations 1955, for selecting persons from the Punjab Civil Service cadre for the purpose of bringing them on the select list of the Indian Administrative Service.
The Committee held its meeting at Chandigarh on May 11, 1973 after which it prepared a list under Regulation 5 selecting respondent 9 for being brought on the select list for the purpose of promotion to the Indian Administrative Service.
It would appear that the appellant 's name was not put on the select list since respondent 2, the Chief Secretary to the Government of Punjab, had refused to give an 'integrity certificate ' to him.
Appellant made a representation against his non inclusion in the select list and that representation having been rejected, he filed a Writ Petition (No. 3315 of 1973) in the High Court of Punjab and Haryana, challenging the promotion of respondent to the selection grade, the refusal of the Chief Secretary to issue an 'integrity certificate ' to him and his non inclusion in the Select List of the Indian Administrative Service.
The appellant 's Writ Petition was allowed partly by a learned single Judge of the High Court by his judgment dated August 19, 1974 whereby the order dated July 27, 1971 of the State Government granting seniority to two junior officers over the appellant in the selection grade was quashed.
The learned Judge directed the State Government to reconsider the case of the appellant along with that of three other officers regarding the grant of selection grade with effect from June 25, 1971.
The appellant filed a Letters Patent Appeal (No. 484 of 1974) against the decision of the learned Single Judge which was disposed of by the High Court on November 19, 1976.
It was held in appeal that the requirement of Resolution No. 1.1 as regards the production of the 'integrity certificate ' was in the nature of a mere executive instruction, that it went beyond the scope of the statutory regulations, that the provision requiring the production of the 'integrity certificate ' was unguided and was likely to lead to arbitrariness and unreasonableness and that therefore, Resolution No. 1.1 was ultra vires of Regulations 4 and 5.
The entire record of the Selection Committee was placed by the State Government before the High Court in the Letters Patent Appeal, from a perusal of which the High Court came to the conclusion that the decision of the 523 Commttee not to include the appellant 's name in the Select List was not based solely on the ground that he was unable to produce the integrity certificate and that the Committee had given another cogent reason for its decision viz., that the appellant was not suitable for being placed on the Select List otherwise also.
Since inclusion in the select list for the purposes of promotion to the Indian Administrative Service was to be made on the basis of merit cum seniority, the Committee, according to the High Court, was justified in not including the name of the appellant in that list if, in its opinion, he was not otherwise suitable.
The Letters Patent Appeal was accordingly dismissed by the High Court, against which the appellant has filed this appeal by special leave.
We will first deal with the question whether resolution No. 1.1.
is ultra vires regulations 4 and 5 of the Indian Administrative Service (Appointment by Promotion) Regulations, 1955.
These regulations aree framed by the Central Government in pursuance of sub rule 1 of rule 8 of the Indian Administrative Service (Recruitment) Rules, 1954 in consultation with the State Governments and the Union Public Service Commission.
Regulations 3 to 7 provide for bringing members of the State Civil Service on the select list for promotion to the Indian Administrative Service.
Regulation 3 deals with the constitution of the committee for making selections.
Regulation 4 which deals with conditions of eligibility for promotion provides that each committee shall meet at intervals, ordinarily not exceeding one year, and consider the cases of all substantive members of State Civil Service who on the first day of January of that year had completed not less than eight years of continuous service, whether officiating or substantive, in a post of Deputy Collector or any other post or posts declared equivalent thereto by the Government.
By Clause (2) of regulation 4, the committee shall not ordinarily consider the cases of members of the State Civil Service who have attained the age of 52 years on the first day of January of the year in which the meeting of the committee is held, provided that a member of the State Civil Service whose name appears in the select list in force immediately before the date of the meeting of the committee shall be considered for inclusion in the fresh list to be prepared by the committee, even if in the meanwhile he has attained the age of 52 years.
Regulation 5 reads thus: "5.
Preparation of a list of suitable officers (1) The committee shall prepare a list of such members of the State Civil Service as satisfy the condition 524 specified in regulation 4 and as are held by the committee to be suitable for promotion to the service.
The number of members of the State Civil Service included in the list shall not be more than twice the number of substantive vacancies anticipated in the course of the period of twelve months commenceing from the date of the preparation of the list, in the posts available for them under rule 9 of the recruitment rules or 10 per cent of the senior duty posts borne on the cadre of the State or group of States whichever is greater: Provided that in the year ending on the 31st December, 1969, the maxmimum limit, imposed by this sub regulation, may be exceeded to such extent as may be determined by the Central Government in consultation with the State Government concerned.
(2) The selection for inclusion in such list shall be based on merit and suitablity in all respects with due regard to seniority.
(3) The names of the officers included in the list shall be arranged in order of seniority in the State Civil Service: Provided that any junior officer who in the opinion of the committee is of exceptional merit and suitability may be assigned a place in the list higher than that of officers senior to him.
(4) The list so prepared shall be reviewed and revised every year.
(5) If in the process of selection, review or revision it is proposed to supersede any member of the State Civil Service, the Committee shall record its reasons for the proposed supersession.
" The All India Services Manual, Part II, which is issued under the authority of the Government of India, Cabinet Secretariat, (Department of Personnel and Administrative Reforms), sets out under appropriate regulations the "Government of India 's Decisions" which are, for convenience, referred to by the High Court as "resolutions".
525 Resolution 1.1 which incorporates a decision taken by the Government of India reads thus: "1.1.
On the basis of the recommendations of the Committee on the Prevention of Corruption, it has been decided that the following certificate should be recorded by the Chief Secretary to the State Government who is the sponsoring authority in respect of all eligible officers whose cases are placed before the Selection Committee for consideration: "The State Government certify the integrity of Shri with reference to the entries in his annual confidential reports".
Resolution 1.2 which is on the same subject says: "1.2.
The Selection Committee should also consider the question of suitability of the officers for selection with reference to their integrity and should specifically record in their proceedings that they were satisfied from the remarks in the confidential reports of the officers, selected by them for inclusion in the Select List, that there was nothing against their integrity.
" The learned Single Judge of the High Court rejected the appellant 's contention that resolution 1.1 is ultra vires of regulations 4 and 5.
The Letters Patent Bench of the High Court different from him and quashed the resolution, observing: "Regulations 3 to 7 are self contained regulations prescribing the whole procedure for the constitution of the selection committee, qualifications for the eligibility, preparation of list of suitable candidates etc.
It is evident from the plain reading of these regulations that integrity certificate is not the requirement for eligibility for promotion.
Integrity certificate is the requirement of resolution 1.1 which is only an executive instruction.
The regulations are quite detailed and the whole mode of selection is given and merit cum seniority is the main basis for bringing the persons on the select list.
It is nowhere laid down in the regulations that integrity certificate is also required for eligibility for promotion.
Hence this requirement under the executive instruction goes counter to the statutory regulations.
It has put restrictions and limitations on the committee in its discretion.
Moreover, it is nowhere laid down as to how the integrity certificate is to be issued.
No 526 criteria is mentioned in resolution 1.1.
No guideline is provided.
Hence it can lead to arbitrariness and unreasonableness in certain cases. .
I have, therefore, no hesitation in holding that resolution 1.1 contravenes the regulations, which cannot legally be sustained and is struck down as ultra vires of regulations 4 and 5.
" We find it impossible to sustain this conclusion and are of the opinion that the learned Single Judge of the High Court was right in upholding the validity of resolution 1.1 on the ground that it is not inconsistent with any of the regulations.
Clause (2) of Regulation 5 provides that selection for inclusion in the Select List shall be based on merit and suitability in all respects, with due regard to seniority.
In other words, the test for inclusion in the Select List is merit cum seniority.
Neither the Indian Administrative Service (Recruitment) Rules, 1954 under which the Regulations are framed nor indeed the provisions of the All India Services Act, 61 of 1951, under which the Rules are made, furnish any guidelines for assessing merit or suitability of a candidate for inclusion in the Select List or provide for the consideration of any particular data before a candidate can be brought on the Select List.
Every executive authority is charged with the obligation of organising its services so as to ensure maximum efficiency.
The ideal of maximum efficiency cannot be achieved unless persons who are selected for public offices possess integrity in as high a measure as ability.
Integrity is indeed the sine qua non of merit and suitability: no person can be considered as possessing merit and suitability if he lacks in character and integrity.
If, as provided by Regulation 5, selection for inclusion in the Select List has to be based on merit and suitability in all respects, and the Rules and Regulations do not furnish guidelines for a proper assessment of these requirements, the government would have the power to prescribe the criteria for determining whether the requirements are fulfilled by any particular candidate.
The prescription of the Regulation for inclusion in the Select List is merit cum seniority.
The executive decision which is contained in resolutions 1.1 and 1.2 effectuates the purpose of that prescription.
Undoubtedly the government in the exercise of its executive authority cannot supersede a statutory rule or regulation but it can certainly effectuate the purpose of a rule or regualtion by supplementing it.
Resolution 1.2 provides that the Selection Committee should consider the question of suitability of officers with reference to their integrity and should specifically record in its proceedings, that it is satisfied from the remarks in the confidential reports of the officers selected by it for inclusion in the Select List, 527 that there was nothing against their integrity.
Resolution 1.1 requires the Chief Secretary of the concerned State Government, who is the sponsoring authority, to record a certificate in respect of all eligible officers, whose cases are placed before the Selection Committee for consideration, that the State Government certifies the integrity of the officers with reference to the entries in their annual confidential reports.
These resolutions of the Government of India do not transgress the requirement of the Regulations but are in furtherance thereof.
The circumstance that the Chief Secretary has to record a certificate does not confer upon him unguided or unfettered discretion to assess the integrity of the officers by granting or refusing the integrity certificate at his sweet will.
The State Government has to certify the integrity of the eligible candidate "with reference to the entries in his annual confidential reports".
We are, therefore, quite clear that the Letters Patent Bench of the High Court was in error in striking down resolution 1.1 as being ultra vires of Regulation 5.
Both the resolutions 1.1 and 1.2, are in our opinion within the scope of the Regulations and are valid.
Though the High Court was of the opinion that Resolution 1.1 is ultra vires of Regulation 5, it did not quash the decision of the Selection Committee because, having perused the record and proceedings of the Selection Committee (which were made available to it during the hearing of the Letters Patent Appeal), it found that the non selection of the appellant was not based solely on the ground that the Chief Secretary had not issued an integrity certificate in his favour.
The proceedings of the Selection Committee, according to the High Court, disclosed that the appellant was not selected for the reason also that he was "not found suitable otherwise".
The course adopted by the High Court has cause to the appellant an amount of injustice which has to be rectified.
It is clear that the Chief Secretary, Punjab, did not grant integrity certificate in favour of the appellant because of the adverse report in his confidential roll for the year 1966 67.
One of the reasons which evidently weighed with the Selection Committee in not putting the appellant 's name on the Select List was that the Chief Secretary had not issued the integrity certificate in his favour.
Thus, the non inclusion of appellant 's name in the Select List and the non issuance of the integrity certificate are closely linked, whether or not there was another reason also for which the Selection Committee kept him out from the Select List.
528 In so far as the non issuance of the integrity certificate is concerned, it is undisputed that its only justification is the adverse report in the confidential roll of the appellant for the year 1966 67.
The circumstances surrounding the adverse entry may therefore bear examination for seeing whether such preponderating importance could, on the facts to which we will immediately advert, be given to the particular entry.
The counter affidavit filed on behalf of the Government of Punjab by Shri Phuman Singh, Under Secretary in the services department, shows that after the adverse remarks were communicated to the appellant, he submitted a representation requesting that the remarks be expunged.
That representation was referred by the Government to Shri Sewa Singh, retired District and Sessions Judge, who had made the particular remarks.
Shri Sewa Singh desired that the reference which was made to him by the Government should be routed through the High Court.
The Government then made a reference to the High Court of Punjab and Haryana requesting it to obtain the comments of Shri Sewa Singh.
The High Court replied that it was not its practice to call for comments of District and Sessions Judges on the representation of an officer against whom adverse remarks were made.
The High Court was once again requested by the Government that the Chief Justice and the Judges may communicate their views to the Government on the representation made by the appellant.
As the High Court did not express its view, the Government asked the appellant to submit a detailed representation along with documentary evidence in order to show that the adverse entry was made mala fide as alleged by him.
The appellant submitted his representation again on December 19, 1971, as desired by the Government.
After a detailed examination of that representation, it was decided by the Government that since the comments of the Reporting Officer of the High Court on the representation made by the appellant were not available, which was necessary for the proper disposal of the representation, a suitable note may be placed on the appellant 's character roll alongwith the confidential report for the year 1966 67.
An attested copy of that note is annexed to Shri Phuman Singh 's affidavit as annexure 1.
After setting out the facts and circumstances narrated above, that note says that in the absence of necessary comments of the authority concerned, it was not possible for the Government to take any decision on the merits of the representation made by the appellant.
The principle is well settled that in accordance with the rules of natural justice, an adverse report in a confidential roll cannot be 529 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.
Such an opportunity is not an empty formality, its object, partially, being to enable the superior authorities to decide on a consideration of the explanation offered by the person concerned, whether the adverse report is justified.
Unfortunately, for one 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.
In these circumstances, it is difficult to support the non issuance of the integrity certificate to the appellant.
The chain of reaction began with the adverse report and the infirmity in the link of causation is that no one has yet decided whether that report was justified.
We cannot speculate, in the absence of a proper pleading, whether the appellant was not found suitable otherwise, that is to say, for reasons other than those connected with the non issuance of an integrity certificate to him.
We may also indicate, since the High Court saw the file and discovered that the appellant was not brought on the Select List because he was "not found suitable otherwise", that regulation 5 which deals with the preparation of a list of suitable officers provides by clause 7 that "if in the process of selection, review or revision it is proposed to supersede any member of the State Civil Service, the Committee shall record its reasons for the proposed supersession".
While dealing with an identical provision in clause 5 of regulation 5 of the same Regulations as they stood then, this Court observed in Union of India vs Mohan Lal Capoor & Others(1) that "rubberstamp" reasons given for the supersession of each officer to the effect that the record of the officer concerned was not such as to justify his appointment "at this stage in preference to those selected", do not amount to "reasons for the proposed supersession" within the meaning of clause 5.
"Reasons", according to Beg J. (with whom Mathew J. concurred) "are the links between the materials on which certain conclusions are based and the actual conclusions".
The Court accordingly held that the mandatory provisions of regulation 5(5) were not complied with by the Selection Committee.
That an officer was "not found suitable" is the conclusion and not a reason in support of the decision to supersede him.
True, that it is not expected that the Selection Committee should give anything approaching the judgment of a Court, but it must at least state, as 530 briefly as it may, why it came to the conclusion that the officer concerned was found to be not suitable for inclusion in the Select List.
In the absence of any such reason, we are unable to agree with the High Court that the Selection Committee had another "reason" for not bringing the appellant on the Select List.
In matters of this nature, particularly when the Select Lists have to be prepared and reviewed from year to year, it becomes difficult to work out the logical consequences of holding that the case of any particular officer ought to be reconsidered.
But, inevitably, for reasons mentioned above, the case of the appellant shall have to be considered afresh by the Selection Committee.
How best to do it has to be left to its wise discretion in the matter of details, but in order to eliminate, in so far as one may, chance of yet another litigation we ought to indicate the broad frame work within which the Committee should act and the preliminary steps which the Government must take in order to facilitate the Committee 's task.
In the first place, the State Government shall consider and dispose of within two months from to day the representations made by the appellant on January 23, 1969 and December 19, 1971 in regard to the adverse report in his confidential roll, for the year 1966 67.
We are hopeful that the High Court will co operate with the Government in the disposal of the representations.
The Selection Committee will, within three months thereafter, decide whether the appellant should be included in the Select List as of May 11, 1973.
That question has to be decided in accordance with the relevant regulations by applying the test of merit and suitability cum seniority.
For deciding the question of appellant 's merit and suitability, the Selection Committee will take into consideration the Government 's decision on his representations and his service record up to date.
If the Committee decides that he is not suitable for inclusion in the Select List and should therefore be superseded, it shall record its reasons for the proposed supersession.
If, on the other hand, the Committee decides to include his name in the Select List, he will be entitled to rank in that list in accordance with his seniority as of May 11, 1973 unless, in the opinion of the Committee, there is a junior officer of exceptional merit and suitability who may be assigned a higher place.
The Selection Committee will review the list for 1973 in accordance with these directions.
The Union Public Service Commission will thereafter be consulted in accordance with the regulations.
The Select List as finally approved by the Commission will form the Select List of the members of the State Civil Service.
531 We may indicate that the Writ Petition filed by the appellant and his appeal to this Court cannot be considered to have become infructuous on the ground that the Union Public Service Commission has already approved of the Select List.
The learned Single Judge of the High Court had stayed the final publication of the list by his order dated September 24, 1973 and had directed by his order dated February 11, 1974 in C.M. 994 of 1974 that the publication of the Select List will be subject to the result of the Writ Petition.
With these modification, the appeal is allowed but there will be no order as to costs.
N.V.K. Appeal allowed.
| IN-Abs | The Indian Administrative Service (Appointment by Promotion) Regulations, 1955 formulates the procedure for selecting persons from the State Civil Service Cadre for the purpose of bringing them on the select list of the Indian Administrative Service.
Regulation 5 which deals with the preparation of the list of suitable officers provides by cl.
(2) that the selection for inclusion in such list shall be based on merit and suitability in all respects with due regard to seniority, while cl.
(5) provides that if it is proposed to supersede any member of the State Civil Service, the Selection Committee shall record its reasons for the proposed supersession.
The "Government of India 's Decisions" under the regulations have been published by the Govt.
in the All India Services Manual, Part II.
Resolution 1.1 requires the Chief Secretary to the State Government who is the sponsoring authority to record a certificate in respect of every eligible officer whose case is placed before the Selection Committee, that the State Government certifies the integrity of the officer with reference to the entries in his annual confidential reports.
Resolution 1.2 provides that the Selection Committee should specifically record in its proceedings that it is satisfied from the remarks in the confidential reports of the officers selected by it for inclusion in the Select List that there was nothing against their integrity.
The appellant and respondents 8 to 15 were members of the Punjab Civil Service (Executive Branch), the respondents being junior to the appellant.
In 1966 67, an adverse entry was recorded in the confidential report of the appellant by the District and Sessions Judge.
No decision was taken by the Government as to whether the adverse entry was justified and whether the contentions raised by the appellant in his representation to the same were well founded.
After 1966 67, the appellant worked in various capacities, earned good reports and was allowed to cross the first and second efficiency bars.
However, respondents 8 to 15 were promoted to the selection grade of the service prior to the appellant.
His representation in this regard was rejected by the Government.
Respondents 2 to 7 who constituted the committee for selecting persons from the Punjab Civil Service cadre for the purpose of bringing them on the select list of the Indian Administrative Service, selected respondent No. 9.
The 519 Appellent 's name was not put on the select list, since respondent No. 2, the Chief Secretary to the State Govt.
had refused to give an 'integrity certificate ' to him.
His representation against the non inclusion having been rejected, he approached the High Court.
The High Court rejected the appellant 's contention that resolution 1.1 was ultra vires of regulations 4 and 5; but quashed the order of the State Government granting seniority to two junior officers over the appellant in the selection grade.
In appeal by the appellant, the High Court held that it is nowhere laid down that integrity certificate is the requirement for eligibility for promotion.
Integrity certificate is the requirement of resolution 1.1 which is only an executive instruction.
No criteria is mentioned, nor guidelines provided as to how the integrity certificate is to be issued.
The executive instruction, therefore, went beyond the scope of the statutory regulation, the provision requiring the production of the integrity certificate was unguided and was likely to lead to arbitrariness and unreasonableness and that therefore resolution 1.1 was ultra vires of regulations 4 and 5.
The High Court held further that the records of the Selection Committee reveal that the decision not to include the appellant 's name in the select list was not based solely on the ground of non availability of the integrity certificate and that the Committee had given another cogent reason, that the appellant was not suitable otherwise also Allowing the further appeal to this Court, ^ HELD: 1.
(i) The Letters Patent Bench of the High Court was in error in striking down, resolution 1.1 as being ultra vires of regulation 5.
Both resolutions 1.1 and 1.2 are within the regulations and are valid.
[527 C] (ii) Under cl.
(2) of Regulation 5 selection for inclusion in the select list has to be based on merit and suitability in all respects with due regard to seniority.
Neither the 1954 Rules nor the 1951 Act furnish any guidelines for assessing merit and suitability.
The Government would therefore, have the power to prescribe the criteria for determining whether the requirements of merit and suitability are fulfilled by any particular candidate, The Executive decision which is contained in resolution 1.1 and 1.2 effectuates the purpose of that prescription.
[526 C, F, G] (iii) The Government in the exercise of its executive authority cannot supersede a statutory rule or regulation but it can certainly effectuate the purpose of a rule or regulation by supplementing it.
These resolutions of the Government of India do not transgress the requirement of the Regulations but are in furtherance thereof.
It, therefore, cannot be stated that the Chief Secretary had been conferred with an unguided or unfettered discretion to assess the integrity of the officers by granting or refusing the integrity certificate at his sweet will.
[526 H, 527 B] (iv) Every Executive Authority is charged with the obligation of organising its services so as to ensure maximum efficiency.
The idea of maximum efficiency cannot be achieved unless persons who are selected for public offices possess integrity in as high a measure as ability.
Integrity is, therefore, the sine qua non of merit and suitability.
No person can be considered as possessing merit and suitability if he lacks in character and integrity.
[526 E] 520 2.
One of the reasons which evidently weighed with the Selection Committee in not putting the appellant 's name on the select list was that the Chief Secretary had not issued the integrity certificate in his favour.
The non inclusion of appellant 's name in the select list and the non issuance of the integrity certificate are thus closely linked, whether or not there was another reason also for which the Selection Committee kept him out from the select list.
[527 G H] 3.
An 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.
Such an opportunity is not an empty formality, its object, partially, being to enable the supeurior authorities to decide on a consideration of the explanation offered by the person concerned, whether the adverse report is justified.
[528 H 529 B] In the instant case for one reson 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.
In such circumstances it is difficult to support the non issuance of the integrity certificate to him.
The chain of reaction began with the advese report and the infirmity in the link of causation is that no one has yet decided whether that report was justified.
[529 C] 4.
In the absence of a proper pleading it cannot be speculated that the appellant was not found suitable for reasons other than those connected with the non issuance of an integrity certificate to him.
[529 D] 5.
The High Court saw the file and discovered that the appellant was not brought on the select list because he was 'not found suitable otherwise '.
Regulation 5(7) provides that the Committee shall record its reasons if it is proposed to supersede any member of the State Civil Service.
That an officer was "not found suitable" is the conclusion and not a reason in support of the decision to supersede him.
In the absence of any reason, this Court cannot agree with the High Court that the Selection Committee had another "reason" for not bringing the appellant on the select list.
[529 E, G, 530 A] [Directed that the case of the appellant be considered afresh by the Selection Committee indicating the broad frame work within which the Committee should act and the preliminary steps the Government should take in order to facilitate the Committee 's task.] Union of India vs Mohan Lal Capoor & Ors., ; referred to.
|
: Criminal Appeal No. 57 of 1972.
Appeal by Special Leave from the Judgment and Order dated 5 3 1971 of the Calcutta High Court in Crl.
Revision No. 35/71.
P. K. Chatterjee and G. section Chatterjee for the Appellant.
D. N. Mukherjee for the Respondent.
The Judgment of the Court was delivered by SARKARIA, J.
This appeal by special leave is directed against a judgment, dated March 5, 1971, of the High Court of Calcutta.
The facts are as follows: Abani Maity, respondent herein, and three other persons were tried by the Magistrate, First Class, Alipore, District 24 Parganas, in respect of a charge under Section 46(a) of the Bengal Excise Act, 1909 (hereinafter referred to as the Act).
On the night of July 29, 1963, at about 7.30 p.m., the Excise staff intercepted Motor Car No. WBD 8169 at village Rajpur, Police Station Sonarpur.
The car was searched and thereupon 199 kgs.
700 grams contraband Ganja was recovered from inside the car.
The respondent, Abani Maity, who was the registered owner of the car, and held a driving licence was himself on the steering wheel.
Abani Maity and the three other occupants of the car were arrested.
After completing the investigation, a charge sheet was submitted against Abani Maity and his companions in respect of an offence under Section 46(a) of the Act.
During the trial, out of the accused, Robin, died Kalipada absconded; and the case proceeded only against Abani Maity and his coaccused, Mihir Bose.
The Magistrate, ultimately, by his order dated August 21, 1970, convicted both the accused persons under Section 46(a) of the Act and sentenced each of them to pay a fine of Rs. 800/ , and, in default, to suffer six months ' rigorous imprisonment.
The Magistrate, however, failed to pass orders for the disposal of the contraband Ganja, and the confiscation of the seized car.
In the course of the trial, it was established by evidence that the respondent, Abani Maity, was the registered owner of the car and he was driving the vehicle at the time of its interception.
It was further 474 established that some packets of contraband Ganja were seized from underneath the driver 's seat and some from the luggage boot which was opened with a key produced by the respondent.
Thus, the evidence on record indubitably established that the car (Registered No. WBD 8169) was used for the transport of this contraband Ganja by its owner, Abani Maity, respondent.
After his conviction, on November 16, 1970, Abani Maity made an application to the Magistrate, praying for return of the car and the other articles seized by the Excise Staff.
On the same day, the Magistrate, without issuing any notice to the prosecution, passed an ex parte order directing return of the seized car and other articles to the accused respondent.
Against that order, dated November 16, 1970, of the Magistrate, the State preferred a Revision in the High Court, which was finally heard by a Division Bench, who, by an order dated March 5, 1971, affirmed the Magistrate 's order relating to the return of the car to the accused respondent, but directed confiscation of the Ganja.
Mr. Chatterjee, appearing for the appellant State, does not now request the Court to pass an order of confiscation of the aforesaid car, obviously because the passing of such an order after a lapse of about 16 years from the date of its seizure, will be an exercise in futility.
The learned counsel, however, submits that this Court should for the guidance of the courts below, clarify the law on the point so that the efficacy of the provisions contained in Sections 63 and 64 of the Act as an instrument for combating and preventing such anti social crime is not undermined due to misinterpretation or misunderstanding in regard to their import, nature and application.
It is contended that as soon as Abani Maity, the owner driver of this car was found guilty of using this car for transport of contraband Ganja, the Magistrate was bound in addition to the conviction of Abani Maity for that offence, to pass an order for confiscation of the car, or to give its owner, Abani Maity, an option to pay in lieu of confiscation a fine, as the Magistrate thought fit.
The point sought to be made out is that the words "shall be liable to confiscation" occurring in Section 63(1) read with sub section (1) of Section 64, make it obligatory on the Magistrate in the event of the conditions laid down in these provisions being satisfied, to adopt either of the two alternatives, namely, to confiscate the car, or, in lieu of confiscation, to impose a fine at the option of its owner.
In support of this contention, reliance has been placed upon certain observations of 475 this Court in Indo China Steam Navigation Co. Ltd. vs Jasjit Singh, Additional Collector of Customs & Ors(1).
As against this, learned counsel for the respondent, submits that the words "liable to" used in the context of "confiscation", in Section 63(1) of this Act or in some other penal statutes, do not convey an absolute imperative; they are merely directory and leave it to the discretion of the Magistrate to confiscate or not to confiscate the vehicle by means of which such offence has been committed.
Section 63 of the Act defines the things liable to confiscation, while Section 64 indicates when the order of confiscation is to be passed by the Magistrate or Collector.
Section 63 and 64 read as follows: "63 (1).
Whenever an offence has been committed which is punishable under this Act, the (intoxicant) materials, steel, utensils, implement and apparatus in respect of or by means of which such offence has been committed shall be liable to confiscation.
(2) Any (intoxicant) lawfully imported, transported, manufactured; had in possession or sold along with, or in addition to, any (intoxicant) which is liable to confiscation under sub section (1) and the receptacles, packages and coverings in which any such (intoxicant) as first aforesaid, or any such materials, steel, utensils, implement or apparatus as aforesaid, is found, and the other contents, if any, of such receptacles or packages, and the animals, carts, vessels, rafts or other conveyances used in carrying the same shall likewise be liable to confiscation: Provided that no animal, cart, vessel, raft or other conveyance as aforesaid shall be liable to confiscation unless the owner thereof is proved to have been implicated in the commission of the offence.
Explanation.
For purpose of this Section "owner" includes, in relation to any animal car, vessel, raft or other conveyance.
(a) which is the subject of a hire purchase agreement, the person in possession thereof under that agreement." "64(1).
When in any case tried by him, the Magistrate decides that anything is liable to confiscation under Section 476 63, he may either order confiscation or give the owner of such an option to pay, in lieu of confiscation, such fine as the Magistrate thinks fit: Provided that the Magistrate shall in cases order confiscation of the intoxicants decided by him to be liable to confiscation under Section 63.
(2) Whenever anything is liable to confiscation under Section 63, and the offender or the person entitled to possession is not known or cannot be found, the case shall be inquired into and determined by the Collector, who may order confiscation: Provided that no such order shall be made until the expiration of two months from the date of seizing the thing intended to be confiscated, or, without giving such person as may, before such expiration, claim any right thereto, an opportunity of being heard and of producing such evidence as he may like to produce in support of his claim: Provided further that if the thing in question is liable to speedy and natural decay, or if the Collector is of opinion that its sale would be for the benefit of its owner, the Collector may at any time direct it to be sold, and the provisions of this sub section shall, as early as may be practicable, apply to the net proceeds of the sale.
" It will be seen that the liability to confiscation of a conveyance, such as, a car or cart or vessel under Section 63 is incurred only if two conditions are established, namely: (a) that the conveyance was used in carrying the contraband intoxicant, (b) the owner of that conveyance is implicated in the commission of the offence.
In the instant case, both these conditions were established.
It has been found by all the courts below that the car in question (WBD 8169) was used in carrying and transporting contraband Ganja and it was being driven by its owner, Abani Maity, who was convicted of the offence of possessing and transporting the contraband Ganja in this car.
The liability to confiscation of the car had, therefore, been incurred.
It may be further marked that in sub section (2) of section 63 the Legislature has used the words "shall be" in the context of "liable to confiscation".
Even, in the proviso to sub section (2) the expression "shall be liable to confiscation" has been reiterated.
Once 477 the facts essential for incurring the liability to confiscation are established, the Magistrate has no option but to adopt any of the two alternative courses indicated in sub section (1) of Section 64, that is to say, he may either order confiscation of that conveyance; or give its owner an option to pay in lieu of confiscation, such fine as the Magistrate thinks fit.
The Magistrate cannot just ignore to adopt any of these alternatives.
Since sub section (1) of Section 64 talks of the imposition of fine in lieu of confiscation, it appears that such an order of confiscation or fine in lieu of confiscation, is to be passed at the conclusion of the trial, when after conviction, a sentence for the commission of the offence is awarded.
It is true that ordinarily, the word "liable" denotes: (1) "legally subject or amenable to", (2) "Exposed or subject to or likely to suffer from (something prejudicial)", (3) "Subject to the possibility of (doing or undergoing something undesirable)" (See Shorter Oxford Dictionary).
According to Webster 's New World Dictionary, also, the word "liable" denotes "something external which may befall us".
Accordingly, the word "liable" occurring in many statutes, has been held as not conveying the sense of an absolute obligation or penalty but merely importing a possibility of attracting such obligation, or penalty, even where this word is used along with the words "shall be".
Thus, where an American Revenue Statute declared that for the commission of a certain act, a vessel "shall be liable to forfeiture", it was held that these words do not effect a present absolute forfeiture but only give a right to have the vessel forfeited under due process of law.
(See Kate Haron, 14 Fed.
139, 141 6 Sawy.
106) quoted in Words and Phrases, Vol.
25 page 109.
Permanent Edition, West Publishing Co.) Similarly, it has been held that in Section 302, Indian Penal Code, the phrase "shall also be liable to fine" does not convey a mandate but leave it to the discretion of the Court convicting an accused of the offence of murder to impose or not to impose fine in addition to the sentence of death or transportation for life.
But a statute is not to be interpreted merely from the lexicographer 's angle.
The court must give effect to the will and inbuilt policy of the Legislature as discernible from the object and scheme of the enactment and the language employed therein.
Exposition ex visceribus actus is a long recognised rule of construction.
Words in a statute often take their meaning from the context of the statute as a whole.
They are therefore, not to be cons 478 trued in isolation.
For instance, the use of the word "may" would normally indicate that the provision was not mandatory.
But in the context of a particular statute, this word may connote a legislative imperative, particularly when its construction in a permissive sense would relegate it to the unenviable position, as it were, "of an ineffectual angel beating its wings in a luminous void in vain".
If the choice is between two interpretations", said Viscount Simon L.C. in Nokes vs Doncaster Amalgamated Collieries, Ltd,(1) "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".
The provisions of Sections 63 and 64 of the Act are to be interpreted in the light of this principle.
The language and scheme of the Excise Act, taken as a whole, show that the purpose of this legislation is not only to raise revenue but also to control and restrict the import, export, transport, manufacture and sale of intoxicants.
Free and unrestricted use of intoxicants and illicit trade in contraband intoxicants not only means a loss of revenue to the public exchequer but also has a harmful effect on public health and morals.
Moreover, illicit trade and smuggling of intoxicants is often committed in an organised and clandestine manner, and is difficult to detect.
We have, therefore, to adopt that construction of the expressions "shall be liable to confiscation" used in Section 3(2) and "may" in sub section (1) of Section 64, which will preserve the efficacy of the provisions as an instrument for combating these anti social activities, and reject the other which will render them ineffective.
Thus considered, it seems clear that the expressions "shall be liable to confiscation" and "may" in the aforesaid provisions were intended to have a compulsive force.
We need not dilate on the topic further.
We will close the discussion by noticing one decision of this Court which has been cited by the counsel for the appellant.
That case is: Indo China Steam Navigation Co. Ltd. vs Jasjit Singh, Additional Collector of Customs Ors.
(ibid), wherein this Court was considering the interpretation of certain provisions of the Sea Customs Act.
In dealing with an offence under Section 167(12A) of the , the Customs Officer has also to exercise his jurisdiction under Section 183 of that Act, which expressly requires 479 the adjudicating Officer to give an option to the owner of the offending vessel to pay fine in lieu of confiscation.
Question arose as to what was the nature of the responsibility prescribed by Section 167(12A).
Gajendragadkar, C.J., speaking for the Court elucidated the position, thus: "We have already seen that Section 167(12A) provides that if a vessel contravenes Section 52A, it shall be liable to confiscation and the master of such vessel shall be liable to a penalty not exceeding Rs. 1,000/ .
Can it be said that the penalty prescribed by Section 167(12A) may in any given case not be imposed against the ship on the ground that the contravention proved against it is of a very trivial character, or has been the result of an act on the part of a criminal who acted on his own contrary to the instructions of the master of the ship? The words used in the third column of Cl.
(12A) are that "such vessel shall be liable to confiscation".
The context seems to require that it is not open to the Customs Authority to refuse to confiscate the vessel on the ground that there are any extenuating circumstances surrounding the contravention of section 52A in a given case and that it would be unfair to impose the penalty of confiscation.
Two penalties are prescribed, one is the confiscation of the ship, and the other is a fine against the master.
In regard to the later penalty, it is within the discretion of the Customs Authority to decide what amount of penalty should be imposed; just as in the case of the first penalty it is not open to it to say that it would not impose the penalty of confiscation against the offending ship, so in the case of the second penalty it is not open to it to say that it will not levy any penalty against the master.
In its discretion, it may impose a very small fine against the master if it is satisfied that the master was innocent and despite his best efforts, he could not prevent the contravention of section 52A.
If the two penalties prescribed by cl.
(12A) had been alternative, the position may have been different, but they are independent penalties, one is against the ship and the other is against the master; and so, there is no scope for contending that the Customs Authority may refuse to impose one penalty and impose the other, or may refuse to impose either of the two penalties.
It must be regarded as an elementary requirement of clause 12A that as soon as the offence referred to in column 1 of the said clause is 480 proved, some penalty has to be imposed and cl.
(12A) indicates that two penalties have to be imposed and not one, there being discretion in regard to the penalty imposable against the master as regards the amount of the said penalty.
Therefore, we do not think it would be possible to take the view that if there are extenuating circumstances attending the contravention of section 52A in a given case the Customs Authority can refrain from confiscating the vessel.
Confiscation of the vessel is the immediate statutory consequence of the finding that an offence under cl.
12A is established, just as the imposition of some penalty against the master is another statutory consequence of the same contravention.
" The language of Section 167(12A) and 183 of the , is not in pari materia with those of Sections 63 and 64 of the Bengal Excise Act.
It was on the language of these provisions, as they then stood, it was held that the penalties prescribed under Sections 167(12A) and 183 are independent and not alternative.
The observations, extracted above therefore, are not applicable in their entirety.
Nevertheless, they are a useful guide inasmuch as the expression "shall be liable to confiscation" used in Section 167(12A) in the context of a vessel found in the Customs waters in circumstances that amounted to a contravention of Section 52A, was held to cast on the Customs Authority an imperative duty to confiscate such vessel.
For all that has been said above and keeping in view the purpose, the scheme and the language of the provisions in question, we are of opinion that as soon as on proof of the conditions necessary under Section 63, a conveyance incurs the liability to confiscation, the word "may" used in Section 64(1) acquires the force of "must", and the Magistrate is bound to abide by either of the two alternatives viz., confiscation of the conveyance or imposition of the fine in lieu thereof in accordance with that Section.
Thus, the discretion of the Magistrate is restricted to choice between these two alternatives.
This limited discretion, also, is not to be exercised whimsically, but judicially, in a manner which will not emasculate these provisions or debilitate their potency as an instrument for suppressing the mischief which the Legislature had in view.
In the circumstances of this case therefore, it was imperative for the Magistrate, to pass, at the 481 conclusion of the trial, in addition to the conviction of the accused respondent, an order of confiscation of the car by means of which the offence was committed.
With this clarification of the law on the point, the appeal stands disposed of.
P.B.R. Appeal allowed.
| IN-Abs | Section 63(1) of the Bengal Excise Act, 1909 provides that whenever an offence punishable under the Act had been committed, the intoxicant material and the means by which such offence had been committed "shall be liable to confiscation '.
Section 64(1) provides that when the Magistrate decides that anything is liable to confiscation under section 63 he may either order confiscation or give the owner an option to pay in lieu of confiscation such fine as he thinks fit.
The respondent was found carrying contraband ganja in a car of which he was the owner.
The Magistrate passing the order of conviction and sentence against him, did not pass orders for the disposal of the contraband goods and confiscation of the car which was seized.
On the question whether the words "liable to" used in the context of "confiscation" in section 63(1) convey an absolute imperative or merely leave it to the discretion of the Magistrate to confiscate or not to confiscate the vehicle by means of which such offence had been committed.
Allowing the appeal, ^ HELD: 1.
It is imperative for the Magistrate to pass, at the conclusion of the trial, in addition to the conviction and sentence, an order of confiscation of the car by means of which the offence was committed.
[481 A] 2.
The expressions "shall be liable to confiscation" and "may" in the sections were intended to have a compulsive force.
As soon as the conditions of section 63, namely, that the conveyance had been used for carrying the contraband intoxicant and that the owner of that conveyance was implicated in the commission of the offences are established the word "may" in section 64(1) acquires the force of "must".
The discretion of the Magistrate is restricted to a choice between the two alternatives mentioned in section 64(1) namely, confiscation of the conveyance or imposition of fine in lieu thereof.
G H] 3.
Ordinarily the word "liable" has been held as conveying not an absolute obligation or penalty but as merely importing a possibility of attracting such obligation or penalty even where it is used with the words "shall be.
" But a statute is not to be interpreted merely from the lexicographer 's angle.
Exposition ex visceribus actus is a long recognised rule of construction.
Words in a statute often take their meaning from the context of the statute as a whole; they are not to be construed in isolation.
The purpose of the Excise Act is not merely to raise revenue but also to stop free use of intoxicants and illegal 473 trade in them which has a deleterious effect on public health and morals.
Thus considered both the expressions are intended to have a compulsive force.
[477 E H] Indo China Steam Navigation Co. Ltd. vs Jasjit Singh, Addl.
Collector of Customs & Ors., ; ; held in applicable.
|
No. XVI of 1950.
Appli cation under article 32 of the Constitution for a writ of prohibition and certiorari.
The facts are set out in the judgment.
C.R.Pattabhi Raman, for the petitioner.
K. Rajah Ayyar, Advocate General of MadraS, (Ganapathi Ayyar, with him) for the opposite party.
May 26.
The Judgment of Kania C.J., Mehr Chand Mahajan, Mukherjea and Das JJ.
was delivered by Patanjali Sastri J. Fazl Ali J. delivered a separate judgment.
PATANJALI SASTRI J.
The petitioner is the printer, publisher and editor of a recently started weekly journal in English called Cross Roads printed and published in Bombay.
The Government of Madras, the respondents herein, in exer cise of their powers under section 9 (1 A) of the Madras Maintenance of Public Order Act, 1949 (hereinafter referred to as the impugned Act) purported to issue an order No. MS.
1333 dated 1st March, 1950, whereby they imposed a ban upon the entry and circulation of the journal in that State.
The order was published in the Fort St. George Gazette and the notification ran as follows : "In exercise of the powers conferred by section 9 (I A) of the Madras Maintenance of Public Order, Act, 1949 (Madras Act XXIII of 1949) His Excellency the Governor of Madras, being satisfied that for the purpose of securing the public safety and the maintenance of public order, it is necessary so to do, hereby prohibits, with effect on and from the date of publication of this order in the Fort St. George Gazette the entry into or the circulation, sale or distribution in the State of Madras or any part thereof of the newspaper entitled Cross Roads an English weekly published at Bombay.
" The petitioner claims that the said order contravenes the fundamental right of the petitioner to freedom of See the headnote to Brij Bhushan vs The State of Delhi, p. 605 infra.
596 speech and expression conferred on him by article 19 (1) (a) of the Constitution and he challenges the validity of section 9 (1 A) of the impugned Act as being void under article 13 (1) of the Constitution by reason of its being inconsistent with his fundamental right aforesaid.
The Advocate General of Madras appearing on be half of the respondents raised a preliminary objection, not indeed to the jurisdiction of this Court to entertain the application under article 32, but to the petitioner resort ing to this Court directly for such relief in the first instance.
He contended that, as a matter of orderly proce dure, the petitioner should first resort to the High Court at Madras which under article 226 of the Constitution has concurrent jurisdiction to deal with the matter.
He cited criminal revision petitions under section 435 of the Crimi nal Procedure Code, applications for bail and applications for transfer under section 24 of the Civil Procedure Code as instances where, concurrent jurisdiction having been given in certain matters to the High Court and the Court of a lower grade, a rule of practice has been established that a party should proceed first to the latter Court for relief before resorting to the High Court.
He referred to Emperor vs Bisheswar Prasad Sinha (1) where such a rule of practice was enforced in a criminal revision case, and called our attention also to certain American decisions Urquhart vs Brown (2) and Hooney vs Kolohan (3) as showing that the Supreme Court of the United States ordinarily required that whatever judicial remedies remained open to the appli cant in Federal and State Courts should be exhausted before the remedy in the Supreme Court be it habeas corpus or certiorari would be allowed.
We are of opinion that neither the instances mentioned by the learned Advocate General nor the American decisions referred to by him are really analogous to the remedy afforded by article 32 of the Indian Constitution.
That article does not merely confer power on this Court, as article 226 does on the (1) I.L.R. 56 All.
(2) ; (3) ; 597 High Courts, to issue certain writs for the enforcement of the rights conferred by Part III or for any other purpose, as part of its general jurisdiction.
In that case it would have been more appropriately placed among articles 131 to 139 which define that jurisdiction.
Article 32 provides a "guaranteed" remedy for the enforcement of those rights, and this remedial right is itself made a fundamental right by being included in Part 1II.
This Court is thus constituted the protector and guarantor of fundamental rights, and it cannot, consistently with the responsibility so laid upon it, refuse to entertain applications seeking protection against infringements of such rights.
No similar provision is to be found in the Constitution of the United States and we do not consider that the American decisions are in point.
Turning now to the merits, there can be no doubt that freedom of speech and expression includes freedom of propa gation of ideas, and that freedom is ensured by the freedom of circulation.
"Liberty of circulation is as essential to that freedom as the liberty of publication.
Indeed, without circulation the publication would be of little value ": Ex parte Jackson(1).
See also LoveIl vs City of Griffin(s).
It is therefore perfectly clear that the order of the Gov ernment of Madras would be a violation of the petitioner 's fundamental right under article 19 (1) (a), unless section 9 (1 A) of the impugned Act under which it was made is saved by the reservations mentioned in clause (2) of article 19 which (omitting immaterial words regarding laws relating to libel, slander, etc., with which we are not concerned in this case) saves the operation of any "existinglaw in so far as it relates to any matter which undermines the security of, or tends to overthrow, the State.
" The question accord ingly arises whether, the impugned Act, in so far as it purports by section 9 (1 A) to authorise the Provincial Government "for the purpose of securing the public safety or the maintenance of public order, to prohibit or regulate the entry into (1) ; (2) ; 598 or the circulation, sale or distribution in the Province of Madras or any part thereof of any document or class of documents" is a "law relating to any matter which undermines the security of or tends to overthrow the State." The impugned Act was passed by the Provincial Legisla ture in exercise of the power conferred upon it by section 100 of the Government of India Act 1935, read with Entry 1 of List II of the Seventh Schedule to that Act, which com prises among other matters, "public order.
" Now "public order" is an expression of wide connotation and signifies that state of tranquillity which prevails among the members of a political society as a result of the internal regula tions enforced by the government which they have estab lished.
Although section 9 (I A) refers to "securing the public safety" and "the maintenance of public order" as distinct purposes, it must be taken that "public safety" is used as a part of the wider concept of public order, for, if public safety were intended to signify any 'matter distinct from and outside the content of the expression "public order," it would not have been competent for the Madras Legislature to enact the provision so far as it relates to public safety.
This indeed was not disputed on behalf of the respondents.
But it was urged that the expression "public safety" in the impugned Act, which is a statute relating to law and order, means the security of the Province, and, therefore, ' 'the security of the State" with the meaning of article 19 (2)as "the State" has been defined in article 12 as including, among other things, the Government and the Legislature of each of the erstwhile Provinces.
Much reli ance was placed in support of this view on Rex vs Wormwood Scrubbs Prison(1) where it was held that the phrase "for securing the public safety and the ' defence of.
the realm" in section 1 of the Defence of the Realm (Consolidation) Act, 1914, was not limited to securing the country against a foreign foe but included also protection against internal disorder such as a rebellion.
The decision is not of much assistance to the respondents as the context in (1) 599 which the words "public safety" occurred in that Act showed unmistakably that the security of the State was the aim in view.
Our attention has not been drawn to any definition of the expression "public safety," nor does it appear that the words have acquired any technical signification as words of article "Public safety" ordinarily means security of the public or their freedom from danger.
In that sense, anything which tends to prevent dangers to public health may also be regarded as securing public safety.
The meaning of the expression must, however, vary according to the context.
In the classification of offenCes in the Indian Penal Code, for instance, Chapter XIV enumerates the "offences affecting the public health, safety, convenience, decency, and morals" and it includes rash driving or riding on a public way (section 279) and rash navigation of a vessel (section 280), among others, as offences against public safety, while Chapter VI lists waging war against the Queen (section 121), sedition (section 124 A) etc.
as "offences against the State", because they are calculated to undermine or affect the security of the State, and Chapter VIII defines "of fences against the public tranquillity" which include unlaw ful assembly (section 141) rioting (section 146), promot ing enmity between classes (section 153 A), affray (sec tion 159) etc.
Although in the context of a statute relat ing to law and order "securing public safety" may not in clude the securing of public health, it may well mean secur ing the public against rash driving on a public way and the like, and not necessarily the security of the State.
It was said that an enactment which provided for drastic remedies like preventive detention and ban on newspapers must be taken to relate to matters affecting the security of the State rather than trivial offences like rash driving, or an affray.
But whatever ends the impugned Act may have been intended to subserve, and whatever aims its framers may have had in view, its application and scope cannot, in the ab sence of limiting words in the statute itself, be restricted to those aggravated forms of prejudicial activity which are calculated to 600 endanger the security of the State.
Nor is there any guar antee that those authorised to exercise the powers under the Act will in using them discriminate between those who act prejudicially to the security of the State and those who do not.
The Government of India Act, 1935, nowhere used the expression" security of the State" though it made provision under section 57 for dealing with crimes of violence intend ed to overthrow the Government.
While the administration of law and order including the maintenance of public order was placed in charge of a Minister elected by the people, the Governor was entrusted with the responsibility of combating the operations of persons who "endangered the peace or tranquillity of the Province" by committing or attempting to commit "crimes of violence intended to overthrow the Govern ment.
" Similarly, article 352 of the Constitution empowers the President to make a Proclamation of Emergency when he is satisfied that the "security of India or any part of the territory thereof is threatened by war or by external ag gression or by internal disturbance.
" These provisions recognise that disturbance of public peace or tranquillity may assume such grave proportions as to threaten the securi ty of the State.
As Stephen in his 'Criminal Law of England(1) observes: ' ' Unlawful assemblies, riots, insurrections, rebellions, levying of war, are offences which run into each other and are not capable of being marked off by perfectly defined boundaries.
All of them have in common one feature, namely, that the normal tranquillity of a civilised society is in each of the cases mentioned disturbed either by actual force or at least by the show and threat of it.
" Though all these offences thus involve disturbances of public tranquil lity and are in theory offences against public order, the difference between them being only a difference ' of degree, yet for the purpose of grading the punishment to be inflict ed in respect of them they may be classified into different minor categories as has been done by (1) Vol.
II, p. 242.
601 the Indian Penal Code.
Similarly, the Constitution, in formulating the varying criteria for permissible legislation imposing restrictions on the fundamental rights enumerated in article 19 (1), has placed in a distinct category those offences against public order which aim at undermining the security of the State or overthrowing it, and made their prevention the sole justification for legislative abridge ment of freedom of speech and expression, that is to say, nothing less than endangering the foundations of the State or threatening its overthrow could justify curtailment of the rights to freedom of speech and expression, while the right of peaceable assembly "sub clause (b)" and the right of association "sub clause (c)" may be restricted under clauses (3) and (4) of article 19 in the interests of" public order," which in those clauses includes the security of the State.
The differentiation is also noticeable in Entry 3 of List III (Concurrent List) of the Seventh Sched ule, which refers to the "security of a State" and "mainte nance of public order" as distinct subjects of.legislation.
The Constitution thus requires a line to be drawn in the field of public order or tranquillity marking off, may be, roughly, the boundary between those serious and aggravated forms of public disorder which are calculated to endanger the security of the State and the relatively minor breaches of the peace of a purely local significance, treating for this purpose differences in degree as if they were differ ences in kind.
It is also worthy of note that the word "sedition" which occurred in article 13 (2) of the Draft Constitution pre pared by the Drafting Committee was deleted before the article was finally.
passed as article 19 (2).
In this connection it may be recalled that the Federal Court had, in defining sedition in Niharendu Dutt Majumdar vs The King Emperor (1), held that "the acts or words complained of must either incite to disorder or must be such as to satisfy reasonable men that that is their intention or tendency", but the Privy Council overruled that 602 decision and emphatically reaffirmed the view expressed in Tilak 's case (1) to the effect that "the offence "consisted in exciting or attempting to excite in others certain bad feelings towards the Government and not in exciting or attempting to excite mutiny or rebellion, or any sort of actual disturbance, great or small " King Emperor vs Sada shiv Narayan Bhalerao (2) Deletion of the word "sedition" from the draft article 13 (2), therefore, shows that criticism of Government exciting disaffection or bad feel ings towards it is not to be regarded as a justifying ground for restricting the freedom of expression and of the press, unless it is such as to undermine the security of or tend to overthrow the State.
It is also significant that the corre sponding Irish formula of "undermining the public order or the authority of the State" article 40 (6) (i) of the Constitution of Eire, [1937] did not apparently find favour with the framers of the Indian Constitution.
Thus, very narrow and stringent limits have been set to permissible legislative abridgement of the right of free speech and expression, and this was doubtless due to the realisation that freedom of speech and of the press lay at the founda tion of all democratic organisations, for without free political discussion no public education, so essential for the proper functioning of the processes of popular govern ment, is possible.
A freedom of such amplitude might involve risks of abuse.
But the framers of the Constitution may well have reflected, with Madison who was "the leading spirit in the preparation of the First Amendment of the Federal Constitution," that "it is better to leave a few of its noxious branches to their luxuriant growth, than, by pruning them away, to injure the vigour of those yielding the proper fruits.": [Quoted in Near vs Minnesotta (3)].
We are therefore of opinion 'that unless a law restrict ing freedom of speech and expression is directed solely against the undermining of the security of the State or the overthrow of it, such law cannot fall within the reservation under clause (2) of article 19, although the (1) (21 L.R. 74, I A. 89.
(8) 282U.S, 607, 717 8.
603 restrictions which it seeks to impose may have been con ceived generally in the interests of public order.
It fol lows that section 9 (1 A) which authorises imposition of restrictions for the wider purpose of securing public safety or the maintenance of public order falls outside the scope of authorised restrictions under clause (2), and is there fore void and unconstitutional.
It was, however, argued that section 9 (1 A) could not be considered wholly void, as, under article 13 (1), an existing law inconsistent with a fundamental right is void only to the extent of the inconsistency and no more.
In so far as the securing of the public safety or the maintenance of public order would include the ' security of the State, the impugned provision, as applied to the latter purpose, was covered by clause (2) of article 19 and must, it was said, be held to be valid.
We are unable to accede to this contention.
Where a law purports to authorise the imposi tion of restrictions on a fundamental right in language wide enough to cover restrictions both within and without the limits of constitutionally permissible legislative action affecting such right, it is not possible to uphold it even so far as it may be applied within the constitutional lim its, as it is not severable.
So long as the possibility of its being applied for purposes not sanctioned by the Consti tution cannot be ruled out, it must be held to be wholly unconstitutional and void.
In other words, clause (2) of article 19 having allowed the imposition of restrictions on the freedom of speech and expression only in cases where danger to the State is involved, an enactment, which is capable of being applied to cases where no such danger could arise, cannot be held to be constitutional and valid to any extent.
The application is therefore allowed and the order of the respondents prohibiting the entry and circulation of the petitioner 's journal in the State of Madras is hereby quashed.
FAZL ALI J.
For the reasons given by me in Brij Bhushan and Another vs The State(1) , which practically 605.
604 involves the same question as is involved in this case, I hold that the reliefs sought by the petitioner cannot be granted.
In this view, I would dismiss this petition, but I should like to add a few observations to supplement what I have said in the other case.
It appears to me that in the ultimate analysis the real question to be decided in this case is whether "disorders involving menace to the peace and tranquillity of the Prov ince" and affecting "public safety" will be a matter which undermines the security of the State or not.
I have bor rowed the words quoted within inverted commas from the preamble of the Act which shows its scope and necessity and the question raised before us attacking the, validity of the Act must be formulated in the manner I have suggested.
If the answer to the question is in the affirmative, as I think it must be, then the impugned law which prohibits entry into the State of Madras of "any document or class of documents" for securing public safety and maintenance of public order should satisfy the requirements laid down in article 19 (2)of the Constitution.
From the trend of the arguments addressed to us, it would appear that if a docu ment is seditious, its entry could be validly prohibited, because sedition is a matter which undermines the security of the State; but if, on the other hand, the document is calculated to disturb public tranquillity and affect public safety, its entry cannot be prohibited, because public disorder and disturbance of public tranquillity are not matters which undermine the security of the State.
Speaking for myself, I cannot understand this argument.
In Brij Bhushan and Another vs The State(1), I have quoted good authority to show that sedition owes its gravity to its tendency to create disorders and an authority on criminal law like Sir James Stephen has classed sedition as an of fence against public tranquillity.
If so, how could sedi tion be a matter which would undermine the security of the State and public disorders and disturbance of public safety will not be such a matter? It was argued that a small riot or an affray will not (1) ; 605 undermine the security of the State, but to this line of argument there is a two fold answer : (1) The Act, as its preamble shows, is not intended for petty disorders but for disorders involving menace to the peace and tranquillity of the Province, (2) There are de grees of gravity in the offence of sedition also and an isolated piece of writing of mildly seditious character by one insignificant individual may not also, from the layman 's point of view, be a matter which undermines the security of the State, but that would not affect the law which aims at checking sedition.
It was also said that the law as it stands may be misused by the State executive, but misuse of the law is one thing and its being unconstitutional is another.
We are here concerned with the latter aspect only.
I shall not pursue the matter further as I have said enough on the subject in the connected case.
Petition allowed.
Agent for the petitioner: K. J. Kale.
Agent for the opposite party : P. A. Mehta.
| IN-Abs | Held, by the Full Court (i) (overruling a preliminary objection) Under the Constitution the Supreme Court is constituted the protector and guarantor of fundamental rights, and it cannot, consistently with the responsibility so laid upon it, refuse to entertain applications seeking protection against infringement of such rights, although such applications are made to the Court in the first in stance without resort to a High Court having concurrent jurisdiction in the matter.
Urquhart vs Brown ; and Hooney vs Kolohan ; distinguished.
(ii) Freedom of speech and expression includes freedom propagation of ideas and that freedom is ensured by the freedom of circulation.
Ex parte Jackson ; and Lovell vs City of Griffin ; referred to.
Held per KANIA C.J., PATANJALI SASTRI, MEHR CHAND MAHAJAN, MUKHERJEA and DAS JJ. (FAZL ALI J. dissenting): (i) Apart from libel, slander etc.
unless a law restricting freedom of speech and expression is directed solely against the undermining of the security of the State or the over throw of it, such law cannot fall within the reservation under cl.
(2) of article 19 of the Constitution, although the restrictions which it seeks to impose may have been con ceived generally in the interests of public order.
Section 9 (1 A) of the Madras Maintenance of Public Order Act, XXXIII of 1949, which authorises impositions of restrictions for the wider purpose of securing public safety or the mainte nance of public order falls outside the scope of authorised restrictions under cl.
(2) and is therefore void and uncon stitutional; (ii) Where a law purports to authorise the imposition of restrictions on a fundamental right in lan guage wide enough to cover restrictions both within and without the limits of constitutionally permissible legisla tive action affecting such right, it is not possible to uphold it even so far as it may be applied within the constitutional limits, as it is not severable.
So long as the possibilitY of its being applied for purposes not sanc tioned by the Constitution cannot be ruled out 595 must be held to be wholly unconstitutional and void.
Section 9 (1 A) is therefore wholly unconstitutional and void.
Per FAZL ALI J. Restrictions which section 9 (1 A) autho rised are within the provisions of cl.
(2) of article 19 of the Constitution and section 9 (1 A)is not therefore unconstitutional or void.(1) Brij Bhushan and Another vs The State ; referred to.
|
Criminal Appeal No. 17 of 1951.
Appeal against a Judgment and.
Order dated 22nd January, 1951, of the High Court of Judicature at Patna (Imam J.) in Criminal Revision No. 1533 of 1950 677 S.P. Sinha (P.S. Safeer and K.N. Aggarwal, with him) for the appellants.
The respondent did not appear.
May 24.
The Judgment of the Court was delivered by PATANJALI SASTRI J.
This is an appeal by special leave from an order of the High Court of Judicature at Patna setting aside an order of acquittal of the appellants by the Sessions Judge, Purnea, and directing their retrial.
The appellants were prosecuted for alleged offences under sections 147, 148, 323, 324, 326, 302 and 302/149 of the Indian Penal Code at the instance of one Polai Lal Biswas who lodged a complaint against them before the po lice.
The prosecution case was that, while the complainant was harvesting the paddy crop on his field at about 10 a.m. on 29th November, 1949, a mob of about fifty persons came on to the field armed with ballams, lathis and other weapons and that the first appellant Logendranath Jha, who was leading the mob, demanded a settlement of all outstanding disputes with the complainant and ,said he would not allow the paddy to be removed unless the disputes were settled.
An altercation followed as a result of which Logendra or dered an assault by his men.
Then Logendra and one of his men, Harihar, gave ballam blows to one of the labourers, Kangali, who fell down and died on the spot.
Information was given to the police who investigated the case and submitted the charge sheet.
The committing Magistrate found that a prima facie case was made out and committed the appellants to the Court of Sessions for trial.
The appellants pleaded not guilty alleging inter alia, that Mohender and Debender, the brothers of Logendra (appel lants 2 and 3) were not present in the village of Dandkhora with which they had no concern, as all the lands in that village had been allotted to Logendra at a previous parti tion, that Logendra himself was not in the village at the time of the occurrence but arrived 678 soon after and was dragged to the place at the instance of his enemies in the village and was placed under arrest by the Assistant Sub Inspector of Police who had arrived there previously.
It was also alleged that there were two factions in the village, one of which was led by one Harimohan, a relation of the complainant, and the other by Logendra and there had been numerous revenue and criminal proceedings and long standing enmity between the families of these leaders as a result of which this false case was foisted upon the appellants.
The learned Sessions Judge examined the evidence in great detail and found that the existence of factions as alleged by the appellants was true.
He found, however, that the appellants ' plea of alibi was not satisfactorily made out, "but the truth of the prosecution", he proceeded to observe, "cannot be judged by the falsehood of the defence nor can the prosecution derive its strength from the weak ness of the defence.
Prosecution must stand on its own legs and must prove the story told by it at the very first stage.
The manner of occurrence alleged by the prosecution must be established beyond doubt before the accused persons can be convicted".
Approaching the case in this manner and seeing that the basis of the prosecution case was that Polai had batai settlement of the disputed land and had raised the paddy crop which he was harvesting when the occurrence took place, the learned Sessions Judge examined the evidence of the prosecution witnesses who belonged to the opposite faction critically and found that the story of the prosecu tion was not acceptable.
Polai, who was alleged to have taken the land on batai settlement from his own maternal grandmother Parasmani who brought him up from his childhood, was only 19 years old and unmarried and was still living with his grandmother.
He did not claim to be a bataidar of any other person.
"In these circumstances", said the learned Judge, "it does not appear to me to be probable that Polai would have been allowed to maintain himself by running adhi cultivation of his mamu 's land in the lifetime of 679 his nani who has brought him up from his infancy like her own child.
Nor does it appeal to me that the unmarried boy Polai would have undertaken upon himself the task of run ning batai cultivation of the lands of his mamu where he has been living since his childhood without any trouble, more particularly in view of the heavy expenses of cultivation brought out by the evidence of Tirthanand (P.W. 14)".
He, therefore, disbelieved the whole story that Polai had taken the lands of his grandmother or his uncles as bataidar for cultivation and that he was engaged in harvesting the paddy crop on the lands at the time of the occurrence.
This false story, in his opinion, "vitally affected the prosecution case regarding the alleged manner of the occurrence".
He also found a number of discrepancies and contradictions in the evidence of the prosecution witnesses, which, in his view, tended to show that the prosecution was guilty of concealment of the real facts. ' 'In view of such conceal ment of real facts," the learned Judge concluded, "it does not appear to me to be possible to apportion liability and to decide which of the two parties commenced the fight and which acted in self defence.
Such being the position, it is not possible at all to hold either party responsible for what took place.
In such a view of the matter coupled with the fact that the manner of occurrence alleged by the prose cution has not been established to be true beyond doubt, I think that the accused persons cannot be safely convicted of any of the offences for which they have been charged.
" The learned Judge accordingly acquitted the appellants of all the charges framed against them.
Against that order the complainant Polai preferred a revision petition to the High Court under section 439 of the Criminal Procedure Code., The learned Judge who heard the petition reviewed the evidence at some length and came to the conclusion that the judgment of the learned Sessions Judge could not be allowed to stand as the acquittal of the appellants was "perverse ' '.
In his opinion, "the entire judgment displays a lack 680 of true perspective in a case of this kind.
The Sessions Judge had completely misdirected himself in looking to the minor discrepancies in the case and ignoring the essential matters so far as the case is concerned," and there was no justifiable ground for rejecting the prosecution evidence regarding the cultivation and harvesting by Polai.
And he concluded with the warning "I would, however, make it per fectly clear that when the case is re tried, which I am now going to order, the Judge proceeding with the trial will not be in the least influenced by any expression of opinion which I may have given in this judgment.
" On behalf of the appellants Mr. Sinha raised two conten tions.
In the first place, he submitted that having regard to section 417 of the Criminal Procedure Code which provides for an appeal to the High Court from an order of acquittal only at the instance of the Government, a revision petition under section 439 at the instance of a private party was incompetent, and, secondly, that sub section (4) of section 439 clearly showed that the High Court exceeded its powers of revision in the present case in upsetting the findings of fact of the trial Judge. ' We think it is unnecessary to express any opinion on the first contention of Mr. Sinha especially as the respondent is unrepresented, as we are of opinion that his second and alternative contention must prevail.
It will be seen from the judgment summarised above that the learned Judge in the High Court re appraised the evi dence in the case and disagreed with the Sessions Judge 's findings of fact on the ground that they were perverse and displayed a lack of true perspective.
He went further and, by way of "expressing in very clear terms as to how perverse the judgment of the court below is", he indicated that the discrepancies in the prosecution evidence and the circum stances of the case which led the Sessions Judge to discred it the prosecution story afforded no justifiable ground for the conclusion that the prosecution failed to establish their case.
We are of opinion that the learned Judge in the High Court did not properly appreciate the 681 scope of inquiry in revision against an order of acquittal.
Though sub section(1) of section 439 authorises the High Court to exercise, in its discretion, any of the powers conferred on a court of appeal by section 423, sub section (4) specifically excludes the power to "convert a finding of acquittal into one.
of conviction".
This does not mean that in dealing with a revision petition by a private party against an order of acquittal, the High Court could in the absence of any error on a point of law re appraise the evidence and reverse the findings of facts on which the acquittal was based, provided only it stopped short of finding the accused guilty and passing sentence on him.
By merely characterising the judgment of the trial Court as "perverse" and ' lacking in perspective", the High Court cannot reverse pure findings of fact based on the trial Court 's appreciation of the evidence in the case.
That is what the learned Judge in the court below has done, but could not, in our opinion, properly do on an application in revision filed by a private party against acquittal.
No doubt, the learned Judge formally complied with sub section (4) by directing only a retrial of the appellants without convicting them, and warned that the court retrying the case should not be influenced by any expression of opinion con tained in his judgment.
But there can be little doubt that he loaded the dice against the appellants, and it might prove difficult for any subordinate judicial officer dealing with the case to put aside altogether the strong views expressed in the judgment as to the credibility of the prosecution witnesses and the circumstances of the case in general.
We are of opinion that the learned Judge in the High Court exceeded his powers of revision in dealing with the case in the manner he did, and we set aside his order for retrial of the appellants and restore the order of acquittal passed by the Sessions Judge.
Appeal allowed.
| IN-Abs | Though sub section
(1) of section 439 of the.
Criminal Procedure Code authorises the High Court to exercise in Its discretion any of the powers conferred on a court of appeal by section 423, yet sub section
(4) specifically excludes the power to "convert a finding of acquittal into one of conviction.
" This. does not mean that in dealing with a revision petition by a private party against an order of acquittal, the High Court can in the absence of any error on a point of law re ap praise the evidence and reverse the findings of facts on which the acquittal was based, provided only it stops short of finding the accused guilty and passing sentence on him, by ordering a re trial.
|
minal Appeal No. 34 of 1955.
Appeal by special leave from the judgment and order dated the 7th June 1954 of the Punjab High Court at Simla in Criminal Revision No. 985 of 1953 arising out of the judgment and order dated the 9th May 1953 of the Court of the Additional District Judge, Ambala.
Ramalal Anand and I. section Sawhney, for the appellant.
Gopal Singh and P. G. Gokhale, for respondent No. I. Jindra Lal and Gopal Singh, for respondent No. 2. 1956.
February 15.
The Judgment of the Court was delivered by BOSE J.
This appeal was argued at great length because of the wide divergence of judicial opinion that centres round sections 195 and 476 of the Criminal Procedure Code.
The question is about the validity of a complaint made against the appellant for perjury and for using a forged document as genuine in the following circumstances.
The second respondent Amar Singh filed a civil 127 suit against the appellant for recovery of a large sum of money on the basis of a mortgage in the Court of Mr. E. F. Barlow, a Subordinate Judge of the First class.
The appellant filed a receipt which purported to show that Rs. 35 000 had been paid towards satisfaction of the mortgage (whether in full satisfaction or part is not clear), and in the witness box he swore that he had paid the money and was given the receipt.
Mr. Barlow held that the receipt did not appear to be a genuine document and that the appellant 's evidence was not true.
Accordingly he passed a preliminary decree against the appellant for the full amount of the claim on 15 3 1950 and a final decree followed on 15 7 1950.
There was an appeal to the High Court but that was dismissed on 9 5 1951.
The High Court also held that the receipt was a very auspicious document and that the appellant 's evidence was not reliable.
The plaintiff then made an application in the Court of Mr. W. Augustine, who is said to have succeeded Mr. Barlow as a Subordinate Judge of the first class, asking that a complaint be filed against the, appellant under sections 193 and 471 of the Indian Penal Code.
But before it could be beard Mr. Augustine was transferred and it seems that no Subordinate Judge of the first class was appointed in his place; instead, Mr. K. K. Gujral, a Subordinate Judge of the fourth class, was sent to this area and be seems to have been asked to decide the matter.
But as he was only a Subordinate Judge of the fourth class be made a report to the District Judge that he had no jurisdiction because the offences had been committed in the Court of a Subordinate Judge of the first class.
The District Judge thereupon transferred the matter to the Senior Subordinate Judge, Mr. Pitam Singh, and that officer made the complaint that is now under consideration.
The appellant filed an appeal against Mr. Pitam Singh 's order to the Additional District Judge, Mr. J. N. Kapur.
This learned Judge held that the Senior Subordinate Judge (Mr. Pitam Singh) had no jurisdiction to make the complaint because he was 128 not Mr. Barlow 's successor.
He also held, on the merits, that there was no prima facie case.
The matter went to the High Court in revision and the learned High Court Judge who beard the matter held that the Senior Subordinate Judge had jurisdiction and that the material disclosed a prima facie case.
Accordingly, he set aside the Additional District Judge 's order and restored the order of the Senior Subordinate Judge making the complaint.
This raises three questions.
The first concerns the jurisdiction of the Senior Subordinate Judge Mr. Pitam Singh to entertain the application and make the complaint.
The second is whether the Additional District Judge had jurisdiction to entertain an appeal against Mr. Pitam Singh 's order; and the third is whether the High Court had power to reverse the Additional District Judge 's order in revision.
We will first deal with Mr. Pitam Singh 's jurisdiction to make the complaint.
This question is governed by the Criminal Procedure Code and by the Punjab Courts Act, 1918.
We will examine the Criminal Procedure Code first.
The offences said to have been committed are ones under sections 471 and 193 of the Indian Penal Code, namely, using as genuine a forged document knowing it to be forged and perjury.
Section 195(1) (b) and (c) of the Criminal Procedure Code prohibit any Court from taking cognizance of either of these two offences except on the complaint in writing of the Court concerned "or of some other Court to which such Court is subordinate".
The offences were committed in the Court of Mr. E.F. Barlow, a Subordinate Judge of the first class.
It seems to have been accepted that Mr. Gujral was not Mr. Barlow 's successor because be was only a Subordinate Judge of the fourth class, but whether he was the successor or not, he neither made the complaint nor rejected the application.
He declined to do either because he said be had no jurisdiction; so also neither Mr. Barlow nor Mr. Augustine made a complaint or rejected the application.
That carries 129 us on to section 476 A of the Criminal Procedure Code.
Section 476 A states that when the Court in which the offence is said to have been committed neither makes a complaint nor rejects an application for the making of a complaint, "the Court to which such former Court is subordinate within the meaning of section 195, sub section (3)" may take action under section 476.
Section 476 authorises the appropriate Court, after recording a finding that it is expedient in the interests of justice, etc., to, among other things, make a complaint in writing and forward it to a Magistrate of the first class having jurisdiction.
That was done by Mr. Pitam Singh.
So the only question we have to decide on this part of the case is whether the Court of the Senior Subordinate Judge over which Mr. Pitam Singh presided was the Court to which the Court of Mr. Barlow was subordinate within the meaning of section 195(3 ).
Now it is to be noticed that subordination has been given a special meaning in this section.
It is not any superior Court that has jurisdiction, nor yet the Court to which the "former Court" is subordinate for, what might be termed, most general purposes, but only the Court to which it is subordinate within the meaning of section 195(3).
Section 195(3) states that "For the purposes of this section, a Court shall be deemed to be subordinate to the Court to which appeals ordinarily lie from the appealable decrees or sentences of such former Court, or in the case of a Civil Court from whose decrees no appeal ordinarily lies to the principal court having ordinary original civil jurisdiction within the local limits of whose jurisdiction such Civil Court is situate" and then follows this proviso "Provided that (a)where appeals lie to more than one Court, the Appellate Court of inferior jurisdiction shall be the Court to which such Court shall be deemed to be subordinate; and 130 (b) where appeals lie to a Civil and also to a Revenue Court, such Court shall be deemed to be subordinate to the Civil or Revenue Court according to the nature of the case or proceeding in connection with which the offence is alleged to have been committed".
These provisions have given rise to much conflict in the High Courts.
The controversy has centred round the word "ordinarily".
One class of case, of which Wadero Abdul Rahman vs Sadhuram(1) is a sample, holds that "ordinarily" means "in the majority of cases" and that it has no reference to the particular case in hand.
We do not think that is right because that gives no meaning to the proviso to sub clause (3).
If appeals lie to a particular Court, e.g., the District Court, in the majority of cases and to another Court,say the High Court, only in a few cases, then the inferior tribunal is a fixed quantity and so the need to choose between the inferior and the superior Court cannot arise.
That makes sub clause (a) to the proviso otiose; also, it does not necessarily follow that the appeal in the majority of cases will always lie to the inferior Court.
Cases may occur in which the majority of appeals would go to the higher of two given tribunals; and in any case this interpretation has the disadvantage that a Court may be compelled to call for and go into a mass of statistics to ascertain which of two Courts entertains the majority of appeals over a given period of time, as well as to determine what is the appropriate period of time.
Another view considers that the word means that the higher Court is the one to which there is an unrestricted right of appeal and so cannot apply when any restriction intervenes such as when the right of appeal is limited to a particular class of cases or is hedged in by conditions.
This was the view taken in M. section Sheriff vs Govindan(2).
Other views are also possible but we do not intend to explore them.
In our opinion, the matter is to be viewed thus.
The first question to be asked is whether any decrees, orders or sentences of the original Court (1) [1930) (2) A.I.R. I , 1061, 131 are appealable at all.
If they are not, and the Court is a Civil Court, then,, under section 195(3), the appeal against the order making or refusing.to make a complaint will be to the principal Court of ordinary original civil jurisdiction.
If, however, appeals from its various decrees and orders lie to different Courts, then we have to see to which of them they "ordinarily" lie and select the one of lowest grade from among them.
In determining the Court or Courts to which an appeal will ordinarily lie, we have to see which Court or Courts entertain appeals from that class of tribunal in the ordinary way apart from special notifications or laws that lift the matter out of the general class.
Our meaning will be clearer when we turn to the case in hand and examine the Punjab Courts Act of 1918.
Apart from the Courts of Small Causes and Courts established under other enactments, the Punjab Courts Act, 1918 makes provision for three classes of Civil Courts, namely (1) the Court of the District Judge, (2) the Court of the Additional Judge, and (3) the Court of the Subordinate Judge.
At the moment we are concerned with the Subordinate Judge.
Section 22 enables the State Government to fix the number of Subordinate Judges after consultation with the High Court.
The local limit of jurisdiction of each of these Judges is the district in which he is appointed unless the High Court defines a different limit (section 27).
The pecuniary limits are set out in section 26: "The jurisdiction to be exercised in civil suits as regards the value by any person appointed to be a Subordinate Judge shall be determined by the High Court either by including him in a class or otherwise as it thinks fit".
These are what might be termed the ordinary powers and jurisdiction of these Courts.
But sections 29 and 30 authorise the High Court to confer certain additional powers and jurisdiction on them.
We will deal with that later.
132 Next, we turn to the provisions for appeal.
They are governed by section 39.
In the absence of any other enactment for the time being in force, when the value of the suit does not exceed five thousand rupees the appeal lies to the District Judge, and in every other suit, to the High Court.
But by sub section (3) the High Court is empowered to direct by notification "that appeals lying to the District Court from all or any of the decrees or orders passed in an original suit by any Subordinate Judge shall be preferred to such other 'Subordinate Judge as may be mentioned in the notification" and when that is done "such other Subordinate Judge shall be deemed to be a District Court for the purposes of all appeals so preferred".
The High Court availed itself of this provision and provided that appeals lying to the District Courts from decrees or orders passed by any Subordinate Judge in two classes of case which are specified "shall be preferred to the Senior Subordinate Judge of the first class exercising jurisdiction within such Civil District".
There are thus three forums of appeal from the Court of the Subordinate Judge depending on the nature of the suit and its value.
The question is whether in each of these three classes of case the appeal can be said to lie "ordinarily" to one or other of these appellate tribunals.
Applying the rule we have set out above, the appeal to the Senior Subordinate Judge cannot be termed "ordinary" because the special appellate jurisdiction conferred by the Notification is not the ordinary jurisdiction of the Senior Subordinate Judge but an additional power which can only be exercised in a certain limited class of case.
It is not a power common to all Subordinate Judges nor even to all Senior Subordinate Judges.
Therefore, it cannot be said that appeals from the Courts of the various Subordinate Judges "ordinarily" lie to the Senior Subordinate Judge.
Consequently, that Court is not one of the appellate tribunals contemplated 133 by section 195(3) of the Criminal Procedure Code and its proviso.
But appeals do "ordinarily" lie either to the District Court or the High Court; and as the District Court is the lower of these two tribunals that must be regarded as the appellate authority for the purposes of section 476 B of the Criminal Procedure Code.
Now it is to be observed that this is a purely objective analysis is and is not subjective to any particular suit.
In the present suit, the value of the suit was over Rs. 5,000, so the appeal would have lain to the High Court, but we are not concerned with that be cause section 195(3) does not say that the appellate authority within the meaning of that section shall be the Court to which the appeal in the particular case under consideration would ordinarily lie but generally "the Court to which appeals ordinarily lie from the appealable decrees or sentences of such former Court".
It would, however, be wrong to say that the nature of the proceedings in the case must be wholly ignored because sub clause (b) to the proviso to sub section (3) states that "where appeals lie to a Civil and also to a Revenue Court, such.
Court shall be deemed to be subordinate to the Civil or Revenue Court according to the nature of the case or proceeding".
Therefore, to that limited extent the nature of the proceedings must be taken into account, but once the genus of the proceedings is determined, namely whether civil, criminal or revenue, the heirarchy of the superior Courts for these purposes will be determined, first by the rules that apply in their special cases and next by the rule in section 195(3) which we have just expounded and explained.
M. section Sheriff vs The State of Madras and Others,(1) was quoted but the present point was neither considered nor decided there.
The next question is whether the Court of the Senior Subordinate Judge is the same Court as Mr. Barlow 's Court, namely the Court of the Subordinate (1) [1954] section C. R. 1144,1147.
18 134 Judge of the first class.
That depends on whether there is only one Court of the Subordinate Judge in each district, presided over by a number of Judges, or whether each Court is a separate Court in itself.
That turns on the provisions of the Punjab Courts Act.
We make it clear that our decision on this point is confined to the Punjab Act.
We understand that similar Acts in other States are differently worded so that what we decide for the Punjab may not bold good elsewhere.
We say this because rulings were cited before us from other parts of India which take differing views.
We do not intend to refer to them because it would not be right to examine the language of Acts that are not directly before us.
Accordingly, we confine ourselves to the Punjab Act (Act VI of 1918).
Section 18 of the Punjab Courts Act states that there shall be the following classes of Courts, namely ". . . . . . . . (3) the Court of the Subordinate Judge".
Section 22 provides that "the State Government may. . fix the number of Subordinate Judges to be appointed".
Section 26, which has already been quoted, fixes the pecuniary limits of their jurisdiction.
Then comes section 27 defining the local limits of their jurisdiction: "(1) The local limits of the jurisdiction of a Subordinate Judge shall be such as the High Court may define.
(2) When the High Court posts a Subordinate Judge to a district, the local limits of the district shall, in the absence of any direction to the contrary, be deemed to be the local limits of his jurisdiction".
From there we go to the Notification.
It is High Court Notification No. 4 dated 3 1 1923.
It makes four classes of Subordinate Judges with effect from 5 1 1923 "in respect of the jurisdiction to be exercised by them in original suits, namely: Class I Subordinate Judges exercising juris 135 diction without limit as to the value of the cases; Class II Subordinate Judges exercising jurisdiction in cases of which the value does not exceed Rs. 5.000; Class III Subordinate Judges exercising jurisdiction in cases of which the value does not exceed Rs. 2,000; Class IV Subordinate Judges exercising jurisdiction in cases of which the value does not exceed Rs. 1,000.
When a Subordinate Judge is appointed to any of the classes constituted by this Notification, he shall exercise the jurisdiction here in before defined for the class to which he is appointed within the local limits of the civil district to which he may be posted from time to time".
This gives rise to three points of view.
According to one, there is only one Court of the Subordinate Judge for each district and every other Subordinate Judge is an additional Judge to that Court.
This is based on the language of section 18, and the High Court Notification is, under that view, interpreted as dividing the Judges of that one Court into four categories but not as creating independent Courts.
Section 26 is there read as empowering the High Court to include each Subordinate Judge individually on appointment into a given class within the one Court and not to turn him into a separate Court.
According to the second view, there are four classes of Subordinate Judge 's Courts in the Punjab because of the High Court Notification.
The argument here runs that section 18 must be read with section 26, and as the High Court is empowered to divide Subordinate Judges in a district into classes it must mean that each class forms an independent Court, for according to this point of view, it would be anomalous to have Judges of the one Court invested with differing pecuniary jurisdictions because that is always regarded as inherent to the Court.
The position created by the Act, it is said, is not the same as the one that arises when work is administratively distributed among Additional Judges of the same 136 Court because the jurisdiction and powers of the Judges are unaffected by such distribution and there remains the one Court with one inherent and territorial jurisdiction despite the distribution.
The third view is that each Subordinate Judge is a separate and independent Court in himself and it is pointed out that section 27 invests each Judge personally with a territorial jurisdiction and not the Court, and so also section 26.
Under section 33 the power of control (apart from the High Court) over all civil Courts within the local limits of a District Judge 's jurisdiction is with him, and section 34 empowers the District Judge to distribute any civil business "cognizable by . the Courts under his control. among such Courts in such manner as he thinks fit".
The Senior Subordinate Judge does not therefore appear to be vested with either administrative or judicial control over any other Subordinate Judge except in so far as he is a Court of appeal in certain specified classes of case.
In our opinion, the Senior Subordinate Judge who made the complaint had no jurisdiction to make it, either as the original Court which tried the suit, or as the appellate authority under section 476 B of the Criminal Procedure Code.
It is not enough that he also had first class powers because be was not the same Court.
That is not to say that a successor could not have been appointed to Mr. Barlow so as to establish continuity in the Court over which he presided.
It is possible that one could have been appointed and indeed it seems to have been assumed that Mr. Augustine was his successor.
But as Mr. Augustine did not take up this matter we need not decide that point.
What we think is clear is that Mr. Pitam Singh was not a successor, especially as appeals lay to him from certain decisions of the Subordinate Judges in his district.
It would be unusual to provide an appeal from one Judge of a Court to another single Judge of the same Court.
It would be even more anomalous to have an appeal from the decision of a judge lie to his successor in office.
Even 137 in the High Courts, where there are Letters Patent appeals, the appeal is always heard by a Division Bench of at least two Judges; nor can this be treated as a case where a Court with inherent jurisdiction decides the matter as an original tribunal though, owing to territorial or other similar classification not affecting inherent jurisdiction, the case should have gone to some other tribunal of co ordinate or lesser authority.
Section 193(1) of the Criminal Procedure Code imposes a definite bar which cannot be ignored or waived any more than the prohibitions under sections 132 and 197 and, just as the sanctions provided for in those sections cannot be given by any authority save the ones specified, so here, only the Courts mentioned in section 195 (1) (b) and (c) can remove the bar and make the complaint.
This also appears to accord with the Punjab practice.
The Rules and Orders of the Punjab High Court reproduce a Notification of the High Court dated 16 5 1935 as amended on 23 2 1940, at page 3 of Chapter 20 B of Volume I, where it is said in paragraph 2 "It is further directed the Court of such Senior Subordinate Judge of the first class shall be deemed to be a District Court, etc.
" This appears to regard each Senior Subordinate Judge as a Court in himself and not merely as the presiding officer of the Court of the Subordinate Judge.
Section 39(3) of the Punjab Courts Act is also relevant.
It states that "the High Court may by notification direct that appeals lying to the District Court from all or any of the decrees or orders passed in an original suit by any Subordinate Judge shall be preferred to such other Subordinate Judge as may be mentioned in the notification, and the appeals shall thereupon be preferred accordingly, and the Court of such other Subordinate Judge shall 'De deemed to be a District Court, etc.
" Now this permits an appeal from one Subordinate Judge to another and the words the "Court of such other Subordinate Judge" indicate that the Subordi 138 nate Judge to whom the appeal is preferred is a separate and distinct Court.
The position thus reduces itself to this.
The original Court made no complaint; section 476 A of the Criminal Procedure Code was therefore attracted and the jurisdiction to make the complaint was transferred to the Court to which Mr. Barlow 's Court was subordinate within the meaning of section 195.
That Court, as we have seen, was the Court of the District Judge.
Now, when the matter was reported to the District Judge by Mr. K. K. Gujral, the District Judge dealt with it.
He had authority under section 476 A either to make the complaint himself or to reject the application.
He did neither.
Instead, he sent it to Mr. Pitam Singh who had no jurisdiction.
Of course, the District Judge could have sent it to the original Court or to the successor Judge of that Court if there was one, but he sent it to a Court without jurisdiction, so his order was ineffective and the subsequent order of Mr. Pitam Singh was without jurisdiction.
That still left the District Court free to act under section 476 A when the matter came back to it again.
This time it came by way of appeal from Mr. Pitam Singh 's order but that made no difference because the substance of the matter was this: the original Court had not taken any action, therefore it was incumbent on the District Judge to make an appropriate order either under section 476 A or by sending it for disposal to the only other Court that had jurisdiction, namely the original Court.
But the District Judge did not deal with it.
The application went instead to the Additional District Judge and what we now have to see is whether the Additional District Judge had the requisite power and authority.
That depends on whether the Additional District Judge was a Judge of the District Court or whether he formed a separate Court of his own like the various Subordinate Judges; and that in turn depends on the language of the Punjab Courts Act.
As we have already pointed out, section 18 of that Act states that, in addition to Courts of Small Causes 139 and Courts established under other enactments, "there shall be the following classes of Civil Courts, namely: (1) The Court of the District Judge; (2) The Court of the Additional Judge; and (3) The Court of the Subordinate Judge".
The Court of the Additional Judge is therefore constituted a distinct class of Court, and it is to be observed that the Act speaks of the Court of the Additional Judge and not of the Additional District Judge as is the case with certain other Acts in other parts of India.
This language is also to be compared with articles 214 and 216 of the Constitution which constitute and define the constitution of the High Courts in India. ``214(1).
There shall be a High Court for each State ' '.
"216 .
Every High Court shall consist of a Chief Justice and such other Judges as the President may from time to time deem it necessary to appoint".
The Punjab Courts Act nowhere speaks of an Additional District Judge or of an Additional Judge to the District Court; also, the Additional Judge is not a Judge of co ordinate judicial authority with the District Judge.
Section 21 (I) states that "When the business pending before any District Judge requires the aid of an Additional Judge or Judges for its speedy disposal, the State Government may appoint such Additional Judges as may be necessary".
But these Judges cannot discharge all the judicial functions of the District Judge.
Their jurisdiction is a limited one and is limited to the discharge of such functions as may be entrusted to them by the District Judge.
Section 21(2) states that "An Additional Judge so appointed shall discharge any of the functions of a District Judge ' which the District Judge may assign to him".
It is true that sub section (2) goes on to say that "in the discharge of those functions he shall exercise the same powers as the District Judge" but these powers are limited to the cases with which 140 he is entitled to deal.
Thus, if his functions are confined to the hearing of appeals he cannot exercise original jurisdiction and vice versa.
But if he is invested with the functions of an appellate tribunal at the District Court level, then he can exercise all the powers of the District Judge in dealing with appeals which the District Judge is competent to entertain.
This is a very different thing from the administrative distribution of work among the Judges of a sin ale Court entitled to divide itself into sections and sit as division Courts.
When the Chief Justice of a High Court or the District Judge of a District Court makes an administrative allotment of work among the Judges of his Court, their jurisdiction and powers are not affected, and if work allotted to one Judge goes to another by mistake his jurisdiction to entertain the matter and deal with it is not affected.
But that is not the scheme of the Punjab Courts Act and the mere fact that Mr. J. N. Kapur called himself the Additional District Judge and purported to act as such cannot affect the matter of his jurisdiction.
As the Punjab Courts Act does not contemplate the appointment of Additional Judges to the District Court, none can be appointed.
The Court contemplated is the Court of the Additional Judge which is in the nature of a special tribunal set up for a special purpose and invested with the powers of a District Judge when dealing with the matters specially entrusted to its jurisdiction.
We hold therefore that the Court of the Additional Judge is not a division Court of the Court of the District Judge but a separate and distinct Court of its own.
Now, as we have seen, when the original Court does not make a complaint under section 476 of the Criminal Procedure Code or reject the application, then the only other Court competent to exercise these powers is the Court to which appeals from the original Court "ordinarily lie".
That Court, in the present case, was the Court of the District Judge and not the Court of the Additional Judge Mr. J. N. Kapur.
Therefore, Mr. J. N. Kapur 's order was also without jurisdiction.
141 Mr. Kapur 's order went up to the High Court in revision, and the next question we have to determine is whether the High Court had jurisdiction to entertain the revision and the extent of its powers.
Keshardeo Chamria vs Radha Kissen Chamria and Other8(1) and many cases from the High Courts were cited which show that there is much difference of opinion about this but we are fortunately not called upon to decide that question because this is not a case where a Court with jurisdiction has acted under section 476 of the Criminal Procedure Code of its own motion or has acted as a Court of appeal under section 476 B.
As we have shown, the Court of the Senior Subordinate Judge Mr. Pitam Singh had no jurisdiction to entertain this matter either as a Court of appeal under section 476 B or of its own authority under section 476 A.
The Additional Judge Mr. J. N. Kapur, who has called himself an Additional District Judge, also had no jurisdiction under either section.
But he seised himself of the case and has rejected the application for the making of a complaint.
He therefore assumed a jurisdiction which he did not possess and that at once attracted the revisional jurisdiction of the High Court.
Now it does not matter in this case whether that jurisdiction lies under section 439 of the Criminal Procedure Code or under section 115 of the Civil Procedure Code because under either of these two sections the High Court is entitled to set aside an order of a Court subordinate to it which has assumed a jurisdiction that it does not possess.
Therefore, in so far as the High Court set aside the order of Mr. J. N. Kapur it was right.
But where it went wrong was in upholding the complaint made by the Senior Subordinate Judge.
As we have shown, that Court had no jurisdiction to make the complaint .
The next question is whether the High Court could itself have made the complaint in this particular case because if it could have done so then we would not have used our extraordinary powers of appeal under article 136 to set right what would in those circum (1) ; , 150 to 152.
19 142 stances have been a mere procedural irregularity.
But as our opinion is that the High Court had no jurisdiction to act under section 476 in this case, we are bound to interfere.
As we have shown, section 195 contains an express prohibition against taking cognizance of the kind of complaint we have here unless the bar is lifted either by the original Court or the Court to which it is subordinate within the meaning of section 195(3).
Those are the only Courts invested with jurisdiction to lift the ban and make the complaint.
Had this been a case in which the High ' Court was the superior Court within the meaning of section 195(3) the matter would have been different, but as the original Court was neither the original Court nor the Court to which the original Court was subordinate, according to the special definition in section 195(3), it had no jurisdiction to make the complaint of its own authority.
Therefore, all that the High Court could, and should, have done was to send the case to the District Judge for disposal according to law.
We will, therefore,, now do what the High Court should have done.
We were asked not to allow the proceedings to pend any longer but we are not prepared to do that in this case.
If the view taken by Mr. Pitam Singh and the High Court is right, then a serious offence of a kind that is unfortunately becoming increasingly common, and which is difficult to bring home to,an offender, has been committed against the administration of justice, and if the District Court is satisfied, as were Mr. Pitam Singh and the High Court, that a prima facie case has been made out and that it is expedient in the interests of justice that a complaint should be filed, then it is but right that the matter should be tried in the criminal Courts.
We will not say anything more lest it prejudice the appellant.
The District Judge will of course be free to exercise his own discretion.
The application for the making of a complaint will accordingly be remitted to the District Judge who will now deal with it.
| IN-Abs | The question as to which Court is competent to make a com plaint under section 476 A read with section 195(3) of the Code of Criminal Procedure where none wag made by the Court in which the offence was committed or its successor Court, will depend on the nature of the proceeding in which the offence was committed, whether civil, criminal or revenue, and on the hierarchy of superior Courts to which an appeal from such proceeding will ordinarily lie as contemplated by section 195(3) of the Code, apart from such exceptions as may be made in respect of any particular matters by any special notifications or laws.
Where, however, appeals ordinarily lie to different courts, the one of the lowest grade will be the Court competent to make the complaint.
Wadero Abdul Bahman vs Sadhuram, ([1930] and M. section Sheriff vs Govindan (A.I.R. , 1061), not approved.
Under the Punjab Courts Act of 1918 and the hierarchy of civil Courts established thereby, appeals from the Courts of the various subordinate Judges who constitute distinct Courts do not ordinarily lie to the Senior Subordinate Judge but to the District Judge and the Court of the Additional Judge is not a Court of coordinate jurisdiction with that of the District Judge.
The Act neither mentions nor recognises an Additional District Judge as a Court of that hierarchy.
Consequently, in a case where offences under sections 193 and 471 of the Indian Penal Code were alleged to have been committed in a civil proceeding in the Court of a Subordinate Judge of the first class, exercising jurisdiction under the Punjab Courts Act of 1918, and neither he nor his successor made a complaint or rejected the application for the making of it, the Senior Subordinate Judge had no jurisdiction to entertain the matter and make the complaint either as a Court of appeal under section 476 B or of Its own authority under section 476 A of the Code of Criminal Procedure and the Additional 17 126 Judge, by wrongly describing himself as an Additional District Judge, could not assume a jurisdiction which he did not possess under those sections.
The High Court has power to revise orders of subordinate Courts made without jurisdiction both under section 439 of the Code of Criminal Procedure and under section 115 of the Code of Civil Procedure, therefore, it was not necessary to decide under article 136 of the Constitution which of these two sections applied in the present case, but the High Court erred in upholding the complaint made by the Senior Subordinate Judge because that court had no jurisdiction to make the complaint.
The High Court is not a Court to which the Subordinate Judge of the first class is subordinate within the meaning of section 196(3) of the Code of Criminal Procedure and could not, therefore, make the complaint of its own authority and should have remitted the application to the District Judge for disposal according to law.
|
Civil Appeal No. 2077 of 1972.
From the Judgment and Order dated 2 8 1971 of the Delhi High Court in Civil Writ No. 162 D of 1966.
E. C. Agarwala and R. N. Sachthey for the Appellants.
Lal Narain Sinha, K. K. Jain, section K. Gupta, Pramod Dayal and Bishamber Lal for the Respondent No. 1 455 Rameshwar Dial, Adarsh Fial, and A. D. Mathur for Respondents 2 3.
The Judgment of the Court was delivered by CHANDRACHUD, C. J.
This appeal by certificate raises an interesting controversy between the Sales Tax Authorities in the Union Territory of Delhi and those in Haryana, the question being as to which of the two authorities can assess respondent 1 to sales tax.
One of the reliefs sought by respondent 1 is that until the Sales Tax authorities of the two territories settle their differences, no sales tax should be levied or recovered from it since, it does not know to whom to pay the tax.
This controversy arises on the following facts.
Respondent 1 is a private limited company called K. G. Khosla & Co. (P) Ltd., having its head office in the Union Territory of Delhi at 1, Deshbandhu Gupta Road, New Delhi.
The company carries on business in Air Compressors and garage equipment which it manufactures in its factory at Faridabad, which was formerly in the State of Punjab and is now a part of the State of Haryana.
For the purposes of sales tax, respondent 1 is registered as a dealer both in the Union Territory of Delhi and in the State of Haryana.
It filed returns of sales tax with the sales Tax authorities in Delhi since, according to it, the sale of goods manufactured in the factory at Faridabad was being effected from Delhi by its head office.
The sales tax was being paid by the company under the Bengal Finance (Sales Tax) Act, 1941 as extended to Delhi, on the basis that the sales effected by the company were intra State sales within the territory of Delhi.
On November 24, 1965, however, the Sales Tax Assessing Authority at Gurgaon, which was then in the State of Punjab but which subsequently became a part of the State of Haryana, sent a notice to the company under sections 11 and 14 of the East Punjab Central Sales Tax Act, 1948 and rule 33 made thereunder that, in respect of the period commencing on April 1, 1961 and ending with the year 1964 65, the sales made by the company were liable to assessment in Haryana.
On March 13, 1968 an assessment was made by the Assessing Authority at Faridabad on the basis that the sales effected by the company were inter State sales liable to be assessed to sales tax under the Central Sales Tax Act, 74 of 1956.
An appeal against the order of assessment is said to be pending.
In the meanwhile, on February 14, 1966, the company filed a writ petition before the Punjab High Court Circuit Bench at Delhi which, after the recorganisation of States, was dealt with by the Delhi High 456 Court.
The Chief Commissioner of the Union Territory of Delhi and the Assessing Authority of the territory were impleaded as respondents 1 and 2 to the writ petition.
Respondent 3 was the State of Punjab and respondent 4 the Assessing Authority at Gurgaon.
Respondent 3 was later substituted by the State of Haryana.
The company contended by its writ petition that except the manufacturing of goods at the Faridabad factory, all of its activities, including those of booking of orders, sales, despatching of goods, billing and receiving of sale price were being done by and through the head office in Delhi and that no sales were effected by or from the factory.
Since, however, both the Sales Tax authorities, namely, at Delhi and Haryana, were demanding payment of sales tax on the same sale transactions, the company prayed by its writ petition that the High Court do resolve the controversy between the Sales Tax authorities of the two States and decide the question of their respective jurisdiction to assess its turnover.
The State of Haryana contended by its counter affidavit to the writ petition that the goods were manufactured by the company at Faridabad in pursuance of contracts of sale with outside purchasers, that those goods were appropriated to the various contracts of sale in the State of Haryana and that the movement of the goods from Faridabad to Delhi and onwards was caused as a necessary incident of the contracts of sale made by the company.
The sales, according to the State of Haryana had taken place at Faridabad during the course of inter State trade.
The Union of India, on the other hand, contended that the goods were brought from Faridabad to Delhi and were thereafter sold by the company to the various purchasers outside Delhi.
These sales according to the Union of India, were governed by the Bengal Finance (Sales Tax) Act, 1941 as extended to Delhi, their situs being the Union Territory of Delhi.
The Delhi High Court by its judgment dated August 2, 1971 allowed the writ petition and granted a declaration that the sales effected by respondent 1 which fell under section 3 (a) of the were liable to be assessed to inter State sales tax by the Sales Tax authorities at Faridabad since, those sales caused the movement of goods from Faridabad to Delhi.
The High Court added that the writ petition was confined to the goods manufactured at Faridabad in pursuance of pre existing contracts of sales and therefore, its judgment would have no application to the local sales 457 effected by respondent 1 at Delhi.
In the result, the High Court passed an order directing that the amount of tax which respondent 1 had wrongly paid to the sales tax authorities at Delhi on the inter State sales between 1.4.1961 to 30 9 1965 be transferred by the Sales Tax authorities at Delhi to the Sales Tax authorities at Faridabad.
The High Court has granted a certificate of fitness to the Union of India to file an appeal to this Court under Article 133, (1) (b) of the Constitution.
The question which arises for decision is whether the sales made by respondent 1 were made at Faridabad in the course of inter State trade as contended by the State of Haryana or whether they are intra State sales effected within the Union Territory of Delhi as contended by the appellant, the Union of India.
The answer to this question would depend upon the course and nature of transactions in relation to which the movement of goods was caused from Faridabad to Delhi and the terms of the contracts of sales which caused that movement.
But before adverting to those aspects of the matter, it would be necessary to notice the relevant provisions of the 74 of 1956 ("The Act").
Section 3 of the Act provides as follows: "3.
When is a sale or purchase of goods said to take place in the course of inter State trade or commerce: A sale or purchase of goods shall be deemed to take place in the course of inter State trade or commerce if the sale or purchase: (a) occasions the movement of goods from one State to another; or (b) is effected by a transfer of documents of title to the goods during their movement from one State to another.
" There are two Explanations to the section but they have no bearing on the appeal.
Section 9(1) of the Act provides as follows: 9.
"Levy and collection of tax and penalties (1) the tax payable by any dealer under this Act on sales of goods effected by him in the course of inter State trade or commerce, whether such sales fall within clause (a) or clause (b) of section 3, shall be levied by the Government of India and the tax so levied shall be collected by that Government 458 in accordance with the provisions of sub section (2), in the State from which the movement of the goods commenced.
" There is a proviso to section 9(1) to which it is unnecessary to refer since it has no application.
In the light of these provisions, what has to be considered is whether the sales effected by respondent 1 occasioned the movement of goods from one State to another State, which on the facts of the instant case would mean, from the State of Haryana to the Union Territory of Delhi.
It is only if a sale occasions the movement of goods from one State to another that it can be deemed to have taken place in the course of inter State trade or commerce within the meaning of section 3 (a) of the Act.
Clause (b) of section 3 is not relevant for our purpose.
The course and manner of its business have been set out by respondent 1 in paragraphs 3 and 27 of the writ petition in the following terms: "3.
Orders for the supply of goods from various parties are received by the petitioner 's company at its head office in Delhi.
The head office draws out a production programme and advises the factory to manufacture the goods in accordance therewith.
After the goods are so manufactured in the factory, the goods are collected by the head office and brought to its head office in Delhi.
From its head office the goods are despatched to various customers whether outside Delhi or in Delhi.
The price of goods is also received at the head office.
In short, the position is that excepting the manufacture of goods at the factory, all other activities including that of booking of orders, sales, despatching and billing and receiving of sale price are being carried out from the head office in Delhi." "27.
The goods manufactured in the factory are future goods within the meaning of the and the dispute does not relate to any ready goods.
" It is clear from these averments that goods were manufactured by respondent 1 in its factory at Faridabad, Haryana, in pursuance of specific orders received by its head office at Delhi.
The contracts of sales were made at Delhi and in pursuance of those contracts, goods were manufactured at Faridabad according to specifications mentioned in the contracts.
This, therefore, is not that type of case in which goods are manufactured in the general course of business for being 459 sold as and when offers are received by the manufacturer for their purchase.
Contracts of sales were finalised in the instant case at Delhi and specific goods were manufactured at Faridabad in pursuance of those contracts.
Those were "future goods" within the meaning of section 2(6) of the .
After the goods were manufactured to agreed specifications, they were despatched to the head office at Delhi for being forwarded to the respective customers at whose instance and pursuant to the contracts with whom the goods were manufactured.
The goods could as well have been despatched to the respective customers directly from the factory but they were sent in the first instance to Delhi as a matter of convenience, since there are better godown and rail facilities at Delhi as compared with Faridabad.
The despatch of the goods of Delhi was but a convenient mode of securing the performance of contracts made at Delhi.
Goods conforming to agreed specifications having been manufactured at Faridabad, the contracts of sale could be performed by respondent 1 only by the movement of the goods from Faridabad with the intention of delivering them to the purchasers.
Thus, the movement of goods was occasioned from Faridabad to Delhi as a result or incident of the contracts of sale made in Delhi.
It is true that in the instant case the contracts of sales did not require or provide that goods should be moved from Faridabad to Delhi.
But it is not true to say that for the purposes of section 3(a) of the Act it is necessary that the contract of sale must itself provide for and cause the movement of goods or that the movement of goods must be occasioned specifically in accordance with the terms of the contract of sale.
The true position in law is as stated in Tata Iron and Steel Co. Ltd., Bombay vs section R. Sarkar and others(1) wherein Shah, J. speaking for the majority observed that clauses (a) and (b) of section 3 of the Act are mutually exclusive and that section 3(a) covers sales in which the movement of goods from one State to another "is the result of a covenant or incident of the contract of sale, and property in the goods passes in either State" (page 391).
Sarkar, J. speaking for himself and on behalf of Das Gupta, J. agreed with the majority that clauses (a) and (b) of section 3 are mutually exclusive but differed from it and held that "a sale can occasion the movement of the goods sold only when the terms of the sale provide that the goods would be moved; in other words, a sale occasions a movement of goods when the contract of sale so provides" (page 407).
The view of the majority was approved by this Court in the Central 460 Marketing Co. of India vs State of Mysore,(1) State Trading Corporation of India vs State of Mysore(2) and Singareni Collieries Co. vs Commissioner of Commercial Taxes, Hyderabad.(3) In K. G. Khosla & Co. vs Deputy Commissioner of Commercial Taxes,(4) counsel for the Revenue invited the Court to reconsider the question but the Court declined to do so.
In a recent decision of this Court in Oil India Ltd. vs The Superintendent of Taxes & others(5) it was observed by Mathew, J., who spoke for the Court, that: (1) a sale which occasions movement of goods from one State to another is a sale in the course of inter State trade, no matter in which State the property in the goods passes; (2) it is not necessary that the sale must precede the inter State movement in order that the sale may be deemed to have occasioned such movement; and (3) it is also not necessary for a sale to be deemed to have taken place in the course of inter State trade or commerce, that the covenant regarding inter State Movement must be specified in the contract itself.
It would be enough if the movement was in pursuance of and incidental to the contract of sale (page 801).
The learned Judge added that it was held in a number of cases by the Supreme Court that if the movement of goods from one State to another is the result of a covenant or an incident of the contract of sale, then the sale is an inter State sale.
The decision in Tata Engineering & Locomotive Co. Limited vs The Assistant Commissioner of Commercial Taxes and Another(6) on which the Union of India relies, proceeds on a different consideration and is distinguishable.
The appellant therein carried on the business of manufacturing trucks in Jamshedpur in the State of Bihar.
The sales office of the appellant in Bombay used to instruct the Jamshedpur factory to transfer stocks of vehicles to the stockyards in various States after taking into account the production schedule and requirements of customers in different States.
The stocks available in the stockyards were distributed from time to time to dealers.
The transfer of the vehicles from the factory to the various stockyards was a continuous process and was not related to the requirement of any particular customer.
It was the stockyard incharge who appropriated the required number of vehicles to the contract of sale out of the stocks available with him.
Until such appropriation of vehicles was made, it was open 461 to the company to allot any vehicle to any purchaser or to transfer the vehicles from the stockyard in one State to a stockyard in another State.
At page 870 of the report, a statement occurs in the judgment of Grover, J., that it was not possible to comprehend how in the above situation it could be held that "the movement of the vehicles from the works to the stockyards was occasioned by any covenant or incident of the contract of sale.
" This statement is relied upon by the Union of India in support of its contention that the contract of sale must itself provide for the movement of goods from one State to another.
We are unable to read any such implication in the observation cited above.
At page 866 of the report, after referring to certain decisions, the Court observed that the principle admits of no doubt, according to the decisions of this Court, that the movement of goods "must be the result of a covenant or incident of the contract of sale.
" This decision may be usefully contrasted with another decision between the same parties, which is reported in State of Bihar & Anr.
vs Tata Engineering & Locomotive Co. Ltd.(1).
In that case the turnover in dispute related to the sales made by the company to its dealers of trucks for being sold in the territories assigned to them under the dealership agreements.
Each dealer was assigned an exclusive territory and under the agreement between the dealers and the company, they had to place their indents, pay the price of the goods to be purchased and obtain delivery orders from the Bombay office of the company.
In pursuance of such delivery orders trucks used to be delivered in the State of Bihar to be taken over to the territories assigned to the dealers.
Since under the terms of the contracts of sale the purchasers were required to remove the goods from the State of Bihar to other States, no question arose in the case whether it was or was not necessary for a sale to be regarded as an inter State sale that the contract must itself provide for the movement of goods from one State to another.
If a contract of sale contains a stipulation for such movement, the sale would, of course, be an inter State sale.
But it an also be an inter State sale, even if the contract of sale does not itself provide for the movement of goods from one State to another but such movement is the result of a covenant in the contract of sale or is an incident of that contract.
The decisions to which we have referred above show that in order that a sale may be regarded as an inter State sale, it is immaterial whether the property in the goods passes in one State or another.
The question as regards the nature of the sale, that is, whether it is an inter 462 State sale or an intra State sale, does not depend upon the circumstances as to in which State the property in the goods passes.
It may pass in either State and yet the sale can be an inter State sale.
The High Court was, therefore, right in holding that the sales in question are inter State sales and that the turnover of sales is assessable to sales tax under the at the instance of the Sales Tax authorities at Faridabad.
The amount of tax which respondent has wrongly paid to the Sales Tax authorities at Delhi on such inter State sales from 1 4 1961 to 30 9 1965 shall have to be transferred by the Sales Tax authorities at Delhi to the Sales Tax authorities at Faridabad, as directed by the High Court.
The appeal is accordingly dismissed but there will be no order as to costs.
N.K.A Appeal dismissed.
| IN-Abs | The respondent company who was a manufacturer of air compressors and garage equipment had its factory at Faridabad (in the State of Haryana) and its head office in Delhi (Union Territory of Delhi).
The head office drew the production programme and advised the factory to manufacture the goods in accordance therewith.
After the goods were so manufactured in the factory they were collected by the head office and brought to Delhi and despatched to various customers whether outside Delhi or in Delhi.
The price of goods was received at the head office.
In other words excepting the manufacture of goods at the factory all other activities, were carried out from the head office in Delhi.
In respect of sale of goods manufactured at Faridabad the respondent company filed sales tax returns with the sales tax authorities at Delhi on the ground that the sales were effected from Delhi by the head office and that they were intra state sales within the territory of Delhi and accordingly paid sales tax at Delhi.
In November, 1965, however, the sales tax authorities of Haryana demanded payment of sales tax under the East Punjab General Sales Tax, Act, 1948 for the period commencing from April 1, 1961 and ending with the year 1964 65 pointing out that the sales effected were inter state sales liable to be assessed by them under the .
In its writ petition the respondent company alleged that since all its activities were being carried on by or through the head office in Delhi and no sales were effected by or from the factory at Faridabad sales tax was paid by it in Delhi and since the sales tax authorities in Haryana were demanding payment of Central Sales Tax in respect of the same transaction the High Court might resolve the controversy.
The High Court held that the sales fell under section 3(a) of the and were liable to be assessed to inter state sales tax by the Sales Tax Authorities at Faridabad and accordingly ordered that the sales tax paid by the respondent in Delhi be transferred to the Sales Tax Authorities at Faridabad.
On appeal the Union of India contended that since the situs of sale was Delhi Sales Tax was payable in Delhi.
Dismissing the appeal, 454 ^ HELD: 1 (a) The High Court was right in holding that the sales were inter state sales and that the turnover on sales was assessable to sales tax under the and that the amounts of sales tax wrongly paid in Delhi be transferred to the Sales Tax Authorities at Faridabad.
[462 A B] (b) In order that a sale may be regarded as an inter state sale it is immaterial whether the property in the goods passes in one State or another.
The question as regards the nature of the sale, that is, whether it is an inter State sale or an intra State sale does not depend upon the circumstance as to in which State the property in the goods passes.
It may pass in either and yet the sale can be an inter State sale.
[461 G H, 462 A] In the instant case the contracts of sales were made at Delhi and in pursuance of those contracts, goods were manufactured at Faridabad according to specifications mentioned in the contracts.
This, therefore, is not that type of case in which goods are manufactured in the general course of business for being sold as and when offers are received by the manufacturer for their purchase.
Contracts of sales were finalised in the instant case at Delhi and specific goods were manufactured at Faridabad in pursuance of those contracts.
These were "future goods" within the meaning of section 2(6) of the .
After the goods were manufactured to agreed specifications, they were despatched to the head office at Delhi for being forwarded to the respective customers at whose instance and pursuant to the contracts with whom the goods were manufactured.
The despatch of goods of Delhi was but a convenient made of securing the performance of contracts made at Delhi.
Thus the movement of goods was occasioned from Faridabad to Delhi as a result or incident of the contracts of sale made in Delhi.
[458 H, 459 A D (c) For the purpose of section 3(a) it is not necessary that the contract of sale must itself provide for and cause the movement of goods or that the movement of goods must be occasioned specifically in accordance with the terms of contract of sale.
[459 E] Tata Iron and Steel Co. Ltd., Bombay vs section section Sarkar & Ors., ; ; Central Marketing Co. of India vs State of Mysore, ; State Trading Corporation of India vs State of Mysore, ; Singareni Collieries Co. vs Commissioner of Commercial Taxes, Hyderabad, ; ; K. G. Khosla & Co. vs Dy.
Commr.
of Commercial Taxes; , ; Oil India Ltd. vs The Superintendent of Taxes & Ors., ; ; followed.
Tata Eng. & Locomotive Co. Ltd. vs The Asstt.
Commr.
of Commercial Taxes & Anr.
, ; ; distinguished.
State of Bihar & Anr.
vs Tata Eng. & Locomotive Co. Ltd.; , ; referred to.
|
Civil Appeal No. 2152 of 1969.
Appeal by Special Leave from the Judgment and Order dated 1 8 1967 of the Assam and Nagaland High Court in Civil Rule No. 256 of 1966.
Naunit Lal for the Appellant.
section K. Dutta, section K. Nandy and A. Sen for the Respondent.
J. Respondent J. Ahmed joined service in Assam State in 1945 and some time in 1959 came to be promoted to the Indian Administrative Service Cadre.
In that very year he was posted as Deputy Commissioner and District Magistrate, Nowgong District.
While he was holding the aforementioned post, some time in the beginning of June 1960 there were large scale disturbances in Nowgong city and District area described in official parlance as 'language disturbances '.
There was considerable damage to property.
One Shri A. N. Kidwai, the then Additional Chief Secretary to the Government of Assam, undertook an inquiry into the causes of disturbances at Nowgong with a view to ascertaining the responsibility of District officials.
After Shri Kidwai submitted his Report, the Government took the first step of suspending the respondent from service by an order dated 14th September 1960.
The Chief Secretary to the Government of Assam by his communication dated 13th September 1960 conveyed to the respondent various charges framed against him and called upon him to submit his explanation.
A statement of allegations was annexed to the communication.
Respondent submitted his explanation and thereafter the Government appointed respondent 507 No. 4, K. Balachandran as the Enquiry Officer.
After the inquiry was concluded, the Enquiry Officer submitted his report.
It may be noticed that respondent was born on 1st February 1907 and according to Rule 16 of the All India Services (Death cum Retirement Benefits) Rules, 1958 ( 'Retirement Rules ' for short), then in force, the age of retirement being 55 years, the respondent would have retired from service on 1st February 1962.
First, the Governor of Assam by his order dated 31st January 1962 purporting to exercise power under Rule 16(1) of the Retirement Rules, directed that the respondent then under suspension be retained in service for a period of three months beyond the date of his retirement which fell on Ist February 1962 or till the termination of departmental proceedings drawn up against him whichever is earlier.
By subsequent orders dated 21st June 1962, Ist September 1962, 23rd February 1963 and 28th August 1963 respondent was retained in service, till the inquiry pending against him concluded and final orders were passed in the proceedings.
It may be mentioned that the order dated 28th August 1963 was made by the Governor in exercise of the powers conferred by subrule (2) of rule 16 of the Retirement Rules.
The Enquiry Officer submitted his report holding charges 1, 2, 3, 5 and 6 proved and in respect of charge No. 4 the finding recorded was that though the charge was proved, the Enquiry Officer took note of certain extenuating circumstances mentioned in the report.
A Memorandum dated 22nd February 1963 was served by the Government of India on the respondent forwarding the report of the Enquiry Officer and the respondent was called upon to show cause why the provisional penalty determined by the Government of removal from service be not imposed upon him.
Ultimately, by order dated 11th October 1963 the President, after consultation with the Union Public Service Commission, imposed the penalty of removal from service on the respondent.
A memorial submitted by the respondent to the President under Rule 20 of the All India Services (Discipline & Appeal) Rules, 1955, ( 'Discipline and Appeal Rules ' for short), against the imposition of the penalty was rejected.
The respondent filed a petition under Article 226 of the Constitution in the High Court of Assam and Nagaland.
Two contentions were raised before the High Court: (1) Whether rule 16(2) of the Retirement Rules is attracted so as to retain the respondent in service beyond the period of his normal retirement for the purpose of completing disciplinary proceedings against the respondent; and (2) if rule 16(2) was not attracted, whether the retention of respondent beyond the normal period of his retirement was valid and if it was not valid, whether he 508 could be removed from service after he had actually and effectively retired from service ? While examining these two contentions, the High Court was of the opinion that disciplinary proceedings can be held and punishment can be imposed for misconduct and the charges held did not disclose any misconduct because negligence in performance of duty or inefficiency in discharge of duty would not constitute misconduct.
On the second point it was held that if the Enquiry was not for any misconduct, sub rule (2) of rule 16 would not be attracted and the Government had no power to retain the respondent in service for the purpose of holding or completing disciplinary proceeding which can only be for misconduct, and as there was no inquiry into what can be styled as misconduct, the retention in service of the respondent beyond the period of retirement was not legal and valid, and, therefore, the respondent could not bemoved from service from which he had retired.
In accordance with these findings, the writ petition filed by the respondent was allowed declaring that the respondent was deemed to have retired from service from Ist February 1962 and that the punitive or disciplinary action taken against him after that date is completely without jurisdiction and wholly unjustified, and the same was quashed.
The Union of India and the State of Assam have preferred this appeal by special leave.
Rule 3 of the Discipline and Appeal Rules provides that the penalties therein set out may, for good and sufficient reasons, be imposed on a member of service.
One such penalty prescribed therein is 'removal from service which shall not disqualify for future employment '.
Rule 4 prescribes the authority competent to institute disciplinary proceedings.
Where a member of a service has committed any act or omission which renders him liable to any penalty specified in rule 3, an inquiry shall be held according to procedure prescribed in rule 5.
Therefore penalty prescribed in rule 3 can be imposed upon a member of the service for any act or omission committed by him which, according to rule 3, must provide good and sufficient reason to impose one or the other of the penalties mentioned therein.
Rule 7 of the Discipline and Appeal Rules enables the Government to put under suspension a member of the Service during disciplinary proceeding if having regard to the nature of charges and circumstances the Government thinks it proper to do so.
Sub rule (2) of Rule 16 of the Retirement Rules as it stood at the relevant time reads as under: "16(2).
A member of the service under suspension on a charge of misconduct shall not be required or permitted to retire from the service but shall be retained in service until the 509 inquiry into the charges against him is concluded and a final order is passed".
A survey of these rules would show that disciplinary proceedings can be held against a member of the service for any act or omission which renders him liable to a penalty and such penalty can be imposed for good and sufficient reasons.
All India Services (Conduct) Rules, 1954, prescribe a code of conduct for members of service.
Discipline and Appeal Rules provide for disciplinary action and imposition of penalties.
Sub rule (2) of rule 16 of the Retirement Rules contemplates a situation where a member of service against whom disciplinary proceeding is pending is likely to retire and the proceedings may be thwarted and provides for his retention in service beyond the date of his retirement till the completion of the inquiry, provided the delinquent officer is under suspension on a charge of misconduct.
The respondent contended and the contention has found favour with the High Court that the charges framed against the respondent, even if they are held proved, would not constitute misconduct, and, therefore, it could not be said that he was under suspension on a charge of misconduct and accordingly sub rule (2) of rule 16 would not be attracted and he could not be retained in service beyond the date of his retirement.
It was said that retention in service being invalid, imposition of penalty after his retirement is illegal.
Therefore, what constitutes misconduct for a member of a service liable to be removed from service on proof of such misconduct in a disciplinary proceeding, looms large in this case.
To appreciate the contention it is better to have a look at the charges framed against the respondent.
They are as under: "(i) Completely failed to take any effective preventive measures against widespread disturbances breaking out in Nowgong District in spite of adequate warning being conveyed.
(ii) Showed complete lack of leadership when the disturbances actually did break out and failed to give proper direction to your subordinate Magistrates and co ordinate co operations with the police to restore Law and Order; (iii) Did not personally visit the scenes of disturbances within the town or in the Rural areas, in time to take personal control of the situation and to exercise necessary supervision; 510 (iv) Did not keep Government informed of the actual picture and extent of the disturbances; (v) Showed complete inaptitude, lack of foresight, lack of firmness and capacity to take quick and firm decision and were, thus largely responsible for complete break down of Law and Order in Nowgong town as well as the rural areas of Nowgong District.
Thus you proved yourself completely unfit to hold any responsible position".
The Inquiry Officer has treated the statement in the letter conveying the charges that the respondent proved himself completely unfit to hold a responsible position as a separate and independent charge which on the face of it is merely a surmise or a conclusion drawn from the five charges set out above.
This surmise or conclusion has to be ignored and cannot be treated as a specific charge.
The five charges listed above at a glance would convey the impression that the respondent was not a very efficient officer.
Some negligence is being attributed to him and some lack of qualities expected of an officer of the rank of Deputy Commissioner are listed as charges.
to wit, charge No. 2 refers to the quality of lack of leadership and charge No. 5 enumerates inaptitude, lack of foresight, lack of firmness and indecisiveness.
These are qualities undoubtedly expected of a superior officer and they may be very relevant while considering whether a person should be promoted to the higher post or not or having been promoted, whether he should be retained in the higher post or not or they may be relevant for deciding the competence of the person to hold the post, but they cannot be elevated to the level of acts of omission or commission as contemplated by Rule 4 of the Discipline and Appeal Rules so as to incur penalty under rule 3.
Competence for the post, capability to hold the same, efficiency requisite for a post, ability to discharge function attached to the post, are things different from some act or omission of the holder of the post which may be styled as misconduct so as to incur the penalty under the rules.
The words 'acts and omission ' contemplated by rule 4 of the Discipline and Appeal Rules have to be understood in the context of the All India Services (Conduct) Rules, 1954 ( 'Conduct Rules ' for short).
The Government has prescribed by Conduct Rules a code of conduct for the members of All India Services.
Rule 3 is of a general nature which provides that every member of the service shall at all times maintain absolute integrity and devotion to duty.
Lack of integrity, if proved, would undoubtedly en 511 tail penalty.
Failure to come up to the highest expectations of an officer holding a responsible post or lack of aptitude or qualities of leadership would not constitute failure to maintain devotion to duty.
The expression 'devotion to duty ' appears to have been used as something opposed to indifference to duty or easy going or light hearted approach to duty.
If rule 3 were the only rule in the Conduct Rules it would have been rather difficult to ascertain what constitutes misconduct in a given situation.
But rules 4 to 18 of the Conduct Rules prescribe code of conduct for members of service and it can safely stated that an act or omission contrary to or in breach of prescribed rules of conduct would constitute misconduct for disciplinary proceedings.
This code of conduct being not exhaustive it would not be prudent to say that only that act or omission would constitute misconduct for the purpose of Discipline and Appeal Rules which is contrary to the various provisions in the Conduct Rules.
The inhibitions in the Conduct Rules clearly provide that an act or omission contrary thereto as to run counter to the expected code of conduct would certainly constitute misconduct.
Some other act or ommission may as well constitute misconduct.
Allegations in the various charges do not specify any act or omission in derogation of or contrary to Conduct Rules save the general rule 3 prescribing devotion to duty.
It is, however, difficult to believe that lack of efficiency, failure to attain the highest standard of administrative ability while holding a high post would themselves constitute misconduct.
If it is so, every officer rated average would be guilty of misconduct.
Charges in this case as stated earlier clearly indicate lack of efficiency, lack of foresight and indecisiveness as serious lapses on the part of the respondent.
These deficiencies in personal character of personal ability would not constitute misconduct for the purpose of disciplinary proceedings.
It would be appropriate at this stage to ascertain what generally constitutes misconduct, especially in the context of disciplinary proceedings entailing penalty.
Code of conduct as set out in the Conduct Rules clearly indicates the conduct expected of a member of the service.
It would follow that that conduct which is blameworthy for the Government servant in the context of Conduct Rules would be misconduct.
If a servant conducts himself in a way inconsistent with due and faithful discharge of his duty in service, it is misconduct [see Pierce vs Foster(1)].
A disregard of an essential condition of the contract of service may constitute misconduct [see Laws vs London Chronicle .(Indicator Newspapers) (2)].
This 512 view was adopted in Shardaprasad Onkarprasad Tiwari vs Divisional Superintendent, Central Railway, Nagpur Division, Nagpur(1), and Satubha K. Vaghela vs Moosa Raza(2).
The High Court has noted the definition of misconduct in Stroud 's Judicial Dictionary which runs as under: "Misconduct means, misconduct arising from ill motive; acts of negligence, errors of judgment, or innocent mistake, do not constitute such misconduct".
In industrial jurisprudence amongst others, habitual or gross negligence constitute misconduct but in Management, Utkal Machinery Ltd. vs Workmen, Miss Shanti Patnaik(3), in the absence of standing orders governing the employee 's undertaking, unsatisfactory work was treated as misconduct in the context of discharge being assailed as punitive.
In section Govinda Menon vs Unio nof India(4), the mamnner in which a member of the service discharged his quasi judicial function disclosing abuse of power was treated as constituting misconduct for initiating disciplinary proceedings.
A single act of omission or error of judgment would ordinarily not constitute misconduct though if such error or omission results in serious or atrocious consequences the same may amount to misconduct as was held by this Court in P. H. Kalyani vs Air France, Calcutta(5), wherein it was found that the two mistakes committed by the employee while checking the load sheets and balance charts would involve possible accident to the aircraft and possible loss of human life and, therefore, the negligence in work in the context of serious consequences was treated as misconduct.
It is, however, difficult to believe that lack of efficiency or attainment of highest standards in discharge of duty attached to public office would ipso facto constitute misconduct.
There may be negligence in performance of duty and a lapse in performance of duty or error of judgment in evaluating the developing situation may be negligence in discharge of duty but would not constitute misconduct unless the consequences directly attributable to negligence would be such as to be irreparable or the resultant damage would be so heavy that the degree of culpability would be very high.
An error can be indicative of negligence and the degree of culpability may indicate the grossness of the negligence.
Carelessness can often be productive of more harm than deliberate wickedness or malevolence.
Leaving aside the classic example of the sentry who sleeps at his post 513 and allows the enemy to slip through, there are other more familiar instances of which a railway cabinman signals in a train on the same track where there is a stationary train causing headlong collision; a nurse giving intravenous injection which ought to be given intramuscular causing instantaneous death; a pilot overlooking an instrument showing snag in engine and the aircraft crashes causing heavy loss of life.
Misplaced sympathy can be a great evil [see Navinchandra Shakerchand shah vs Manager, Ahmedabad Co op.
Department Stores Ltd.(1)].
But in any case, failure to attain the highest standard of efficiency in performance of duty permitting an inference of negligence would not constitute misconduct nor for the purpose of Rule 3 of the Conduct Rules as would indicate lack of devotion to duty.
The High Court was of the opinion that misconduct in the context of disciplinary proceeding means misbehaviour involving some form of guilty mind or mens rea.
We find it difficult to subscribe to this view because gross or habitual negligence in performance of duty may no involve mens rea but may still constitute misconduct for disciplinary proceedings.
Having cleared the ground of what would constitute misconduct for the purpose of disciplinary proceeding, a look at the charges framed against the respondent would affirmatively show that the charge inter alia alleged failure to take any effective preventive measures meaning thereby error in judgment in evaluating developing situation.
Similarly, failure to visit the scenes of disturbance is another failure to perform the duty in a certain manner.
Charges Nos. 2 and 5 clearly indicate the shortcomings in the personal capacity or degree of efficiency of the respondent.
It is alleged that respondent showed complete lack of leadership when disturbances broke out and he disclosed complete inaptitude, lack of foresight, lack of firmness and capacity to take firm decision.
These are personal qualities which a man holding a post of Deputy Commissioner would be expected to possess.
They may be relevant considerations on the question of retaining him in the post or for promotion, but such lack of personal quality cannot constitute misconduct for the purpose of disciplinary proceedings.
In fact, charges 2, 5 and 6 are clear surmises on account of the failure of the respondent to take effective preventive measures to arrest or to nip in the bud the ensuing disturbances.
We do not take any notice of charge No. 4 because even the Enquiry officer has noted that there are number of extenuating circumstances which may exonerate the respondent in respect of that charge.
What was styled as charge No. 6 is the conclu 514 sion, viz., because of what transpired in the inquiry, the Enquiry Officer was of the view that the respondent was unfit to hold any responsible position.
Somehow or other, the Enquiry Officer completely failed to take note of what was alleged in charges 2, 5 and 6 which was neither misconduct nor even negligence but conclusions about the absence or lack of personal qualities in the respondent.
It would thus transpire that the allegations made against the respondent may indicate that he is not fit to hold the post of Deputy Commissioner and that if it was possible he may be reverted or he may be compulsorily retired, not by way of punishment.
But when the respondent is sought to be removed as a disciplinary measure and by way of penalty, there should have been clear case of misconduct, viz., such acts and omissions which would render him liable for any of the punishments set out in rule 3 of the Discipline & Appeal Rules, 1955.
No such case has been made out.
Mr. Naunit Lal for the appellant contended that the word 'misconduct ' is nowhere used either in the Conduct Rules or in the Discipline and Appeal Rules and the Court should not import any concept of misconduct in this inquiry.
The word 'misconduct ' has relevance here because the respondent in due course would have retired from service on 1st February 1962 on attaining the age of 55 years.
The inquiry could not be completed before the relevant date and it became necessary for the Government to retain the respondent in service beyond the normal period of retirement on superannuation for continuing the inquiry.
Rule 16(1) of the Retirement Rules 1955 as it stood at the relevant time provided for retirement on superannuation on attaining the age of 55 years.
There is a proviso to rule 16(1) which enables the State Government to postpone the period of retirement and retain the Government servant in service for an aggregate period not exceeding six months and if the retention in service beyond that period is required, the same will have to be with the sanction of the Central Government.
Respondent would have retired from service on attaining the age of 55 years on 1st February 1962.
He was served with a charge sheet dated 13th September 1960.
The inquiry could not be completed before the date of retirement of the respondent.
The Government of Assam by order dated 31st January 1962 retained the respondent in service for a period of three months beyond the date of his retirement which fell on 1st February 1962 or till the termination of the departmental proceedings drawn up against him whichever is earlier.
In view of the language of rule 16(1), the Assam Government had no power to extend the period of service of a member of the service beyond a period of six months in the aggregate.
Therefore, retention for a period of three months would be legal and valid with the result that the 515 date of retirement of the respondent would be postponed to 1st May 1962.
Admittedly no order was made by the Assam Government before 1st May 1962.
The order postponing the date of retirement and retention of the respondent in service beyond 1st May 1962 was made on 21st June 1962.
No order was made by the Assam Government for postponing the period of retirement of the respondent and his retention in service before 1st May 1962.
The State Government had power under rule 16(1) (a) of the Retirement Rules to retain the respondent in service for a period of six months in aggregate and therefore, even though specific period was mentioned in the order, simultaneously providing for retention in service till the date of termination of the proceedings, the extension would be valid for a period of six months in the aggregate if the inquiry was continuing till the expiration of six months but not exceeding six months.
In that event the respondent would retire from service by 1st August 1962.
Putting the construction on rule 16 (1) (a) and the order of extension, most favourable to the State Government, it may be stated at once that retention in service upto 1st August 1962 would be valid but unfortunately the inquiry was not over by 1st August 1962.
No order was made before 1st August 1962 for retention of the respondent in service beyond 1st August 1962.
The order next in succession in of 1st September 1962.
This order is again made by the State of Assam.
The State Government had no power to retain a member of the service for a period exceeding six months in the aggregate after the date of his normal retirement.
The maximum period for which retention could be ordered by the State Government being thus six months, the respondent would have retired from service on 1st August 1962.
Even if an order had been made by the State Government to retain the respondent in service it would be without jurisdiction and the order in fact was made on 1st September 1962.
Now, undoubtedly under rule 16(1) (b) the Central Government has power to retain a member of the service in service after the date of retirement for any period beyond six months.
But in this connection it may be pointed out that no such order appears to have been made by the Central Government.
All the subsequent orders were made by the Government of Assam.
Such orders made by the Government of Assam would not have the effect of retaining the respondent in service beyond a period of six months from the date of his normal retirement.
That being the maximum period, the State Government had no power to retain the respondent in service.
If the State Government could not retain him in service beyond 1st August, 1962, it could not continue the inquiry thereafter.
This position seems to be clearly established by the decision of this Court in State of Assam 516 vs Padma Ram Borah(1).
In that case the State Government had made an order to retain the Government servant in service up to the end of March 31, 1961.
Subsequent order extending the period was made on 9th May 1961.
This Court held that according to the earlier order of the State Government itself the service of the Government servant had come to an end on March 31, 1961 and the State Government could not by unilateral action create a fresh contract of service to take effect from April 1, 1961.
If the State Government wished to continue the service of the respondent for a further period, the State Government should have issued a notification before March 31, 1961.
It is thus clear that the retention of the respondent in service by order of the State Government not made before the retirement taking place on 1st August 1962 and the State Government not having the power to retain the respondent, a member of the Indian Administrative Service, beyond a period of six months, the respondent could not be said to have continued in service so that an inquiry could be continued against him.
Mr. Naunit Lal, however, contended that sub rule(2) of rule 16 clearly provides that a member of the service under suspension on a charge of misconduct shall not be required or permitted to retire from the service until the enquiry into the charges against him is concluded and a final order is passed.
It is in the context of sub rule (2) of rule 16 that the question of the nature of the proceedings held against the respondent assumed importance.
If the inquiry was on a charge of misconduct, the respondent could be retained in service until the inquiry into the charges against him was concluded and a final order was made.
But before sub rule (2) of rule 16 would be attracted it must be shown that the member of the service was under suspension on a charge of misconduct and an inquiry was being conducted against him.
As pointed out earlier, no misconduct as one would understand that word in the context of disciplinary proceeding was alleged against the respondent.
There was an inquiry but before sub rule (2) of rule 16 is attracted, it had to be an inquiry on a charge of misconduct.
What is alleged is not misconduct as the word is understood in service jurisprudence in the context of disciplinary proceedings.
Therefore, it could not be said that an inquiry on a charge of misconduct was being held against the respondent and sub rule (2) of rule 16 would thus be attracted and he would be deemed to have been retained in service till the inquiry was concluded.
It thus appears crystal clear that there was no case stricto sensu for a disciplinary proceeding against the respondent.
In fact the inquiry was held to establish that the respondent was not fit to hold a respon 517 sible post.
The respondent was actually retiring from service and there was no question of his any more holding a responsible position.
Yet not only the inquiry was initiated but he was retained in service beyond the date of his normal retirement till the final order was made on 11th October, 1963 when he was removed from the Indian Administrative Service.
It appears that there were large scale disturbances in the State.
There followed the usual search for a scapegoat and the respondent came handy.
Some charges were framed none of which could costitute misconduct in law.
Some charges were mere surmises.
Substance of the allegations was that he was not a very efficient officer and lacked the quality of leadership and was deficient in the faculty of decision making.
These deficiencies in capacity would not constitute misconduct.
If the respondent were a young man and was to continue in the post for a long period, such an inquiry may be made whether he should be retained in the responsible post.
He may or may not be retained but to retain him in service beyond the period of his normal retirement with a view to punishing him was wholly unjustified.
The High Court was, therefore, right in coming to the conclusion that the respondent was no longer in service on the date on which an order removing him from service was made and, therefore, the order was illegal and void.
Accordingly, this appeal fails and is dismissed with costs.
P.B.R. Appeal dismissed.
| IN-Abs | The respondent, an officer belonging to the Indian Administrative Service, was due to retire on February 1, 1962.
Since a departmental enquiry in respect of some charges levelled against him was pending, he was retained in service, in the first instance, for a period of three months beyond the date of his retirement or till the termination of departmental proceedings whichever was earlier.
This date was, however, extended from time to time and eventually on August 28, 1963 an order under r. 16(2) of the All India Services (Death cum Retirement) Rules, 1958 was passed.
That Rule provides that "a member of the service under suspension on a charge of misconduct shall not be required or permitted to retire from service but shall be retained in service until the enquiry into the charges against him is concluded and a final order is passed.
" The charges levelled against the respondent were (1) that he completely failed to take any effective preventive measures against widespread disturbances which broke out in the district, (2) that he showed complete lack of leadership and failed to give proper directions to his subordinate officers, (3) that he did not personally visit the scene of disturbances; (4) that he did not keep the Government informed of the extent of disturbances; and (5) that he showed complete inaptitude, lack of foresight, capacity to take firm and quick decision and, that therefore, he proved himself completely unfit to hold any responsible position.
On the report of the enquiry officer that all the charges (except one) were substantially proved, he was removed from service.
Striking down the order of his removal from service, the High Court held that (i) negligence and efficiency in the performance of one 's duty would not constitute misconduct so as to attract punishment of removal from service and (ii) under r. 16(2) an officer could be retained in service only for the purpose of holding or completing disciplinary proceedings for misconduct and since in this case there was no enquiry into what could be called misconduct, his retention in service beyond his date of retirement was void.
Dismissing the appeal, ^ HELD: 1(a) No case, stricto sensu, for a disciplinary proceeding for misconduct had been made out against the respondent.
Any deficiency in the discharge of one 's duties would not constitute misconduct.
The enquiry held 505 was to establish that the respondent was not fit to hold a responsible post; it did not establish any misconduct on his part to deserve the punishment.
[516 H] (b) Conduct which is blameworthy on the part of a government servant in the context of the Conduct Rules would be misconduct, that is if a government servant conducts himself in a way which is not consistent with due and faithful discharge of his duties it is misconduct.
Similarly, disregard of an essential condition of the contract of service may constitute misconduct.
So too an error or omission resulting in serious or atrocious consequences may amount to misconduct.
But competence for the post, capability to hold and discharge the functions attached to it with requisite efficiency are different from some act or omission on the part of its holder so as to be called misconduct.
A single act or omission or error of judgment while holding a post of responsibility unaccompanied by serious or atrocious conduct would not constitute misconduct.
[511 G H] Pierce vs Foster, 17 QB 536 at 542; Laws vs London Chronicle (Indicator Newspapers),[1959] 1 WLR 698; section Govinda Menon vs Union of India, ; ; P.H. Kalyani vs Air France, Calcutta, ; ; referred to.
(c) The All India Services (Conduct) Rules, 1954 prescribe a code of conduct for members of the service, such for example as, that every member shall at all times maintain absolute integrity and devotion to duty and that an act or omission contrary to or in breach of the prescribed norms of conduct would constittute misconduct for disciplinary proceedings.
But the Rules are not exhaustive.
In the absence of an exhaustive or self contained code, therefore it would not be correct to say that only that act or omission would constitute misconduct for the purposes of Discipline and Appeal Rules which is contrary to the provisions of the Conduct Rules.
[511 C E] In the instant case all that the charges framed against the respondent show is that he was not a very efficient officer.
They did not specify any act or omission in derogation of or contrary to Conduct Rules, except the general rule (r.3) prescribing devotion to duty.
Lack of leadership, inaptitude, lack of foresight, lack of firmness and indecisiveness which are deficiencies in the personal character or ability of a Government servant would not by themselves constitute misconduct for the purpose of disciplinary proceedings.
They may be relevant while considering an officer 's promotion to higher post or for his retention in a higher post but they cannot be elevated to the level of acts of omission or commission contemplated by Discipline and Appeal Rules for imposing punishment.
When the respondent was sought to be removed from service as a disciplinary measure by way of penalty, a clear case of misconduct should have been established.
(d) In the context of disciplinary proceedings, misconduct does not mean misbehaviour involving some form of guilty mind or mens rea.
Gross or habitual negligence in the performance of one 's duty may not involve mens rea but yet it may constitute misconduct for disciplinary proceedings.
[513 D] 2(a) The respondent was no longer in service on the date on which the order removing him from service was made and to retain him in service 506 beyond the period of his normal retirement with a view to punishing him was wholly unjustified.
[517 C D] (b) Since the State Government had no power to retain him in service under r. 16(1)(a) of the Retirement Rules beyond August 1, 1962 it could not continue the enquiry thereafter.
Although under r. 16(1)(b) the Central Government had power to retain him in service beyond six months of the date of his retirement, no order had been passed by it.
[515 H] (c) Before r. 16(2) (which provides that a member of the service under suspension on a charge of misconduct shall not be required or permitted to retire from service until the enquiry into the charges against him is concluded and a final order passed) would be attracted it must be shown that a member of the service was under suspension on a charge of misconduct and an enquiry was being conducted against him.
No misconduct having been alleged against the respondent, it cannot be said that r. 16(2) was attracted and that he was deemed to have been retained in service until the enquiry was concluded.
[516 F G]
|
Civil Appeal No. 2082 of 1969.
Appeal by Special Leave from the Judgment and Order dated 14 2 1969 of the Punjab and Haryana High Court in L.P.A. No. 103/68.
R. section Narula, section K. Mehta, T. section Doabia, P. N. Puri and K. R. Nagaraja, for the Appellant.
Girish Chandra for Respondent No. 1.
Hardev Singh and R. section Sodhi for Respondents 2 5.
The Judgment of the Court was delivered by DESAI, J.
This appeal by special leave arises from the dismissal of the Civil Writ Petition filed by the present appellant by a learned single Judge of the Punjab & Haryana High Court as also dismissal in limine of the Letters Patent appeal preferred by him.
Appellant is a displaced person from West Pakistan.
On his migration to India he was allotted on quasi permanent basis land admeasuring 321/2 standard acres in village Daulatpur, Tehsil Pathankot, 402 District Gurdaspur.
First respondent Union of India acquired land admeasuring 1243 canals, 5 marlas which included 15 acres of land alloted to the appellant, for constructing a railway line.
According to the appellant he was paid cash compensation for the same.
First respondent further acquired in 1950 some land for construction National Highway from Jammu to Jullundur and the acquistion included a portion of the land allotted to the appellant and along with other allottees he was paid cash compensation for the same.
First respondent wanted an open plot of land for setting up a housing colony for rehabilitating some refugees from Mirpur (Kashmir) and in all it took possession of land comprising 7.88 acres of non evacuee land and 6.64 acres of evacuee land.
This acquisition included land admeasuring 1 standard acre and 151/2 units of land allotted to the appellant.
Possession of the land including the land of the appellant was admittedly taken over in July 1953.
Since then the appellant has been requesting the first respondent and other competent authorities for payment of compensation for the same.
In the mean time after the introduction of the , ( '1954 Act ' for short), allotment of land to appellant which was till then on quasi permanent basis was converted into permanent basis.
As the appellant was clamouring for compensation for the land taken from him, the Chief Settlement Commissioner, Punjab, made an order on 17th March 1961, Annexure 'C ', whereby a reference made from the Evacuee Property Department was accepted and the permanent settlement rights conferred on the appellant in respect of 1 standard acre and 151/2 units of land were cancelled on the ground that there already existed houses over that portion of the land and the land was described as ghair mumkin abadi and was not allottable on permanent settlement, as agricultural land against the verified claim of the appellant.
The appellant questioned the correctness of this order in Writ Petition No. 559/61 in the High Court which was dismissed in limine on 22nd March 1961 and which has led to a contention on behalf of the respondents that the subsequent writ petition from which the present appeal arises is barred by the principles analogous to res judicata.
After the dismissal of the aforementioned writ petition the appellant approached the Financial Commissioner (Rehabilitation Department), Chandigarh, as per his representation Annexure 'D ' dated 15th March 1963 requesting him to pay cash compensation for the land taken over by the first respondent which till such taking over was held by the appellant on quasi permanent allotment.
On receipt of this representation the appellant was directed as per Annexure 'E ' dated 25th April 1963 to appear before the Financial Commissioner (Taxation) on 16th March 1963 at Chandigarh.
The appellant accordingly appeared before the 403 Financial Commissioner (Taxation) and represented his case for cash compensation.
Subsequent thereto, Secretary to the Government of Punjab, Rehabilitation Department, wrote to his counterpart in the Central Government requesting the first respondent to concur with the decision of the Punjab Government for payment of cash compensation to the appellant adding that the land held by the appellant on quasi permanent basis was taken over for the purpose of the first respondent and that as the area involved was less than 2 acres, the decision to pay cash compensation in respect of such area arrived at in the meeting held between the officers of the Punjab Government and the Ministry of Rehabilitation on 27th August, 1957 would govern the case.
Presumably in response to this communication from the Punjab Government the then Home Minister wrote a demi official letter to the then Chief Minister of Punjab in which it was admitted that the land allotted to the appellant was in rural areas and a part of it was required later on for public purpose and that in view of the decision arrived at the meeting on 27th August, 1957 the appellant would be entitled to cash compensation and requested the Chief Minister to process the case accordingly.
Thus, even though both the Governments agreed in their inter departmental communications that the appellant would be entitled to cash compensation, nothing tangible came out with the result that the appellant preferred a petition under section 33 of the 1954 Act challenging the order dated 17th March 1961 of the then Settlement Commissioner cancelling the permanent settlement rights conferred upon the appellant.
This application was rejected by the Joint Secretary to the Government of India observing that the cancellation of the permanent settlement rights was in accordance with law and no interference was called for.
Thereafter the appellant filed the writ petition from which the present appeal arises.
After the writ petition was filed and rule nisi was issued, a return was filed as per the affidavit of one R. C. Aggarwal, Under Secretary to Government of Punjab, Rehabilitation Department, presumably on behalf of all the respondents which undoubtedly amongst others, include the Union of India, the first respondent, and the State of Punjab, the second respondent.
It must be specifically mentioned that the Union of India did not file any separate return and accepted the return filed by and on behalf of the State of Punjab and other officers of the Punjab Government.
There are certain averments in this return which must be noticed.
Appellant is a displaced person and he was allotted 32 1/2 standard acres of land on quasi permanent basis is in fact admitted.
It is equally admitted that the land which was taken over for setting up a colony for rehabilitation of some families from Kashmir included one 404 standard acre and 15 1/2 units of land which was till then held by the appellant and that the land was taken over in July 1953.
It was contended that when land is allotted on quasi permanent basis, the allotment can be cancelled and the land can be resumed and that when such a resumption takes place the allottee is only entitled to compensation in the form of land and not in cash.
It was also contended that the cancellation of the permanent settlement rights was just and legal because the conferment was the result of a fraud between the appellant and some officers of the Punjab Government and proceeded on the erroneous assumption that the land was used as agricultural land though in fact it can be appropriately described as ghair mumkin abadi.
The manner in which the preliminary objection was raised at the hearing of the writ petition that in view of the dismissal of the earlier petition bearing on the same subject the present petition is barred by the principles of res judicata was not in terms taken up in the return filed on behalf of the respondents.
The High Court, however, appears to have permitted the respondents to raise that contention.
The learned single Judge held that the effect of dismissal of the earlier petition filed by the present appellant was that the order dated 17th March, 1961 by which permanent settlement rights conferred on the appellant were cancelled became final and if the present petition is allowed the only thing the court would have to do would be to cancel the order dated 17th March, 1961 which has become final against the appellant and, therefore, the petition is barred by the principles analogous to res judicata.
Mr. Girish Chandra for the first respondent and Mr. Hardev Singh for the remaining respondents urged that the appeal must fail for the same reason for which the earlier petition of the appellant was dismissed inasmuch as the cause of action for both the petitions being the same, the subsequent petition would be barred by the principles analogous to res judicata.
In the earlier petition the appellant questioned the correctness of the decision dated 17th March 1961 by which permanent settlement rights conferred on the appellant for the land held by him on quasi permanent basis, including the land admeasuring 1 standard acre and 15 1/2 units taken over by the first respondent in Joly 1953, and the appellant in the earlier petition did not claim any cash compensation for the land taken over by the first respondent.
In the present petition the appellant seeks a direction for quashing the order of the Joint Secretary, Rehabilitation Department, Government of India dated 29th September, 1964 rejecting the representation made to the Central Government presumably under section 33 of the 1954 Act question 405 ing the correctness of the order dated 17th March 1961.
Under section 33 the Central Government has power to call for the record of any proceeding under the Act and to pass such order in relation thereto as in its opinion the circumstances of the case require and as is not inconsistent with any of the provisions contained in the Act or the rules made thereunder.
Broadly stated the power of revision is conferred on the Central Government under section 33.
Appellant invoked this revisional jurisdiction under section 33 against the order dated 17th March 1961 which he challenged in the first petition.
After the dismissal of the first petition he preferred revision application under section 33 and when this revision petition was dismissed he preferred the second petition.
The High Court was of the view that the order dated 17th March 1961 merged into the order dated 29th September 1964 passed by the Central Government while dismissing the revision application of the appellant and, therefore, if now the petition is allowed it would have the effect of setting aside the order dated 17th March 1961 which in view of the dismissal of the earlier petition of the appellant had become final.
The High Court is clearly in error in reaching this conclusion.
The earlier petition was dismissed by a non speaking, one word, order 'dismissed '.
The High Court may as well dismiss the petition in limine on the ground of delay or laches or on the ground of alternative remedy.
The second petition after pursuing the alternative remedy would not be barred by the principles analogous to res judicata.
More often a petition under Article 226 is dismissed on the ground that before invoking the extraordinary jurisdiction of the High Court, if the petitioner has an alternative remedy under a statute under which the right is claimed by the petitioner, the Court expects the petitioner to exhaust the remedy and in such a situation the petition is dismissed in limine.
If after preferring an appeal or revision under the statute under which the right is claimed by the petitioner a petition under Article 226 is filed irrespective of the fact that the revision or appeal was dismissed and the original order which was challenged in the first petition had merged into the appellate or revisional order, nonetheless the second petition in the circumstances would not be barred by the principles analogous to res judicata because the cause of action is entirely different and the merger of the order cannot stand in the way of the petitioner invoking the jurisdiction of the High Court under Article 226.
In the leading case of Daryao & Ors.
vs State of U.P. & Ors.(1) this Court in terms said that if the petition filed in the High Court under 406 Article 226 is dismissed not on the merits but because of the laches of the party applying for the writ or because it is held that the party had an alternative remedy available to it then the dismissal of the writ petition would not constitute a bar to the subsequent petition under article 32 except in cases where the facts found by the High Court may themselves be relevant even under article 32.
If a writ petition is dismissed in limine and an order is pronounced in that behalf whether or not the dismissal would constitute a bar would depend upon the nature of the order.
If the order is on the merits it would be a bar; if the order says that the dismissal was for the reason that the petitioner was guilty of laches or that he had an alternative remedy it would not be a bar except in cases indicated in the judgment.
Then comes an observation which may better be quoted: "It the petition is dismissed in limine without passing a speaking order then such dismissal cannot be treated as creating a bar of res judicata.
It is true that, prima facie, dismissal in limine even without passing a speaking order in that behalf may strongly suggest that the Court took the view that there was no substance in the petition at all, but in the absence of a speaking order it would not be easy to decide what factors weighed in the mind of the Court and that makes it difficult and unsafe to hold that such a summary dismissal is a dismissal on merits and as such constitutes a bar of res judicata against a similar petition filed under article 32".
In Virudhunagar Steel Rolling Mills Ltd. vs The Government of Madras,(1) rejecting the contention that if the petition under article 226 is dismissed without issuing a notice to the other side though by a speaking order such a dismissal would not bar the subsequent petition for same cause of action or for the same relief, it was observed that this Court in Daryao 's case(2) did not mean to lay down that if the petition is dismised in limine without notice to the opposite side it would not bar a subsequent petition.
This Court only ruled that if the petition is dismissed in limine but with a speaking order which order itself indicates that the petition was dismissed on merits, the absence of notice to other side by itself would not be sufficient to negative the plea of res judicata in a subsequent petition in respect of the same cause of action.
However, while negativing the contention on the facts of the case this Court reaffirmed that if the petition is dismissed in limine without passing a speaking order than such a dismissal cannot be treated as creating a bar of res judicata.
Similarly in Tilokchand Motichand & Ors.
vs H. B. 407 Munshi & Anr.
,(1) a majority of the Judges affirmed the ratio in Daryao 's case (supra) that if a petition under article 226 is dismissed not on merits but because an alternative remedy was available to the petitioner or that the petition was dismissed in limine without a speaking order such dismissal is not a bar to the subsequent petition under article 32.
It must follow as a necessary corollary that a subsequent petition under article 226 would not be barred by the principles analogous to res judicata.
Re affirming the view taken on this point in Daryao 's case, in P. D. Sharma vs State Bank of India(2) the preliminary objection about bar of res judicata was negatived.
It is, therefore, incontrovertible that where a petition under article 226 is dismissed in limine without a speaking order such a dismissal would not constitute a bar of res judicuta to a subsequent petition on the same cause of action, more so, when on the facts in this case it appears that the petition was dismissed presumably because the petitioner had an alternative remedy by way of a revision petition under section 33 of the 1954 Act which remedy he availed of and after failure to get the relief he moved the High Court again for the relief.
It would be incorrect in such a situation to dismiss the petition on the ground that the order made by the revisional authority dismissing the revision petition had the effect of merging the original order against which the revision was preferred with the order made by the revisional authority and, therefore, the challenge on the first cause of action to the order made by the revisional authority would of necessity be a challenge to the original order also and the petition would be barred by the principles analogous to res judicata as the rest order had become final.
The High Court was clearly in error in dismissing the petition on this short ground.
There is yet another fallacy in the approach of the High Court while dismissing the petition as being barred by the principles analogous to res judicata because the second relief claimed by the appellant in the second petition was never claimed in the first petition and is an independent and separate relief which the High Court was invited to grant if the appellant was otherwise entitled to it.
The appellant, by prayer (b) of the petition, sought a direction that the respondents be ordered to pay cash compensation to the appellant for the area of land which had been taken over by the respondents.
It is nobody 's case that such a prayer was ever made in the first petition.
In the first petition the grievance of the appellant was that the order dated 17th March, 1961 made by the Chief Settlement Commissioner cancelling the permanent settlement rights conferred on the appellant in respect of his land was illegal and invalid.
There was no claim for 408 compensation.
A claim for compensation was being separately pursued by the appellant and he did not invoke the jurisdiction of the High Court praying for a direction to pay him compensation.
In the second petition from which this appeal arises there is a specific prayer for compensation and Mr. Narula, learned counsel for the appellant, stated that the appellant is not interested in the first prayer questioning the validity of the order made by the Joint Secretary to Government of India dated 29th September 1964 affirming the order dated 17th March, 1961 which was the subject matter of the first petition.
Now, if claim for compensation was not raised in the first petition and if it is specifically raised in the second petition on the allegation that as the land of the appellant has been taken over by the Government for its own use, if compensation is not paid it would be deprivation of property without compensation and would be denial of fundamental right to hold property, it is unthinkable that the present petition for this particular relief can ever be dismissed in the facts of this case on the ground that it is barred by the principles analogous to res judicata.
For this additional reason the order of the High Court is unsustainable.
And now to the facts of the case.
The appellant is admittedly a displaced person to whom 32 1/2 standard acres of land was allotted and the allotment admittedly was on quasi permanent basis.
It is again an admitted position that in July 1953 the first respondent, Union of India, took possession of 1 standard acre and 15 1/2 units of land from the land allotted to the appellant on quasi permanent basis for its use, viz., for setting up a colony.
Appellant contends that he must be paid compensation in cash for the land taken over from him.
Respondents on the other hand contend that an allotment of land on quasi permanent basis could be resumed by the first respondent when the land was required for its own use and on such resumption the appellant would only be entitled to allotment of an equivalent area of land but in no case the appellant would be entitled to compensation in cash.
This necessitates examination as to what is the interest of the appellant in the land allotted to him on quasi permanent basis and when and in what circumstances and for what purpose it can be resumed or allotment cancelled and if so resumed, to what relief the appellant is entitled to.
There has been a flood of enactments on the taking over and administration of evacuee property as also compensation payable to displaced persons.
This Court in Amar Singh vs Custodian, Evacuee 409 Property, Punjab,(1) exhaustively and stage by stage examined the measures taken by the Central and State Governments first for rehabilitating displaced persons, taking over of properties left by those who migrated to Pakistan, its distribution and allotment to displaced persons who came over to India on partition, and ultimately extinguishment of the evacuee interest in such properties.
To recapitulate them here would be merely adding to the length of this judgment.
We would, therefore, only take note of the conclusion reached in Amar Singh 's case (supra) with regard to the interest of the displaced persons to whom agricultural land was allotted on quasi permanent basis up to July 22, 1952.
Says the Court at page 823: "(1) The allottee is entitled to right of use and occupation of property until such time as the property remains vested in the Custodian; (2) The benefit of such right will enure to his heirs and successors; (3) His enjoyment of the property is on the basis of paying land revenue thereupon and cesses for the time being.
Additional rent may be fixed thereupon by the Custodian.
If and when he does so, the allottee is bound to pay the same; (4) He is entitled to quiet and undisturbed enjoyment of the property during that period; (5) He is entitled to make improvements on the land with the assent of the Custodian and is entitled to compensation in the manner provided in the Punjab Tenancy Act; (6) He is entitled to exchange the whole or any part of the land for other evacuee land with the consent of the Custodian; (7) He is entitled to lease the land for a period not exceeding three years without the permission of the Custodian and for longer period with his consent.
But he is not entitled to transfer his rights by way of sale, gift, will, mortgage or other private contract; (8) His rights in the allotment are subject to the fairly extensive powers of cancellation under the Act and rules as then in force prior to July 22, 1952, on 410 varied administrative considerations and actions such as the following: . . . ." Undoubtedly this Court held that these quasi permanent rights in land would not be property within the meaning of Article 31 of the Constitution and, therefore, if deprivation of property is complained of a petition under article 32 would not lie.
However, after concluding in this manner this Court summed up the position with regard to the interest of quasi permanent holder in his holding as under : "In holding that quasi permanent allotment does not carry with it a fundamental right to property under the Constitution we are not to be supposed as denying or weakening the scope of the rights of the allottee.
These rights as recognised in the statutory rules are important and constitute the essential basis of a satisfactory rehabilitation and settlement of displaced land holders.
Until such time as these land holders obtain sanads to the lands, these rights are entitled to the zealous protection of the constituted authorities according to administrative rules and instructions binding on them, and of the courts by appropriate proceedings where there is usurpation of jurisdiction or abuse of exercise of statutory powers".
After re affirming the position of the quasi permanent allottees as herein quoted, this Court in State of Punjab vs Suraj Prakash Kapur, etc.,(1) held that after July 22, 1952, the Custodian ceases to have any authority to cancel or modify quasi permanent allotment.
This enunciation of the interest of the quasi permanent allottees in the land allotted to them should dispel any doubt about their entrenched interest in the land.
Nor could it be said that those allottees were at the mercy of the Custodian and can be dispossessed at his whim or caprice.
These were heritable rights and the holders were entitled in due course to permanent settlement by issuance of sanads.
But even before this situation was reached a fundamental change occurred in the position of the Custodian vis a vis the quasi permanent allottees about the right of the former to cancel allotment and resume land.
In exercise of the powers conferred by section 56 of the , the Central Government enacted what are styled as Administration of Evacuee Property (Central) Rules, 1950 Rule 14 recites the power of the Custodian to vary or cancel the lease or allotment under certain circumstances mentioned therein.
Initially sub rule (6) was added to this rule and later on it was modified where 411 by the power to cancel any allotment or resume evacuee property allotted on quasi permanent basis was circumscribed and was available in the circumstances mentioned in amended sub rule (6).
The amendment effective from 22nd July 1952 had undoubtedly the effect of modifying and thereby restricting the power of resumption or cancellation vested in the Custodian in respect of quasi permanent allottees and the power was confined within very narrow limits.
Therefore, subsequent to July 22, 1952, the Custodian of Evacuee Property would have the power to cancel an allotment only upon a ground which falls within the exceptions enumerated in sub rule (6) (vide Joginder Singh & Ors.
vs Deputy Custodian General of Evacuee Property).
(1) We need not examine the circumstances in which resumption or cancellation can be ordered under the amended sub rule (6) of rule 14 because it is not the case of the respondents that the land was resumed in exercise of the power conferred by rule 14 and in one or other of the circumstances mentioned in sub rule (6) thereof.
Suffice it to say that after July 22, 1952, the Custodian had no authority to cancel quasi permanent allotment and resume land except in the circumstances and contingencies mentioned in sub rule (6) of rule 14 and that having not been done, it cannot be contended on behalf of the respondents that the land in this case allotted on quasi permanent basis to appellant was resumed by the Custodian.
Two fact situations material and necessary for raising this contention are absent in this case.
There is no material placed on record, including the counter affidavit, which would show that the Custodian resumed the land of the appellant in exercise of the power conferred by rule 14 and in one of the circumstances mentioned in sub rule (6).
And secondly, no such order of Custodian is forth coming even after time was given to produce the file.
Mr. Hardev Singh, however, contended that even though sub rule (6) of rule 14 as amended up to July 22, 1952 would not enable the Custodian to resume land or cancel allotment granted on quasi permanent basis except in the circumstances mentioned in sub rule (6), yet the State Government had the requisite power under a rule made by the Punjab State Government on 29th August, 1951.
It was contended that in exercise of the powers delegated by the Central Government under sub section
(1) of section 55 of the , to make rules under clause (i) of sub section (2) of section 56, the Punjab Government made the rule, the relevant portion of which reads as under : 412 "The Custodian shall be competent to cancel or terminate any lease or allotment or vary the terms of any lease, allotment or agreement and evict the lessee allottee in any one of the following circumstances; . . (h) that it is necessary or expedient to cancel or vary the terms of a lease/allotment for the implementation of resettlement schemes and/or rules framed by the State Government or for such distribution amongst displaced persons as appears to the Custodian to be equitable and proper".
Mr. Hardev Singh contended that presumably the Custodian at the State level cancelled the allotment in respect of the land taken over for resettlement and rehabilitation of refugees from Kashmir and that this cancellation and resumption must be for implementation of resettlement scheme or under the rules framed for such resettlement schemes by the State Government and, therefore, the resumption was one under the and it was not a case of either acquisition or taking over of the land of the petitioner.
There is no material placed before us to support this submission.
In the counter affidavit on behalf of the respondents not one word has been stated that the Custodian at State level cancelled the allotment and resumed the land.
The stand taken in the return filed in the High Court is that evacuee area measuring 7.88 acres was taken over by the Government for construction and development of a colony for rehabilitation of 300 Kashmiri displaced persons and that such land included an area of 1 standard acre and 15 1/2 units of the land allotted to the petitioner.
It was further stated that this land of the appellant stood acquired under section 12 of the Displaced Persons (Compensation & Rehabilitation) Act, 1954.
There is not the slightest suggestion that the Custodian in exercise of the power under the aforementioned rule cancelled the allotment in favour of the appellant and resumed the land.
If such is not the case, the power claimed under the rule cannot help the respondents.
Assuming that there was power to cancel allotment and resume land under the State Rules, it must be shown that the State Government had framed a resettlement scheme and for the purpose of the scheme the allotment was cancelled and land was resumed.
The fact pleaded is to the contrary that the Union of India took possession of the land for setting up a colony.
This also becomes clear from the letter written by the Secretary to Government of Punjab, Rehabilitation Department, Annexure 'F ' wherein it was in terms stated that 413 the land in question was not acquired by the State Government but stood acquired by the Central Government in terms of the general notification issued in 1955 and, therefore, the Government should concur in payment of compensation out of the funds allotted for setting up of the colony.
From the contents of the letter which have remained uncontroverted the situation that emerges is that the land was acquired by the Central Government for its own use.
The Central Government could exercise powers under the Central Rules.
It had not asked the State Government to acquire the land.
Therefore, the power conferred on the State Custodian under the State Rules would not help the respondents as contended by Mr. Hardev Singh.
It was next contended that on the introduction of the 1954 Act and the issuance of Notification under section 12, all evacuee property was acquired by the Central Government and under sub section
(4) of section 12 such acquired evacuee property formed part of the compensation pool.
It was further said that if acquisition was under section 12 of the 1954 Act, the allottee of land on quasi permanent basis would be entitled to compensation as provided by rule 49 of Displaced Persons (Compensation & Rehabilitation) Rules, 1955, and in that event he would be entitled to compensation by allotment of agricultural land but not cash compensation.
To understand the full import of the submission it is necessary to state that when there was migration of large number of persons both the ways from India to Pakistan and vice versa, initially such property left by migrants from India to Pakistan was taken over for the purpose of administration under the provisions of the .
This Act broadly provided for appointment of Custodian General of Evacuee Property and other authorities subordinate to him.
The authorities set up under the Act were empowered to declare certain properties to be evacuee property and any property so declared as evacuee property would, under section 8, vest in the Custodian for the State.
The Custodian was empowered to administer the property and the powers and duties of the Custodian were enumerated in section 10.
In exercise of this power the Custodian allotted lands on quasi permanent basis to displaced persons.
But this was an unsatisfactory situation because the interest of the evacuee in the evacuee property remained intact and till such evacuee interest was extinguished, the evacuee property could not be settled on permanent basis.
In order to obviate this difficulty the Displaced Persons (Compensation & Rehabilitation) Act, 1954, was enacted by Parliament.
Section 12 provided for issuance of a notification as hereinabove mentioned and sub section
(2) of section 12 amongst others provided that the right, title and interest of any evacuee in the evacuee property specified in 414 the notification shall, on and from the beginning of the date on which the notification is so published, be extinguished and the evacuee property shall vest absolutely in the Central Government free from all encumbrances.
Evacuee properties acquired in this manner would form part of the compensation pool.
If the scheme of the 1954 Act is as hereinbefore mentioned, we fail to see how the property which was admittedly allotted to the appellant on quasi permanent basis and which was taken over by the Central Government in July 1953, i.e. much before the introduction of the 1954 Act, became property of the compensation pool.
Assuming that even though it was taken over by the Central Government in July 1953, the evacuee interest therein having not been extinguished till the issue of a notification under section 12 of the 1954 Act and, therefore, on the issue of a notification the property became part of the compensation pool, the consequences provided in 1954 Act must ensue, viz., that so long as the property remained vested in the Central Government it shall continue in possession of the person to whom it was allotted on the same conditions on which he held the property immediately before the date of acquisition.
In this connection reference to section 10 of the 1954 Act would be advantageous.
The relevant portion reads as under : "10.
Where any immovable property has been leased or allotted to a displaced person by the Custodian under the conditions published : (a) by the notification of the Government of Punjab in the Department of Rehabilitation No. 4891 S or 4892 S, dated the 8th July 1949; or (b) by the notification of the Government of Patiala and East Punjab States Union in the Department of Rehabilitation No. 8R or 9R, dated the 23rd July, 1949, and published in the Official Gazette of that State, dated the 7th August 1949, and such property is acquired under the provisions of this Act and forms part of the compensation pool, the displaced person shall, so long as the property remains vested in the Central Government, continue in possession of such property on the same conditions on which he held the property immediately before the date of the acquisition, and the Central Government may, for the purpose of payment of compensation to such displaced person, transfer to him such property on such terms and conditions as may be prescribed.
" 415 Now, indisputably the appellant was allotted the property on quasi permanent basis under the conditions published by the notification of the Government of Punjab in the Department of Rehabilitation, dated 8th July 1949.
If he had continued to hold the property on the clate on which the notification under section 12 of the 1954 Act was issued, by the operation of section 10 he would be entitled to hold the property till the property remained vested in the Central Government and would be entitled to payment of compensation by transfer to him of such property on terms and conditions that may be prescribed.
Therefore, if 1954 Act is not attracted because the property in question was already taken over by the Central Government in July 1953 much before the 1954 Act came into force neither section 12 nor Rule 49 would be attracted.
If on the other hand the evacuee interest in the property came to be extinguished on the issue of a notification under section 12 of the 1954 Act, its consequences would be as provided in section 10 and the appellant would be entitled to hold the property till it continues to vest in the Central Government under section 12.
In either event he would be entitled to compensation.
Mr. Hardev Singh, however, urged that assuming that the appellant is entitled to compensation for taking over of his land the land having formed part of the compensation pool on the issue of a notification under section 12 and the allotment in this case being one not under the notification of the Government of Punjab dated 8th July 1949 but a fresh allotment under section 10, the compensation would only be payable in the form of land under rule 49.
There is a two fold fallacy in this submission.
Indisputably the land was allotted to the appellant under the conditions published by the notification of the Government of Punjabs dated 8th July 1949 and section 10 does not purport to make a fresh allotment.
It merely takes note of the earlier allotment and assures that if the displaced person has continued to be in possession of the land allotted, on the issue of a notification under section 12 and the land becoming part of the compensation pool, such allottee would be entitled to continue in possession of such property on the same conditions on which he held the property immediately before the date of acquisition by issue of notification under section 12 till the property continues to vest in the Central Government and further he would be entitled to the transfer of such property to him presumably on permanent settlement basis as and by way of compensation.
Section 10 does not permit a construction as canvassed for by Mr. Hardev Singh that a fresh allotment could be made under section 10 416 Further, rule 49 which provides that compensation shall be in the from of land will have to be read with r. 69 which reads as under: "69.
Saving Nothing in this Chapter shall apply to agricultural land allotted in the States of Punjab and Patiala and East Punjab States Union under section 10 of the Act.
" It will immediately appear that where allotment was made under the conditions published by the notification of the Government of Punjab dated 8th July 1949, the whole of Chapter VIII of the 1955 Rules which includes Rules 49 to 69 would not apply.
In this case appellant was allotted agricultural land and the allotment was under the notification hereinbefore mentioned which has been set out in rule 10(a) and in that situation provisions contained in Chapter VIII of the Rules would not be attracted.
Therefore, rule 49 cannot be called in aid by the respondents.
The last contention, however, is that if the appellant is a displaced person and he was being allotted land against a verified claim in respect of agricultural land held by him in Pakistan, ordinarily compensation for land taken over must be in the form of land and not in form of cash.
Ordinarily it should be so.
But in this connection the experience gained by the Government in disposing of the claims cannot be overlooked.
There were allottees of small plots of land.
Once allotment is made and thereafter the land is taken over by the Government a fresh allotment cannot be in a compact area and if a small plot of land is allotted at a distant place the allottee would be put to a serious disadvantage.
Realising this position, at a meeting between the officers of the Punjab Government and the Ministry of Rehabilitation of the Central Government held on 27th August 1957, a decision was taken which was notified by the Press Note Annexure 'A ' of the very date.
It provides that there are large number of displaced land allottees whose whole or part of the land were acquired by the Government for various public purposes and their claim for cash compensation is pending.
Such of the allottees who have acquired permanent rights and others who are quasi permanent allottees and small pieces of their land are acquired by the Government, should send their applications to the Deputy Secretary to the Government of Punjab, Rehabilitation Department, Jullundur, giving various details therein.
The decision further provided that quasi permanent land allottes whose land exceeding two standard acres have been acquired should apply for alternative allotment to the Land Claims Officer, and those whose land admeasuring less than two standard acres is acquired should apply for payment of compensation in cash.
The decision was the decision of the Central 417 Government and the Punjab State Government that displaced persons to whom lands were allotted on quasi permanent basis, part of which was taken over for public purposes by the Government and where the land acquired was less than two standard acres in area, payment of compensation would be in cash and applications were accordingly invited.
This decision was affirmed in the letter of the Secretary to Government of Punjab, Rehabilitation Department, addressed to his counterpart in the Central Government wherein after referring to the meeting dated 27th August, 1957 and the decision arrived at it, he requested the Central Government that the appellant would be entitled to cash compensation because the land taken over from him was less than two standard acres and was covered by the decision arrived at, at the meeting and that the Central Govermnent should concur in payment of compensation out of the funds allotted for setting up the colony for which the land was acquired.
In the face of this position it is difficult to entertain the contention that compensation in cash was never payable for agricultural land taken over from a quasi permanent allottee.
It was said that such a decision which runs counter to the statute cannot be given effect to by the Court.
Once Chapter VIII of 1955 Rules and especially rule 49 which provides for payment of compensation in the form of land is out of the way, we see nothing in the statute which would debar a quasi permanent allottee asking for compensation in cash and the Government paying the same.
In fact the appellant has averred in his petition and in his affidavit that on former occasion he was paid compensation in cash and the denial is on the ground of want information which can frankly be styled as a vague one.
Now it is indisputable that the appellant was a quasi permanent allottee and that his land admeasuring 1 standard acre and 151/2 units had been taken over by the Central Government in July 1953.
In view of the decision recorded in the Press Note referred to above he would be entitled to compensation in cash which has not been paid to him.
The appellant would be entitled to compensation in cash for the interest that he had in the land because land was taken away from him.
What is the quantum of compensation will have to be worked out according to law and the modalities of determining the compensation.
This appeal accordingly succeeds and is allowed.
The respondents are directed to pay the compensation in cash to the appellant for the land admeasuring 1 standard acre and 151/2 units taken over in July 418 1953.
As there is a delay of nearly 25 years, the respondents should pay the compensation as directed herein within a period of six months from today.
Respondents should also pay the costs of the appellant and bear their own costs.
P.B.R. Appeal allowed.
| IN-Abs | A part of the land allotted to the appellant on quasi permanent basis as a displaced person from West Pakistan was acquired by the Government.
When the question of payment of compensation in respect of the land acquired was pending, the was passed which enabled holders of quasi permanency rights to obtain permanent settlement pursuant to which permanent settlement in respect of acquired land was made in favour of the appellant.
Alleging that the land allotted to the appellant was not allottable on a permanent basis, the Chief Settlement Commissioner, by his order dated 17th March, 1961, cancelled the allotment.
The appellant 's petition questioning the correctness of this decision was dismissed by the High Court in limine.
Thereupon the appellant preferred a petition under s.33 of the Act to the Joint Secretary to the Government of India, Rehabilitation Department, challenging the order of the Chief Settlement Commissioner.
By his order dated 29th September, 1964 the Joint Secretary rejected the petition pointing out that the cancellation of the appellant 's permanent settlement rights in the land was in accordance with law and that no interference was called for.
The appellant filed a writ petition in the High Court.
In rejecting the appellant 's writ petition impugning the order dated 29th September, 1964 the High Court was of the view that it was barred by principles analogous to res judicata because if that petition were allowed, it would in effect, amount to cancellation of the order dated the 17th March, 1961 which became final as against the appellant on dismissal of his first petition.
Allowing the appeal, ^ HELD: 1(a) Where a petition under article 226 is dismissed in limine without a speaking order, such a dismissal would not constitute a bar of res judicata to a subsequent petition on the same cause of action.
When a petition is dismissed on the ground that the petitioner has an alternative remedy by way of appeal or revision under a statute and on failure to get relief after pursuing the remedy by way of appeal or revision, he moved the High Court, it would be incorrect to dismiss the petition on the ground that the order made by the revisional authority had the effect of merging the original order with the order of the revisional authority, and that the challenge on the fresh cause of action to the order of the revisional authority would of necesity be a challenge to the original order also and that therefore the petition would be barred by principles analogous to res judicata as the first order had become final.
[407C E] 400 Daryao & Ors.
vs State of U.P. & Ors.
; ; Virudhunagar Steel Rolling Mills Ltd. vs The Govt of Madras, ; ; Tilokchand Motichand & Ors.
vs H. B. Munshi & Anr., ; referred to.
In the instant case in the first writ petition the appellant questioned the correctness of the order of the Chief Settlement Commissioner dated 17th March, 1961 without claiming therein any compensation for the land acquired.
That having been dismissed in limine he invoked the revisional jurisdiction under section 33 of the Act.
When that petition was dismissed by the revisional authority he preferred the second writ petition.
What he prayed in the second petition was a direction quashing the order dated 29th September, 1964 of the Joint Secretary to the Government of India.
The High Court was, therefore, in error in rejecting the second petition on the sole ground that the order of 17th March, 1961 merged into the order of 29th September, 1964 and in substance the challenge was to the order dated 17th March, 1961 which had become final.
[408 A B] (b) Secondly, if the claim for compensation was not raised in the first petition but was specifically raised in the second, it would not be dismissed on the ground that it was barred by principles analogous to res judicata.
[408 D] 2(a) It has been well established by a long line of decisions of this Court that after July 22, 1952 the Custodian had no authority to cancel or modify quasi permanent allotment, that the allottes of these rights could not be dispossessed at the whim or caprice of the Custodian, that the quasi permanent rights were heritable and that the holders were entitled to permanent settlement by issuance of sanad.
Added to this was the fact that r. 14(6) of the Administration of Evacuee Property (Central) Rules, 1950 as amended from July 22, 1952 restricted the power of the Custodian to resume or cancel quasi permanent rights of the allottees except in the circumstances mentioned in the subrule and no material is placed on record to show that the Custodian had exercised his power under r. 14(6) of the Rules.
[411 D E] P. D. Sharma vs State Bank of India, ; ; Amar Singh vs Custodian, Evacuee Property, Punjab, [1957] SCR 801; State of Punjab vs Suraj Prakash Kapur, etc., ; Joginder Singh & Ors.
vs Deputy Custodian General of Evacuee Property, ; at 740; referred to.
(b) Nor again is there any material to show that the Custodian had the power to cancel the allotment under the State Rules.
It was not shown that the State Government had framed any re settlement scheme and that the allotment was cancelled for that purpose.
[412 H] 3 (a) Under the Evacuee Property Act, 1950 property which was declared us evacuee property vested in the Custodian and was allotted to displaced persons on a quasi permanent basis.
To obviate difficulties caused by continued unextinguished title of the evacuee, the 1954 Act was passed, under section 12(2) of which the right, title and interest of any evacuee in the evacuee property specified in the notification issued under the section stood extinguished and the evacuee property would vest absolutely in the Central Government.
Evacuee property acquired in this manner formed part of the compensation pool.
Therefore, the appellant 's property which was acquired in 1953, much before the coming into force of the 1954 Act, could not have become part of the compensation pool.
[413 G H] 401 (b) Even assuming that though the property was taken over by the Central Government in 1953 evacuee interest in it had not been extinguished till a notification under section 12 of the 1954 Act had been issued and that on the issue of the notification it became part of the compensation pool, the consequence envisaged by section 10 of the 1954 Act must ensue.
It is that so long as the property remained vested in the Central Government it shall continue in possession of the person to whom it was allotted on the same conditions on which he held the property immediately before the date of acquisition.
[914 C D] In the present case if the property had been taken over by the Central Government much before the 1954 Act came into force neither section 12 of the 1954 Act nor r. 49 would be attracted.
If on the other hand the evacuee interest in the property came to be extinguished on the issue of a notification under section 12, section 10 would be attracted and the appellant would be entitled to hold the property till it continued to vest in the Central Government under section 12.
In other words in either event he would be entitled to compensation.
[415 C D] (c) Nor again is it correct to say that it was a fresh allotment under section 10 of the 1954 Act.
The land was allotted in 1949 and section 10 does not purport to make a fresh allotment.
[415 A] 4(a) The whole of chapter VIII of the 1955 Rules (which includes rr.
49 to 69) would not apply because the land allotted was agricultural land and the allotment was made under the notification of the Government of Punjab dated 8th July, 1949.
[416 C] (b) Once chapter VIII of the 1955 Rules and especially r. 49 which provides for payment of compensation in the form of land is out of the way, there is nothing in the Act which would debar a quasi permanent allottee asking for compensation in cash and the Govenment paying it.
Moreover on the former occasion the appellant was paid compensation in cash for a part of the land acquired from him.
[417 D E]
|
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.
V. section Desai, section P. Nayar and Miss A. Subhashini for the Appellant.
section T. Desai, J. Ramamurthi and D. N. Gupta for the Respondents and Vice Versa.
The Judgment of the Court was delivered by UNTWALIA, J.
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. 1965 of 1971.
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. 2.
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.
The Certificate Officer declined to review his previous order and rejected the review petition.
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. 19,001.3 annas only.
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.
201 to 205/1, Old China Bazar Street, Calcutta.
Now a few facts of the other appeal being Civil Appeal No. 1965 of 1971 may be stated.
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 Certificate case was started.
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 order under section 35 was passed on March 2, 1953.
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.
M/s. Jardine Henderson Ltd., respondent in Civil Appeal No. 1575 of 1971 and appellant in Civil Appeal No. 1965 of 1971 purchased the whole of the premises in question on September 20, 1954 for a total sum of Rs. 3,00,100/ purchasing one half of the undivided share from each of the two brothers.
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.
Two revisions were filed before the Board of Revenue which were allowed.
The respondent company then moved the High Court under Article 227 of the Constitution.
The petition giving rise to Civil Appeal No. 1575 was allowed and hence the Union of India has come up in appeal.
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.
In agreement with the High Court we have no difficulty in rejecting this argument.
We may first read some of the relevant provisions of the Bengal Act.
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.
He, of course, under section 22 can take recourse to the said provision by filing an application to set aside the sale of immovable property on deposit of the amounts provided therein.
But the rules in Schedule II under section 38 have the effect as if enacted in the body of the Act.
In Schedule II is to be found rule 39 which is very much like rule 58 of Order 21 of the Code of Civil Procedure, 1908.
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, therefore, not quite accurate to say that the Company had no locus standi to prefer the claim.
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.
In Income tax Officer, Kolar Circle, and another vs Seghu Buchiah Setty(1) best Judgment assessments had been made for the assessment years 1953 54 and 1954 55.
A notice of demand for each of the two years was served upon the assessee under section 29 of the Income tax Act, 1922.
The assessee preferred appeals.
In the meantime for non payment tax he was treated as a defaulter and a Certificate was forwarded to the Collector under section 46(2).
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.
This is an Act "to provide for the continuation and validation of proceedings in relation to Government dues and for matters connected therewith." In the Schedule appended to the Act are enumerated various tax statutes including the Income tax Act.
"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 the latter case the first proceedings started for the recovery of the original amount will lose its force and the fresh proceeding will have to proceed de novo.
But in the former the first proceedings are not affected at all.
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.
We reject this argument as being unsound and for two reasons.
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.
In such a case the expression "the sum payable" would obviously mean the difference between the amount refunded and the reduced amount which was liable to be refunded.
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.
He also claimed that he had made certain payments.
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.
Thereupon the Taxing Authority gave him the information and the amount of the Certificate debt was substantially reduced.
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.
Mr. section T. Desai called our attention to the decision of the Allahabad High Court in Ram Swarup Gupta vs Behari Lal Baldeo Prasad and others.(1).
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.
V. D. K. C.A. No. 1965/71 dismissed.
| IN-Abs | In Income Tax Officer, Kolar Circle and Anr.
vs Seghu Buchiah Setty. , this Court held that the recovery proceedings initiated against the assessee respondent on the basis of the original demand notice were had as it was of the view that the amount of tax assessed when reduced as a result of the appellate orders a fresh demand notice had to be served on the respondent before he could be treated as a defaulter.
To get over the difficulties in the collection of income tax and other direct taxes created by the decision in Seghu Chetty 's case, the was passed with retrospective effect by an express provision in section 5.
The property belonging to two brothers, the certificate debtors in C.A. 1575(NT) 71 and C.A. 1965 (NT) of 1963 respectively were purchased by M/s Jurdine Henderson (Ltd.) on September 20, 1954, i.e. after service of notices under section 7 of the Bengal Public Demands Recovery Act, 1913.
The objections raised by the certificate debtors were rejected and the property came to be sold.
In both cases the Company received a notice on August 6, 1956 fixing a date for settling the terms of the sale proclamation 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 incometax 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.
Two revisions were filed before the Board of Revenue which were allowed.
The respondent company then moved the High Court under Article 227 of the Constitution.
The petition giving rise to Civil Appeal No. 1575 was allowed.
The other petition giving rise to C.A. 1965 of 1971 was dismissed by the same Bench.
556 Two questions, namely (a) the locus standi of the purchaser Company to prefer a claim objecting to the sale of the property and (b) the effect of section 3(1)(a) and (b) of the Validation Act, 1964 read with Section 35(4) of the Income Tax Act, 1962 arose for decision in these appeals.
Allowing C.A. 1575/71 and dismissing C.A. 1965/71 (both by certificates) the Court.
^ HELD: 1.
The Company as a purchaser of the property of the certificate debtors had locus standi to prefer the claim.
The company preferred a claim objecting to the sale of property on the ground that it was not liable to be sold as it had purchased the property from the two certificate debtors.
In the Bengal Public Demands Recovery Act, 1913, 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.
He, of course, under section 22 can take recourse to the said provision by filing an application to set aside the sale of immovable property on deposit of the amounts provided therein.
But the rules in Schedule II under section 38 have the effect as if enacted in the body of the Act.
In Schedule II is to be found rule 39 which is very much like rule 58 of Order 21 of the Code of Civil Procedure, 1908.
[561 F G] (a) 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 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.
[561 H, 562 A C] (b) It is clear from sections 7, 8, 9 and 10 of the Bengal Public Demands Recovery Act, 1913, 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.[561 D E] 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.
[561 E] 2.
The transfer was void against the Certificate claims in both cases under section 8(a) of the Bengal Public Demands Recovery Act, 1913.
In both the cases notices under section 7 of the Bengal Act had been served upon the Certificate debtor before the property in question was transferred by them to the company.
In neither of the two cases did the certificate proceeding became invalid, in one case by reduction of the demand and in the other by an enhancement, since clause (c) of section 3(1) of the Validation Act clearly and expressly provides that no proceedings in relation to Government dues 557 shall be invalid merely because no fresh notice was served upon the assessee, after the dues were enhanced or reduced in any appeal or proceeding.
[566 E F] Ram Swarup Gupta vs Behari Lal Baldeo Prasad and Ors., ; Distinguished.
(a) On a plain reading of clause (a) of section 3 of the Validation Act, 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 (i) to initiate another proceedings 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 the latter case, the first proceedings started for the recovery of the original amount will lose its force and the fresh proceedings will have to proceed de novo.
But in the former, the proceedings are not affected at all.
[564 E G] 3.
(b) The argument that the effect of sub section (4) of section 35 of the Income Tax Act has not been done away with by clause (a) of section 3 of the Validation Act, 1964 is not correct.
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.
In such a case the expression "the sum payable" would obviously mean the difference between the amount refunded and the reduced amount which was liable to be refunded.
Secondly, 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.
[565 B E] 4.
Sub clause (i) of clause (b) of sub section (1) of section 3 of the Validation Act 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 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.
[565 E H] (a) The view of the High Court that the provision contained in subclause (ii) of clause (b) of section 3(1) of the Validation Act is mandatory and in absence of a formal intimation 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), is not sustainable in law.
[565 H, 566 A] 558 (b) On the facts of the case in C.A. 1575(NT)/71, 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).
[566 C D]
|
: Criminal Appeal No. 43 of 1975.
From the Judgment and Order dated 9 1 1973 of the Bombay High Court in Criminal Application No. 681/72.
V. section Desai, P. H. Parekh, C. B. Singh, M. Mudgol, B. L. Verma and J.C. Rajani, for the Appellants.
637 M. N. Shroff for the Respondents.
The Judgment of the Court was delivered by FAZAL ALI, J.
This is an appeal under section 19 of the Contempt of Courts Act (hereinafter called the Act) against an order of the High Court of Bombay convicting the appellants for a Civil Contempt and sentencing them to one month 's simple imprisonment.
The facts of the case have been fully detailed by the High Court and it is not necessary for us to repeat the same all over again.
It appears that Respondent No. 1 had given a loan of Rs. 50,000/ to the appellants on certain conditions.
Somehow or other, the loan could not be paid by the appellants as a result of which Respondent No. 1 filed a complaint under section 420 I.P.C. against the appellants.
While the complaint was pending before the Court of the Magistrate, the parties entered into a compromise on 22 7 1971 under which the appellants undertook to pay the loan of Rs. 50,000/ with simple interest @ 12% per annum on or before 21 7 1972.
An application was filed before the Court for allowing the parties to compound the case and acquit the accused.
The Court after hearing the parties, passed the following order: "The accused given an undertaking to the court that he shall repay the sum of Rs. 50,000/ to the complainant on or before 21 7 1972 with interest as mentioned on the reverse.
In view of the undertaking, I permit the compromise and acquit the accused".
It is obvious, therefore, that the Court permitted the parties to compound the case only because of the undertaking given by the appellants.
Thereafter, it appears, that the undertaking was violated and the amount of loan was not paid to the Respondent No. 1 at all.
The respondent, therefore, moved the High Court for taking action for contempt of Court against the appellants as a result of which the present proceedings were taken against them.
The High Court came to the conclusion that the appellants had committed a wilful disobedience of the undertaking given to the Court and were, therefore, guilty of civil contempt as defined in section 2(b) of the Act.
Hence, this appeal before us.
Mr. V. section Desai appearing in support of the appeal has raised two short points before us.
He has submitted that there is no doubt that the appellants had violated the undertaking but in the circumstances it cannot be said that the appellants had committed a wilful disobedience of the orders of the Court.
So far as this point is concerned, we fully agree with the High Court.
In the circumstances, the appellants undoubtedly committed wilful disobedience of the order of the court 638 by committing a serious breach of the undertaking given to the Court on the basis of which alone, the appellants had been acquitted.
For these reasons, the first contention put forward by Mr. Desai, is overruled.
It is, then, contended that under section 12(3), normally the sentence that should be given to an offender who is found guilty of civil contempt, is fine and not imprisonment, which should be given only where the Court is satisfied that ends of justice require the imposition of such a sentence.
In our opinion, this contention of learned counsel for the appellants is well founded and must prevail.
Sub section 3 of section 12 reads thus : "Notwithstanding anything contained in this section, where a person is found guilty of a civil contempt, the Court, if it considers that a fine will not meet the ends of justice and that a sentence of imprisonment is necessary shall, instead of sentencing him to simple imprisonment, direct that he be detained in a civil prison for such period not exceeding six months as it may think fit".
A close and careful interpretation of the extracted section leaves no room for doubt that the Legislature intended that a sentence of fine alone should be imposed in normal circumstances.
The statute, however, confers special power on the Court to pass a sentence of imprisonment if it think that ends of justice so require.
Thus before a Court passes the extreme sentence of imprisonment, it must give special reasons after a proper application of its mind that a sentence of imprisonment alone is called for in a particular situation Thus, the sentence of imprisonment is an exception while sentence of fine is the rule.
Having regard to the peculiar facts and circumstances of this case, we do not find any special reason why the appellants should be sent to jail by sentencing them to imprisonment.
Furthermore, respondent No. 1 before us despite service, has not appeared to support the sentence given by the High Court.
Having regard to these circumstances, therefore, we are satisfied that the present case, squarely falls in the first part of section 12(3) and a sentence of fine alone should have been given by the High Court.
We, therefore, allow this appeal to this extent that the sentence of imprisonment passed by the High Court is set aside and instead the appellants are sentenced to pay a fine of Rs. 1000/ each.
In case of default, 15 days simple imprisonment.
Four weeks time to pay the fine.
P.B.R. Appeal allowed in part.
| IN-Abs | Respondent No. 1 filed a complaint under section 420 IPC against the appellants alleging that a loan taken by them from him had not been repaid.
While the complaint was pending before a Magistrate the parties entered into a compromise under which the appellants undertook to repay the loan before a stipulated date.
The Magistrate accordingly allowed the parties to compound the case.
When the appellants failed to repay the loan in accordance with the undertaking given before the Magistrate the respondent moved the High Court for taking action against the appellants for contempt of court.
On the view that the appellants had committed a willful disobedience of the undertaking the High Court held that they were guilty of civil contempt and sentenced them to one month 's simple imprisonment.
Allowing the appeal in part, ^ HELD: 1.
The appellants had committed willful disobedience of the court of the Magistrate by committing serious breach of the undertaking given to it on the basis of which alone they had been acquitted.
The High Court was, therefore, right in holding that the appellants were guilty of civil contempt under section 2(b) of the Contempt of Courts Act.
[638 A] 2.
Having regard to the circumstances of the case the present case falls within the first part of section 12(3) of the Act and a sentence of fine alone should have been awarded by the High Court.
By enacting the section the legislature intended that a sentence of fine alone should be imposed in normal circumstances.
Special power is, however, conferred on the court to pass a sentence of imprisonment if it thought that ends of justice so required.
Therefore, before a court passed a sentence of imprisonment it must give special reasons for passing such a sentence.
[638 G] In the present case there are no special reasons why the appellants should be sent to jail
|
Civil Appeals Nos.
2902 2903 of 1977.
Appeals by Special Leave from the Judgment and Order dated 3 11 1976 of the Punjab and Haryana High Court in Civil Writ Petition No. 6781/74.
Y. section Chitale, M. N. Phadke and P. C. Bhartari (In CA 2903/77) for the Appellants.
G. L. Sanghvi, section K. Bagga and Mrs. section Bagga for RR 1 2.
R. section Sodhi for the State of Punjab.
The Judgment of the Court was delivered by DESAI, J.
These two appeals by special leave arise from a common judgment rendered by the High Court of Punjab & Haryana at Chandigarh in Letters Patent Appeals Nos.
560 and 564 of 1974 and Civil Writ No. 6781/74.
The controversy raised in these appeals turns upon the construction of the Punjab Police Service Rules, 1959 ( 'Service Rules ' for short).
A few relevant facts as alleged by respondents 1 and 2 in Civil Appeal No. 2903/78 who moved Civil Writ No. 825 of 1972 in the High Court would highlight the problem posed in these appeals.
588 Respondents 1 and 2, Gurdip Singh and Dalip Singh, filed a writ petition under Article 226 of the Constitution against the State of Punjab, Inspector General of Police, Punjab, and six others including the present appellants, praying for a direction to confirm them in Punjab Police Service.
Respondents 1 and 2 alleged that they were promotees to the cadre of Deputy Superintendent of Police of February, 1961 and January, 1961 respectively having been brought on 'G ' List by an order dated 23rd February 1961 of the State of Punjab and the Inspector General of Police, Punjab, respondents 3 and 4 herein.
Appellants and respondents 5 to 8 were recruited to the same cadre by direct appointment commencing from May, 1961 to May, 1965.
The grievance of respondents 1 and 2 in the petition filed by them was that recruitment to Punjab Police Service is made from two sources, namely, 80% by promotion and 20% by direct appointment but this quota rule is not adhered to at the time of confirmation in the service and, therefore, even though they were members of the service since a period earlier to appellants and respondents 5 to 8, they were not confirmed though the latter were confirmed and as seniority in the cadre of Deputy Superintendent of Police is reckoned under rule 10 according to date of confirmation, the failure to confirm them in the post available to them, in breach of the relevant rules, has denied to them equality of opportunity enshrined in Article 16 of the Constitution to be considered for nomination to Indian Police Service which is done according to seniority cum merit.
The State of Punjab and Inspector General of Police, Punjab, on the one hand and the direct recruits on the other contested the writ petition, inter alia, contending that the quota applies at the stage of initial recruitment and not at the time of confirmation and there is no allegation that the quota rule was violated at the time of initial recruitment.
It was further contended that no one can claim to be confirmed as a matter of right and, therefore, the writ petition is misconceived.
Direct recruits to the post of Dy.
Superintendent of Police, appellants and respondents 5 to 8 further contended that the petitioners were promoted on officiating basis against temporary posts and as there were no permanent posts available, they could not be confirmed till substantive vacancies in the permanent strength of the cadre were available and till confirmation their seniority having to be reckoned from the date of confirmation, they cannot claim to be senior to the direct recruits on the principle of continuous officiation.
The writ petition came up before a learned single Judge of the High Court who was of the opinion that the quota rule is linked with the seniority rule and in order to give a reasonable interpretation and 589 in order not to make the seniority rule unreasonable, upon a proper construction it must be held that the quota rule would operate not only at the time of initial recruitment but also at the time of confirmation.
In reaching this conclusion the learned single Judge relied upon two decisions of this Court in section G. Jaisinghani vs Union of India & Ors.,(1) and Mervyn Coutindo & Ors.
vs Collector of Customs, Bombay & Ors., (2) and some other decisions of other High Courts.
The learned single Judge accordingly gave a direction that the writ petitioners, respondents 1 and 2 herein, should be confirmed.
Two appeals being Letters Patent Appeal No. 560/74 by the present appellant 1 and Letters Patent Appeal No. 564/74 by the State of Punjab and the Inspector General of Police, Punjab, were preferred.
One Rakha Ram filed Civil Writ No. 6781/74 raising identical contentions and this writ petition was referred to the Division Bench before which the aforementioned two Letters Patent Appeals came up for hearing The Court by a common judgment disposed of all the three matters.
Both the Letters Patent Appeals were dismissed and Civil Writ No. 6781/74 by Ram Rakha was allowed, but the direction given by the learned single Judge was modified to the extent that the State of Punjab and Inspector General of Police, Punjab, should consider the cases of writ petitioners 1 and 2 for confirmation and to fix their seniority afresh according to the quota rule.
The present two appeals arise from this common judgment preferred by the direct recruits.
It may be mentioned that neither the State of Punjab nor the Inspector General of Police, Punjab, have questioned the decision of the High Court though at the hearing of these appeals Mr. R. section Sodhi appeared for the State of Punjab and supported the contentions canvassed on behalf of the appellants.
As the main controversy turns upon the construction of rules 3, 6, 8 and 10 of the Service Rules it would be advantageous to get a clear picture of the relevant rules.
The Service Rules provide for constitution, recruitment, qualifications for being members of the service, probation, pay, seniority and discipline of the members of the Service.
Rule 3 provides that the Service shall comprise of the posts specified in Appendix 'A ' to the Service Rules.
Designation of the Post in Appendix 'A ' is shown to be Deputy Superintendent of Police and the strength of the cadre is shown as 66.
The State Government, under rule 5, is the appointing authority to the Service.
Rule 6 provides for method of recruitment from two different sources, viz., 80% by promotion from the rank of Inspectors and 20% by direct recruitment.
It also prescribes eligibility qualification for promotees.
Sub 590 rule (2) of rule 6 provides that appointment by promotion shall be made by he Government from Inspectors brought on List 'G ' and the method of drawing up of List 'G '.
Sub rule (3) provides that direct appointment to the Service shall be made upon the result of a competitive examination conducted by the Punjab Public Service Commission ( 'Commission ' for short) and further confers power on the Government in consultation with the Commission to frame necessary rules relating to examination.
Rule 7 prescribes qualifications of physical fitness.
Rule 8 provides that members of the Service shall be on probation for two years which shall include the period of training at the Police Training School, Phillaur, and in the districts and in the case of members recruited by promotion the Government may be a special order in each case permit periods of officiating appointment to the Service to count towards the period of probation.
There is a proviso to the rule which enables the Government to extend the period of probation by not more than one year.
Rule 9 provides for pay of members of the Service.
Rule 10 provides for seniority of members to be reckoned by the date of confirmation in the Service.
Dr. Chitaley followed by Mr. Phadke, urged that the vires, validity or reasonableness of rule 10 having not been challenged, it was not open to the High Court to put upon rules, 6, 8 and 10 a construction on the supposed unreasonableness of rule 10 if it is interpreted by giving the language therein used its ordinary grammatical meaning.
The High Court applied the quota rule even at the stage of confirmation to avoid the vice of unreasonableness which, in the opinion of the High Court, would be implicit in rule 10 if any other view were taken.
The rules provide for constitution of Service and the Service shall comprise of the posts specified in Appendix 'A ' to the rules.
At the relevant time the sanctioned strength of the Service was 66 posts.
There is a proviso to rule 3 which enables the Government to make additions to or reductions in the number of such posts whether permanently or temporarily.
Rule 6 which provides for method of recruitment in terms says that recruitment to the Service shall be made: (i) 80% by promotion from the rank of Inspectors; and (ii) 20% by direct appointment.
Thus there is recruitment to the Service from two independent sources, viz., promotion and direct recruitment.
Once recruitment to any given cadre is from two sources obviously after recruitment is made from two sources they have to be integrated into one cadre which also necessitates providing for their inter se seniority.
Rule 10 provides that the seniority of the 591 members of the Service shall be determined by the date of confirmation in the Service.
There is a proviso to rule 10 which is not material for the present discussion.
On behalf of the promotees it was contended that if seniority is to be reckoned from the date of confirmation in the Service, confirmation must be made available to recruits from both the sources, viz., promotees and direct recruits.
It was further contended that if on satisfactory completion of probation a direct recruit is confirmed or is deemed to be confirmed and a promotee who can be continued in an officiating capacity for any length of time without considering his case for confirmation, promotees would be put at a serious disadvantage because for further promotion or what is styled as nomination to Indian Police Service, seniority cum merit being the criterian and the basic cadre being the cadre of Deputy Superintendent of Police from which nomination is to be made, their case would not come up for consideration as they are not confirmed.
They pointed out that in 1971 their names were recommended by Deparmental Committee set up for the purpose but the State Government turned down their names on the only ground that they were not confirmed.
It is clear from Rule 8 that both promotees and direct recruits would be on probation for two years and in case of promotees the Government may be special order in each case permit periods of officiating appointments to the Service to count towards the period of probation.
Clause (b) of rule 8 provides that the services of a member recruited by direct appointment may be dispensed with by the Government on his failing to pass the final examination at the end of his period of training or on his being reported on, during or at the end of his period of probation, as unfit for appointment.
There is a proviso at the end of sub rule (b) which reads as under: "Provided that the Government may, if it deems fit, extend the period of probation by not more than one year.
" There is some controversy between the parties whether the proviso is to operate as proviso to rule 8(a) and 8(b) both or only to rule 8 (b).
It was contended on behalf of the direct recruits that once a specific period of probation is fixed and a fetter is put on the power of the Government to extend probation only by a specific period, at the end of such extended period either the service of the direct recruit is to be dispensed with on the ground that he was unfit for appointment or if he is continued thereafter he must be deemed to have been confirmed and the date next after the day of expiry of his ordinary or 592 extended period of probation would be the date of his confirmation.
This Court has consistently held that when a first appointment or promotion is made on probation for a specific period and the employee is allowed to continue in the post after the expiry of the period without any specific order of confirmation he should be deemed to continue in his post as a probationer only in the absence of any communication to the contrary in the original order of appointment or promotion or the Service Rules.
In such a case an express order of confirmation is necessary to give the employee a substantive right to the post and from the mere fact that he is allowed to continue in the post after the expiry of the specific period of probation it is not possible to hold that he should be deemed to have been confirmed.
This view was taken in Sukhbans Singh vs State of Punjab(1); G. section Ramaswamy vs The Inspector General of Police, Mysore State, Bangalore(2); and State of U. P. vs Akbar Ali(3).
This view was founded up on the relevant rules which permitted extension of the probationary period for an indefinite time.
In fact there was no negative rule in these cases prohibiting the Government from extending the probationary period beyond a certain maximum period.
However, where the rules provide for a fixed period of probation with a power in the Government to extend it up to a specific period and not any unlimited period, either by express provision or by necessary implication, at the end of such specified period beyond which the Government had no power to extend the probation, the probationer if he continues beyond that period, should be deemed to have been confirmed in the post.
This Court in State of Punjab vs Dharam Singh(4); after taking into consideration rule 6(3) of the Punjab Educational Service (Provincialised Cadre) Class III Rules, 1961, which provided for either dispensing with the services of the person appointed to the post on probation if his work was found to be unsatisfactory or to extend the period of probation for such period as may be deemed fit or revert him to his former post if he was promoted from some lower post, provided that the total period of probation including the extensions if any, shall not exceed three years, held that the Service Rules fixed a certain period of time beyond which the probationary period cannot be extended and if an employee appointed or promoted to a post is allowed to continue in that post after completion of the maximum period of probation without an express order of confirmation he cannot be deemed to continue in that post as a probationer by implication.
In such a case the Court held it is permissible to 593 draw an inference that the employee allowed to continue in the post on completion of the maximum period of probation has been confirmed in the post by implication.
Rule 8 of the Service Rules prescribes the period of probation of two years and the proviso confers power to extend the period of probation by not beyond one year meaning thereby that in any case the Government would not have the power to extend the period of probation beyond a period of three years.
In this situation the ratio in Dharam Singh 's case (supra) would mutatis mutandis apply and it will have to be held that the direct recruit who completed the period of probation of two years and in the absence of an extension of probationary period, would be deemed to be confirmed by necessary implication.
Respondent 5 to 8 direct recruits have accordingly been confirmed on expiry of the period of probation of two years.
Now if seniority is to be reckoned from the date of confirmation and if promotees are not confirmed for years together in some cases, to wit, respondents 1 and 2 who were promotees of February and January, 1961 respectively, were not confirmed till they filed the writ petition in 1972 while direct recruits who came much later got confirmed and ipso facto became senior to the promotees, if quota rule is only applied, as is contended on behalf of the appellants and the State of Punjab, at the time of initial recruitment, this undesirable result is wholly unavoidable.
Mr. G. L. Sanghi learned counsel for the interveners and the promotees contended that the framers of the rule could not have intended to accord such a discriminatory treatment to the promotees in whose favour the quota is as big as 80% of the total strength.
Where recruitment to a cadre is from two sources and the Service Rules prescribe quota for recruitment for both sources a question would always arise whether the quota rule would apply at the initial stage of recruitment or also at the stage of confirmation.
Ordinarily, if quota is prescribed for recruitment to a cadre, the quota rule will have to be observed at the recruitment stage.
The quota would then be co related to vacancies to be filled in by recruitment but after recruitment is made from two different sources they will have to be integrated into a common cadre and while so doing, the question of their inter se seniority would surface.
Seniority is ordinarily determined from the date of entry into cadre on the principle of continuous officiation.
Confirmation in a post would ordinarily depend upon such circumstances as satisfactory completion of probationary period, efficiency in the discharge of duty, capacity to discharge functions of the post, availability of permanent vacancy, etc.
Now, if seniority is to be determined according to the date of confirmation and the quota rule 594 is not made relatable to confirmation in various posts falling vacant in the cadre it would directly impinge upon the seniority of members of the service.
In a slightly different form this question came before this Court in section B. Patwardhan & Ors. etc.
vs State of Maharashtra & Ors., (1) in which vires of rule 8(iii) of 1960 Rules were questioned.
Rule 8(iii) of the 1960 Rules provided that probationers recruited directly to the Bombay Service of Engineers Class II Cadre in any year shall, in a bunch, be placed senior to promotees confirmed during that year.
Striking down this rule as violative of Article 16 this Court held that the rule leaves the valuable right of seniority to depend upon the mere accident of confirmation.
The recruitment to Punjab Police Service is from two sources.
Recruits from both the sources have to be on probation.
Adopting the construction as canvassed for and on behalf of direct recruits that the proviso to rule 8(b) permitting a maximum period of probation of three years at the end of which the direct recruit automatically be confirmed unless his services are dispensed with simultaneously enjoying seniority from the date of such automatic confirmation without applying quota rule at the time of confirmation, would put the promotee to an unintended disadvantage who may be continued in an officiating capacity without confirming him and consequently denying or relegating him down in seniority for years as has happened in the case of respondents 1 and 2.
Appellants who were recruited to the Service after respondents 1 and 2, came to be confirmed at the end of two years ' period of probation while respondents 1 and 2 were not confirmed after more than 11 years of officiating service and there it not the slightest suggestion that the services of respondents 1 and 2 were not satisfactory and that the confirmation was denied on any such ground thereby directly affecting their place in the seniority list.
Such an approach would be wholly unreasonable.
Now, if the other view is taken that the quota rule would apply both at the time of recruitment and at the time of confirmation, rule 10 which provides for seniority according to the date of confirmation would certainly be save from the vice of unreasonableness.
Is such a construction possible ? One need not stretch the language to bring about the desired result but in this case upon a harmonious reading of rules 3, 6, 8 and 10, the conclusion is inescapable that quota rule is operative both at the time of initial recruitment and at the time of confirmation.
If the rule of seniority were one otherwise than according to date of confirmation it would not have become necessary to 595 apply the quota rule at the stage of confirmation but in this case the quota rule is linked up with the seniority rule and unless the quota rule is strictly observed in practice it will be difficult to hold that the seniority rule is not unreasonable and does not offend Article 16 (see section G. Jaisinghani 's case (supra) at pp. 717 and 718).
Quota rule is linked up with seniority rule because, not the date of entry in service determines the seniority but the date of confirmation determines seniority and, therefore, quota rule is inextricably intertwined with the seniority rule and any delinking would render the seniority rule wholly unreasonable.
Any other view would lead to the most undesirable result wholly unintended by the framers of the rule.
It must be remembered that after recruitment, members of the service, though drawn from two different sources direct recruits and promotees constitute a single integrated cadre.
They discharge identical functions, bear similar responsibilities and acquire an equal amount of experience in the respective assignments.
In this background in section B. Patwardhan 's case (supra) this Court held that if the promotees are treated with an evil eye and an unequal hand in the matter of seniority as was done under rule 8(iii), the rule would suffer from the vice of unreasonableness and would offend Article 16 and it was actually struck down.
An exactly identical situation would follow here if quota rule is applied at the stage of initial recruitment and wholly ignored at the time of confirmation because in that event while direct recruits will get confirmation automatically, the promotees would hang out for years as has happened in the case of respondents 1 and 2 and if they are not confirmed they would never get seniority and their chances of being considered for promotion to the higher post would be wholly jeopardised.
To avoid this utterly unconsciounable outcome the construction we have put on rule 8 would be in consonance with justice and reason.
It may be pointed out that where recruitment is from two sources and the seniority in the cadre is determined according to the date of confirmation, to accord utmost fair treatment a rotational system has to be followed while giving confirmation.
The quota rule would apply to vacancies and recruitment has to be made keeping in view the vacancies available to the two sources according to the quota.
If the quota rule is strictly adhered to there will be no difficulty in giving confirmation keeping in view the quota rule even at the time of confirmation.
A roster is introduced while giving confirmation ascertaining every time which post has fallen vacant and the recruit from that source has to be confirmed in the post available to the source.
This system would breakdown the moment recruitment from either source in excess of the quota is made.
In fact a strict adherence to the quota 596 rule at the time of recruitment would introduce no difficulty in applying the rule at the time of confirmation because vacancies would be available for confirmation to persons belonging to different sources of recruitment.
The difficulty arises when recruitment in excess of the quota is made and it is further accentuated when recruits from one source, to wit, in this case direct recruits get automatic confirmation on completion of the probationary period while the promotees hang out for years together before being confirmed.
In Mervyn Coutindo 's case (supra) this Court in terms said that rotational system of fixing seniority meaning thereby confirmation followed by seniority does not offend equality of opportunity in Government service and recruitment not following the fixed quota rule need not be a ground for doing away with rotational system.
It was, however, contended that in A. K. Subraman & Ors. etc.
vs Union of India & Ors.
(1) this Court in terms has held that when recruitment is from two sources and the quota rule is enforced, the same will have to be enforced at the time of initial recruitment in officiating capacity and not at the time of confirmation.
It was, therefore, said that it would be contrary to settled law to hold that quota rule will also operate at the time of confirmation.
Now, the observation of the Court is in the context of Central Engineering Service (Class I) Recruitment Rules, 1954, which came up for interpretation before the Court in that case.
The recruitment was from three different sources, viz., by competitive examination, by promotion and by transfer.
Rule 4 provided that 75% of the vacancies in the grade of Executive Engineer Class I shall be filled by promotion of Assistant Executive Engineers Class I, the rest of the vacancies being filled by promotion and/or by transfer in accordance with Parts IV and V of the Rules respectively.
The general seniority rule which was held applicable in that case was that seniority should be determined on the basis of length of service in that grade or a service in an equivalent grade irrespective of whether the latter was under Central or Provincial Government in India or Pakistan.
It is in the context of these rules the question whether the quota rule should be applied at the stage of initial recruitment or confirmation came up for consideration.
Unlike the rule in the present case seniority was not dependent on confirmation but seniority was dependent upon continuous officiation in the cadre.
In this background this Court held that the quota has to be enforced at the time of initial recruitment in officiating capacity and not at the time of confirmation.
The situation in the case under discussion is materially different.
Therefore, it cannot be said that ignoring the 597 rule a proposition of universal application has been laid down that whenever there is a quota prescribed for recruitment to a cadre it can only apply at the time of initial recruitment and not at the time of confirmation.
Everything will depend upon the whole body of rules and harmonious construction has to be put upon the rules so as to avoid the possibility of a rules becoming unreasonable.
This Court while saying in Subraman 's case (supra) that quota rule has to be adhered to and enforced at the time of initial recruitment re affirmed the observation in Mervyn Coutindo 's case (supra) that there is no inherent invalidity in introduction of quota system and to work it out by rule of rotation.
When it is said that the confirmation shall follow the quota rule it is in terms being stated that the rotational system should be followed at the time of confirmation so as to make quota rule effective and seniority rule reasonable because all the three are interlinked.
Undoubtedly, the decision in Subraman 's case was in terms affirmed in Patwardhan 's case (supra) but the scheme of rules in Patwardhan 's case (supra) was more or less similar to the one that was examined by this Court in Subraman 's case.
Mr. Sanghi also urged that the language of Rule 8(a) would unmistakably show that members of Service recruited from either source would be on probation for a period of two years and this would imply that promotees would also be on probation for a period of two years.
Approaching the matter from this angle he further urged that proviso to rule 8(b) which permits extension of probation only by one year without expressly referring to direct recruits would govern both promotees and direct recruits and in that view of the matter promotees would also be deemed to be confirmed on the expiry of period of probation.
This contention overlooks the latter Part of rule 8(a) which provides that in case of promotees the Government may by special order in each case permit periods of officiating appointments to the Service to count towards the period of probation.
It appears that both promotees and direct recruits to Service would be on probation.
But the latter part of rule 8 (a) comprehends Inspectors being promoted on officiating basis.
Unless there is a temporary addition to the strength of the cadre such officiating appointment by promotion would not make the promotee a member of the service in view of Rule 3.
In order to avoid any injustice to such promotees the Government may make an order to treat officiating service to count towards probation.
In the absence of such order the officiating service would not count towards probation and such appointment would not make the promotee a member of the service.
In that event his case would not be covered 598 by the proviso to rule 8(a).
Therefore, the contention cannot be accepted.
The High Court was, therefore, right in concluding that the quota rule would operate at both the stages.
Accordingly both these appeals fail and are dismissed but in the circumstances of the case with no order as to costs.
S.R. Appeals dismissed.
| IN-Abs | Under the Punjab Police Service Rules, 1959, recruitment to Punjab Police Service (Deputy Superintendent of Police) is made from two sources, namely 80% by promotion and 20% through direct recruitment.
Under Rule 10, seniority in the cadre of Deputy Superintendent of Police is reckoned according to the date of confirmation.
Consideration for nomination to Indian Police Service is done according to seniority cum merit.
Respondents 1 and 2 in C.A. 2903/78 who were promotees to the cadre of Deputy Superintendents of Police in February, 1961 and January, 1961 respectively were not confirmed even though appellants and respondents 5 to 8 who were recruited to the same cadre by direct appointment commencing from May, 1961 to May, 1965 were confirmed.
They, therefore, filed a Writ Petition praying for a direction to confirm them in the Punjab Police Service, adhering to the quota rule at the time of confirmation as well.
They alleged that as seniority in the cadre of Deputy Superintendent of Police is reckoned under rule 10, according to date of confirmation failure to confirm in the post available to them in breach of the relevant rules, had resulted in the denial of equality of opportunity in public service enshrined in article 16 of the Constitution at the time of consideration of their cases for nomination to the Indian Police Service which is done according to seniority cum merit.
Allowing the Writ Petition and directing the State to confirm them, the learned single judge held that the quota rule would operate not only at the time of initial recruitment but also at the time of confirmation, as he was of the opinion that the quota rule is linked with the seniority rule.
Two Letters Patent Appeals, one filed by appellant No. 1 and another by the State, were heard along with another Writ Petition filed by one Ram Rakha urging identical contentions.
The Writ Petition was allowed and the appeals were dismissed by a common judgment modifying the direction given by the learned single judge to the extent that the State should consider the case of the Writ petitioners for confirmation afresh according to quota rule and then refix their inter se seniority.
Dismissing the appeals, by special leave the Court 585 ^ HELD: 1.
When a first appointment or promotion is made on probation for a specific period and the employee is allowed to continue in the post after the expiry of the period without any specific order of confirmation he should be deemed to continue in his post as a probationer only in the absence of any communication to the contrary in the original order of appointment or promotion or the Service Rules.
In such a case, an express order of confirmation is necessary to give the employee a substantive right to the post.
From the mere fact that he is allowed to continue in the post after the expiry of the specific period of probation he should not be deemed to have been confirmed.
This is so, when the relevant rules permitted extension of the Probationary period for an indefinite time.
[592 A C] Sukhbans Singh vs State of Punjab, ; , G. section Ramaswamy vs The Inspector General of Police, Mysore State Bangalore, ; State of U.P. vs Akbar Ali, ; referred to.
Where the rules provide for a fixed period of probation with a power in the Government to extend it up to a specific period and not any unlimited period, either by express provision or by necessary implication, at the end of such specified period beyond which the Government had no power to extend the probation, the probationer, if he continues beyond that period, should be deemed to have been confirmed in the post.
[592 C E] State of Punjab vs Dharam Singh, ; explained.
Rule 8 of the Punjab Service Rules, 1959 prescribes a period of probation of two years and the proviso confers power to extend the period of probation by not beyond one year meaning thereby that in any case the Government would not have the power to extend the period of probation beyond a period of three years.
[593 A B] In this situation, (a) the ratio of Dharam Singh 's case would mulatis mutandis apply and the direct recruits who completed the period of probation of two years and in the absence of an extension of probationary period would be deemed to be confirmed by necessary implication.
[593 B C] (b) If seniority is to be reckoned from the date of confirmation and if promotees are not confirmed for years together in some cases, while direct recruits who came much later got confirmed and ipso facto became senior to the promotees, if quota rule is only applied at the time of initial recruitment, this undesirable result is wholly unavoidable.
[593 C D] 4.
Where recruitment to a cadre is from two sources and the Service Rules prescribe quota for recruitment for both sources, a question would always arise, whether the quota rule would apply at the initial stage of recruitment or also at the stage of confirmation.
Ordinarily, if quota is prescribed for recruitment to a cadre, the quota rule will have to be observed at the recruitment stage.
The quota would then be co related to vacancies to be filled in by recruitment but after recruitment is made from two different sources they will have to be integrated into a common cadre and while so doing the question of their inter se seniority would surface.
[593 F G] 586 Seniority is ordinarily determined from the date of entry into cadre on the principle of continuous officiation.
Confirmation in a post would ordinarily depend upon such circumstances as satisfactory completion of probationary period, efficiency in the discharge of duty, capacity to discharge functions of the post, availability of permanent vacancy etc.
Now, if seniority is to be determined according to the date of confirmation and the quota rule is not made relatable to confirmation in various posts falling vacant in the cadre it would directly impinge upon the seniority of members of the service.
[593 G H, 594 A] section B. Patwardhan and Ors.
vs State of Maharashtra; , @ 797; referred to.
A harmonious reading of rules 3, 4, 6, 8, and 10 makes it clear that the quota rule is operative both at the time of initial recruitment and at the time of confirmation.
The recruitment to Punjab Police Service is from two sources.
Recruits from both the sources have to be on probation.
Adopting the construction that the proviso to Rule 8 (b) permitting a maximum period of probation of three years at the end of which the direct recruit would automatically be confirmed unless his services are dispensed with simultaneously enjoying seniority from the date of such automatic confirmation without applying quota rule at the time of confirmation would put the promotee to an unintended disadvantage who may be continued in an officiating capacity without confirming him and consequently denying or relegating him down in seniority for years as has happened in the case of respondents 1 and 2.
Such an approach would be wholly unreasonable more so when there was not the slightest suggestion that their services were not satisfactory and that the confirmation was denied on any such ground, thereby directly affecting their places in the seniority list.
[594 C F, H] If the other view that the quota rule would apply both at the time of recruitment and at the time of confirmation, is adopted rule 10 which provides for seniority according to the date of confirmation would certainly be saved from the vice of unreasonableness.
[594 G] The quota rule is linked up with the seniority rule.
Quota rule is linked up with seniority rule because, not the date of entry in service determines the seniority but the date of confirmation determines seniority.
Quota rule being inextricably intertwined with the seniority rule any delinking would render the seniority rule wholly unreasonable.
After recduitment, members of the service, though drawn from two different sources direct recruits and promotees constitute a single integrated cadre.
They discharge identical functions, bear similar responsibilities and, acquire an equal amount of experience in the respective assignments.
If quota rule were to be applied at the stage of initial recruitment and wholly ignored at the time of confirmation the rule would suffer from the vice of unreasonableness and would offend article 16, because, in that event, while direct recruits would get confirmation automatically, the promotees would hang out for years as has happened in the case of respondents 1 and 2 and if they are not confirmed they would never get seniority and their chances of being considered for promotion to the higher post would be wholly jeopardised.
[595 A B, C, D E] section G. Jaisinghani vs Union of India and Ors. ; @ 717 and 718; section B. Patwardhan vs State of Maharashtra, ; @ 797; followed.
587 6.
Where recruitment is from two sources and the seniority in the cadre is determined according to the date of confirmation to accord utmost fair treatment a rotational system has to be followed while giving confirmation.
The quota rule would apply to vacancies and recruitment has to be made keeping in view the vacancies available to the two sources according to the quota.
If the quota rule is strictly adhered to there will be no difficulty in giving confirmation keeping in view the quota rule even at the time of confirmation.
A roster is introduced while giving confirmation ascertaining every time which post has fallen vacant and the recruit from that source has to be confirmed in the post available to the source.
This system would breakdown the moment recruitment from either source in excess of the quota is made.
In fact a strict adherance to the quota rule at the time of recruitment would introduce no difficulty in applying the rule at the time of confirmation because vacancies would be available for confirmation to persons belonging to different sources of recruitment.
The difficulty would arise when recuruitment in excess of the quota is made and it would further be accentuated when recruits from one source viz. direct recruits get automatic confirmation on completion of the probationary period, while the promotees hang out for years together before being confirmed.
[596 F H, 597 A B] Mervyn Coutindo and Ors.
vs Collector of Customs, Bombay and Ors.
, ; A. K. Subraman and Ors.
vs Union of Indian and Ors.
, [1975] 2 SCR 979; explained and distinguished.
|
Special Leave Petition (Civil) Nos.
4062 4066 of 1978.
From the Orders dated 11 1 1978 of the Madhya Pradesh High Court in M.P. Nos. 390, 391, 393, 395 and 397/75.
AND SPECIAL LEAVE PETITION (CIVIL) NO. 4069 of 1978.
From the Order dated 5 1 78 of the Madhya Pradesh High Court in M.P. No. 580/75.
section K. Gambhir for the Petitioners in all the section L. Ps.
The Order of the Court was delivered by DESAI, J. Mr. Gambhir, learned counsel for the petitioner informed us that a number of petitions are pending in the High Court of Madhya Pradesh in which the question raised in the present group of petitions is involved and as we are not inclined to grant leave, we would rather indicate our reasons by a speaking order.
At the commencement of the British Raj both in the Raj ruled area of India and the princely States institutions of higher education were set up and manned under Government aegis.
As the demand for institutions of higher education increased with the proliferation of State activity and need of white collar employees, these institutions speedily multiplied and they were generally set up and manned by educational societies or local authorities.
The turmoil since independence and especially in the last one and a half decade in the world of academicians led to the reversal of the policy of Government directly setting up educational institutions and 632 in fact whatever they had set up, being slowly handed over to educational societies and/or local authorities, and it has turned a full circle.
The grievance of the teachers in such school manifested in the demand for taking over of such institutions by the State and all over the country the transition has begun.
In Madhya Pradesh the State regulated the functioning and standards of academic instruction in Higher Secondary Schools under Madhya Pradesh Madhyamik Shiksha Adhiniyem, 1965.
This supervisory role of the State hardly improved the situation with the result that tensions increased and the demand became louder that these institutions should be taken over by the Government for its direct management and the teachers should be accorded the status of Government servants.
The State Government responded to this demand by enacting the Madhya Pradesh Local Authorities School Teachers (Absorption in Government Service) Act, 1963 ( 'the Act ' for short).
The Act provided for absorbing teachers serving in Middle Schools and Primary Schools managed by local authorities in Government service.
The relevant rule for absorption is rule 3 of the Rules enacted under the Act.
In these petitions we are concerned with rule 3(b) which reads as under: "3 (b).
For absorption on the post of Head Master/Principal of a High/Higher Secondary School, the person concerned should possess the post graduate degree and should have worked on the post for a minimum period of 7 years in the same institution and should have 10 years teaching experience in any recognised institution of Madhya Pradesh".
While implementing the aforementioned rule there arose a cleavage on the interpretation of the rule, the concerned teacher contending that what is relevant is that working on the post for a minimum period of 7 years would for the purpose of computation of 7 years include service even as incharge Head Master/Principal or officiating service in the post whereas the State contended that the teacher claiming to be absorbed as Head Master/Principal should have worked as a confirmed Head Master/Principal in a substantive post for the full period of 7 years.
The State in accordance with its interpretation declined absorption to a number of Head Masters/Principals which led to the filing of a number of writ petitions in the Madhya Pradesh High Court.
It appears that this question was first examined by the Madhya Pradesh High Court in Satyendra Prasanna Singh Yadav vs State of 633 Madhya Pradesh & 3 Ors.(1), in which the High Court took the view that the period during which a Head Master/Principal worked as incharge Principal ought to be taken into account for computing the period of 7 years.
Following this decision the present group of petitions were allowed by a Division Bench of the Madhya Pradesh High Court and an application for leave to appeal to this Court under Article 133 of the Constitution was rejected.
Hence the State of Madhya Pradesh has filed this group of petitions for special leave to appeal.
It may be mentioned that the earlier decision which the High Court seeks to follow appears to have been accepted by the State of Madhya Pradesh.
Mr. Gambhir, learned counsel for the petitioner urged that the expression: "should have worked on the post for a minimum period of 7 years in the same institution" would, in the context of the rule and the consequences flowing from it, mean only a substantive post on which the Head Master/Principal was confirmed and the confirmed holder of the substantive post for a period of 7 years would be entitled to absorption as envisaged by rule 3 (b).
On a pure grammatical construction of the expression it would indisputably appear that the person claiming to be absorbed must have worked on the post of Head Master/Principal of a High/Higher Secondary School for a minimum period of 7 years.
Emphasis is on the experience gained by working on the post of Head Master/Principal.
A person incharge of the post also works and discharges the duties and functions of the post of which he has taken charge.
Even an officiating incumbent of the post does discharge the functions and duties of the post.
While examining the relative positions of confirmed Deputy Engineers and Officiating Deputy Engineers in section B. Patwardhan & Ors. etc.
vs State of Maharashtra & Ors.
,(2) this Court observed that the officiating Deputy Engineers discharge identical functions, bear similar responsibilities and acquire an equal amount of experience in the respective assignments.
Viewed from this angle, the confirmed holder of a substantive post would be discharging the functions attached to the post and when some one is placed in that very post in an officiating capacity or directed to hold charge of the post, he would be required to perform the duties and discharge the functions of the post rendering identical service.
If the rule expressly did not make any differentiation between the persons working as a confirmed holder of substantive post and an incharge or officiating holder of the post, is there anything in the expression itself which by necessary implication excludes service in any other capacity except as a confirmed Head Master/Principal in a substantive post ? A 634 confirmed holder of a substantive post may look tautologous because one can only be confirmed in the substantive post.
Now, every High School or Higher Secondary School must of necessity have the post of Head Master/Principal and it was nowhere suggested that there would not be a post of Head Master/Principal.
If that would mean that there was always a substantive post of Head Master/Principal it may be that the confirmed holder of the post may be away and not in a position to discharge the duties and some one may be appointed in an officiating capacity or may be directed to hold charge but none the less such holder of the post will have to perform duties and discharge functions attached to the post.
Further, the emphasis in the expression is on working on the post meaning thereby performing the duties and discharging the functions assigned to the post and not the capacity in which the post is held.
Confirmation in a post being one of the glorious uncertainties of service as observed by this Court in section B. Patwardhan 's case, (supra) it is rational to believe that the framers of the rule did not want to attach any importance to the capacity in which the post is held but the emphasis was on working on the post meaning thereby discharging the duties and performing the functions assigned to the post.
Our attention was drawn to State of Assam & Ors.
vs Shri Kanak Chandra Dutta(1).
We fail to see how this decision can assist in deciding the question one way or the other.
The question that came for consideration of this Court was: whether the holder of a post designated as Moujadar in the Assam valley was holding a civil post in the context of Article 311 of the Constitution ? After examining the duties and functions attached to the post of Moujadar, this Court held that a post can exist apart from the holder of the post and that Moujadar is the holder of a civil post under the State and that it makes no difference that he is remunerated by way of a commission on the collection of Government dues and does not draw a salary.
In fact, if at all this decision helps, it would fortify the view which we are taking that the post is independent of the holder thereof and the requirement of the rule is that the person claiming to be absorbed must have worked in the post of Head Master/Principal.
Perhaps there would have been some merit in the submission on behalf of the petitioner if in rule 3(b) the words used were "who held the post" but the language in rule 3(b) is so materially different and it speaks that a person should have worked on the post.
The State was apparently wrong in introducing the element of rank for the purpose 635 of rule 3(b).
The controversy that surfaced in Ramrattan vs State of Madhya Pradesh & Ors.,(1) and the subsequent decision in State of Madhya Pradesh vs Gokul Prasad,(2) which led to a reference to a Full Bench in Girja Shankar vs S.D.O., Harda & Ors.,(3) on account of the use of the expressions such as "person appointed to be incharge of the current duties of the office" which indicated that such person did not hold the rank and, therefore, could not discharge statutory functions assigned to the post should not detain us.
The language here indicates emphasis on work being done while on the post irrespective of the capacity.
The absorption of a person as Principal under rule 3(b) does not depend on rank but on the nature of functions and duties that an incumbent discharges for a particular number of years, i.e. the duties of a Principal for a period of 7 years.
It thus clearly transpires that while computing the period of 7 years for the purpose of rule 3(b) what is determinative is performing duties and discharging functions of the post of Head Master/Principal irrespective of the capacity in which the post was held.
The High Court was, therefore, right in holding that the period during which the petitioners (respondents in these petitions) worked as incharge Head Masters/Principals ought to be taken into account by the State Government for computing the period of 7 years.
These petitions are accordingly dismissed.
V.D.K. Petitions dismissed.
| IN-Abs | The Madhya Pradesh Local Authorities School Teachers (Absorption in Government Service) Act provided for absorbing teachers serving in Middle Schools and Primary Schools managed by local authorities in Government service.
The relevant rule for absorption enacted under the Act in rule 3 and rule 3(b) read as follows: "3(b)For absorption on the post of Head Master/Principal of a High/ Higher Secondary School, the person concerned should possess the post graduate degree and should have worked on the post for a minimum period of 7 years in the same institution and should have 10 years ' teaching experience in any recognised institution of Madhya Pradesh".
On the question of interpretation of the words "should have worked on the post for a minimum period of seven years" the High Court was of the view that the period during which a Head Master/Principal worked as incharge Principal ought to be taken into account for computing the period of 7 years.
Dismissing the special leave petitions by the State the Court, ^ HELD : 1.
While computing the period of 7 years for the purpose of rule 3(b) what is determinative is performing duties and discharging functions of the post of Head Master/Principal irrespective of the capacity in which the post was held.
[635 C] 2.
The absorption of a person as Principal under rule 3(b) does not depend on rank but on the nature of functions and duties that is incumbent discharges for a particular number of years (i.e.) the duties of a Principal for a period of seven years.
The language, in the instant case, indicates emphasis on work being done while on the post irrespective of capacity.
[635 B C] Ramrattan vs State of M.P. and Ors., I.L.R. 1964 M.P. 242; State of Madhya Pradesh vs Gokul Prasad,[1971] M.P.L.J. 609; Girja Shanker vs S.D.O. Harda and Ors., A.I.R. 1973 M.P. 104; distinguished.
On a pure grammatical construction of the expression "should have worked on the post for a minimum period of seven years in the same institution".
it is clear that the person claiming to be absorbed must have worked on the post of Head Master/Principal of a High/Higher Secondary School for a minimum period of 7 years, the emphasis being on the experience gamed by working on the said post.
A person in charge of the post also works and 631 discharges the duties and functions of the post of which he has taken charge.
Even an officiating incumbent of the post does discharge the functions and duties of the post.
If the rule expressly did not make any differentiation between the persons working as a confirmed holder of substantive post and an incharge or officiating holder of the post, there is nothing in the expression itself which by necessary implication excludes service in any other capacity except as a confirmed Head Master/Principal in a substantive post.
[633 D E, G H] Confirmation in a post being one of the glorious uncertainties of service as observed by this Court in section B. Patwardhan 's case, it is rational to believe that the framers of the rule did not want to attach any importance to the capacity in which the post is held but the emphasis was on working on the post meaning thereby discharging the duties and performing the functions assigned to the post.
[634 C D] section B. Patwardhan and Ors.
vs State of Maharashtra and Ors.
, ; ; applied.
|
Civil Appeal No. 348 of 1977.
Appeal by special leave from the Judgment and Order dated 21 9 1976 of the Punjab & Haryana High Court in Letters Patent Appeal No. 89/76.
W. C. Chopra for the appellant.
M. L. Varma for respondent No. 1.
The Judgment of the Court was delivered by KRISHNA IYER, J.
A judgment often possesses a sublime essence and a humdrum component.
The appeal before us, in its happy conclusion, holds out the higher lesson that hate and fight are dissolved by basic human fellowship, even after bitter litigative struggle, if the Bench and the Bar pursue consensual justice, and bring into play conciliatory processes, and successfully persuade the parties to see reason and right beyond bare law.
If the effort succeeds, as it has in this case, court and counsel derive spiritual fulfilment and get satisfaction.
Two sisters, apparently of the affluent bracket, with a common father but different mothers, became estranged when one (the appellant) claimed a half share in the estate of the father, on whose death before 1956, the respondent 's mother inherited her husband 's estate but died after 1956, possessed of her husband 's assets and her own.
When intestate succession to her opened the plaintiff appellant claimed a half share therein, founded on section 15(1)(a) of the (the Act, for short).
The High Court negatived the right to a share as an heir, and, in doing so, preferred the interpretation of the provision adopted by the then Mysore High Court (AIR as against the meaning attached to the provision by the Allahabad High Court In fact, a plurality of decisions has been brought to our notice indicating a plain conflict.
Interpretation is sometimes a projection of judicial inclination to do justice.
The question of law canvassed before us turns on the meaning of "son" and "daughter" in the setting of section 15(1)(a) of the Act.
Do the expressions include step son and step daughter or embrace only the son and daughter of the deceased female propositus ? The text and the context and the application of traditional rules of statutory interpretation leave the position in an unsatisfactory dilemma of dual import.
Even an equitable approach may not necessarily help reach a just solution, because equity shifts as the situation varies, as illustra 641 tions presented to us convinced us.
Thus, the problem is a little tricky and may well arise frequently.
Contradictory positions already taken by different High Courts add to the difficulty and result in the deleterious uncertainty of the law which may well incite, as it has done here, close relations to quarrel over property.
Blood may be thicker than water, but wealth breaks all relations on a word of material value sets.
The Supreme Court may, when the High Courts disagree, resolve the logomachic conflict by exercising its preference guided by the language and the milieu and following the customary canons of statutory interpretation.
While its decision will be binding on account of Article 141 of the Constitution, it may still be fallible because the intendment of Parliament is best brought out by legislative clarification.
In the present instance, we have a hunch that the specific point of claim by stepsons and step daughters to inherit to the estate of a deceased female has escaped Parliament 's attention while fashioning the legislation.
This is not surprising when we appreciate the push and pressure, hurry and worry of law making modalities.
In such a situation, when a sharp conflict has shown up in the rulings of courts, the matter should not be left in doubt or to forensic linguistic exercises but must be settled by legislative action on the part of Parliament, making explicit its policy on this branch of the .
Inaction leads to more litigation, speculation and compulsion for judicial legislation by the Supreme Court.
Drafting lapses are understandable but when differences of interpretation come into the open, delay in correctional parliamentary performance is fraught with negative litigative potential.
We are hopeful that the Indian draftsmen will disprove the old English jingle: I 'am the parliamentary draftsman I compose the country 's laws And of half the litigation I 'am undoubtedly the cause.
The sublime element which we adverted to in the beginning consists in the optimistic endeavour to bring parties together so that the litigation may not cut them asunder, especially when they are sisters.
The purpose of law and justice (dharma) is promotion of cohesion and not production of fission.
From this angle, as the arguments proceeded and the legal tempers flared up, we suggested that instead of escalating estrangement the parties may as well compose themselves and their quarrels and re establish their sisterly relations making a somewhat amicable adjustment of the lis before us.
Viewing the case from this perspective of tranquillity versus turbulence, but making it perfectly 642 plain that suggestions from the court towards this end will not affect its unbiased adjudicatory duty in case it became necessary, we ventured tentative solutions.
Counsel took up the suggestion in the proper spirit and we must record our admiration for the strenuous effort made by the young lawyer Shri M. L. Varma who did his best and successfully persuaded his client who had won in the High Court to come down to a compromise.
We need hardly say that such a seasoned and senior counsel like Shri Lal Narain Sinha could be counted upon to aid in the process, and he did.
The finest hour of justice arrives propitiously when parties, despite falling apart, bury the hatchet and weave a sense of fellowship or reunion.
In the present case, counsel today put in a joint statement(1) signed by the parties setting down the terms on which they have agreed.
We consider it a success of the finer human spirit over its baser tendency for conflict.
Now we come to the humdrum part of the case.
According to the compromise some landed properties are to be made over to the appellant.
Some cash is also to be paid to the appellant by the respondent.
The discretion to fix the sum has been left by the parties to us.
We direct that the respondent shall pay a sum of Rs. 75,000/ to the appellant within two weeks of the attachment of the moneys by the trial court being withdrawn.
The plaintiff/appellant undertakes that she will get the attachment withdrawn and we direct her to do so.
We make it further clear that this withdrawal of the attachment is to facilitate the making of the payment of Rs. 75,000/ from out of the sum now lying in bank deposit.
We also direct that landed property worth Rs. 25,000/ will in addition be made over to the appellant from out of the suit property.
The further direction must justly follow and we make that all the rents due from the properties allotted to the appellant under the joint statement prior to this date and subsequent to this date shall be collectible by the appellant.
If they have already been deposited in court, they will be withdrawn by the appellant.
The actual allocation of the lands under the joint statement will be made by Mr. Prem Nath Handa within two months from today.
Both sides agree on Shri Handa being impartial and competent to make the said allotment.
His allotment once made will not be challengeable.
Shri Handa pursuant to this direction will make the allocation and put in a statement to that effect in the trial court and that statement will be deemed to be part of this decree.
643 We need hardly mention it is so obvious that the land that remains will belong entirely to the respondent and there will be no more claims from the appellant on the respondent in regard to the estate of her step mother, or in respect of its income or otherwise.
Before we part with the case we should like to emphasise that having regard to the merits of the claim, this is not merely a just adjustment of a bitter litigation but a path finder for the subordinate courts in dealing with family or like disputes.
Indeed, we have had to take the lead in giving shape to the settlement as it has finally emerged.
Counsel on both sides have also, statesman like, assisted in producing the settlement.
We command this example to the judiciary and to the Bar and reinforce it with what Gandhiji has recorded in his autobiography: "I have leant the true practice of law.
I had learnt to find out the better side of human nature and to enter men 's hearts.
I realised that the true function of a lawyer was to unite parties driven asunder.
The lesson was so indelibly burnt into me that a large part of my time during the twenty years of my practice as a lawyer was occupied in bringing about private compromises of hundreds of cases.
I lost nothing, thereby not even money, certainly not my soul.
" We allow the appeal in part but entirely in terms of the compromise which we consider clearly reasonable and just.
There will be no order as to costs.
TULZAPURKAR, J. Decree in terms of compromise without costs.
Parliament should clarify its intention regarding section 15(1) (a).
P.B.R. Appeal allowed in part.
| IN-Abs | The purpose of law and justice (Dharma) is promotion of cohesion and not production of fission.
A judgment often possesses a sublime essence and a humdrum component.
The sublime element consists in the optimistic endeavour to bring parties together so that the litigation may not cut them as under, especially when they are blood relations like sisters.
The present appeal in its happy conclusion, holds out the higher lesson that hate and fight are dissolved by basic human fellowship, even after bitter litigative struggle, if the Bench and the Bar pursue consensual justice and bring into play conciliatory processes and successfully persuade the parties to see reason and right beyond bare law.
If the effort succeeds, the court and counsel derive spiritual fulfilment and get satisfaction.
The finest hour of justice arrives propitiously when parties, despite falling apart, bury the hatchet and weave a sense of fellowship or union.
[640 D] The present case is not merely a just adjustment of a bitter litigation but a path finder for the subordinate courts in dealing with family or like disputes.
[643 B] The text and the context and the application of traditional rules of statutory interpretation, in a given case, might leave the position in an unsatisfactory dilemma of dual import.
Even an equitable approach may not necessarily help reach a just solution because equity shifts as the situation varies.
Contradictory positions taken by different High Courts add to the difficulty and result in the deleterious uncertainty of the law.
The Supreme Court may resolve the conflict by exercising its preference guided by the language and the milieu and following the customary canons of statutory interpretation.
While its decision will be binding on account of article 141 of the Constitution it may still be fallible because the intendment of Parliament is best brought out by legislative clarification in some cases.
[640 H] The appellant and the respondent were step sisters daughters of a common father but of different mothers.
The father who owned vast properties had died before the coming into force of the .
The respondent 's mother who inherited her husband 's estate died after the coming into force of the 1956 Act.
The High Court dismissed the appellant 's claim for a half share in the properties under section 15(1)(a) of the Act.
The specific point of claim, whether a son and daughter in the setting of section 15(1)(a) of the Act, includes step son and step daughter or embraces only the son and daughter of the deceased female propositus, has escaped the Parliament 's attention while passing the legislation.
[At the Court 's suggestion the parties came to a compromise assisted by counsel on both sides.] 640 Tulzapurkar, J. Parliament should clarify its intention regarding section 15(1)(a) of the Act. ^
|
N: Criminal Appeal Nos.
152 153 of 1972.
From the Judgment and Order dated 28 10 1970 of Delhi High Court in Criminal Revision Nos. 426/68 and 5/70.
AND CRIMINAL APPEAL NOS.
166 167 OF 1972 From the Judgment and Order dated 28 10 1970 of Delhi High Court in Criminal Revision Nos. 72 73/68.
626 Soli J. Sorabji, Addl.
of India, B. P. Maheshwari and Suresh Sethi for the Appellant in Crl.
A. Nos.
152 153/72.
V. M. Tarkunde, section C. Malik and B. R. Agarwala for RR 4 in Crl.
A. 152/72.
H. K. Puri for RR.
3 in Crl.
A.153/72 Mrs. Urmila Sirur for RR.
3 in Crl.
A. No. 152/72.
B. K. Jaggi for the Appellant in Crl.
A. No. 166 167/72.
H. section Marwah and M. N. Shroff for RR.
in Crl.
A. Nos.
166 167/72.
B. P. Maheshwari and Suresh Sethi for the Intervener.
The Judgment of the Court was delivered by FAZAL ALI, J.
These appeals by certificate arise out of a common Judgment delivered by the High Court of Delhi and will be disposed of by us by one judgment.
In Appeals Nos. 152 153/72, one Gian Singh sold toffees to the Food Inspector and as the toffees were found to be adulterated, a prosecution was launched against him under section 7/16 of the Prevention of Food Adulteration Act.
Gian Singh, however, produced in course of the trial a warranty given by the distributors and manufacturers as a result of which the Magistrate acquitted accused Gian Singh.
After having acquitted Gian Singh, the Magistrate issued notice under section 20A against the Respondents for being impleaded and prosecution on the ground that the articles manufactured by the distributors were adulterated.
The respondents went up in revision to the Sessions Judge which was dismissed.
But on further revision to the High Court the High Court allowed the petition and set aside the order of the Magistrate impleading the respondents.
In the other two appeals i.e. Crl.
Appeals Nos. 166 and 167/1972, the manufacturers were impleaded under section 20A before the acquittal of the last seller and that order was upheld by the High Court and, hence these appeals before us by the appellants.
The common question of law that arises for consideration in all these appeals is: whether or not the Magistrate is entitled to implead the distributors or manufacturers under section 20A even after acquitting the last seller on the ground that he is protected by a warranty.
In other words, the question for decision in these appeals turns upon the interpretation of section 20A and section 20 of the Prevention of Food Adulteration Act.
section 20A runs thus: "Where at any time during the trial of any offence under this Act, alleged to have been committed by any person, not 627 being the manufacturer, distributor or dealer of any of food, the Court is satisfied, on the evidence adduced before it, that such manufacturer, distributor or dealer is also concerned with the offence, then the Court may, notwithstanding anything contained in sub section(1) of section 351 of the Code of Criminal Procedure, 1898, or in Section 20 proceed against him as though a prosecution had been instituted against him under section 20".
The opening lines of section 20A clearly contemplate a contingency where the discretionary jurisdiction under this Act can be exercised only during the trial of any offence, that is to say, the stage at which the Magistrate can exercise his discretion under this Section must be before the trial has concluded and ended in acquittal or conviction.
section 20 which precedes section 20 A runs thus: "section 20 (1) No prosecution for an offence under this Act, not being an offence under section 14 or section 14A, shall be instituted except by or with written consent of the Central Government or the State Government or a person authorised in this behalf, by general or special order, by the Central Government or the State Government; Provided that a prosecution for an offence under this Act may be instituted by a purchaser referred to in section 12, if he produces in court a copy of the report of the public analyst alongwith the complaint.
(2) No court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the first class shall try any offence under this Act.
(3) Notwithstanding anything contained in the Code of Criminal Procedure, 1973, an offence punishable under subsection (IAA) of Section 16 shall be cognizable and non bailable".
A combined reading of section 20A and section 20 is that where a distributor or manufacturer or any other person is impleaded in the course of a trial, the obligation to get a fresh sanction for such person is dispensed with and the sanction obtained for the last seller in the trial will ensure for the benefit of the prosecution of the other person impleaded also and no further sanction is necessary.
It is manifest that this special statutory concession is given to the prosecution only if the conditions mentioned in section 20A are fulfilled and not otherwise.
In other words, the protection of section 20 is not available to the prosecution if the parties concerned are impleaded after the trial is over.
In such a case, a fresh trial will have to be started by obtaining sanction under 628 section 20.
This matter is no longer res integra as it has been fully considered by this Court in V. N. Kamdar vs Municipal Corporation, Delhi(1) where this Court observed as follows: ".
In order that the manufacturer, distributor or dealer may be impleaded under section 20A, it is necessary that there should be a trial for an offence committed under the Act by a person and that the manufacturer, distributor or dealer must be concerned in the offence.
When once the manufacturer, distributor or dealer is impleaded, the trial proceeds as if he is also an accused in the case.
That is made clear by the closing words of the section.
As already indicated, no prosecution for an offence under the Act can be instituted by a Food Inspector without the sanction specified in section 20.
The real purpose of enacting section 20A is to avoid.
as far as possible, conflicting findings.
If, in the prosecution instituted against the vendor, it is found that the vendor has sold the article of food in the same state as he purchased it and that while it was in his possession it was properly stored, and the vendor is acquitted, it would look rather ridiculous if in the prosecution against the manufacturer, distributor or dealer, it is found on the evidence that he did not give a false warranty, but that the article was not stored properly while it was in the possession of the vendor or that he did not sell the article in the same stage as he purchased it.
This being so, the object of the legislature in enacting the section will be frustrated if a Magistrate were to exercise his discretion improperly by failing to implead the manufacturer, distributor or dealer under section 20A in a case where he should be impleaded.
But that is no reason to hold that a separate prosecution against the manufacturer, distributor or dealer would be barred, if he is not impleaded under section 20A, and tried along with the person who is alleged to have committed an offence under the Act.
In order to avoid multiplicity of proceedings and conflict of findings, it is imperative that the Magistrate should implead these persons under section 20A whenever the conditions laid down in the section are satisfied.
As I said, it is a far cry from this to say that if this is not done, the manufacturer, distributor or dealer would get an immunity from a separate prosecution.
" For these reasons, therefore, and in the facts and circumstances of the case so far as Cr.
Appeals No. 152 153/1972 are concerned, the 629 Magistrate had no jurisdiction to implead the respondents after having concluded the trial by the acquittal of the last seller.
Similarly, the Magistrate was fully justified in Crl.
Appeals No. 166 and 167/72 in impleading the appellants during the course of the trial as the trial was still continuing and the case would, therefore, squarely fall under section 20A of the Act and no further sanction would be necessary.
For these reasons, therefore, all the appeals are dismissed.
N.K.A. Appeals dismissed.
| IN-Abs | Toffees sold by a vender to a Food Inspector having been found to be adulterated, prosecution was launched against him.
The vendor produced a warranty in the Trial Court as a result of which he was acquitted by the Magistrate.
The Magistrate however directed notice to the respondents under section 20 A for being impleaded and prosecuted on the grounds that the articles manufactured and distributed the them were adulterated.
On revision, the Session Judge dismissed the same but on further revision to the High Court, it allowed the revision and set aside the order of the Magistrate, In the other two Criminal Appeals Nos. 166 & 167 of 1972, the appellants were impleaded under section 20A before the acquittal of the last seller and that order was upheld by the High Court.
On the question whether the magistrate was entitled to implead the distributors or manufacturers under section 20A even after acquitting the seller on the ground that he was protected by a warranty.
Dismissing the appeals ^ HELD :The opening lines of section 20A clearly contemplate a contingency where the discretionary jurisdiction under this Act can be exercised only during the trial of any offence, i.e. the stage at which the magistrate can exercise his jurisdiction under this section must be before the trial has concluded and ended in acquittal or conviction.
A combined reading of section 20A and 20 is that where a distributor or manufacturer or any other person is impleaded in the course of a trial, the obligation to get a fresh sanction for such a person is dispensed with and the sanction obtained for the last seller in the trial, will ensure for the benefit of the prosecution of the other person impleaded.
Therefore protection of section 20 is not available if the parties concerned are impleaded after the trial was over.
The special statutory concession is given to the prosecution only if the conditions mentioned in section 20A are fulfilled and not otherwise.
[627B C, F H] V. N. Kamdar vs Municipal Corpration of Delhi ; followed.
|
Special Leave Petitions (Civil) Nos.
2585 2594/79.
From the Judgment and Order dated 9 3 1979 of the Delhi High Court in Civil Writ Petition Nos.
116 122 and 135 137/79.
V. section Desai (In SLP 2585), L. N. Sinha (In SLP.
2586), L. M. Singhvi (In SLP 2587), P.P. Rao (In SLP 2588), R. C. Verma, Y. K. Sabharwal, D. P. Mukherjee, (In SLP 2589 94) and A. K. Ganguli (In all the S.L.Ps.) for the Petitioners.
Soli J. Sorabjee, Addl.
R. K. Bhatt and R. N. Sachthey for the Respondent.
656 The Order of the Court was delivered by DESAI, J. Law touching manufacture, import, use or consumption of liquor (as understood in common parlance) is recently vigorously assailed with almost afflicted sentimentalism that even though we have dismissed this batch of Special Leave Petitions on 23rd March, 1979, in fairness to petitioners on whose behalf all possible contentions that can be formulated by research and dialectics were advanced with eloquence and devoid of inebriation likely to be caused by the subject matter of dispute, we propose shortly to state our reasons for dismissal of the petitions.
To illumine the contours of controversy events preceding the promulgation of the Ordinance amending the Punjab Excise Act, 1914 ( 'Act ' for short), as in force in the Union Territory of Delhi ( 'Delhi ' for short) styled as Punjab Excise (Delhi Amendment) Ordinance, 1979 ( 'Ordinance ' for short) may be stated.
Punjab Excise Act, 1914 has been extended to Delhi.
While implementing the provisions of the Act, the concerned authority used to hold auction for grant of licence in Form L 10 for selling country liquor and at one such auction held on 29th March 1978 the petitioners ' bids were accepted and they were granted licences in Form L 10 for the period 1st April 1978 to 31st March 1979.
The licence included a condition to sell a bottle of 750 ml. of country liquor at Rs. 15/ which was, inter alia, made up of excise duty at the rate of Rs. 10.23 and profit of licensee at the rate of Rs. 2/ .
This excise duty was styled as 'still head duty ' for obvious reasons.
In Writ Petition No. 716/78 filed in the High Court of Delhi by certain petitioners, validity of the levy of 'still head duty ' was challenged inter alia on the ground that it was nothing but countervailing duty and in the absence of manufacture of liquor in Delhi, countervailing duty on the import of liquor cannot be constitutionally levied.
This contention found favour with a learned single Judge of the Delhi High Court and a number of Letters Patent Appeals were filed against that judgment which were pending in the High Court.
In the mean time on 20th January 1979 the President of India, promulgated the Ordinance purporting to amend the Punjab Excise Act with retrospective effect and conferring power on the Government under the provisions of the Act to levy special duty on the import of country liquor in Delhi at rates not exceeding that set out in Schedule I A which was introduced in the Act by the Ordinance Pursuant to the Ordinance amending the principal Act, the Delhi Fiscal Duty Order, 1979, was issued levying special duty at the rates set out in the order on import of country liquor into Delhi.
Some of the petitioners questioned the validity generally of the Ordinance and specifically of the import of special duty in Civil Writ No. 116/79.
A Division Bench of the Delhi 657 High Court heard the Letters Patent Appeals against the judgment of the learned single Judge of the Delhi High Court as well as the aforementioned writ petition and by a common judgment held the Ordinance as well as the impost thereunder valid and dismissed the writ petition and allowed the Letters Patent Appeals setting aside the judgment of the learned single Judge.
This bunch of petitions is filed against the judgment of the Delhi High Court in Civil Writ No. 116/79 and allied writ petitions and the Letters Patent Appeals.
The cardinal question around which the various facts of controversy rotates turns upon the competence of Parliament to enact legislation under challenge which would directly impinge upon the competence of the President to issue the impugned Ordinance.
Article 123 of the Constitution enables the President to issue an Ordinance in the circumstances thereunder mentioned and the power to issue Ordinance is co extensive with the legislative power of Parliament vide Article 123(3).
The question, therefore, is whether Parliament had the power to impose special duty on the import of country liquor in Delhi.
In order to avoid the slightest confusion it must be reiterated that the power of Parliament to legislate for Delhi is in question.
Article 246(1) confers exclusive power on Parliament to make laws with respect to any of the matters enumerated in List I in the Seventh Schedule.
Sub article (3) confers similar power on the Legislature of any state with respect to any of the matters enumerated in List II.
Sub article (2) confers power both on Parliament and the State Legislature to make laws with respect to any of the matters enumerated in List III (Concurrent List).
Sub article (4) reads as under: "Parliament has power to make laws with respect to any matter for any part of the Territory of India not included in a State notwithstanding that such matter is a matter enumerated in the State List".
Article 248(1) provides that Parliament has exclusive power to make any law with respect to any matter not enumerated in the Concurrent List or State List.
In other words, residuary power of legislation is conferred on Parliament Sub article (2) of Article 248 is material and may be extracted: "(2).
Such power shall include the power of making any law imposing a tax not mentioned in either of those Lists".
658 Entry 84 in the Union List reads as under: "84.
Duties of excise on tobacco and other goods manufactured or produced in India except: (a) alcoholic liquors for human consumption; (b) opium, Indian hemp and other narcotic drugs and narcotics, but including medicinal and toilet preparations containing alcohol or any substance included in sub paragraph (b) of this entry".
Entry 97 of the Union List reads as under: "97.
Any other matter not enumerated in List II or List III including any tax not mentioned in either of those Lists".
Entry 51 in the State List reads as under: "51.
Duties of excise on the following goods manufactured or produced in the State and countervailing duties at the same of lower rates on similar goods manufactured or produced elsewhere in India: (a) alcoholic liquors for human consumption; (b) opium, Indian hemp and other narcotic drugs and narcotics; but not including medicinal and toilet preparations containing alcohol or any substance included in sub paragraph (b) of this entry".
Entry 52 is as under: "52.
Taxes on the entry of goods into a local area for consumption, use or sale therein".
The relevant provisions of the impugned Ordinance may also be extracted for convenience of reference.
The Ordinance in its Preamble states that by reason of certain excisable articles not being manufactured or produced in Delhi, one such being country liquor, countervailing duty is not leviable on such articles which are imported into Delhi, and proceeds to define duty in clause 5(a) of section 3 as under: "(5a).
"duty" means the excise duty or countervailing duty or, as the case may be, special duty;" 659 Clause (c) was added to clause (6) of section 3 specifying the words "any spirit".
Clause (18a) was added specifying thereunder the definition of 'special duty ' which reads as under: "(18A). "Special duty" means a tax on the import of any excisable article being an article on which countervailing duty as in mentioned in entry 51 of List II in the Seventh Schedule to the Constitution is not imposable on the ground merely that such article is not being manufactured or produced in the territory to which this Act extends".
Section 31 was amended enabling the Government to levy over and above excise duty a countervailing duty or special duty at such rate or rates not exceeding the rates set forth in Schedule IA which was also added by the Ordinance.
The contention is that Entry 51 in the State List enables the State Legislature to levy duty of excise or countervailing duty on alcoholic liquors for human consumption and that the almost corresponding Entry 84 of the Union List denies power to Parliament to levy duty of excise on alcoholic liquors for human consumption.
Proceeding further it was said that initially countervailing duty was levied on the country liquor imported in Delhi and when it was found that as country liquor was not manufactured in Delhi countervailing duty could not be levied upon it, an attempt was made to levy the same duty by a camouflage of changing the name and that in pith and substance the Ordinance levies countervailing duty which Parliament had no power to levy particularly because country liquor on which duty is levied is not manufactured in Delhi.
It is an admitted position that country liquor, the subject matter of impost, is not manufactured in Delhi.
It is again an admitted position that as country liquor is not manufactured in Delhi, countervailing duty as is commonly understood could not be levied upon its import in Delhi.
The question is: does that exhaust the power of Parliament to levy a duty on the import of country liquor into Delhi ? Scheme underlying distribution of legislative powers in Part XI, Chapter I and especially Articles 246 and 248 is that except the matters specifically enumerated in List II (State List) in the Seventh Schedule, Parliament 's plenary power to legislate extends to all conceivable matters which can be topic of legislation, and even this limitation on its power vanishes when Parliament legislates for part of the territory of India not included in a State.
The three dimensional picture becomes complete, viz., (i) to select topic for legislation; (ii) enactment of legislation on the topic; and (iii) to impose tax in respect 660 of such subject matter of legislation, by reference to article 248 which confers power to make any law with respect to any matter not enumerated in Lists II and III including the power to impose tax not mentioned in either of those Lists.
Under Article 246(4) Parliament has power to make laws with respect to any matter for any part of the territory of India not included in a State notwithstanding that such matter is a matter enumerated in the State List.
Power of Parliament thus to legislate with respect to any matter for Delhi, territory not included in a State, is unabridged or unfettered by the entries in the State List.
Further, residuary power of legislation including the power to levy tax is conferred on Parliament by the combined operation of Articles 246(4), 248(1) & (2) and Entry 97 in the Union List.
That power is untramelled by the limitations prescribed by Articles 246(2) and (3) and Entry 51 of State List and is plenary and absolute subject only to such restrictions as are imposed by the Constitution and we find none such which is material to the present question (vide Mithan Lal vs State of Delhi) (1).
Accordingly, if excise or countervailing duty could be levied on country liquor manufactured or imported into Delhi, albeit other conditions for the levy of such duty being fulfilled, Parliament would not lack competence to levy the same only because levy of such duty on alcoholic liquors for human consumption is within the competence of a State.
But it must be confessed that as country liquor is not manufactured in Delhi, the Parliament could not under Entry 51 of the State List levy either excise or countervailing duty on it.
Merely because Parliament could not levy countervailing duty on country liquor imported into Delhi because country liquor is not manufactured in Delhi, it does not exhaust the power of Parliament to levy some other duty on the import of liquor if it is otherwise constitutionally permissible.
It was, however, said that Entry 51 in State List being a specific entry providing for levy of duty either on manufacture or import of country liquor and there being no other specific entry enabling to levy special duty it is inconceivable that the framers of the Constitution should have left some such levy on the import of country liquor in respect of Delhi under residuary entry.
In other words, it was said that where there is a specific entry the legislation must squarely fall within the entry and correspondingly is must be assumed that it would not be covered by the residuary entry.
In fact the argument went so far that before resort could be had to the residuary Entry 97 the Court in 661 its exploration to ascertain under which Entry the legislation falls, must proceed from the beginning and in its journey till Entry 97 if it falls somewhere, removing the camouflage under which the legislation is sought to be taken out from the specific entry, it would not be proper to say that the legislation is covered by the residuary entry.
Whenever legislative competence is in question attempt of the Courts is to find out whether the legislation squarely falls in one or the other entry.
If a particular legislation is covered by any specific entry well and good.
If it does not, the second question would be: is it beyond the legislative competence of Parliament ? In undertaking this exercise it is quite often known that a legislation may be covered by more than one entry because an analysis has shown that the entries are overlapping.
If the legislation may fall in one entry partly and part of it may be covered by the residuary entry, the legislation would none the less be immune from the attack on the ground of legislative competence.
This was the approach adopted by a 7 Judges Bench of this Court in Union of India vs H. section Dhillon(1) wherein while examining the constitutional validity of the amended Wealth Tax Act which included the capital value of agricultural land for the purpose of computing net wealth, the controversy was whether the impugned Act was a law with respect to entry, including Entry 49 in the List II or was it one under Entry 86 read with Entry 97 or Entry 97 itself of the List I. Repelling the contention of legislative incompetence this Court held that there is nothing in the Constitution to prevent Parliament from combining its powers under one or other Entry with its power under Entry 97.
The terse observation is that this Court knows no principle which debars Parliament from relying on the powers under the specified entries 1 to 96, List I and supplement them with the powers under Entry 97, List I and Article 248 or even the powers under entries in the Concurrent List.
This authoritative pronouncement would answer the contention that while legislating for the Union Territories the Parliament unhampered by Articles 246(2) and (3) but enriched by Article 248(1) and (2) could legislate on any of the topics either in the List I or in List II or in exercise of the residuary power under Entry 97.
There is thus no dearth of legislative competence of Parliament to enact legislation for a territory not included in a State because the power to legislate takes within its sweep matters included in all the three Lists and added to it is the residuary power on matters not specifically included in any entry in any of the three Lists.
It was, however, said that the observations in Dhillon 's case (supra) are no more good law in view of the opinion of Judges constituting 662 majority in His Holiness Kesavananda Bharati Sripadagalavaru vs State of Kerala(1).
The controversy in Kesavananda Bharati 's case was about the power of the Parliament to amend the Constitution and a contention being the spill over from I.C. Golaknath vs State of Punjab(2) was that apart from Article 368, Entry 97 of List I would confer power on Parliament to amend the Constitution.
After pointing out that when all the three Lists were exhaustively drawn up it is difficult to believe that an important power would be kept hidden in Entry 97 of the Union List leaving to the off chance of the courts locating that power in that entry, it was said that if a subject of legislation was present to the minds of the framers of the Constitution, it could not have been left to be found by the Courts in the residuary powers.
Mr. Seervai 's commentary at p. 1264 on Constitutional Law of India, 2nd Edn., was pressed into service wherein it is observed that a fortiori if a subject of legislative power was prominently present to the minds of the framers of our Constitution, they would not have left it to be found by Courts in the residuary power.
Proceeding ahead it was submitted that while enacting Entry 51 in List II the subject of levying duty on import of alcoholic liquor was present to the minds of the framers of the Constitution and, therefore, it is futile to search that power in the residuary Entry.
The observations in Kesavananda 's case (supra) have to be kept in focus in the context of the controversy whether Article 368 confers specific power of amendment of the Constitution and it was sought to be brushed aside by saying that it merely provided procedure for amendment of the Constitution and, therefore, the power for amendment must be located in the residuary Entry 97 of the Union List.
The position here is materially different.
With the advancement of society, expanding horizons of scientific and technical knowledge, probe into the mystery of creation, it is impossible to conceive that every imaginable head of legislation within human comprehension and within the foreseeable future could have been within the contemplation of the founding fathers and was, therefore, specifically enumerated in one or the other of three Lists, meaning thereby that three Lists were exhaustive of Governmental action and activity.
Demands of welfare State, hopes and aspirations and expectations in a developing society and the complex world situation with inter dependence and hostility amongst nations may necessitate legislation on some such topics that even for visionary they could not have within the contemplation of the founding fathers.
Complex modern governmental administration in a federal set up pro 663 viding distribution of legislative powers coupled with power of judicial review may raise such situations that a subject of legislation may not squarely fall in any specific entry in List I or III.
Simultaneously on correct appraisal it may not be covered by any entry in List II though apparently or on a superficial view it may be covered by an entry in List II.
In such a situation Parliament would have power to legislate on the subject in exercise of residuary power under Entry 97, List I and it would not be proper to unduly circumscribe, corrode or whittle down this power by saying that subject of legislation was present to the mind of the framers of the Constitution because apparently it falls in one of the entries in List II and thereby deny power to legislate under Entry 97.
The history of freedom struggle demonstrates in unequivocal terms the importance of residuary power of legislation being conferred on Parliament.
Therefore, the scope and ambit of Entry 97 need not be whittled down or circumscribed by a process of interpretation.
In any case majority decision in Dhillon 's case (supra) is neither overruled not departed from in Kesavananda 's case (supra).
Accordingly, once the power of Parliament to legislate on a topic is not expressly taken away by any constitutional provision, it remains intact under Entry 97 of List I. Undoubtedly, excise and countervailing duties on alcoholic liquors for human consumption were within the contemplation of the framers of the Constitution.
That is a specific topic of legislation in List II.
It does not exhaust all conceivable levy that can be legitimately imposed on such items if otherwise they could be legally levied by reference to constitutional power to levy the same.
And Entry 97 is a complete answer to the contention.
It was incidentally urged that Entry 52 in the State List which enables the levying of taxes on entry of goods in local area for consumption, use or sale therein was also within the contemplation of the founding fathers and that power under Entry 52 having been exercised by the Delhi Municipal Administration in the form of terminal tax the same cannot be arrogated by Parliament to itself.
Terminal tax is entirely different from the special duty sought to be imposed by the impugned Ordinance.
The impost is on entry of country liquor into Delhi to be recovered by the Delhi Administration for its own use.
Delhi Administration and Delhi Municipal Administration are entirely different, and therefore, it cannot be said that Entry 52 excludes the power of the Parliament to levy tax on import of country liquor in Delhi.
Incidentally, the argument is that the taxing event being the import of liquor in Delhi it is exposed to double taxation, namely, the special 664 duty levied by Parliament and the terminal tax imposed by the Municipal Administration and that is impermissible.
This has merely to be mentioned to be rejected in view of the decision of this Court in Avinder Singh & Ors.
vs State of Punjab & Ors.
,(1) wherein it was observed that if on the same subject the legislature chooses to levy tax twice over there is no inherent invalidity in the fiscal adventure save wherever prohibitions exist.
It was next contended that what is sought to be done by the impugned Ordinance is to circumvent the decision of the learned single Judge of the High Court which invalidated the levy of countervailing duty and that at best it is a colourable legislation and that in pith and substance it is re introduction of countervailing duty under a different nomenclature and hence unsustainable.
If by a legislation tax is sought to be imposed in exercise of certain legislative power which under judicial review is found to be wanting, it does not prohibit the legislature from exercising the same power if it can be traced to provisions of the Constitution.
Merely because an incorrect exercise of legislative power under a misconception of power itself is once invalidated that very legislative power if it is traceable to provisions in the Constitution cannot be struck down on the ground that it is a colourable legislation or a mere camouflage.
Undoubtedly initially countervailing duty was levied but it was found that as country liquor was not manufactured in Delhi legally it was impermissible to levy countervailing duty.
This is admitted in the Preamble of the Ordinance itself.
It was a constitutional error to have levied such a duty and the same was pointed out.
Now, if the very duty could be levied under the power which is available it can never be said that it is a colourable exercise of power or that the new impost is a camouflage for the old one.
What is colourable legislation was explained by this Court in K. C. Gajapati Narayan Deo vs State of Orissa,(2) and it was re affirmed in Maharana Shri Jayvant Singhji Ranmal Singhji etc.
vs State of Gujarat.(3) This Court said that the idea conveyed by the expression "colourable legislation" is that although apparently a legislature in passing a statute purported to act within the limits of its powers, yet in substance and in reality it transgressed those powers, the transgression being veiled by what appears, on proper examination, to be a more pretence or disguise.
Applying this test it is difficult to say that the impugned impost is either a camouflage or a colourable legislation.
Conditions for levy of countervailing duty may not be satisfied.
That 665 does not debar the Parliament from levying tax on import of country liquor if it has otherwise power to do so.
It would be too trite a saying that if countervailing duty cannot be imposed there would be no power to impose duty in any form on the import of country liquor into a territory where that country liquor is not manufactured.
In fact, where particular pre requisites for levying a tax are not satisfied and it is so pointed out by a Court of law, the legislature would not lack power to levy that tax if it could be traced to the provisions of the Constitution.
In such a situation Legislature has power to set at naught the judgment of the court by resort to appropriate power.
This is well settled by the decision of this Court in Patel Gordhandas Hargovindas vs Municipal Commissioner, Ahmedabad,(1) where the word 'rate ' as used in Bombay Municipal Boroughs Act, 1925, came up for interpretation and it was held that it can be imposed on the annual letting value of the property but not on the capital value of the property.
The legislature stepped in by enacting Gujarat Imposition of Tax by Municipalities (Validation) Act, 1963, providing in section 3 thereof assessment and collection of rate on lands and buildings on the basis of capital value or a percentage of the capital value and declaring the past levy to be valid by further providing that tax on lands and buildings may be imposed either on the basis of annual letting value or on the basis of capital value.
When the amending and validating Act was questioned Prithvi Cotton Mills Ltd. & Anr.
vs Broach Borough Municipality & Ors.
,(2) this Court observed that the legislature exercised its undoubted powers of redefining 'rate ' so as to equate it to a tax on capital value and convert the tax purported to be collected as a 'rate ' into a tax on lands and buildings, and thus got rid of the judgment in Patel Gordhandas 's case, (supra).
It would thus follow that merely because a statute was found to be invalid on the ground of legislative competence that does not permanently inhibit the Legislature from re enacting the statute if the power to enact the same is properly traced and established.
In such a situation it would not be correct to say that the subsequent legislation would be merely a colourable legislation or a camouflage to re enact the invalidated previous legislation.
In passing it was mentioned that there is inherent evidence to show that the fresh impost was nothing but the invalidated countervailing duty under a guise of different nomenclature.
It was said that special duty can be levied under the Act amended by the Ordinance only on the import of any 'excisable article ' being an article on which countervailing duty as is mentioned in Entry 51 of List, 2, Seventh Schedule to the Constitution is not imposable on the ground merely that such 666 article is not being manufactured or produced in the territory to which the Act is extended.
Reference was then made to the definition of 'excisable article ' in section 3 of the Act.
Excisable article has been defined to mean (a) an alcoholic liquor for human consumption, or (b) any intoxicating drug, (c) spirit, the last being added by the impugned Ordinance.
Apart from the definition, it was urged that excisable article in common parlance or by judicial interpretation has been understood to mean article on which excise is levied, or leviable.
Proceeding further it was said that as country liquor was not manufactured in Delhi, excise could not be levied on it not countervailing duty could be imposed on its import though that very liquor where manufactured may be an excisable article in that area.
It was, therefore, said that subject matter of impost being an excisable article, meaning if manufactured in Delhi excise could be levied on it, the special duty is nothing but invalidated countervailing duty on excisable article.
There is no merit in this submission because the expression 'excisable article ' which alone can be the subject matter of levy of special duty is merely descriptive of the goods subject to charge.
It is only an identifying mark, a tag, which would attract special duty.
If liquor was manufactured in Delhi it would be an excisable article.
It is that article on which, if manufactured in Delhi, excise could be levied which when imported would provide the taxing event for the levy of special duty because in the absence of manufacture in Delhi countervailing duty cannot be imposed upon it.
The expression is used for identifying the subject matter of impost and nothing more need be read into it.
The next important contention was that this impost imposed unreasonable restrictions on the freedom of inter State trade, commerce and intercourse guaranteed by Article 301 or the freedom to carry on trade or business in liquor is a fundamental right under Article 19(1) being not in public interest, the enactment is constitutionally invalid.
That raises the oft repeated vexed question whether right to carry on trade or business in liquor is a fundamental right under Article 19 (1) (g) and that same considerations would apply for acting under Article 301.
This question has cropped up before the Court at regular intervals but it would be sufficient to take note of two decisions to dispose of the contention.
In Har Shankar & Ors. etc.
vs Dy.
Excise & Taxation Commissioner & Ors.(1) after referring to Crowley vs Christansen,(2) and several cases of this Court it was in terms stated that there is no fundamental right to do trade or business in intoxicants.
The State 667 under its regulatory powers, has right to prohibit absolutely every form of activity in relation to intoxicants its manufacture, storage, export, import, sale and possession.
In all their manifestations, these rights are vested in the State and indeed without such vesting there can be no effective regulation of various forms of activities in relation to intoxicants.
In reaching this conclusion the Court took note of an important observation made in the State of Bombay vs R. M. D. Chamarbaugwala,(1) which may be extracted as under: "We find it difficult to persuade ourselves that gambling was ever intended to form any part of this ancient country 's trade, commerce or intercourse to be declared as free under article 301.
It is not our purpose nor is it necessary for us in deciding this case to attempt an exhaustive definition of the word 'trade ', 'business ', or 'intercourse '.
We are, however, clearly of opinion that whatever else may or may not be regarded as falling within the meaning of these words, gambling cannot certainly be taken as one of them.
We are convinced and satisfied that the real purpose of articles 19(1)(g) and 301 could not possibly have been to guarantee or declare the freedom of gambling.
Gambling activities from their very nature and in essence are extra commercium although the external forms, formalities and instruments of trade may be employed and they are not protected either by article 19(1) (g) or article 301 of our Constitution".
After extracting these observations this Court observed in Har Shankar 's case (supra) that the reasons mentioned by Das, C. J. for holding that there can be no fundamental right to do trade or business in an activity like gambling apply with equal force to the alleged right to trade in liquor and those reasons may not be brushed aside by restricting them to gambling operations.
Recently, in P. N. Kaushal & Ors., vs Union of India & Ors.,(2) after an exhaustive review of all previous decisions, this conclusion was affirmed that there is no fundamental right to trade or business in nauseous drinks which includes liquor.
If there is no fundamental right to carry on trade or business in liquor, there is no question of its abridgement by any restriction which can be styled as unreasonable.
In fact, as stated in Har Shankar 's case, (supra) the State under its regulatory power has a right to control or even to prohibit absolutely every form of activity in relation to intoxicants apart from anything else, its import 668 too.
This power of control is question of society 's right to self protection and it rests upon the right of the State to act for the health, moral and welfare of the people.
Liquor traffic is a source of pauperism and crime.
In this background it is now too late in the day to entertain an argument that imposition of tax on the import of liquor which serves the double purpose of restraining its use by making it costly and prohibiting its use on the ground that it trenches upon the manufacturers slowly and gradually to restrict its manufacture directly impinging upon its unrestricted consumption.
Such an impost, therefore, can be said to be one in the public interest for preserving public health and public morals and cannot be said to be one as infringing the inter State freedom of trade and commerce.
Mr. Rao, who appeared for some of the petitioners specifically submitted that this question is no more res integra in view of the decision of a Constitution Bench of this Court in Kalyani Stores vs The State of Orissa & Ors.(1) In that case the validity of a Notification enhancing the duty on the import of foreign liquors from Rs. 40/ to Rs. 70/ per L.P. Gallon was questioned on the ground that it interferes with freedom of inter State trade and commerce guaranteed by Article 301.
This challenge was upheld by the majority decision observing that "the notification levying duty at the enhanced rate is purely a fiscal measure and cannot be said to be a reasonable restriction on the freedom of trade in the public interest.
Without entering upon an exhaustive categorisation of what may be deemed "required in the public interest", it may be, said that restrictions which may validly be imposed under article 304(b) are those which seek to protect public health, safety, morals and property within the territory".
Since Kalyani Stores case (supra) judicial opinion on the vexed question of right to carry on trade or business in intoxicating drinks has undergone a sea change culminating into Har Shankar 's case (supra) which again is a decision of 5 Judges Constitution Bench of this Court.
Unfortunately the judgment in Kalyani Stores case is not referred to in Har Shankar 's case.
However, the undisputed position that now emerges is that there is no fundamental right to do trade or business in intoxicants.
Once that latter pronouncement is unambiguous and incontrovertible a regulatory measure imposing a tax cannot be questioned on the ground of unreasonableness or want to public interest because one must not lose sight of the well accepted legal proposition that all taxes are imposed in public interest.
Even apart from this, the majority judgment in Kalyani Stores case (supra) clearly recognises the test of 669 reasonable restrictions to be judged in the light of the purpose for which the restriction is imposed, i.e. as may be required in the public interest and restrictions that may validly be imposed under Article 304(b) are those which seek to protect public health, safety, morals and property within the territory.
The Preamble to the impugned Ordinance clearly recites that the special duty on the importation of country liquor into Delhi is an endeavour towards bringing about prohibition of consumption of alcoholic drinks, and, therefore, it is a step in the direction of safeguarding public health.
Incidentally, however, it was stated that when the Minister piloted the Bill replacing the Ordinance it was in terms said that the Act replacing the Ordinance was purely a fiscal measure and had nothing to do with the prohibition.
In the same breath it was stated that the Government was committed to total prohibition and would sincerely try to achieve this objective.
Opinion of the Minister would be hardly relevant in examining the object and purpose behind enacting a certain legislation.
Provision in Punjab Excise Act, 1914, conferring power on the State to direct closure of liquor shops on certain days in a week, month or year was challenged as one not of a regulatory character but introduced with the avowed object of enforcing prohibition and a contention was raised that way back in 1914 the then rulers could not have thought of enforcing prohibition through the provisions of the Punjab Act which was specifically enacted for the purpose of collecting revenue from liquor vendors and indirectly from liquor consumers.
This Court in P. N. Kaushal 's case (supra) while repelling this contention observed as under: "In short, while the imperial masters were concerned about the revenues they could make from the liquor trade they were not indifferent to the social control of this business which, if left unbridled, was fraught with danger to health, morals, public order and the flow of life without stress or distress.
Indeed, even collection of revenue was intertwined with orderly milieu; and these twin objects are reflected in the scheme and provisions of the Act".
The present levy under the amended provisions of the Act in its application to Delhi could certainly be said to be one enacted both with the object of regulating the trade or business in intoxicants and with a view to realising the goal fixed in Article 47 of the Constitution Therefore, one can look upon this measure both as a fiscal measure and the one safeguarding public health and even public morals because it is 670 well recognised that liquor trade is instinct with injury to individual and community and has serious side effects recognised everywhere in every age.
[Not to control alcohol business is to abdicate the right to rule for the good of the people] [see P. N. Kaushal 's case (supra)].
In this very breath it was, however, contended that if this Ordinance was promulgated with a view to advancing the policy of prohibition enunciated in article 47 it could only be prospective and not retrospective because one cannot introduce prohibition retrospectively.
This argument overlooks the twin objects sought to be achieved by the measure, namely, validating an import which was found to be invalid on the ground that it was countervailing duty which could not have been legitimately imposed, and also a measure to safeguard public health and public morals.
These twin objects underlying the measure would clearly permit its being retrospective because retrospective validation of impost has been recognised in a number of decisions (see Prithvi Cotton Mills case) (supra).
Therefore, there is no substance in the contention that the retrospectivity of the Ordinance is illegal and invalid.
Having given the matter our anxious consideration not swayed in any manner by moral, religious, ethical or extraneous preachers ' considerations the altruistic grievance of the petitioners by proxy for consumers strikes as hollow because even with the impost the petitioners ' profit of Rs. 2/ per bottle is guaranteed and they are in no way adversely affected by the impost because the levy is passed on to consumers.
For years the impugned levy was paid as countervailing duty.
Then a loophole appeared which is sought to be plugged by a valid legislation.
And even with this turmoil the licensee in L 10 Form having country liquor vend is assured of this profit of Rs. 2/ per bottle.
The entire impost is passed on to the shoulder of consumers except for the detention of his money for a day or two when he pays in advance while taking the bottles from the Warehouse and recovers it when he sells the bottle and this detention of his money for a period of two days is a triviality which need not detain any one.
It is a part of any business.
Therefore, we see no substance in these petitions.
V.D.K. Petitions dismissed.
| IN-Abs | While implementing the provisions of the Punjab Excise Act, 1914 as in force in the Union Territory of Delhi, the concerned authority used to hold auction for grant of licence in Form L 10 for selling country liquor and at one such auction held on 29th March 1978, the petitioners ' bids were accepted and they were granted licences in Form L 10 for the period 1st April 1978 to 31st March 1979.
The licence included a condition to sell a bottle of 750 ml. of country liquor at Rs. 15/ which was inter alia made up at excise duty (styled as still head duty) at the rate of Rs. 10.23 and profit of licensee at the rate of Rs. 2/ .
In W.P. 716/78, validity of the levy of 'still head duty ' was challenged by certain petitioners inter alia on the ground that it was nothing but countervailing duty and in the absence of manufacture of liquor in Delhi, countervailing duty on the import of liquor cannot be constitutionally levied.
This contention found favour with a learned single judge of the Delhi High Court and a number of Letters Patent Appeals were filed against that Judgment.
During the pendency of these appeals President of India promulgated an Ordinance purporting to amend the Punjab Excise Act, 1914, styled as Punjab Excise (Delhi Amendment) Ordinance, 1979 with retrospective effect, conferring power on the Government under the provisions of the Act to levy 'special duty ' on the import of country liquor in Delhi at rates not exceeding that set out in Schedule I A which was introduced in the Act by the Ordinance.
Pursuant to the Ordinance amending the Principal Act, the Delhi Fiscal Duty Order, 1979 was issued levying special duty at the rates set out in the order on import of country liquor into Delhi.
Some of the petitioners questioned the validity generally of the Ordinance and specifically of the impost of special duty in Civil Writ No. 16/79.
A Division Bench of the Delhi High Court heard the Letters Patent Appeals and the Writ Petition No. 116/79 and by a common judgment held the ordinance as well as the impost of the special duty thereunder valid, dismissed the Writ Petition and allowed the Letters Patent Appeals.
652 Dismissing the special leave petitions, the Court ^ HELD: 1.
Scheme underlying distribution of Legislative power in Part XI Chapter I and especially Articles 246 and 248 is that except the matters specifically enumerated in List II (State List) in the Seventh Schedule, Parliament 's plenary power to legislate extends to all conceivable matters which can be topic of legislation, and even this limitation on its power vanishes when Parliament legislates for part of the territory of India not included in a State.
The three dimensional picture becomes complete, viz. (i) to select topic for legislation (ii) enactment of legislation on the topic and (iii) to impose tax in respect of such subject matter of legislation by reference to article 248 which confers power to make any law with respect to any matter not enumerated in Lists II and III including the power to impose tax not mentioned in either of those lists.
Under article 246 (4) Parliament has power to make laws with respect to any matter for any part of the territory of India, not included in a State notwithstanding that such matter is a matter enumerated in the State List.
Power of Parliament thus to legislate with respect to any matter for Delhi, territory not included in a State is unabridged or unfettered by the entries in the State List.
Further residuary power of legislation including the power to levy tax is conferred on Parliament by the combined operation of Articles 246(4), 248(1) and (2) and Entry 97 in the Union List.
That power is untrammelled by the limitations prescribed by Article 246(2) and (3) and Entry 51 of State List and is plenary and absolute subject only to such restrictions as imposed by the Constitution.
[659 G H, 660 A C] Mithan Lal vs State of Delhi, ; @ 451; referred to.
While legislating for the Union Territories the Parliament unhampered by Articles 246(2) and (3) but enriched by Article 248(1) and (2) could legislate on any of the topics either in the List I and III or in List II or in exercise of the residuary power under Entry 97.
There is nothing in the Constitution to prevent Parliament from combining its powers under one or other Entry with its power under Entry 97.
Parliament can rely on the powers under specified Entries I to 96 List I and supplement them with the powers under Entry 97 List I and Article 24 or even the powers under Entries in the concurrent list.
There is no dearth of legislative competence of Parliament to enact legislation for a territory not included in a State because the power to legislate takes within its sweep matters included in all the three lists and added to it is the residuary power on matters not specifically included in any entry in any of the three lists.
[661 D G] If exercise or countervailing duty could be levied on country liquor manufactured or imported into Delhi, Parliament would not lack competence to levy the same only because levy of such duty on alcoholic liquors for human consumption is within the competence of a State.
As country liquor is not manufactured in Delhi, the Parliament could not under Entry 51 of the State List levy either excise or countervailing duty on it.
Merely because Parliament could not levy countervailing duty on country liquor imported into Delhi because country liquor is not manufactured in Delhi it does not exhaust the power of Parliament to levy some other duty on the import of liquor if it is otherwise constitutionally permissible.
[660 D F] Union of India vs H. section Dhillon, ; ; followed.
653 3.
With the advancement of society, expanding horizons of scientific and technical knowledge, probe into the mystery of creation, it is impossible to conceive that every imaginable head of legislation within human comprehension and within the foreseeable future could have been within the contemplation of the founding fathers and was, therefore, specifically enumerated in one or the other of the three Lists, meaning thereby that three Lists were exhaustive of Governmental action and activity.
Demands of welfare State, hopes and aspirations and expectations in a developing society and the complex world situation with inter dependence and hostility amongst nations may necessitate legislation on some such topics that even for visionary they could not have been within the contemplation of the founding fathers.
Complex modern governmental administration in a federal set up providing distribution of legislative power coupled with power of judicial review may raise such situations that a subject of legislation may not squarely fall in any specific entry in List I or II.
Simultaneously on correct appraisal it may not be covered by any entry in List II though apparently or on a superficial view it may be covered by an entry in List II.
In such a situation Parliament would have power to legislate on the subject in exercise of residuary power under Entry 97, List I and it would not be proper to unduly circumscribe, corrode or whittle down this power by a process of interpretation by saying that subject of legislation was present to the mind of the framers of the Constitution because apparently it falls in one of the entries in List II and thereby deny power to legislate under Entry 97.
The history of freedom struggle demonstrates in unequivocal terms the importance of residuary power of legislation being conferred on Parliament.
Accordingly, once the power of Parliament to legislate on a topic is not expressly taken away by any constitutional provision, it remains intact under Entry 97 of List I. [662 G H, 663 A D] Undoubtedly excise and countervailing duties on alcoholic liquors for human consumption were within the contemplation of the framers of the Constitution.
That is a specific topic of legislation in List II.
It does not exhaust a conceivable levy that can be legitimately imposed on such items if otherwise they could be legally imposed on such items by reference to constitutional power to levy the same.
And Entry 97 is a complete answer to the contention.
[663 D E] His Holiness Kesavananda Bharati Sripadagalavaru vs State of Kerala, ; explained and discussed.
I. C. Golaknath vs State of Punjab, ; referred to.
Union of India vs H. section Dhillon, ; , affirmed.
Terminal tax is entirely different from the special duty sought to be imposed by the impugned Ordinance.
The impost is on entry of country liquor into Delhi to be recovered by the Delhi Administration for its own use.
Delhi Administration and Delhi Municipal Administration are entirely different, and, therefore, it cannot be said that Entry 52 excludes the power of the Parliament to levy tax on import of country liquor in Delhi.
[663 F G] 5.
If on the same subject the legislature chooses to levy tax twice over there is no inherent invalidity in the fiscal adventure.
More so when Special Duty levied by Parliament and the terminal tax imposed by the Municipal Administration on the import of liquor in Delhi can be traced to independent source of power.
[664 A B] 654 Avinder Singh and Ors.
vs State of Punjab and Ors.
; ; followed.
The idea conveyed by the expression "colourable legislation" is that although apparently a legislature in passing a statute purported to be within the limits of its powers, yet in substance and in reality it transgressed those powers, the transgression being veiled by what appears, on proper examination, to be a mere pretence or disguise.
Applying this test it is difficult to say that the impugned impost is either a camouflage or a colourable legislation.
[664 G H] Merely because a statute was found to be invalid on the ground of legislative competence that does not permanently inhibit the legislature from re enacting the statute if the power to enact the same is properly traced and established.
In such a situation it would not be correct to say that the subsequent legislation would be merely a colourable legislation or a camouflage to re enact the invalidated previous legislation.
[665 E F] K. C. Gajapati Narayan Deo vs State of Orissa, ; , Maharana Sri Jayvant Singhji Ranmal Singhji etc.
vs State of Gujarat, [1962] Suppl.
2 SCR 411 @ 440, Patel Gordhandas Hargovindas vs Municipal Commissioner, Ahmedabad, ; , Prithvi Cotton Mills Ltd. and Ors.
vs Broach Borough Municipality and Ors., ; referred to.
The expression 'excisable article ' which alone can be the subject matter of levy special duty is merely descriptive of the goods subject to change.
It is only an identifying mark, a tag, which would attract special duty.
If liquor was manufactured in Delhi it would be an excisable article.
It is that article on which, if manufactured in Delhi excise duty could be levied which when imported would provide the taxing event for the levy of special duty because in the absence of manufacture in Delhi countervailing duty cannot be imposed upon it.
The expression is used for identifying the subject matter of impost and nothing more need be read into it.
[666D E] 8.
There is no fundamental right to do trade or business in intoxicants.
The State under its regulatory powers, has right to prohibit absolutely every form of activity in relation to intoxicants its manufacture, storage, export import, sale and possession.
In all their manifestations these rights are vested in the State and indeed without such vesting there can be no effective regulation of various forms of activities in relation to intoxicants.
[666 H, 667 A] If there is no fundamental right to carry on trade or business in liquor, there is no question of its abridgement by any restriction which can be styled as unreasonable.
The State under its regulatory power has a right to control or even to prohibit absolutely every form of activity in relation to intoxicants apart from anything else, its import too.
This power of control is question of society 's right to self protection and it rests upon the right of the State to act for the health, moral and welfare of the people.
Liquor traffic is a source of pauperism and crime.
Such an impost, therefore, is one in the public interest for preserving public health and public moral and is not one as infringing the interstate freedom of trade and commerce.
All taxes are imposed in public interest.
[667 F H, 668 A B] In the instant case the Preamble to the impugned Ordinance clearly recites that the special duty on the importation of country liquor into Delhi an endeavour towards bringing about prohibition of consumption of alcoholic drinks, and, 655 therefore, it is a step in the direction of safeguarding public health and with a view to realising the goal fixed in Article 47 of the Constitution.
It is a fiscal measure and the one safeguarding public health and even public morals because it is well recognised that liquor trade is instinct with injury to individual and community and has serious side effects recognized everywhere in every age.
Not to control alcohol business is to abdicate the right to rule for the good of the people.
[669 B, G H, 670 A] Har Shanker and Ors. etc.
vs Dy.
Excise and Taxation Commissioner and Ors.
; , State of Bombay vs R.M.D. Chamarbaughwala; , ; P. N. Kaushal and Ors.
vs Union of India and Ors.
, ; ; applied.
Crowley vs Christansen, ; quoted with approval.
P. N. Kaushal and Ors.
vs Union of India and Ors.
, ; ; referred to.
There is no substance in the contention that the retrospectivity of the Ordinance is illegal and invalid.
The argument overlooks the twin objects sought to be achieved by the measure namely, validating an import which was found to be invalid on the ground that it was countervailing duty which could not have been legitimately imposed and also the object to safeguard public health and public moral [670 B D] Prithvi Cotton Mills Ltd. and Anr.
vs Broach Borough Municipality and Ors., ; applied.
The altruistic grievance of the petitioner by proxy for consumers strikes as hollow because even with the impost the petitioners ' profit of Rs. 2/ per bottle is guaranteed and they are in no way adversely affected by the impost because the levy is passed on to consumers, except for the detention of their money for a day or two when they pay in advance while taking the bottles from the Warehouse and recovers it when they sell the bottle and this detention of their money for a period of two days is a triviality and is a part of any business.
[670 E F]
|
os. 651 of 1954 and 39, 46, 51 and 176 of 1955.
45 Under Article 32 of the Constitution of India for the enforcement of fundamental rights.
section P. Sinha (section D. Sekhari, with him), for the petitioner in Petition No. 651 of 1954.
section P., Sinha (B. K. Saran and M. M. Sinha, with him), for the petitioner in Petition No. 39 of 1955.
B. K. Saran and M. M. Sinha, for the petitioner in Petition No. 46 of 1955.
section D. Sekhari, for the petitioner in Petition No. 51 of 1955.
R. Patnaik, for the petitioner in Petition No. 176 of 1955.
M. C. Setalvad, Attorney General of India (R. Ganapathy Iyer and P. G. Gokhale, with him) for respondents in all the Petitions.
January 20.
The Judgment of the Court was delivered by JAGANNADHADAS J.
These are five petitions under article 32 of the Constitution by the heads of five Maths in the State of Orissa of which four known as Mahiparakash Math, Uttaraparswa Math, Dakshinaparswa Math and Radhakant Math are situated in Puri and the fifth known as Manapur Math is near Tirtol in Cuttack district.
In all these petitions certain provisions of the Orissa Hindu Religious Endowments Act, 1951 (Orissa Act II of 1952) as amended by Orissa Act XVIII of 1954 are challenged as being unconstitutional and ultra vires.
Since the questions raised are mostly common, all the petitions are dealt with by this single judgment.
These petitions have a background of previous history of legislation and litigation which it is necessary to set out in order that the questions raised, may be properly appreciated.
The first statutory interference by the Provincial Legislature with the management of Hindu religious endowments in Orissa was by the Orissa Hindu Religious Endowments Act, 1939 (Orissa Act IV of 1939) which came into operation 46 on the 31st August, 1939.
This was modelled on a similar Act operating in the Province of Madras at thetime.
ThevalidityoftheActasawholeasalso, of certain provisions thereof we 're challenged by the Mahants of the various Maths in Orissa, about 30 in number, by instituting a suit in the year 1940.
The suit was on behalf of the individual Maths who figured as plaintiffs (including three of the present petitioners, viz. Mahants of Mahiparakash Math, Dakshinaparswa Math and Radhakanta Math) and also in a representative capacity under Order I, rule 8 of the Civil Procedure Code.
(Vide printed record of this Court in Case No. I of 1950).
That suit was dismissed by the District Judge of Cuttack and came up in appeal to the High Court of Orissa.
The High Court upheld the validity of the Act and of the various sections thereof by its judgment dated the 13th September, 1949, which is reported in Mahant Sri Gadadhar Ramanuj Das vs The Province of Orissa(1).
An appeal was filed therefrom to the Supreme Court in Jaiiuary, '1950, which was numbered as Case No. I of 1950.
This appeal remained pending for over four years and came up for final hearing in February, 1954.
During the period of pendency of the appeal the Orissa Legislature passed two further Acts relating to Hindu religious endowments.
The first of them was Orissa Act II of 1952 which was an Act to "amend and consolidate the law relating to the ad ministration and governance of Hindu religious institutions and endowments in the State of Orissa" and which on its coming into force was intended to repeal the pre existing Orissa Act IV of 1939.
This Act became law on the 16th February, 1952, by the assent of the President.
It did not however come into force at once on account of sub section (3) of section I therein which provided that the Act is to "come into force on such date as the State Government may, by notification, direct".
No such notification was issued during the pendency of the appeal in the Supreme Court.
This Act was, in fact, brought into force much later, i.e., only as from the 1st Janu (1) I.L.R. [19491 Cuttack 656.
47 ary, 1955, by a notification of the Government of Orissa dated the 22nd December, 1954, published in the Orissa Gazette dated the 31st December, 1954.
While thus the 1952 Act remained on the statute book without its coming into force.
, other independent statutory provisions amending the Act of 1939 were passed and brought into operation.
The first of them was Orissa Ordinance No. 11 of 1953 which was promulgated by the Governor of Orissa on the 16th May, 1953.
This was later superseded and substituted by Orissa Act XVIII of 1953 which came into operation on the 28th October, 1953.
By these two successive legislative measures, the Act of 1939 was amended in certain respects and it is the Act so amended that was in operation during the period from May, 1953 to March, 1954, falling within the later portion of the pendency of Case No. I of 1950 in the Supreme Court.
Some time in 1953, subsequent to the month of May, the Commissioner of Hindu Religious Endowments, Orissa, appears to have initiated proceedings for the framing of schemes in respect of a number of Matbs, and schemes were actually framed during this period as regards the four Maths, Mahiparakash, Uttaraparswa, Daksbinaparswa and Radhakanta comprised in Petitions Nos.
651 of 1954, 49, 46 and 51 of 1955, respectively.
These schemes were brought into operation and the administration of some of these Matbs was taken over by the Trustees under the schemes.
Thereafter Mahants of three of the affected Maths, Mahiparakash, Uttaraparswa and Radhakanta, who are also petitioners before us, filed applications under article 226 before the High Court of Orissa challenging the alidity of the schemes.
Those applications were dismissed by the High Court on the 17th February, 1954.
Meanwhile the Mahant of Dakshinaparswa Math who was a petitioner in the High Court and also before filed along with another Mahant, a petition under icle 32 of the Constitution to this Court on the d December, 1953, challenging the Act then in force as being in violation of their fundamental rights.
This was Petition No. 405 of 1953.
This petition as 48 well as Case No. 1 of 1950, referred to above, came up for hearing, together, in this Court on the 9th, 10th and 11th February, 1954.
Judgment of this Court therein was delivered on the 16th March, 1954, and is reported in Mahant Sri Jagannath Ramanuj Das vs The State of Orissa(2).
As a result thereof, sections 38 and 39 of Orissa Act IV of 1939 as amended in 1953, under which the schemes were framed were declared unconstitutional.
Accordingly, the schemes became invalid and therefore the possession of such of the Matbs which had been, taken over under the schemes was restored to the Mahants.
(It may be mentioned in passing, in this context, that the judgment of this Court refers to Orissa Act II of 1952 as being the one in force at the time and whose provisions were under consideration by the Court.
This is a slip.
The Act then in force was, as already stated, the Act of 1939 as amended in 1953.
That this is a slip in the judgment is admitted before us.
That does not however in any way detract from the reasoning and the bind ing character of the judgment, since as a fact what were really referred to were the sections of the 1939 Act as amended in 1953).
Now, after the judgment of this Court was delivered in March, 1954.
, the Orissa Legislature again intervened and passed another Act, Orissa Act XVIII of 1954.
This Act purported to amend not the 1939 Act which was by then in operation but the 1952 Act which had not by then come into force.
Orissa Act XVIII of 1954 received the assent of the President on the 2nd December, 1954; and came into force at once and therefore Orissa Act II of 1952 became pro tanto amended and modified.
By that date the 1952 Act so amended was awaiting the issue of notification under section 1(3) thereof for being brought into force.
This notification, as alreay stated, was ultimately issued on the 22nd December.
1954, bringing Orissa Act II of 1952 as amended Act XVIII of 1954 into force from the 1st January, 1955, and thereby repealing Orissa Act IV of 1939 amended in 1953.
The first of the petitions before us, relating to Mahiparakash Math was filed in this (1) ; 49 Court, anticipating this notification, while the other four were filed after the notification was issued.
As already stated, all these petitions challenge the validity of various sections of Act 11 of 1952 as amended in 1954 (hereinafter referred to as the present Act).
The challenge is entirely based upon the principles laid down by this Court in Mahant Sri Jagannath Ramanuj Das vs The State of Ori8sa(1).
The ' above is the history of the relevant legislation and the connected parallel litigation.
The main attack is in respect of sections 42 and 79 A of the present Act relating to the schemes for religious institutions of the kind with which we are concerned in these petitions.
There can be no doubt that the two sections apply to these Maths.
The phrase "religious institution" occurring in section 42 has been defined as meaning (also) "a math and endowments attached thereto".
A Math is "an institution succession to the headship of which devolves in accordance with the directions of the founder or is regulated by custom" and a hereditary trustee is "a trustee of an institution succession to whose office devolves by custom or is specifically provided for by the founder".
A Math is therefore a religious institution presided over or managed by a hereditary trustee so as to render section 42 (1) (b) applicable.
To appreciate the ground of attack it is necessary to trace the changes in the provisions relating to the framing of schemes for such institutions in the successive legislative measures.
In the Act as it, stood in 1939 the provisions in this behalf are sections 38, 39 and 40.
Since the attack is mainly as regards the procedure for the framing of the scheme, it is sufficient to notice what the gist of these three provisions is in so far as it relates to the procedure for an enquiry to frame a scheme.
Under these three sections the enquiry is to be held by the Commissioner for Endowments appointed under the Act.
For this purpose he is to function jointly with one or more persons in the service of the Crown appointed by the Provincial Government in (1) ; 7 50 this behalf.
The enquiry has to be conducted "in such manner as may be prescribed".
In making the enquiry the Commissioner and the person or persons associated with him therein are to consult the trustee and the persons having interest.
After the scheme is settled and the order determining the scheme is published in the prescribed manner the trustee or any person having interest may, within six months of the date of such publication, institute a suit in the court to modify or set aside such order.
The order settling a scheme is final and binding on the trustee and all persons having interest, subject to the result of the suit, if any, as above mentioned.
Of course, the result of the suit itself would, under the general law, be subject to further appeal under the Civil Procedure Code in the ordinary way.
Changes were made in these provisions in 1953 first by Orissa Ordinance II of 1953 and then by Orissa Act XVIII of 1953 as already stated.
The modification is that sub section (4) of section 39 which provided for a right of suit, by the trustee or the person interested, in the regular civil court (with the concomitant further appeals to higher courts) was deleted and the following was substituted as sub section (4) of section 39: "Every order under this section shall be published in the prescribed manner and the order so passed shall be final and binding on the trustee and all persons having interest".
As a consequence thereof section 40 of the 1939 Act, which stated that "subject to the result of the suit the order settling a scheme is final", was omitted.
The result of these two changes was that once the Commissioner with the assistance of one or more Government officers who were to be specially nominated, settled a scheme after making the prescribed enquiry, that order was not open to any further question or correction in the ordinary courts.
It was at this stage that the validity of the provisions relating to the framing of a scheme came up for consideration before this Court in March, 1954.
This Court held that the legislation in so far as it authorised the 51 framing of a scheme by the Commissioner along with his associates and declared such determination as final without any scope for correction thereof by judicial intervention, was an unreasonable restriction on the right of the head of the Math with reference to his interest in the Math.
Accordingly sections 38 and 39 of the Act then in force were struck down as unconstitutional and invalid.
The present provisions which are the result of a later amendment are contained in sections 42 and 44 of the present Act and are substantially different.
The relevant portions thereof are as follows: "42.
(1) Whenever there is reason to believe that in the interest of the proper administration of religious institution a scheme may be settled for it, or when not less than five persons having interest make an application in writing stating that in the interests of the proper administration of a religious institution a scheme should be settled for it, the Assistant Commissioner or the Commissioner, as the case may be, shall proceed to frame a scheme in the manners hereinafter provided (a) (b) in the case of a religious institution presided over or managed by a hereditary trustee, the Assistant Commissioner shall make such enquiry as he thinks fit and submit his report to the Commissioner who shall hold an enquiry in the manner prescribed and so far as may be, in accordance with the provisions of the Code of Civil Procedure, 1908, relating to the trial of suits and if he is satisfied that in the interests of the proper administration of such institution a scheme of administration should be settled, he shall consult in the prescribed manner the trustee and the persons having interest and by order settle a scheme of administration for the institution.
(7)Every order of the Commissioner settling a scheme under this section shall, subject to the provisions of Section 44, be binding on the trustee, the Executive Officer and all persons having interest.
(1) 52 (2) Any party aggrieved by the order of the Commissioner under sub section (1) of section 42 may appeal to the High Court within thirty days from the date of the order or publication thereof as the case may be".
The effect of these provisions of the present Act is (1) that a scheme can be framed by the Commissioner alone on a report of the Assistant Commissioner on such enquiry as he thinks fit and not by the Commissioner in association with one or more Government officers to be appointed for the purpose by the Government, (2) that there is no right of suit for cballenging the validity or the correctness of the scheme framed by the Commissioner but there is only an appeal to the High Court direct.
It is urged that these provisions still continue to be unreasonable restrictions on the rights of the Mathadipathi and are accordingly ultra vires and unconstitutional.
In the case reported in the Commissioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutth (1) the interest of Mathadipathi in the Math has been recognised as property falling within the scope of article 19(1)(f) of the Constitution.
It was recognised that the ingredients, of office and property, of duties and personal interest, are blended together in the rights of a Mahant and that the Mahant has the right to enjoy the property or the beneficial interest so long as he is entitled to hold his office.
It was recognised that the beneficial interest which the Mahant enjoys is appurtenant to his duties and that as he is in charge of a public institution, reasonable restrictions can always be placed upon his rights in the interests of the public.
It was however held therein that provisions for the framing of a scheme which by its terms operate by way of unreasonable restriction would be unconstitutional and invalid.
It is this principle that was applied in the next decision of this Court relating to Orissa Maths in Mahant Sri Jagannath Ramanuj Das vs The State of Orissa(2).
There, the validity of the then provisions of the Act, i.e., of sections 38 and 39 of (1) (1954] S.C.R. 1005.
(2) ; 53 Orissa Act IV of 1939 as amended in 1953 was adjudged in the following terms: "Sections 38 and 39 relate to the framing of a scheme.
The scheme can certainly be settled to ensure due administration of the endowed property but the objection seems to be that the Act provides for the framing of a scheme not by a civil court or under its supervision but by the Commissioner, who is a ' mere administrative or executive officer.
There is also no provision for appeal against his order to the court. .
We think that the settling of a scheme in regard to a religious institution by an executive officer without the intervention of any judicial tribunal amounts to an unreasonable restriction upon the right of property of the superior of the religious institution which is blended with his office.
Sections 38 and 39 of the Act must, therefore, be held to be invalid".
It is urged that though the obvious purpose of the amending Act of 1954 passed after this decision by the Supreme Court, was to remedy the defect above pointed out by providing for a right of appeal direct to the High Court from the determination of the Commissioner settling the scheme, the present provisions still continue to be unreasonable restrictions on the right of property of the Mahant.
It is further urged that the initial decision in a scheme proceeding is still on the basis of an executive enquiry by an executive officer and that in any case a direct appeal to the High Court as against the Commissioner 's order cannot be as adequate a safeguard regarding the rights of the Mahants, as a suit and a right of appeal therefrom in the ordinary course to the higher courts would be.
It is undoubtedly true that from a litigant 's point of view an appeal to the High Court from the Commissioner 's order is not the same as, an independent right of suit and an appeal to the higher courts from the result of that suit.
But in order to judge whether the provisions in the present Act operate by way of unreasonable restriction for constitutional purposes what is to be seen is whether the person affected gets a reasonable chance of presenting his entire case before the original tribunal which has to 54 determine judicially the questions raised and whether he has a regular appeal to the ordinarily constituted court or courts to correct the errors, if any, of the tribunal of first instance.
For that purpose it is relevant to notice that in the present Act, the Commissioner of Endowments has, by virtue of section 4 thereof, to be a member of the Judicial Service (of the State) not being below the rank of a Subordinate Judge, while under section 7 of Act IV of 1939 a Commissioner of Endowments could be a person of either the judicial or the executive service and that even where a member of the judicial service is appointed he may be a person below the rank of a Subordinate Judge.
Another important difference has also to be noticed, viz., that while under section 38 of the previous Act the enquiry has to be conducted "in such manner as may be prescribed" which means as prescribed by the Provincial Government by rules made under the Act and hence changeable by the Government, under the present Act, section 42(1) (b) specifically enjoins that "the Commissioner shall hold an enquiry in the manner prescribed and so far as may be in accordance with the provisions of the Code of Civil Procedure relating to the trial of suits".
It may also be noticed that before the Commissioner starts his enquiry it is expected that the Assistant Commissioner, who, by virtue of section 5(2), is to be a person holding a judicial office not lower in rank than that of a Munsif, is to make such enquiry as he thinks fit and submit his report.
Thus in the initial stage of the framing of the scheme under the provisions of the present Act there is first of all something in the nature of a preliminary enquiry by a judicial officer of the rank of a Munsif and this is followed by a regular and full enquiry before the Commissioner who is of the rank of a Subordinate Judge.
The enquiry before the Commissioner is assimilated to and is governed by the provisions relating to the trial of suits by enjoining that, as far as may be, it is to be in accordance with the provisions of the Code of Civil Procedure relating to trial of suits.
While, therefore, under the prior Act the enquiry before the Commissioner might well 55 have been of the nature of an executive enquiry by an executive officer, the enquiry under the present Act is by itself in the nature of a judicial enquiry by judicial officers followed up by a right of regular appeal to the High Court.
A scheme framed with reference to such a procedure cannot ipsofacto be pronounced to be in the nature of unreasonable restriction on the rights of the Mahant.
The legislature ' might well have thought that, instead of making the enquiry before the Commissioner more or less in the nature of a preliminary executive enquiry to be followed up by the affected Mahant by way of a regular suit in the Civil Court '.
it is much more satisfactory and in the public interests, to impress the enquiry before the Commissioner himself with the stamp of greater seriousness and effectiveness and to assimilate the same to a regular enquiry by the judicial officer according to judicial procedure and then to provide a right of direct appeal to the High Court.
It has been strongly urged that a mere right to appeal to the High Court would virtually be in the nature of a limited appeal confined to challenge only on certain basic matters and probably limited to questions of law.
We can find no warrant for any such apprehension.
The right of appeal is given in very wide and general terms.
Obviously the appeal can be both on facts and on law and would relate not merely to the merits of the scheme but also to all basic matters whose determination is implicit in the very framing of a scheme.
In our opinion the present provisions cannot be struck down as being in the nature of unreasonable restriction on the rights of the Mahant.
Two other minor provisions in this connection have been brought to our notice and relied upon as indicating unreasonable restriction on the rights.
One is that while under the 1939 Act the period of limitation for a right of suit was six months, the period allowed for an appeal under the present Act is only 30 days.
Another is that under section 74(3) the operation of the order of the Commissioner is not to be stayed pending the disposal of the appeal.
It 56 has been urged that these provisions operate very harshly against the Mahant affected by a scheme when framed.
It is pointed out that as the result of a scheme being put into operation immediately, the Mahant may be deprived of the effective possession of the Math and hence of the wherewithal to file an appeal within the very short time that is allowed, as also of the resources to conduct the appeal in the High Court or to maintain himself during its pendency which may take years.
There is not much force in this contention.
In so far as the question of filing of an appeal is concerned, there should be no difficulty since the provisions relating to appeals in forma pauperis would be applicable and can be availed of if the circumstances call for it.
In so far as any situation may arise which may call for financial facilities for the conducting of the appeal or for interim maintenance, the learned Attorney General suggests that the appellate Court would have inherent power and discretion to give appropriate directions for supply of funds out of the trust estate and that in any view, such power and discretion have to be implied in the provision for an appeal so that the said right of appeal may not become illusory.
Having regard to the suggestion thus put forward, which we accept, we cannot hold that the provision in section 74(3) that the operation of the order of the Commissioner framing a scheme is not to be stayed pending the disposal of the appeal, brings about an unreasonable restriction.
In this view we think that the incidental provisions above referred to do not in any way detract from the reasonableness of the main provisions.
In our opinion, therefore, the provisions in the present Act of 1952 as amended in 1954, relating to the framing of schemes are not open to any of the constitutional objections raised, and are valid.
The next point that has been urged, depends on the fact that in four of the petitions before us relating to the Maths of Mahiparakash, Uttaraparswa, Dakshinaparswa and Radhakanta, schemes were in fact framed in the year 1953 under the provisions of 57 Orissa Act IV of 1939 as amended in 1953.
It may be recalled that these provisions were held invalid by the decision of this Court in March, 1954, above referred to.
It must therefore be taken that these schemes were void as the law then stood.
It is with reference to that situation that the Orissa Legislature by an amendment in 1954 of the 1952 Act introduced section 79 A into this Act which runs as follows: "Notwithstanding anything contained in any of the other provisions of this Act or in any judgment, decree or order of any court all schemes purporting to have been settled in pursuance of sections 38 and 39 of the Orissa Hindu Religious Endowments Act, 1939, after the commencement of the Orissa Hindu Religious Endowments (Amendment) Ordinance, 1953, and before the commencement of this Act shall be deemed to have been settled under the provisions of this Act and any person aggrieved by any such scheme may within sixty days from the date of commencement of this Act prefer an appeal to the High Court and such appeal shall be dealt with and disposed of in the same manner as appeals provided for under sub section (2) of section 44".
This purports to revive the schemes which were pronounced to be invalid by the judgment of this Court and attempts to remove the defect noticed in the judgment of this Court by providing for a regular appeal to the High Court against that very scheme within 60 days from the date of the commencement of the Act.
It may be noticed that the schemes so revived are only those which were settled after the commencement of Orissa Hindu Religious Endowments (Amendment) Ordinance, 1953, and before the commencement of the 1952 Act, i.e., between 16th May, 1953 to 31st December, 1954, (hereinafter referred to as the specified period).
This was exactly the period within which the amendment of 1939 Act made in 1953 was in force, abolishing the right of suit and making the scheme as determined by the Commissioner final and conclusive.
Section 79 A in terms purports to revive the invalid scheme notwith 8 58 standing any judgment, decree or order of any court, which means that though a court may have pronounced the scheme as void still that is deemed to be alive.
It has been suggested that this is directly flouting the decision of this Court and that the legislature has no power to declare as valid and constitutional what was decided by this Court as invalid and unconstitutional.
But it is to be observed that the legislature does not purport to do anything of the kind.
What it does is not to deem the schemes previously settled as having been validly settled on those very dates, under the then existing law.
This of course is beyond legislative competence since the legislature has not the power to override unconstitutionality as such.
But what the legislature has purported to do is to take up those very schemes and deem them to have been settled under the _provisions of the present Act and thereby to lay them open to any attack available under the present law.
Such a pro vision is not uncommon in legislative practice, and is enacted in order to avoid the public inconvenience of having to re do what has previously been done.
The result of section 79 A is to treat the schemes framed within the specified period as schemes framed immediately after the commencement of the present Act and to impute thereto, by a fiction, compliance with the various procedural and other steps which are requisite under section 42.
We can see no reason for thinking that such a provision is not within the competence of the Legislature.
It has been suggested that this is really interfering with the jurisdiction of this Court under article 32.
But there is no substance in that suggestion.
The right of any person to seek remedy under article 32 in respect of any violation of his fundamental rights is in no way curtailed or affected by the fact that an actual decision of this Court on an application under article 32 is, in effect, nullified by appropriate and competent legislative measures.
Indeed, the right has been, in fact, successfully invoked on the prior occasion and has again been invoked on the present occasion.
If it fails this time it is not because the right and the remedy under 59 article 32 have been taken away or affected but because the unconstitutionality has been removed.
Section 79 A, therefore, is not open to any objection on the ground of legislative incompetence.
It has further been urged that to treat the scheme prepared with reference to the Act of 1939 as amended in 1953 as a scheme prepared under the present Act by means of a fiction is really in the nature of deprivation of certain advantages which an aggrieved person would have had if in fact the scheme was settled under the present Act, and that therefore such a scheme would still operate by way of unreasonable restriction.
This contention is also without substance.
It is true that in the present Act the procedure relating to the scheme has four steps which are as follows: (1) The scheme is to be framed by a Commissioner, who is, by appointment, a judicial officer.
(2) The procedure is, as far as may be, the same as that in the trial of suits.
(3) There is a preliminary enquiry by the Assistant Commissioner.
(4) There is an appeal to the High Court.
Out of these four, the substantial item is the last one and that has been specifically provided for under section 79 A and a period of sixty days from the date of the commencement of the Act has been provided for the right of appeal.
There can be no complaint on this score.
It is true that the schemes under the Act then in operation, i.e., during the specified period, might possibly have been framed by (a) an executive officer, as also (b) in pursuance of procedure under the rules framed by the Executive Government which may not approximate to that of a trial of a suit.
But this was merely a theoretical possibility.
In fact, as appears from the record and, as has beenstated to us by the learned Attorney General on behalf of the State and not disputed on the other side, the Endo wment Commissioner during the specified period was a Subordinate Judge of the Orissa Judicial Service.
The actual procedure which was in force at the time under the rules as then prescribed was also in fact in 60 consonance with the trial of suits under the Civil Procedure Code.
This appears clearly from rules 51 to 109 of the Rules framed by the Government of Orissa, an official copy of which has been supplied to us in court by the learned Attorney General on behalf of the State.
As regards the provision that the enquiry by the Commissioner under the present Act has to be preceded by a preliminary enquiry by an Assistant Commissioner who is of the rank if a Munsif, the argument that the deprivation of this feature by the deeming provision in section 79 A operates to the disadvantage of the Mahants is not by any means a serious point.
It is to be noticed that this is setoff by the fact that schemes under the 1939 Act are framed not by the Commissioner alone but along with one or more Government officers appointed by the Government.
We are, therefore, unable to, uphold the contention that the deeming provision under section 79 A which treats the previous schemes as schemes framed under the present Act results in bringing about any substantial disadvantages to the detriment of the Mahants.
We accordingly hold that section 79 A of the present Act is not open to any constitutional objection.
We are, therefore, clearly of the opinion that sections 42(1)(b), 42(7) and 44(2) as well as section 79 A of the present Act are not open to the constitutional objections raised before us.
It may be mentioned that in the petitions before us some other provisions of the present Act have also been challenged as being unconstitutional.
But no arguments have been advanced before us in respect thereof.
It may also be mentioned that the petitions before us have not raised any questions relating to the merits of the scheme in so far as any specific provisions thereof may have operated by way of unreasonable restrictions, in the light of the considera tions pointed out by this Court in its judgment in the Commi8sioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutth(1).
Nor does it appear that any appeal as (1) ; 61 provided in section 79 A has been filed to the High Court in respect of these cases challenging the validity or the propriety of the various provisions in the scheme or correctness of the decision, express or implied, on the basic facts which are the foundation of the scheme proceedings.
We express no opinion on any of these matters.
In the last of the petitions relating to Manapur Math, the facts appear to be slightly dissimilar but this makes no substantial or material difference.
In that case the original scheme was one framed under sections 38 and 39 of the 1939 Act as they stood before their amendment in 1953 which provided for a right of suit.
The scheme itself was dated the 22nd May, 1948.
Previous to the framing of the scheme there appears to have been a claim by the Mahant that the institution was a private one and not a public one and that it did not fulfil the definition of the word "Math" under the Act.
There appears to have been a compromise between the then Mahant and the public of the village in which the Math is situated, who were interested in the Math.
The compromise was to the effect that the institution was to be declared a Math but that the then Mahant was to be recognised as the hereditary trustee thereof.
This compromise was recognised by the Commissioner by his order dated the 12th May, 1947, formally making the above declarations.
It was on the basis of this that, later on, a scheme was framed on the 22nd May, 1948.
It does not appear that the Mahant filed any suit which was then available to him.
But it is stated to us by the learned Advocate appearing for the petitioner that an application was filed in the High Court for a writ to qudsh the scheme, and that it was dismissed by the High Court on the 16th November, 1954.
The scheme became final under the original Act of 1939 as it stood before the 1953 amendment.
Obviously, with reference to the facts of such a case, no argument of the kind that has been addressed to us in the other four petitions was available.
In the result, therefore, all the five petitions must be dismissed with costs.
| IN-Abs | Sections 38 and 39 of the Orissa Hindu Religious Endowments Act, 1939 (Orissa Act IV of 1939) as amended by Orissa Act XVIII of 1953 were declared unconstitutional and void by the Supreme Court in Mahant Sri Jagannath Bamanuj Das vs The State of Orissa ([1954] S.C.R. 1046) on the ground that legislation in so far as it authorised the framing of a scheme by the Commissioner along with his associates and declared such determination as final without any scope for correction thereof by judicial intervention was an unrea sonable restriction on the right of the head of the Math as respects his interest in the Math which is a, right to bold property within the meaning of article 19(1)(f) of the Constitution.
After the judgment dated 16th March 1954 delivered by the Supreme Court in the Case Of Mahant Sri Jagannath Bamanuj Das vs The State of Orissa, ([1954] S.C.R. 1046) the Orissa Legislature passed the Orissa Act XVIII of 1954 purporting to amend not the 1939 Act which was then in operation but the Orissa Act II of 1952 which had not then come into force.
The Orissa Act XVIII of 1954 received the assent of the President on the 2nd December 1954 and came into force at once and thus the Orissa Act II of 1952 became pro tnnto amended and modified.
The 1952 Act so amended came into force from the 1st January 1955 by virtue of a notification dated 22nd December 1954 issued under the provisions of section 1(3) thereof which provided that the Act wag to come into force on such date as the State Government may.
by notification provide.
The five petitions under article 32 of the Constitution in the present case challenged the validity of various sections of the Orissa Act II of 1952 as amended by Act XVIII of 1954 on the principles laid down in the case of Mahant Sri Jagannath Bamanuj Das vs The State of Orissa, ([1954] S.C.R. 1046).
Held, that sections 42(1)(b), 42(7), 44(2) as well as section 79(A) of Orissa Hindu Religious Endowments Act, 1951 (Orissa Act II of 1952) as amended by Orissa Act XVIII of 1954 are not unconstitutional and 44 ultra vires and the contention that the provisions of sections 42 and 44 of the present Act to the effect (1) that a scheme can be framed by the Commissioner alone on a report of the Assistant Commissioner on such inquiry as he thinks fit and not by the Commissioner in association with one or more Government Officers to be appointed for the purpose by the Government (2) that there is no right of suit for challenging the validity or the correctness of the scheme framed by the Commissioner but there is only an appeal to the High Court, still continue to be unreasonable restrictions on the right of Mathadipathi as in the case of Mahant Sri Jagannath Bamanuj Das vs The State of Orissa [(1954) S.C.R. 1046] is without substance.
In the initial stage of the framing of the scheme under the provisions of the present Act there is first of all something in the nature of a preliminary enquiry by a judicial officer of the rank of a Munsif and this is followed by a regular and full enquiry before the Commissioner who is of the rank of a Subordinate Judge.
The enquiry before the Commissioner is assimilated to and is governed by the provisions relating to the trial of suits by enjoining that, as far as may be, it is to be in accordance with the provisions of the Code of Civil Procedure relating to trial of suits. 'While, therefore, under the prior Act the enquiry before the Commissioner might well have been of the nature of an executive enquiry by an executive officer, the enquiry under the present Act is by itself in the nature of a judicial enquiry by judicial officers followed up by a right of regular appeal to the High Court.
A scheme framed with reference to such a procedure cannot ipso facto be pronounced to be in the nature of an unreasonable restriction on the rights of the Mahant.
The legislature might well have thought that instead of making the enquiry before the Commissioner more or less in the nature of a preliminary executive enquiry to be followed up by the affected Mahant by a regular , suit in the Civil Court, it is much more satisfactory and in the public interests, to vest the enquiry before the Commissioner himself with the stamp of greater seriousness and effectiveness and to assimilate the same to a regular enquiry by the judicial officer according to judicial procedure and then to provide a right of direct appeal to the High Court.
The right of appeal to the High Court is given in very wide and general terms because the appeal can be both on facts and on law.
Mahant Sri Gadadhar Bamanuj Dos vs The Province of Orissa, (I.L.R [1949] Cuttack 656), Mahant Sri Jagannath Bamanuj Das vs The State of Orissa ([1954] S.C.R. 1046) and Commissioner, Hindu Beligious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Matth, ([1964) S.C.R. 1006], referred to.
|
Civil Appeal No. 2085 of 1969.
From the Judgment and Decree dated 15 11 68 of the Madras High Court in Criminal Side Appeal No. 45/65.
M. Natesan and Mrs. section Gopalakrishnan for the Appellants.
V. section Desai, P. G. Gokhale and section R. Agarwala for the Respondents 1 2. 702 Ex parte for the Respondents 3.8.
The Judgment of the Court was delivered by SARKARIA, J.
This appeal by certificate is directed against an Appellate Judgment and Decree, dated November 15, 1968, of the High Court of Madras.
The facts leading to this appeal are as follows: The following pedigree table will be helpful in understanding the relationships of the parties: Palaniandi Pillai (died on 19 5 1928) | | | | | | | | Ramaswami Pillai Vadovelu Pillai Nataraja Pillai | (dies in 1953) (died in 31 1 57) | Dharmambal | (died in 1940) | | | | | R.Ekambaram R.Bala | subramaniam| (1st Defdt.) (2nd Defdt)| | | Rajamani Kamala Padma Sarada Laitha Selvaraj (3rd (4th (5th (6th (7th (died in 1952) Defdt.) Defdt.) Defdt.) Defdt.) Defdt.) =Rajammal (8th Defdt.) Palaniandi Pillai, shown in the above pedigree table, owned considerable properties.
On December 12, 1927, he executed a Will whereby he bequeathed certain properties to each of his three sons.
He appointed his sons, Ramaswami Pillai and Vadivelu Pillai, as Executors of his Will.
In regard to his third son, Nataraja Pillai, the testator in clause 5 of the Will stated: "My third son, Nataraja Pillai, shall take the income accruing from the properties, namely, my cast stand, house and ground, situate in the Western Row of Mint Street, bearing Municipal Door No. 278, Re survey No. 600, Collector 's Certificate No. 750 and the 5 Godowns, namely, 2 Godowns situate in Varadaraja Mudali St., bearing Municipal Door No. 90 and 91, and 3 Godowns situate in 3rd North Beach Road bearing Municipal Door Nos. 5, 6 and 7 to 9, Re survey No. 3158 and 3187, Collector 's Certificate No. 2550.
After his life time, if he leaves any male issue, they shall take the aforesaid properties, with 703 powers of alienations such as gift, usufructuary mortgage and sale.
If there are no male issue as aforesaid, my heirs shall take the aforesaid properties.
" Although the Will had not been probated, yet, by mutual arrangements between the first two sons who were named Executors in the Will, and the third son, Nataraja Pillai, the properties were distributed in consonance with the terms of the Will and the Executors conveyed and transferred the same to the respective legatees, and mutual release deeds were, also, executed by the three sons.
Ramaswamy Pillai died in 1954 and Vadivelu Pillai in 1953, Nataraja Pillai died on January 31, 1957, without leaving any issue.
His widow, Krishnammal, the appellant herein, filed the suit (C. section No. 7 of 1959) out of which this appeal has arisen.
She claimed (a) partition and separate possession of one third share in the (plaint schedule) properties left by her husband Palaniandi Pillai, alleging that the properties ' were in the possession of the joint family consisting of his sons, or in the alternative, (b) for a declaration of her title and for possession of the properties on the ground that her husband Nataraja Pillai got the same absolutely by way of partition under the deed, dated July 14, 1928, and she, as his heir, inherited the properties; in the alternative, (c) for a declaration of her rights to the properties on a true construction of the Will of her father in law, Palaniandi Pillai, and for possession of the properties.
The sons of Ramaswamy Pillai, respondents 1 and 2 herein, were impleaded as defendants 1 and 2, and the daughters of Vadivelu Pillai, respondents 3 to 7, were defendants 3 to 7.
The daughter in law of Vadivelu Pillai, respondent 8 herein, was added as 8th defendant.
The findings of the learned trial Judge, material for our purpose, were as follows: (i) Nataraja Pillai got only a life estate in the properties set out in Schedule I of the Plaint; (ii) the contingent interest in favour of the heirs of Palaniandi Pillai became vested only on the death of Nataraja Pillai, (iii) it is not open to the plaintiff, Krishnammal, to invoke Section 8 of the ; (iv) on the termination of the life interest given to Nataraja Pillai, the gift over in favour of the male issues could not take effect as he did not leave any male issue, with the consequence, that the properties, in effect, became revested in Palaniandi Pillai, but devolved on his heirs as if on intestacy; (v) Section 111 of the Indian succession Act would be applicable.
704 In the result, the appellants ' suit was decreed and it was held that she was entitled to one third share and separate possession of the same by partition of the Plaint Schedule 1 properties, and defendants 3 to 8 were equally entitled to one third share together with mesne profits relating to their shares in the said properties, while defendants 1 and 2 were entitled to the remaining one third share.
Aggrieved, defendants 1 and 2 preferred Letters Patent Appeal in the High Court, contending that, according to the terms of the Will of Palaniandi Pillai, they were his only heirs and entitled to get the entire properties in which Nataraja Pillai held only a life interest; and that neither the plaintiff nor defendants 3 to 8 were entitled to any share.
The Appellate Bench of the High Court purporting to proceed mainly on the scope and construction of Clause 5 of the Will of Palaniandi Pillai, held: (1) By his Will (exhibit P. 2) the testator had made "my heirs", i.e. the testator 's heirs as an "artificial" class of ultimate residuary legatees.
(2) This class of legatees or "my heirs" did not acquire a vested interest in the residuary bequest on the death of the testator.
(3) The ultimate bequest in their favour would become vested only in the event of Nataraja dying sonless.
(4) The mandate implicit in the words "if there are no male issues as aforesaid" occurring in Clause 5 of the Will (exhibit P. 2) is that such class of legatees or heirs of the testator would be ascertained and worked out at that point of time when Nataraja died sonless, and at no other.
(5) This class of "my heirs" of the testator would be ascertained with reference to the point of Nataraja 's death (without a son) on January 31, 1957, when succession opened out and the bequest became distributable, "on the hypothesis that Palaniandi Pillai had lived up to that time" i.e. January 31, 1957.
(6) Although this class of the heirs of the testator was to be ascertained on January 31, 1957 on the hypothesis that the testator and Nataraja died simultaneously, such ascertainment could not be done either by resorting to the Hindu Women 's Rights to Property Act, 1937 or to the , because Palaniandi Pillai actually died in 1928, long before the coming into force of these two enactments and he did not die intestate.
705 (7) Such class of heirs of the testator were to be determined according to the orthodox Hindu Law prevailing at the time of the testator 's death on May 19, 1928.
(8) Section 111 of the Indian Succession Act was not applicable.
On the above reasoning, the Appellate Bench of the High Court reversing the decree of the learned trial Judge, held that Respondents 1 and 2 herein were the only persons entitled to the entire Schedule 1 property on the death of Nataraja Pillai, to the exclusion of the latter 's widow, the plaintiff.
Thus the appeal was allowed and the plaintiff 's suit dismissed.
After obtaining a certificate under Article 133 of the Constitution from the High Court, the plaintiff, Krishnammal, has come in appeal before this Court.
Controversy in this case hinges around the scope and construction of Clause 5 of the Will (exhibit P 2).
In that connection, the first question that arises for consideration is: Did the testator by this Clause create or carve out an "artificial" class of his heirs ' and make a residuary bequest in their favour ? In our opinion, on a proper construction of the Will, the answer to this question must be in the negative.
It is well settled that legal terms such as "heirs", used in a Will must be construed in the legal sense, unless a contrary intention is clearly expressed by the testator.
The word "heirs", as pointed out by this Court in Angurbala Mullick vs Debabrata Mullick(1) cannot normally be limited to "issues" only.
It must mean all persons who are entitled to the property of another under the law of inheritance.
There is nothing in the language of Clause 5 of the Will which compels the construction that by use of the expression "my heirs" the testator meant something different from his 'heirs under the law. ' The expression "my heirs" has therefore to be construed as equivalent to "my legal heirs".
Thus considered, the words used in the last two sentences of Clause 5 of the Will are not words of gift over to any 'artificial ' class of heirs.
They only indicate that in the event of Nataraja 's death without any male issue, further devolution of the estate that had been given to him for life, would be regulated in favour of the testator 's heirs ascertained in accordance with Hindu Law of intestate succession.
That is to say, the testator did not specify or lay down any line of heirs, deviating from the Hindu Law of intestate succession.
706 The ground is now clear to consider the second question which is pivotal to the whole problem: Whether the heirs of the testator, on whom the estate was to devolve in the event of Nataraja dying sonless, were to be ascertained according to Hindu Law in force at the time of Nataraja 's death or according to Hindu Law, prevailing in 1928 when the testator died.
This question, also, is one of reaching at the real intent of the testator.
In order to expatiate, the true import of the last two sentences of Clause 5 of the Will (exhibit P 2), the same can be legitimately expanded, parenthesized and elucidated so as to read like this: "After Nataraja 's life time, if he leaves any male issue, they shall take the aforesaid properties, with powers of alienation.
If Nataraja dies without leaving any male issue, then my heirs, then ascertained according to law of inheritance, shall take the aforesaid properties." Thus amplified and elucidated, Clause 5 of the Will brings out, expressly or by inevitable implication, the intention and instructions of the testator in regard to the following: (a) In the event of the termination of the life estate of Nataraja on his death, without male issue, the property will devolve on "my heirs" i.e. the testator 's heirs.
(b) Such heirs of the testator are to be ascertained according to the Hindu Law of intestate succession.
(c) Such ascertainment of the heirs of the testator is to be done on the date of Nataraja 's death without male issue, when succession opens out in favour of those heirs, and not with reference to the date of the testator 's death.
This necessarily implies that "my heirs" of the testator are required to be ascertained on the hypothesis that the testator lived upto and died a moment after Nataraja 's death.
If what is spelled out at (a), (b) and (c) be the true construction of Clause 5 of the Will, it logically and inexorably follows therefrom, that ascertainment of the heirs of the testator, on whom the property was intended to devolve in the event of Nataraja dying sonless, was to be made in accordance with Hindu Law of intestate Succession as in force on the date of Nataraja 's death, on January 31, 1957, when succession opened out, and not in accordance with the orthodox Hindu Law prevailing in 1928, which on the relevant date, January 31, 1957, stood abrogated and superseded by the .
The conclusion is therefore inescapable that "my heirs" referred to by the testator in Clause 5 of his Will, have to be ascertained in accordance with the .
In so 707 doing, we are only giving effect to the import and construction of the Will of the testator, and no question of giving retrospective operation to the statute is involved.
The learned Judges of the High Court have said that at the time of making the Will, the testator could not predicate that at the time of Nataraja 's death without leaving any son, the Hindu Law of Succession would be different from the one prevailing at the time of making the Will or the testator 's death.
Nevertheless, the testator was definitely contemplating the contingency of Nataraja dying without any male issue, and the necessity of ascertaining the testator 's heirs at that point of time for further devolution of the property.
It cannot, therefore, be said that ascertainment of the testator 's heirs according to the law in force at the time of happening of the contemplated contingency, was wholly beyond the ken of the testator.
In the view we take of the import and scope of Clause 5 of the Will (exhibit P. 2) ascertainment of the heirs of Palaniandi Pillai has to be done on the assumption that he died intestate, a moment after Nataraja Pillai 's death, according to Sections 8 to 10 of the .
At that point of time, the plaintiff (who would be assumed to be the widow of a "predeceased" son), and the defendants would all be heirs of the testator, falling in Class I of the Schedule referred to in Section 8.
According to Section 9, all the heirs in Class I of the Schedule shall take simultaneously, to the exclusion of all other heirs.
The distribution of the property among the plaintiff and defendants will be governed by Rules 3 and 4 in Section 10, which are as under: "Rule 3.
The heirs in the branch of each predeceased son or each predeceased daughter of the intestate shall take between them one share.
" "Rule 4.
The distribution of the share referred to in Rule 3 (i) among the heirs in the branch of the predeceased son shall be so made that his widow (or widows together) and the surviving sons and daughters get equal portions; and the branch of predeceased sons gets the same portion; (ii) among the heirs in the branch of the predeceased daughter shall be so made that the surviving sons and daughters get equal portions.
" 708 In accordance with the aforesaid provisions of the , the plaintiff would be entitled to get 1/3rd share in Schedule I property in which her husband had a life interest, while the remaining 2/3rd share in the property shall be equally distributed among the two branches of the defendants, the branches of Ramaswami and Vadivelu getting 1/3rd share each.
For the foregoing reasons, we allow this appeal, set aside the judgment of the High Court and pass a preliminary decree for partition and separate possession in favour of the plaintiff with respect to her 1/3rd share in the suit property.
In the circumstances of the case, the parties are left to pay and bear their own costs.
P.B.R. Appeal allowed.
| IN-Abs | By a will the testator bequeathed certain properties to each of his three sons.
With regard to his third son (NP) the testator provided in Clause 5 of the will that if he had no male issues "my heirs shall take the aforesaid properties" after his life time.
NP died in 1957 without any male issue.
His widow (plaintiff appellant) filed a suit for declaration of her title to the properties on the ground that her husband got the same absolutely by way of partition and that she, as his heir, inherited the properties or in the alternative for a declaration of her right to the properties on a true construction of the testator 's will.
(Defendants 1 and 2 were the sons of the testator 's eldest son while defendants 3 to 7 were the daughters and defendant 8 the widowed daughter in law of the testator 's second son.) The trial judge of the High Court decreed the plaintiff 's suit holding that on the termination of the life interest given to NP who died sonless the properties devolved on the heirs of the testator as if on intestacy, that the plaintiff was entitled to 1/3 share of the properties, and that the remaining 2/3 share should be share by the defendants.
Defendants 1 and 2 appealed to a Division Bench of the High Court, claiming that as the only heirs of the testator they were entitled to get the entire property of NP who had only a life interest in it.
Construing cl. 5 of the will, the Division Bench held : (1) that by his will the testator had made his heirs as an "artificial" class of ultimate residuary legatees; (2) that the mandate implicit in the words "if there are no male issues as aforesaid" is that such class of legatees or heirs of the testator would be ascertained and worked out at that point of time when NP died sonless and at no other; (3) that this class of heirs of the testator was to be ascertained on the death of NP on the hypothesis that the testator had been upto the time of NP 's death, but according to orthodox Hindu Law prevailing at the time of the testator 's death in 1928; (4) that neither Hindu Women 's Right to Property Act, 1937, nor the was applicable because the testator actually died long before the coming into force of these two enactments and he did not die intestate; (5) that according to Hindu Law prevailing at the time of the testator 's death in 1928, respondents 1 and 2 would be the only persons entitled to the property on the death of NP, to the exclusion of the latter 's widow, the plaintiff.
701 Allowing the appeal.
^ HELD: 1(a) On a proper construction of the will the testator could not be said to have created or carved out an "artificial" class of heirs and made a residuary bequest in their favour.
It is well established that the term "heirs" used in a will must be construed in a legal sense and cannot normally be limited to "issues" only.
It must mean all persons who are entitled to the property of another under the law of inheritance.
[705E F] Angurbala Mullick vs Debabrata Mullick, [1951] 2 SCR 1125 at p. 1144; referred to.
(b) The expression "my heirs" used in cl. 5 of the will must be construed as equivalent to "my legal heirs".
The words "if there are no male issues my heirs shall take the aforesaid properties" are not words of gift over to any artificial class of heirs.
[705G] 2.
Construction of clause 5 of the will brings out expressly or by inevitable implication, these instructions of the testator: (a) In the event of NP 's death, without male issue, the property would devolve on the testator 's heir.
(b) Such heirs of the testator would be ascertained according to Hindu Law of intestate succession.
(c) Ascertainment of these "heirs" of the testator, is to be done at the time of NP 's death on the hypothesis that the testator lived up to and died a moment after NP 's death.
(d) It logically follows from (a), (b) and (c) that these heirs of the testator would be ascertained according to the , which was the law in force on 31 1 57 when NP died sonless and succession opened out.
[706 D F] 3.
On the port and scope of cl. 5 of the will, as spelled out above, ascertainment of the testator 's heirs on whom the property would devolve on NP 's death, is to be done according to sections 8 to 10 of the .
At that point of time, the plaintiff (who would be assumed to be the widow of a "predeceased" son) and the defendants would all be the heirs of the testator, falling in Class I of the Schedule referred to in section 8, and in accordance with Rules 3 and 4 in Section 10 of the Act, the plaintiff would be entitled to 1/3rd share, in the property, while the remaining 2/3rd share shall go equally to the branches of Ramaswami and Vedivelu.
[707 DE]
|
Special Leave Petition (Civil) Nos.
5228 and 5286 of 1977.
From the Judgment and order dated 8 8 1977 of the Punjab and Haryana High Court in F.A.O. No. 81 and 82 of 1977.
P. P. Malhotra and R. N. Dikshit for the Petitioner.
section K. Gambhir for the Respondent.
The order of the Court was delivered by KRISHNA IYER, J. An explosive escalation of automobile accidents, accounting for more deaths than the most deadly diseases, has become a lethal phenomenon on Indian Roads everywhere.
The jural impact of this tragic development on our legislatures, courts and law enforcing agencies is insufficient, with the result that the poor, who are, by and large, the casualty in most of these cases, suffer losses of life or limb and are deprived of expeditious legal remedies in the shape of reasonably quantified compensation promptly paid and this, even after compulsory motor insurance and nationalisation of insurance business.
The facts of this special leave petitions, which we dismiss by this order, raise two serious issues which constrain us to make a speaking order.
The first deals with legal 696 rights, literacy in the case of automobile accidents and the processual modalities which secure redressal of grievances.
The second relates to the consequences of negligence of counsel which misleads a litigant into delayed pursuit of his remedy.
Medieval roads with treacherous dangers and total disrepair, explosive increase of heavy vehicles often terribly overloaded and without cautionary signals, reckless drivers crazy with speed and tipsy with spirituous potions, non enforcement of traffic regulations designed for safety but offering opportunities for systematised corruption and little else and, as a cumulative effect, mounting highway accidents demand a new dimension to the law of torts through no fault liability and processual celerity and simplicity in compensation claims cases.
Social justice, the command of the Constitution is being violated by the State itself by neglecting road repairs, ignoring deadly overloads and contesting liability after nationalising the bulk of bus transport and the whole of general insurance business.
The jurisprudence of compensation for motor accidents must develop in the direction of no fault liability and the determination of the quantum must be liberal, not niggardly since the law values life and limb in a free country in generous scales.
In the present case, a doctor and his brother riding a motor cycle were hit, by a jeep driver and both were killed.
The fatal event occurred in November 1971 but the Motor Accident Claims Tribunal delivered judgment five years later awarding sums of Rs. 80,000/ and Rs. 73,500/ to the two sets of claimants.
The delay of five years in such cases is a terrible commentary on the judicial process.
If only no fault liability, automatic reporting by the police who investigate the accident in a statutory proforma signed by the claimants and forward to the tribunal as in Tamil Nadu and decentralised empowerment of such tribunals in every district coupled with informal procedures and liberation from court fees and the sophisticated rules of evidence and burden of proof were introduced easy and inexpensive if the State has the will to help the poor who mostly die in such accidents law 's delays in this compassionate jurisdiction can be banished.
Social justice in action is the measure of the State 's constitutional sensitivity.
Anyway, we have made these observation hopefully to help focus the attention of the Union and the States.
The nationalised insurance company appealed to the High Court against the award.
We have no doubt that the finding on both the 697 culpability and the quantum as rendered by the trial court are correct.
But the High Court dismissed the appeal on the ground of delay, dismissing the application of the petitioner for condonation under section 5 of the Limitation Act.
The Accident Claims Tribunal pronounced its award on September, 15, 1976, after making the necessary computations and deductions.
The appeal had to be filed on or before January 19, 1977 but was actually filed 30 days later.
Counsel for the petitioner is stated to have made the mistake in the calculation of the period of limitation.
He had intimated the parties accordingly with the result that the petitioner was misled into instituting appeal late.
The High Court took the view that the lawyer 's ignorance about the law was no ground for condonation of delay.
Reliance was placed on some decisions of the Punjab High Court and there was reference also to a ruling of the Supreme Court in ; The conclusion was couched in these words: "The Assistant Divisional Manager of the Company appellant is not an illiterate or so ignorant person who could not calculate the period of limitation.
Such like appeals are filed by such companies daily.
The facts of this case clearly show, as observed earlier, that the mistake is not bonafide and the appellant has failed to show sufficient cause to condone the delay.
" We are not able to agree with this reasoning.
A company relies on its Legal Adviser and the Manager 's expertise is in company management and not in law.
There is no particular reason why when a company or other person retains a lawyer to advise it or him on legal affairs reliance should not be placed on such counsel.
Of course, if there is gross delay too patent even for layman or if there is incomprehensible indifference the shield of legal opinion may still be vulnerable.
The correct legal position has been explained with reference to the Supreme Court decision in a judgment of one of us in AIR 1971 Ker. 211: "The law is settled that mistake of counsel may in certain circumstances be taken into account in condoning delay although there is no general proposition that mistake of counsel by itself is always a sufficient ground.
It is always a question whether the mistake was bonafide or was merely a device to cover an ulterior purpose such as laches 698 on the part of the litigant or an attempt to save limitation in an underhand way.
The High Court unfortunately never considered the matter from this angle.
If it had, it would have seen quite clearly that there was no attempt to avoid the Limitation Act but rather to follow it albeit on a wrong reading of the situation." "The High Court took the view that Mr. Raizada being an Advocate of 34 years ' standing could not possibly make the mistake in view of the clear provisions on the subject of appeals existing under Section 39(1) of the Punjab Courts Act and therefore, his advice to file the appeal before the District Court would not come to the rescue of the appellant under Section 5 of the Limitation Act.
The Supreme Court upset this approach." "I am of the view that legal advice given by the members of the legal profession may sometimes be wrong even as pronouncement on questions of law by courts are some times wrong.
An amount of latitude is expected in such cases for, to err is human and lay men, as litigants are, may legitimately lean on expert counsel in legal as in other departments, without probing the professional competence of the advice.
The court must of course, see whether in such cases there is any taint of mala fides or element of recklessness or ruse.
If neither is present, legal advice honestly sought and actually given, must be treated as sufficient cause when an application under Section 5 of the Limitation Act is being considered.
The State has not acted improperly in relying on its legal advisers.
" We have clarified the legal position regarding the propriety and reasonableness of companies and other persons relying upon legal opinion in the matter of computation of limitation since it is a problem which may arise frequently.
If Legal Adviser 's opinions are to be subjected by company managers to further legal scrutiny of their own, an impossible situation may arise.
Indeed Government, a large litigant in this country, may find itself in difficulty.
That is the reason why we have chosen to explain at this length the application of section 5 vis a vis counsel 's mistake.
This does not automatically secure a visa for the petitioner into this Court under Article 136.
There must be manifest injustice or gross misappreciation or perversity in factual findings.
We have 699 examined the merits of the matter to the extent available on the record and have heard counsel for the petitioner.
He has hardly convinced us that the merits of the case call for any intervention at all.
In this view we are constrained to dismiss the Special Leave Petitions now that we have expressed ourselves or both the points dealt with above.
S.R. Petitions dismissed.
| IN-Abs | A doctor and his brother riding a motor cycle were hit by a jeep driver and both were killed in November 1971, but the Motor Accident claims Tribunal delivered judgment on 5 9 1976 five years later awarding sums of Rs. 80,000/ and Rs. 73,500/ to the two sets of claimants.
The appeal in this case had to be filed on or before 19 1 77 but was actually filed 30 days later with an application for condonation under section 5 of the Limitation Act on the ground of Counsel 's mistake in the calculation of the period of limitation.
The High Court dismissed the appeal and the application.
Dismissing the special leave petitions, the Court ^ HELD: A company relies on its Legal Adviser and the Manager 's expertise is in company management and not in law.
There is no particular reason why when a company or other person retains a lawyer to advise it or him on legal affairs reliance should not be placed on such counsel.
Of course, if there is gross delay too patent even for layman or if there is in comprehensible indifference the shield of legal opinion may still be vulnerable.
If legal Adviser 's opinions are to be subjected by company managers to further legal scrutiny of their own, an impossible situation may arise.
Indeed Government, a large litigant in this country, may find itself in difficulty.
[697E F, 698 F G] This does not automatically secure a visa for the petitioner into this Court under article 136.
There must be manifest injustice or gross misappreciation or perversity in factual findings.
[698H] State of Kerala vs Krishna Kurup Madhava Kurup, A.I.R 1971 Kerala 211; approved.
State of West Bengal vs Howrah Municipal Corporation, ; ; referred to.
Observations 1.
The jurisprudence of compensation for motor accidents must develop in the direction of no fault liability and the determination of the quantum must be liberal, not niggardly since the law values life and limb in a free 695 country in generous scales.
Social justice, the command of the Constitution is being violated by the State itself by neglecting road repairs, ignoring deadly over loads and contesting liability after nationalising the bulk of bus transport and the whole of general insurance business.
[696C D] 2.
Medieval roads with treacherous dangers and total disrepair, explosive increase of heavy vehicles often terribly overloaded and without cautionary signals, reckless drivers crazy with speed and tipsy with spirituous potions, non enforcement of traffic regulations designed for safety but offering opportunities for systematised corruption and little else and, as a cumulative effect, mounting highway accidents, demand a new dimension to the law of torts through no fault liability and processual celerity and simplicity in compensation claims cases.
[696B C] 3.
If only no fault liability, automatic reporting by the police who investigate the accident in a statutory proforma signed by the claimants and forwarded to the tribunal as in Tamil Nadu and decentralised empowerment of such tribunals in every district coupled with informal procedures and liberation from court fees and the sophisticated rules of evidence and burden of proof were introduced easy and inexpensive, if the State has the will to help the poor who mostly die in such accidents law 's delays in this compassionate jurisdiction can be banished.
Social justice in action is the measure of the State 's constitutional sensitivity.
[696F G]
|
Civil Appeal Nos.
1831 1833 of 1972.
Appeals by Special Leave from the Judgment and Order dated 22 9 1971 of the Allahabad High Court in I.T. References Nos.
775/70 and 342/64.
section C. Manchanda and Mrs. Urmila Kapoor for the Appellant.
V. section Desai and Miss A. Subhashini for the Respondent.
The Judgment of the Court was delivered by TULZAPURKAR, J.
The assessee, Smt.
Indermani Jatia, widow of Seth Ganga Sagar Jatia of Khurja, carried on money lending and other businesses and derived income from various sources such as investment in shares, properties and businesses.
However, the capital, assets and income in respect of different sources of income were incorporated in one common set of books.
With a view to commemorate the memory of her deceased husband, on October 21, 1955 she promised a donation of Rs. 10 lacs for setting up an Engineering College at Khurja to be named "Seth Ganga Sagar Jatia Electrical Engineering Institute Khurja".
She also promised a further sum of Rs. 1.5 lacs for the construction of a Female Hospital at Khurja but this subsequent donation of Rs. 1.5 lacs was to include the total interest that was to accrue on the sum of Rs. 10 lacs earlier donated to the college.
In pursuance of the promise made on October 21, 1955 she actually made over a sum of Rs. 5.5 lacs by depositing the same in a joint account opened in the names of the District Magistrate, Bulandshahr and Smt.
Indermani Jatia for the college while the balance of Rs. 4.5 lacs was left with the assessee and was treated as a debt to the Institution and interest thereon at 6% per annum with effect from October 21, 1955 was to be finally deposited in the Technical Institute account.
These facts become clear from a certificate dated October 17, 1958, issued by the District Magistrate, Bulandshahr which was produced before the Appellate Tribunal.
The aforesaid transaction came to be recorded in the books of the assessee as follows: At the beginning of the accounting year (Samvat year 2012 13 accounting period 13 11 1955 to 1 11 1956) relevant to the assessment year 1957 58 the capital account of the assessee showed a net credit balance of Rs. 23,80,753.
Initially on November 21, 1955, a sum of Rs. 10 lacs was debited to her capital account and corresponding credit was given to the account of the said Institute.
At the close of the said accounting year (i.e. on 749 1 11 1956) after debiting the aforesaid sum of Rs. 10 lacs the capital account showed a net credit balance of Rs. 15,06,891.
Thereafter, during the same year of account the assessee actually paid only a sum of Rs. 5.5 lacs to the institution on January 7, 1956 from the overdraft account which she had with the Central Bank of India Ltd., Aligarh.
At the beginning of the accounting year the amount outstanding in the overdraft was Rs. 2,76,965; further overdrafts were raised during the accounting year with the result that at the end of the year the liability of the assessee to the bank was Rs. 9,55,660; among the further debits to this account during the year was said sum of Rs. 5.5 lacs paid to the Engineering College on January 7, 1956.
The balance of the promised donation, namely, Rs. 4.5 lacs was, as stated earlier, treated as a debt due by her to the Institute and accordingly she was debited with interest thereon at 6% per annum with effect from October 21, 1955.
In the assessment proceedings for the assessment years 1957 58, 1958 59 and 1959 60 the assessee claimed the deduction of three sums Rs.
20,107/ , Rs. 25,470/ and Rs. 18,445/ being the respective items of interest paid by her to the bank on Rs. 5.5 lacs during the Samvat years relevant to the said assessment years.
The assessee contended that she had preferred to draw on the overdraft account of the bank for the purpose of paying the institution in order to save her income earning assets, namely, the shares, which she would have otherwise been required to dispose of and, therefore, the interest paid by her should be allowed.
As regards interest on the remaining sum of Rs. 4.5 lacs (which was left as a loan with the assessee) that was debited to her account, the assessee urged that she was also entitled to claim the same as a permissible deduction; the claim in respect thereof, however, was made for the assessment years 1958 59 and 1959 60.
As regards the three sums paid by way of interest on Rs. 5.5 lacs to the bank, the taxing authorities took the view that said claim for deduction was not admissible either against business income under section 10(2) or against income from investments under section 12(2) of the Indian Income Tax Act, 1922.
So also the claim for deduction of interest credited to the college account on Rs. 4.5 lacs was disallowed.
The assessee preferred appeals to the Appellate Tribunal.
It was contended on behalf of the assessee that she had promised a donation of Rs. 10 lacs to the Engineering College on October 21, 1955, that the obligation to pay the said amount arose on November 21, 1955 when the amount was debited to her capital account and the corresponding credit was given to the account of the institution, and that out of this total donation a sum of Rs.5.5 lacs was actually deposited in the joint account of the 750 assessee and the District Magistrate, Bulandshahr on January 7, 1956 for which the overdraft with the Central Bank was operated and hence the interest was deductible as business expenditure.
As regards interest on Rs. 4.5 lacs that was debited to her account and credited to the Institute 's account it was urged that this balance amount was kept in trust for the institution and hence the accruing interest thereon which was debited to her account should be allowed as a deduction.
In support of these submissions a certificate issued by the District Magistrate, Bulandshahr dated October 17, 1958 was produced before the Tribunal.
The Appellate Tribunal, however, confirmed the disallowance of interest claimed in respect of the sum of Rs. 5.5 lacs holding that the said sum of Rs. 5.5 lacs over drawn from the bank was not borrowed for business purposes but was borrowed for making over the donation and, therefore, the claim could not be sustained under section 10(2) of the Income Tax Act, 1922.
As regards the interest accruing on the sum of Rs. 4.5 lacs in favour of the Engineering College, the Appellate Tribunal held that no donation of that sum had been made by the assessee, that it was at best a promise by the assessee to the District Magistrate to pay that amount for purpose of charity and the mere entries in the assessee 's own account book crediting the trust, which had yet to come into existence, would not amount to a gift or charity for a trust and as such the interest credited to the account of the Engineering College was also disallowed.
Meanwhile, Smt.
Indermani Jatia died and her legal heir Madhav Prasad Jatia was substituted in the proceedings.
On the question whether the interest on Rs. 5.5 lacs was deductible for the assessment years 1957 58, 1958 59 and 1959 60, the Tribunal declined to make any reference to the High Court, whereupon the assessee applied to the High Court under section 66(2) and upon the application being allowed, the Tribunal referred the question whether interest on the overdraft of Rs. 5.5 lacs the sums of Rs. 20,107 (for the assessment year 1957 58), Rs. 25,470 (for the assessment year 1958 59) and Rs. 18,445 (for the assessment year 1959 60) paid to the Central Bank was allowable as a deduction under section 10(2)(iii) or 10(2) (xv) of the Indian Income Tax Act, 1922 (being Income Tax Reference No. 775 of 1970).
As regards the deduction of interest on Rs. 4.5 lacs claimed for the assessment years 1958 59 and 1959 60, the Tribunal itself made a reference to the High Court under section 66(1) and referred for the opinion of the High Court the question whether in the facts and circumstances of the case the interest credited by the assessee to the account of Ganga Sagar Jatia Engineering College on the sum of Rs. 4.5 lacs 751 and accretion thereto was an admissible deduction for each of the said two years (being Income Tax Reference No. 342 of 1964).
The High Court heard and disposed of both the references by a common judgment dated September 22, 1971.
In the Reference No. 775 of 1970, the case of the assessee was that there was an obligation to pay Rs. 10 lacs to the Engineering College, that for the time being the assessee decided to pay Rs. 5.5 lacs, that it was open to the assessee to pay the amount from her business assets or to preserve the business assets for the purposes of earning income and instead borrow the amount from the bank and that she had accordingly borrowed the amount from the bank and, therefore, since the borrowing was made to preserve the business assets, the interest thereon was deductible under section 10(2) (iii) or 10(2) (xv) of the Act.
The High Court observed that there was nothing to show that the assessee would necessarily have had to employ the business assets for making payment of that amount, and secondly, it was only where money is borrowed for the purposes of business that interest paid thereon becomes admissible as a deduction, and since, in the instant case, the sum of Rs. 4.4 lacs was admittedly borrowed from the Bank for making payment to the Engineering College it was not a payment directed to the business purposes.
According to the High Court the mere circumstance that otherwise the assessee would have to resort to the liquidation of her income yielding assets would not stamp the interest paid on such borrowings with the character of business expenditure.
After referring to the decisions one of the Bombay High Court in Bai Bhuriben Lallubhai vs Commissioner of Income Tax, Bombay North Cutch and Saurashtra and the other of the Calcutta High Court in Mannalal Ratanlal vs Commissioner of Income Tax Calcutta, the High Court rejected the contention of the assessee and held that interest paid on Rs. 5.5 lacs in any of the years was not deductible either under section 10(2) (iii) or 10(2) (xv) of the Act and answered the questions against the assessee.
As regards the question referred to it in Income Tax Reference No. 342 of 1964, the High Court took the view that there was nothing on record before it to establish that the assessee had actually donated the entire amount of Rs. 10 lacs to the Engineering College, that the certificate issued by the District Magistrate, Bulandshahr on October 17, 1958 merely showed that a balance of Rs. 4.5 lacs was left as a loan with the assessee and that the interest accruing thereon from the date of the initial donation "was to be finally deposited in the account of the Technical Institute" and that though the assessee had made 752 entries in her account books crediting the trust with the interest on the amount, the trust had not yet come into existence and as such the amount credited represented her own funds and lay entirely within her power of disposition.
With such material on record, the High Court confirmed the Tribunal 's view that Rs. 4.5 lacs had not been donated by the assessee on October 21, 1955 in favour of the Engineering College and, therefore, the interest credited by the assessee in favour of the Institute on the said sum and the accretion thereto continued to belong to the assessee and as such she was not entitled to the deduction claimed by her and accordingly the question was also answered against the assessee.
On obtaining special leave the original assessee represented by her legal heir has preferred Civil Appeals Nos.
1831 1833 of 1972 to this Court.
Mr. Manchanda appearing for the appellant has raised two or three contentions in support of the appeals.
In the first place he has contended that though the deduction claimed by the assessee in this case was on the basis of business expenditure falling under either section 10(2)(iii) or 10(2)(xv), the taxing authorities, the Tribunal and the High Court have confused the issue by considering the claim for deduction under section 12(2) of the Act.
According to him the scope for allowing the deduction under section 10(2)(iii) or 10(2)(xv) was much wider than under section 12(2) of the Act.
He urged that by applying the ratio of the decision in Bhuriben 's case (supra), which was admittedly under section 12(2) of the Act, to the facts of the instant case the lower authorities as well as the High Court had adopted a wrong approach which led to the inference that the deduction claimed by the assessee was not admissible.
Secondly, he urged that considering the case under section 10(2) (iii) or 10(2) (xv) the question was when could the obligation to pay Rs. 10 lacs to the Engineering College be said to have been incurred by the assessee and according to him such obligation arose as soon as the donation or gift was complete and in that behalf placing reliance upon the certificate dated October 17, 1958, issued by the District Magistrate, Bulandshahr, as well as the entries made by the assessee in her books, he urged that the gift was complete no sooner the capital account of the assessee was debited and the college account was credited with the said sum of Rs. 10 lacs on November 21, 1955, especially when her capital account had a credit balance of Rs. 15,06,891 after giving the debit of Rs. 10 lacs; the gift in the circumstances would, according to him, be complete then as per decided cases such as Gopal Raj Swarup vs 753 Commissioner of Wealth Tax, Lucknow Naunihal Thakar Dass vs Commissioner of Income Tax, Punjab.
He further urged that though the sum of Rs. 5.5 lacs was actually paid by the assessee by borrowing the amount on January 7, 1956 from the overdraft account with the Central Bank of India Ltd. the said overdraft was a running overdraft account opened by her for business purposes and if from such overdraft account any borrowing was made interest thereon would be deductible under section 10(2)(iii) or 10(2) (xv) as being expenditure incurred for the purposes of the business.
According to him, once a borrowing was made from an overdraft account meant for business purposes, the ultimate utilization of that borrowing will not affect the question of deductibility of interest paid on such borrowing under section 10(2) (iii) or 10(2) (xv) and in that behalf he placed reliance upon two decisions of the Bombay High Court, namely, Commissioner of Income Tax, Bombay City II vs Bombay Samachar Ltd., Bombay and Commissioner of Income Tax, Bombay City IV vs Kishinchand Chellaram.
He, therefore, urged that the High Court had erred in sustaining the disallowance in respect of interest paid by the assessee on Rs. 5.5 lacs to the Bank in the three years in question as also the disallowance in regard to the interest credited by the assessee to the account of the Engineering College in the two years in question on the sum of Rs. 4.5 lacs and the accretion thereto.
On the other hand, Mr. Desai for the Revenue, disputed that there was any confusion of the issue or that any wrong approach had been adopted by the lower authorities or by the High Court as suggested by learned counsel for the appellant.
He pointed out that initially the assessee had specifically raised the plea that the borrowing of Rs. 5.5 lacs had been resorted to with a view to save income yielding investments, namely, the shares and, therefore, both the alternative cases as to whether the interest paid on Rs. 5.5 lacs was an admissible deduction either against business income under section 10(2) (iii) or income from investments under section 12(2) were considered by the taxing authorities and the taxing authorities held that such interest was not admissible under either of the provisions.
He pointed out that so far as the Tribunal and the High Court were concerned the assessee 's claim for deduction under section 10(2) (iii) or 10(2) (xv) had been specifically considered and negatived.
He sought to justify the view of the Tribunal and the High Court in regard to the disallowance of interest paid by 754 the assessee on the sum of Rs. 5.5 lacs to the Bank in the three concerned assessment years as also the disallowance of interest credited by the assessee to the account of the Engineering College on the sum of Rs. 4.5 lacs and the accretion thereto; as regards the sum of Rs. 5.5 lacs he contended that the real question was not as to when the obligation to pay to the college was incurred by the assessee but whether the obligation incurred by the assessee was her personal obligation or a business obligation and whether the expenditure by way of payment of interest to the Bank was incurred for the purpose of carrying on business and as regards the sum of Rs. 4.5 lacs whether the trust in favour of the college had at all come into existence on October 21, 1955 or November 21, 1955 as contended for by the assessee and on both the questions the view of the Tribunal and the High Court was right.
As regards the two Bombay decisions, namely Bombay Samachar 's case (supra) and Kishinchand Chellaram 's case (supra), he urged that the ratio of the decisions was inapplicable to the instant case.
At the outset we would like to say that we do not find any substance in the contention of learned counsel for the appellant that there has been any confusion of the issue or that any wrong approach has been adopted by the taxing authorities, the Tribunal or the High Court.
After going through the Tribunal 's order as well as the judgment of the High Court we are clearly of the view that the case of the assessee has been considered both by the Tribunal as well as by the High Court under section 10(2) (iii) or 10(2) (xv) and not under section 12(2).
In fact, in Reference No. 775 of 1970 the questions framed by the Tribunal in terms referred to section 10(2)(iii) and 10(2) (xv) and proceeded to seek the High Court 's opinion as to whether the sums representing interest paid by the assessee to the Central Bank on the overdraft of Rs. 5.5 lacs for the concerned three years were allowable as a deduction under either of the said provisions of the Act and the High Court after considering the matter and the authorities on the point has come to the conclusion that such interest was not allowable as a deduction under either of the said provisions It is true that the High Court did refer to the decision of the Bombay High Court in Bai Bhuriben 's case (supra) but that decision was referred to only for the purpose of emphasizing one aspect which was propounded by that Court, namely, that the motive with which an assessee could be said to have made the borrowing would be irrelevant and that simply because the assessee in that case had chosen to borrow money to buy jewellery it did not follow that she had established the purpose required to be proved under section 12(2) that she borrowed the money in order to maintain or preserve the fixed deposits or helped her to earn interest.
This is far from say 755 ing that the ratio of that case has been applied by the High Court to the instant case.
In fact, the High Court found that there was no material to show that the assessee in the instant case would necessarily have had to employ the business assets for making payment to charity.
The High Court actually considered the assessee 's case under section 10(2) (iii) and 10(2) (xv) and disallowed the claim for deduction under these provisions principally on the ground that the said borrowing of Rs. 5.5 lacs was unrelated to the business of the assessee.
Proceeding to consider the claim for deduction made by the assessee under section 10(2)(iii) or 10(2)(xv), we may point out that under section 10(2) (iii) three conditions are required to be satisfied in order to enable the assessee to claim a deduction in respect of interest on borrowed capital, namely, (a) that money (capital) must have been borrowed by the assessee, (b) that it must have been borrowed for the purpose of business and (c) that the assessee must have paid interest on the said amount and claimed it as a deduction.
As regards the claim for deduction in respect of expenditure under section 10(2)(xv), the assessee must also satisfy three conditions, namely, (a) it (the expenditure) must not be an allowance of the nature described in clauses (i) to (xiv), (b) it must not be in the nature of capital expenditure or personal expenses of the assessee and (c) it must have been laid out or expended wholly and exclusively for the purpose of his business.
It cannot be disputed that the expression "for the purpose of business" occurring in section 10(2) (iii) as also in 10(2) (xv) is wider in scope than the expression "for the purpose of earning income profits or gains" occurring in section 12(2) of the Act and, therefore, the scope for allowing a deduction under section 10(2) (iii) or 10(2) (xv) would be much wider than the one available under section 12(2) of the Act.
This Court in the case of Commissioner of Income Tax, Kerala vs Malayalam Plantations Ltd has explained that the former expression occurring in section 10(2) (iii) and 10(2)(xv), its range being wide, may take in not only the day to day running of a business but also the rationalisation of its administration and modernisation of its machinery; it may include measures for the preservation of the business and for the protection of its assets and property from expropriation, coercive process or assertion of hostile title, it may also comprehend payment of statutory dues and taxes imposed as a pre condition to commence or for the carrying on of a business; it may comprehend many other acts incidental to the carrying on of the business but, however wide the meaning of the expression may be, its limits are implicit in it; the purpose shall be for the purposes, of business, that is to say, the expenditure incurred shall be 756 for the carrying on of the business and the assessee shall incur it in his capacity as a person carrying on the business.
So far as the claim for deduction of interest paid by the assessee on the sum of Rs.5.5 lacs to the Bank in the three concerned years is concerned, the real question that arises for determination is whether the particular borrowing of Rs. 5.5 lacs was for the purposes of business of the assessee or not? The amount of Rs. 5.5 lacs having been actually parted with by the assessee on January 7, 1956, and having been accepted by the institute the same being deposited in the joint account of the assessee and the District Magistrate, Bulandshahr for the Engineering College, the gift to that extent was undoubtedly complete with effect from the said date.
The said payment was made by the assessee by drawing a cheque on the overdraft account which she had with the Central Bank of Indian Ltd., Aligarh.
In regard to this overdraft account the Tribunal has noted that at the beginning of the accounting year the amount outstanding in the said over draft was Rs. 2,76,965, that further overdrafts were raised during the accounting year with the result that at the end of the year the assessee 's liability to the bank in the said account rose to Rs. 9,56,660 and that among the further debits to this account during the year was said sum of Rs. 5.5 lacs paid to the college on January 7, 1956.
On a consideration of the aforesaid position of the overdraft and the other material on record, the Tribunal has recorded a clear finding of fact which has been accepted by the High Court that the said borrowing of Rs. 5.5 lacs made by the assessee from the Bank on January 7, 1956 had nothing to do with the business of the assessee but the amount was directly made over to the college in part fulfilment of the promised donation of Rs. 10 lacs with a view to commemorate the memory of her deceased husband after whom the college was to be named.
In other words the borrowing was made to meet her personal obligation and not the obligation of the business and as such expenditure incurred by the assessee by way of payment of interest thereon was not for carrying on the business nor in her capacity as a person carrying on that business.
Such expenditure can by no stretch of imagination be regarded as business expenditure.
It is true that initially on November 21, 1955 the capital account of the assessee was debited and the college account was credited with the sum of Rs. 10 lacs in the books of the assessee but in our view making of these entries in the assessee 's books would not alter the character of the borrowing nor would the said borrowing be impressed with the character of business expenditure, for, admittedly, the assessee maintained only one common set of books in which were incorporated entries pertaining to her capital, assets and income from all her different sources.
It is, therefore, clear to us that the interest that was paid on the sum 757 of Rs. 5.5 lacs to the bank by the assessee for the three concerned years was rightly held to be not deductible either under section 10(2)(iii) or under section 10(2) (xv) of the Act.
The two Bombay decisions on which reliance was placed by the counsel for the appellant, namely, Bombay Samachar 's case (supra) and Kishinchand Chellaram 's case (supra) are clearly distinguishable and do not touch the issue raised in the instant case before us.
In the former case, the assessee had during the relevant assessment years paid amounts of interest on capital which was borrowed from outsiders and had claimed deduction in respect of such interest.
It was not disputed that the capital borrowed by the assessee from the outsiders was admittedly used by the assessee for the purpose of its business.
The taxing authorities had taken the view that if the assessee had collected outstandings which were due to it from others it would have been able to reduce its indebtedness and save a part of the interest which it had to pay on its own borrowings, that the assessee could not be justified in allowing its outstandings to remain without charging any interest thereon while it was paying interest on the amounts borrowed by it, and that to the extent to which it would have been in a position to collect interest on the outstandings due to it from others, it could not be permitted to claim as an allowance interest paid by it to outsiders.
The High Court held that such a view was clearly unsustainable and observed that it is not the requirement under section 10(2) (iii) that the assessee must further show that the borrowing of the capital was necessary for the business so that if at the time of the borrowing the assessee has sufficient amount of its own the deduction could not be allowed and the High Court further took the view that in deciding whether a claim of interest on borrowing can be allowed the fact that the assessee had ample resources its disposal and need not have borrowed, was not a relevant matter for consideration.
The decision in Kishinchand Chellaram 's case (supra) was rendered in the peculiar facts which obtained in that case.
The Tribunal had recorded a clear finding that since the business of the assessee was that of banking there was no borrowal as such but only acceptance of deposits by the assessee from its clients which were made by the assessee in the course of and for the purposes of its business.
In those circumstances the Tribunal took the view that the aspect as to how these deposits, which were admittedly received by the assessee from the depositors in the course of its banking business, were subsequently utilized would not be material for the purpose of deciding the question whether interest paid by the assessee on these deposits should be allowed under section 10(2) (xv) of the Act and the High Court refused to interfere with that view of the Tribunal and rejected the Revenue 's application for a Reference.
In the instant 758 case admittedly the borrowing of Rs. 5.5 lacs had been made by the assessee to meet her personal obligation and not the obligation of her business.
The borrowing was completely unrelated to the purpose of the business and was actually used for making charity.
On these facts it will be clear that the interest paid on such borrowing cannot be allowed as deduction either under section 10(2) (iii) or 10(2) (xv).
Turning to the question of interest credited by the assessee during the assessment years 1958 59 and 1959 60 to the account of the Engineering College on the sum of Rs. 4.5 lacs and the accretion thereto the real question is whether the gift or donation of Rs. 4.5 lacs was complete and a trust of that amount came into existence in favour of the college as has been contended for by the assessee.
The only material on which reliance has been placed by the assessee in this behalf consists of the entries made in the assessee 's books of accounts and the certificate dated October 17, 1958 issued by the District Magistrate, Bulandshahr but from this material it is difficult to draw the inference suggested by the counsel for the appellant.
In our view both the Tribunal as well as the High Court were right in taking the view that the certificate dated October 17, 1958 was of no avail to the assessee inasmuch as it merely stated that the assessee had promised a donation of Rs. 10 lacs on October 21, 1955, out of which Rs. 5.5 lacs were deposited in the joint account maintained in the name of the assessee and the District Magistrate, Bulandshahr for the college and the remaining sum of Rs. 4.5 lacs was left as a loan with the assessee and interest thereon at 6% per annum was to be finally deposited in the Technical Institute account.
The Tribunal and the High Court were also right in taking the view that beyond making entries in the books of account of the assessee there was no material on record to show that the assessee had actually made over a sum of Rs. 4.5 lacs to the college or that the college had accepted the said donation with the result that the amount credited to the college account in her books represented her own funds and lay entirely within her power of disposition and that being so, the interest credited by the assessee on the said sum of Rs. 4.5 lacs and the accretion thereto continued to belong to the assessee, and, therefore, she was not entitled to the deduction in respect of such interests.
Counsel for the assessee attempted to contend that the obligation to make over the said sum of Rs. 4.5 lacs could be said to have become enforceable on the basis of promissory estoppel but in our view, no material has been placed on record by the assessee to show that acting on the promised donation the college authorities had actually incurred any expenditure towards construction or acted to their prejudice during the accounting period relevant to the assessment years 1958 59 and 1959 60 so as 759 to support the plea of promissory estoppel.
Of course, if in any subsequent years the assessee is in a position to place any material before the taxing authorities or the Tribunal or the Court which would support the plea of promissory estoppel the position in such years may be different.
It is thus obvious that if no trust in favour of the college in regard to the amount of Rs. 4.5 lacs could be said to have come into existence either on October 21, 1955 or on November 21, 1955 or on any other subsequent date during the relevant years, no deduction in respect of interest credited by the assessee to the account of the college over the said sum can be allowed.
In the circumstances, in our view, the High Court rightly answered the questions referred to it against the assessee in both the references.
The appeals are accordingly dismissed with costs.
V.D.K. Appeals dismissed.
| IN-Abs | The appellant assessee carried on money lending and other businesses and derived income from various sources such as investment in shares, properties and business.
Pursuant to her promise to donate a sum of Rs. 10 lacs for setting up an Engineering College to commemorate the memory of her late husband, she actually made over a sum of Rs. 5.5 lacs by depositing the same in a joint account opened in the name of the District Magistrate, Bulandshahr and Smt.
Indermani Jatia for the College.
The balance of Rs. 4.5 lacs was left with the assessee and was treated as a debt to the institution and interest thereon at 6% per annum with effect from October 21, 1955 was to be finally deposited in the technical institute account.
Though in the books of accounts, on November 21, 1955, a sum of Rs. 10 lacs was debited to her capital account and corresponding credit was given to the account of the institute, the assessee actually paid the sum of Rs. 5.5 lacs to the institution on January 7, 1956 from the overdraft account which she had with the Central Bank of India, Aligarh.
In the assessment proceedings for the assessment years 1957 58, 1958 59, 1959 60, the assessee claimed the deduction of these sums Rs.
20,107/ Rs. 25,470/ and Rs. 18,445/ being the respective items of interest paid by her to the bank on Rs. 5.5 lacs during the samvat years.
The assessee contended that she had preferred to draw on the overdraft account of the bank for the purpose of paying the institution in order to save her income earning assets, namely, the shares, which she would have otherwise been required to dispose of and therefore, the interest paid by her should be allowed.
As regards interest on the remaining sum of Rs. 4.5 lacs (which was left as a loan with the assessee) that was debited to her account, the assessee claimed that it was a permissible deduction.
The taxing authorities took the view that the claim for deduction was not admissible either against business income under section 10(2) or against income from investments under section 12(2) of the Income Tax Act, 1922.
The appeals preferred to the Appellate Tribunal failed.
The references made to the High Court went against the assessee.
Dismissing the appeals by special leave, the Court ^ HELD: 1.
Under section 10(2)(iii) of Income Tax Act, 1922, three conditions are required to be satisfied in order to enable the assessee to claim a deduction in respect of interest on borrowed capital, namely, (a) that money 746 (capital) must have been borrowed by the assessee, (b) that it must have been borrowed for the purpose of business and (c) that the assessee must paid interest on the said amount and claimed it as a deduction.
[755B C] 2.
As regards the claim for deduction in respect of expenditure under section 10(2) (xv), the assessee must also satisfy three conditions namely (a) it (the expenditure) must not be an allowance of the nature described in clauses (i) to (xiv); (b) it must not be in the nature of capital expenditure or personal expenses of the assessee and (c) it must have been laid out or expended wholly and exclusively for the purpose of his business.
[755C D] 3.
The expression "for the purpose of business" occurring in s.10(2)(iii) as also in 10(2)(xv) is wider in scope than the expression "for the purpose of earning income profits or gains" occurring in section 12(2) of the Act and, therefore, the scope for allowing a deduction under section 10(2)(iii) or 10(2)(xv) would be much wider than the one available under section 12(2) of the Act.
[755D E] Commissioner of Income Tax vs Malayalam Plantations Ltd., ; ; applied. 4.
Neither there had been any confusion of the issue nor any wrong approach had been adopted by the taxing authorities, the Tribunal or the High Court.
The case of the assessee had been considered both by the Tribunal as well as by the High Court under s.10(2) (iii) or 10(2) (xv) and not under s.12(2).
In fact, in Reference No. 775 of 1970 the questions framed by the Tribunal in terms referred to s.10(2)(iii) and 10(2)(xv) and proceeded to seek the High Court 's opinion as to whether the sums representing interest paid by the assessee to the Central Bank on the overdraft of Rs. 5.5 lacs for the concerned three years were allowable as deduction under either of the said provisions of the Act and the High Court after considering the matter and the authorities on the point had come to the conclusion that such interest was not allowable as a deduction under either of the said provisions.
[743D G] 5.
It is true that the High Court did refer to the decision of the Bombay High Court in Bhai Bhuriben 's case but that decision was referred to only for the purpose of emphasising one aspect which was propounded by that Court, namely, that the motive with which an assessee could be said to have made the borrowing would be irrelevant.
In fact the High Court found that there was no material to show that the assessee, in the instant case, would necessarily have had to employ the business assets for making payment to charity.
The High Court actually considered the assessee 's case under section 10(2) (iii) and 10(2) (xv) and disallowed the claim for deduction under these provisions principally on the ground that the said borrowing of Rs. 5.5 lacs was unrelated to the business of the assessee.
[745G H, 755A B] Bhai Bhuriben Lallubhai vs Commissioner of Income Tax, North Cutch and Saurashtra, ; explained.
(6) In the instant case: (a) The amount of Rs. 5.5 lacs having been actually parted with by the assessee on January 7, 1956, and having been accepted by the institute the same being deposited in the joint account of the assessee and the District 747 Magistrate, Bulandshahr for the Engineering College, the gift to that extent was undoubtedly complete with effect from the said date.
[756A C] (b) The said payment made by the assessee by drawing a cheque on the overdraft account was a borrowing which was made to meet her personal obligation and not the obligation of the business and as such expenditure incurred by the assessee by way of payment of interest thereon was not for carrying on the business nor in her capacity as a person carrying on that business.
Such expenditure could by no stretch of imagination be regarded as business expenditure.
[756C, F] (c) It is true that initially on November 21, 1955 the capital account of the assessee was debited and the college account was credited with the sum of Rs. 10 lacs in the books of the assessee but making of these entries in the assessee 's books would not alter the character of the borrowing nor would the said borrowing be impressed with the character of business expenditure for admittedly, the assessee maintained only one common set of books in which were incorporated entries pertaining to her capital, assets and income from all her difference sources.
The borrowing was completely unrelated to the purpose of the business and was actually used for making charity.
It is, therefore, clear that the interest that was paid on the sum of Rs. 5.5 lacs to the bank by the assessee for the three concerned years was rightly held to be not deductible either under section 10(2) (iii) or under section 10(2) (xv) of the Act.
[756F H, 757A] Commissioner of Income Tax, Bombay City II vs Bombay Samachar Ltd., Bombay, ; Commissioner of Income Tax, Bombay City IV vs Kishinchand, ; distinguished.
(d) Both the Tribunal as well as the High Court were right in taking the view that the certificate dated October 17, 1958 was of no avail to the assessee inasmuch as it merely stated that the assessee had promised a donation of Rs. 10 lacs on October 21, 1955, out of which Rs. 5.5 lacs were deposited in the joint account maintained in the name of the assessee and the District Magistrate, Bulandshahr for the college and the remaining sum of Rs. 4.5 lacs was left as a loan with the assessee and interest thereon at 6% per annum was to be finally deposited in the technical institute account.
The Tribunal and the High Court were also right in taking two views that beyond making entries in the books of account of the assessee there was no material on record to show that the assessee had actually made over a sum of Rs. 4.5 lacs to the college or that the college had accepted the said donation with the result that the amount credited to the college account in her books represented her own funds and lay entirely within her power of disposition and that being so, the interest credited by the assessee on the said sum of Rs. 4.5 lacs and the accretion thereto continued to belong to the assessee, and, therefore she was not entitled to the deduction in respect of such interests, and [758C G] (e) If no trust in favour of the college in regard to the amount of Rs. 4.5 lacs could be said to have come into existence either on October 21, 1955 or November 21, 1955 or on any other subsequent date during the relevant years, no deduction in respect of interest credited by the assessee to the account of the college over the said sum can be allowed.
[759A B] 748
|
ivil Appeals Nos. 921/78 and 425/79 Appeals by Special Leave from the Judgment and Order dated 27 4 1978 of the Allahabad High Court in Writ Petition No. 3732/77.
M. V. Goswami for the Appellant (In CA 921/78) section section Ray, D. Gupta, Shiv Dayal, N. R. Khaitan, U. K. Khaitan and G. Mitra for the Respondent in CA 921/78 and Appellant in CA 425/79.
section N. Kacker, Sol.
of India, G. C. Dwivedi, section C. Bhudhwar, section Markendaya and K. Madan Mohan Reddy for U. P. State Electricity Board (Appellant No. 2 in CA 921/78).
717 The Judgment of the Court was delivered by SHINGHAL J.
These appeals by special leave arise from the judgment of the Allahabad High Court dated April 27, 1978.
While Civil Appeal No. 921 of 1978 has been filed by the State of Uttar Pradesh, the U.P. State Electricity Board and the Executive Engineer of the Rihand Power Station, hereinafter collectively referred to as the State, Civil Appeal No. 425 of 1979 has been filed by the Hindustan Aluminium Corporation Ltd., its Vice President and Chief Accountant, hereinafter referred to as the Company.
We have heard the two appeals together and will dispose them of by a common judgment.
The controversy relates to the supply of electrical energy (for short "energy") for the production of aluminium, which is the most modern of the common metals.
Unlike the other common industrial metals like iron, copper, zinc and lead, pure aluminium is not produced by the direct smelting of its ores.
The metal is now produced by the modern electrolytic method under the influence of direct current.
It takes about 10 kilo watt hours of electricity to produce a pound of aluminium, and the supply of cheap electric power is therefore an essential requisite or raw material for its production.
The metal has many advantages and uses and has gained such importance that it is an essential commodity under the Essential Commodities Act and its production is one of the scheduled industries under the Industries (Development and Regulation) Act.
While the State feels aggrieved because the High Court has interfered with the Uttar Pradesh Electricity (Regulation of Supply, Distribution, Consumption and Use) Order, 1977, dated September 19, 1977, hereinafter referred to as the Order, which it made under section 22B of the Electricity Act, 1910, (for short the Act), the Company 's grievance is that the High Court has not granted all the reliefs which it had claimed in its petition under article 226 of the Constitution.
The Court 's record is much too voluminous, but it appears to us that the appeals can be adequately disposed of on the basis of the important averments in the lists of dates drawn up by counsel for the parties about which there is no dispute before us.
When the question of establishing a new aluminium factory arose for consideration by the Government of India, it took into consideration the consent of the Government of Uttar Pradesh to make energy available for the factory from the Rihand Hydro electric Scheme which was expected to go into operation by the end of 1960, and granted an industrial licence to the Company on September 26, 1959, for the manufacture of 20,000 metric tonnes of aluminium ingots per year at Rihand.
An agreement was also entered into between the State of 718 Uttar Pradesh and the Company on October 29,1959 for the supply of 55 m w of power on a firm, continuous and uninterrupted basis at a rate of 1.997717 paise per unit for a period of 25 years from the date of commencement of the supply.
The Company set up and commissioned its aluminium plant at Renukoot (near Rihand Dam) with an installed capacity of 20,000 metric tonnes per annum in April 1962.
It was granted a further licence for the expansion of its installed capacity by 40,000 metric tonnes per annum.
As the State was unable to meet the extra requirement of energy, sanction under section 28 of the Act was granted to the Company, at its request, on November 12, 1964, to set up a generating station at Renusagar, near Renukoot, through its subsidiary the Renusagar Power Company Ltd. It had two generating units of 67.5 m w each.
The first unit started generating power in 1967 and the other in 1968.
The 40,000 metric tonnes expansion unit was commissioned in 1968.
In the meantime the Company was granted a licence in December 1966 for effecting a further expansion of 60,000 metric tonnes per annum in its installed capacity for the production of aluminium.
The Company thought of setting up the plant for the production of 60,000 metric tonnes of aluminium in Gujarat State as it was informed by the Gujarat State Electricity Board that it would be able to meet the requirement of energy there at a rate of Rs. 320/ per kilowatt year, which was much higher than the rate at which it was receiving energy from U.P. State Electricity Board (U.P.S.E.B.).
The Government of U.P. held negotiations with the Company, and it was decided that the Company would produce the additional 60,000 metric tonnes of aluminium also in Uttar Pradesh.
The Chief Secretary to the government of U.P. wrote a detailed letter to the Company on November 20, 1968, in which the position regarding the supply of energy was stated as follows, "Regarding the power plant, I can see no difficulty in meeting the interim requirements for 2 to 3 years from the U.P. State Electricity Board, nor do I see any difficulty in arranging for parallel running of your new power station, with the U.P. State Electricity Board.
" The Company then addressed a letter to the State Government on September 26, 1969 stating the position regarding the supply and generation of increased energy for the expansion of aluminum production as follows, "5(a) The Scheme of power supply for our expansion by UPSEB is interlinked with the question of expansion of 719 Our Renusagar power plant and its parallel operation with your system.
The application for the expansion of our Renusagar Power Plant has already been submitted to your office, a copy of which is enclosed herewith for your ready reference.
The necessary permission for the same is requested as early as possible.
(b) The emergency assistance under parallel operation would be required for about 100 m w and the terms and conditions for the same would have to be decided simultaneously with the permission for expansion of our Power Plant.
" It may be mentioned that the Company was granted sanction to expand Renusagar generation by 250 m w.
In 1972 the Company expanded its installed capacity for the production of aluminium by 35,000 metric tonnes per year.
On its part, the U.P.S.E.B. sanctioned 110 m w additional energy under a phased programme to be compelled by June 1, 1975.
It was clearly stated in the letter of the U.P.S.E.B. dated September 2, 1972, that the supply would be without prejudice to the power of the State Government to control the distribution and consumption of energy under section 22B of the Act.
Reference in the letter was made to the acute shortage of power because of scanty rainfall in the catchment area.
It so happened that additional energy was not made available to the Company during 1972 75 although the rate was substantially increased (to 11 paise instead of 1.997717 paise) with retrospective effect from June 30, 1975, under the new aluminium policy of the Government of India.
An agreement was however entered into between the Company and the U.P.S.E.B. on November 30, 1976 for the supply of 85 m w of energy on a continuous basis, for a period of 5 years, in supersession of the earlier agreements, and it was stipulated that it would be read and construed in all respects in conformity with the provisions of the Act, the , and the rules and the regulations and the amendments thereto The Company received that supply and was even promised an additional supply of 35 m w over a phased period from July 1977, but did not get it.
The Company was all the same able to raise its production of aluminium to 95,000 metric tonnes by April 7, 1977, because of the supply of 85 m w of energy.
In the meantime, the State Government took a decision by the end of December 1976 to reconnect some 70,000 pumping sets which had 720 been disconnected for non payment of the electricity dues.
That placed an additional load of about 400 m w on the grid system of the State.
The Chairman of U.P.S.E.B. submitted a note on the power situation which was likely to obtain from April to July 1977.
He pointed out that there was acute shortage of energy and suggested the imposition of some restrictions upto the end of July 1977 by when the demand for agriculture was expected to decrease and the Rihand and Matatila reservoirs would be filled up.
That was proposed to meet the needs of agriculture and related industries and to meet the industrial demand to the extent possible.
One of the proposals was for a 50 per cent cut in the demand of the Company and some other industrial units including Kanoria Chemicals and Industries Ltd. That note came up for consideration in the State Cabinet on April 1, 1977, and was partially approved.
The U.P. Electricity (Regulation of Distribution and Consumption) Order, 1977, was therefore issued on April 7, 1977.
Under clause 6(a) (i) of the Order, the Company could draw energy only to the extent of 42.5 m w i.e. 50 per cent of its monthly consumption; but it was allowed to draw 55 m w for the time being.
Uttar Pradesh came under the President 's rule on April 30, 1977, and the Company was allowed to draw 55 m w until further orders.
It is the case of the State that the shortage of energy became more acute in the third week of May. The Company, in the meantime, filed its first writ petition [No. 1790(c) of 1977] on receipt of a letter of the Executive Engineer (O.&M.), Rihand, that the power supply to the Company should be cut off completely with immediate effect.
The writ petition was dismissed on May 20, 1977, because of a subsequent letter by the Government requiring the U.P.S.E.B. to continue the supply of 42.5 m w energy instead of 55 m w in accordance with the aforesaid Order of April 7, 1977.
The Secretary of the Power Department of the State government sent a note to the Governor on May 24, 1977, proposing some additional cuts in the supply of energy.
Decision thereon was deferred until information was obtained from other States in regard to availability of energy to aluminium plants.
A fresh note was thereafter prepared for orders.
In that note dated May 31, 1977, it was stated that there was a large gap between demand and availability of energy and that was creating a serious imbalance requiring load shedding on a large scale, and that had given rise to discontent in all sectors of the economy and, in particular, in the rural sector.
It was also pointed out that overriding public interest, particularly the need to maintain 721 food supply and the industrial production, required that units which were heavy consumers of energy should be subjected to further cut in the consumption of energy.
It was particularly pointed out that as the Company was itself generating energy at Renusagar, it will have more than 50 per cent of energy even if the Board 's supply of 42.5 m w was completely withdrawn, and that will service some 8500 pumping sets.
It was, all the same, stated that the Company would continue to have 60 m w from the U.P.S.E.B. as stand by supply as in the past.
The Governor approved that proposal on June 1, 1977.
A proviso was, inter alia, inserted in clause 6(a)(i) of the U.P. Electricity (Regulation of Distribution and Consumption) Order, 1977, on June 2, 1977, according to which the industrial consumer which had its own source of generation of energy from which it obtained 50 per cent or more of its total consumption would suffer a cut of 100 per cent in the energy supplied by the U.P.S.E.B.
The Company was accordingly given time to bring about the total cut.
In the meantime, the Company filed its second writ petition [No. 2160(c) of 1977] along with an application for stay.
The High Court admitted the writ petition, but rejected the application for stay.
The Company then moved this Court for special leave.
The Hon 'ble Vacation Judge made an observation that the matter may be discussed by the parties concerned, and the State agreed to give 20 m w of energy to the Company for the time being.
Fresh elections were held to the State Legislative Assembly, and the new Cabinet was sworn in on June 23, 1977.
It decided to reduce the supply of energy to the Company to zero, in pursuance of the amendment dated June 2, 1977, and called for a fresh note on the position regarding the generation and distribution of energy.
The Executive Engineer, Rihand, accordingly asked the Company to reduce the consumption to zero.
A detailed note was prepared by the Secretary concerned on June 28, 1977, and it came up for consideration in the Cabinet on June 30, 1977, but no decision was taken and the note was kept pending.
It appears that the Chairman of the U.P.S.E.B. prepared a note on August 26, 1977, in which he pointed out the shortage of energy, including a substantial fall in the generation of thermal energy and in the "import" of energy.
It appears that the Minister concerned made some statements in regard to the generation of energy in the State and the position of the Company, but we shall refer to them later when we deal with the allegation regarding malice in law.
It will be sufficient to say that the State Government made the Order 722 on September 19, 1977, called the Uttar Pradesh Electricity (Regulation of Supply, Distribution, Consumption and Use) Order, 1977.
It has undergone some amendments, but learned counsel are in agreement that they have no bearing on the controversy before us.
The Company filed its third writ petition (No. 3732 of 1977), against the Order, on September 26, 1977.
It was admitted the same day and the earlier writ petition (No. 2160 of 1977) was dismissed as withdrawn.
The High Court directed the Company to make an application under clause 10 of the Order, for exemption, but it was rejected all December 9, 1977 when made.
The High Court ultimately heard and decided the writ petition by the impugned judgment dated April 27, 1978 against which these appeals by special leave have been directed as aforesaid.
This Court made an order on May 4, 1978 for the supply of 20 m w of energy to the Company as a purely interim arrangement.
That was raised to 35 m w by an order dated August 29, 1978, and the State is now supplying 42.5 m w to the Company as an interim arrangement.
These basic facts are not in dispute before us.
We shall examine the arguments of the learned counsel for the parties with reference to them, after taking into consideration the other well settled facts on which reliance has been placed by learned counsel, and with due regard to the relevant averments of the parties.
The High Court has recorded a number of findings.
We shall have occasion to refer to those of the findings which have been challenged before us.
It may be sufficient to say here that the High Court has worded the operative part of its judgment as follows, "In view of the aforesaid discussion the provisions of the first proviso to clause VI (a)(i) of the Uttar Pradesh Electricity (Regulation of Supply, Distribution, Consumption and Use) Order, 1977 dated September 19, 1977 are declared ultra vires and are quashed.
The U. P. State Electricity Board is directed to supply electrical energy to the petitioner in accordance with law without taking into consideration the provisions of the said proviso".
In order to examine the findings of the High Court about the invalidity of the proviso to clause 6(a) (i) of the order, it will be convenient to examine the relevant findings of the High Court on the various points of law.
The High Court has taken the view that it is the statutory obligation of the U.P.S.E.B. because of the obligation of a licensee under 723 sections 18 and 26 of the to supply electrical energy to a consumer.
Reference in this connection has also been made to clause VI of the Schedule to the Act.
Clause (h) of section 2 of the Act defines a "Licensee" to mean any person licensed under Part II to supply energy.
Section 26 of the Act of 1948 provides, inter alia, that, subject to the provisions of that Act, the Electricity Board shall in respect of the whole State, have all the powers and obligations of a licensee under the , and the Act of 1948 "shall be deemed to be the licence of the Board" for purposes of the Act (of 1910).
The first proviso to the section excludes the application of some sections, including section 22, of the Act, and the second proviso states that the provisions of clause VI of the Schedule to the Act shall apply to the Board in respect of that area only where distribution mains have been laid by the Board and the supply of the energy through any of them has commenced.
While, therefore, the U.P.S.E.B. is a licensee under the Act, it will be sufficient, for purpose of the controversy before us, to say that section 22 of the Act is not applicable to it, and clause VI of the Schedule is applicable to it subject to the restriction contained in the second proviso to section 26 of the Act of 1948.
So even though the Board is a licensee, the obligation under section 22 of the Act to supply energy to every person within the area of its supply is not fastened on it.
The provisions of the Schedule to the Act are deemed to be incorporated in, and to form part of, every licence granted under Part II.
Clause VI of that Schedule states that where after distributing mains have been laid down and the supply of energy through them has commenced, a requisition is made by the owner or occupier of any premises situate within the area of supply requiring the licensee to supply energy for such premises, the licensee shall make the supply and shall continue to do so in accordance with the requisition.
But, as has been pointed out, the second proviso to section 26 of the Act of 1948 places a restriction on that obligation for it says that the provisions of clause VI shall apply to the Board in respect of that area only "where distribution mains have been laid by the Board and the supply of energy through any of them has commenced".
Clause (i) of section 2 of the Act defines a "main" to mean any electric supply line through which energy is or is intended to be, supplied to the public.
A "distribution mail" has been defined by clause (e) of the same section to mean the portion of any main with which a service line is, or is intended to be, immediately connected.
We 724 have also gone through the definitions of "electric supply line" and "service line".
They leave no doubt that a "distributing main" is different from an electric supply line, for to it a service line is immediately connected.
The High Court has stated that the Company gets its supply from the Pipri Bus Bar, which is composed of a set of conductors which are made up of thick aluminium core steel reinforced cables, and has taken the view that the Pipri Bus Bar is a "distributing main" under section 2(e) of the Act and is an electric supply line as defined in section 2(f) so that clause VI of the Schedule to the Act would be fully applicable to the Board in so far as its obligation to the Company is concerned.
But as has been stated in the second proviso of section 26 of the Act of 1948, the provisions of clause VI of the Schedule to the Act could apply to the U.P.S.E.B. in respect of that area where distribution mains had been "laid by the Board".
It was therefore a question of fact whether that was so, and had to be examined on the basis of the averments of the parties to that effect.
It is however not disputed before us that the Company did not plead that distributing mains had been laid by the Board for supply of energy to the Company, or to any one else, from the Pipri Sub station.
The State had therefore no occasion to controvert any such allegation.
This has in fact been admitted to be so by Mr. Ray in his arguments, and the High Court went wrong in recording a finding of fact against the State without any basis for it in the pleadings.
We have also gone through section 18 of the Act of 1948 to which reference has been made in the judgment of the High Court, but it is also of no avail to the Company.
The section makes a mention of the general duties of the Board, but it does not make it obligatory for it to supply energy to every person irrespective of its practical difficulties.
The High Court has in fact quoted extensively from its earlier judgment in Civil Miscellaneous Writ Petition No. 618 of 1972 to which one of the two Judges was a party.
It is not disputed, however, that when an appeal was taken against that judgment, the writ petition was itself withdrawn and was dismissed, so that judgment of the High Court may not be said to have subsisted thereafter, and need not have formed the basis of the finding of the High Court against the Board in regard to its duty to supply the energy asked for by the Company the more so when the decision on the point should have turned on the facts pleaded and established on the record.
725 Mr. Ray for the Company has however invited our attention to a decision of the Rajasthan High Court in firm Sadul Cotton Ginning and Pressing Factory vs Rajasthan State Electricity Board.(1) But that was a different case where it was not pleaded by the Electricity Board that clause VI of the Schedule to the Act was not applicable to it as the distributing mains had not been laid by it.
The High Court therefore erred in taking the view in the present case that the Board was bound by the terms of clause VI of the Schedule to the Act to supply energy to the Company within one month of the making of the requisition or within such longer period as the Electrical Inspector may allow.
But even if it were assumed that the Board was under an obligation to supply energy to every person, the fact nonetheless remains that the State Government had the overriding power to provide, by order made under section 22B of the Act, for regulating the supply, distribution, consumption or use thereof.
In fact sub section (2) of that section categorically states that, without prejudice to the generality of the power under sub section (1), the order, may direct the Board not to comply with any contract, agreement or requisition for the supply of energy etc.
The High Court erred in taking a contrary view.
It has next been argued that only the energy which was generated by the Board could be the subject matter of an order under section 22B of the Act and it was not permissible for the State to take into account the energy generated by the Company for its own use.
It may be recalled that the Company applied for the grant of sanction under section 28(1) of the Act to generate 120 m w of energy for the additional production of aluminium.
That was allowed and a notification was issued on November 12, 1964, granting sanction to the Renusagar Power Company Limited (a wholly owned subsidiary of the Company) to engage in the business of supplying energy to the Company.
It has two generating units and 135 m w power is being generated by the Renusagar Station for the exclusive use of the Company, and it is this energy for which it has been argued that it cannot be the subject matter of an order under section 22B.
But sub section (1) of section 28 of the Act in terms refers to, and deals with, engaging by a non licensee, in the business of supplying energy to the "public".
It is therefore futile to contend that what was generated by the Renusagar Power Company was not meant for supply to the public but was the Company 's own energy.
It is true that that generation became, in the circumstances, the "captive" generation for the use of the Company, but that is far from saying that, in 726 the eye of law, it was not energy meant for supply to the public or that it was not amenable to control under section 22B.
It must therefore be held that it was not amenable to control under section 22B.
It must therefore be held that it was also liable to equitable distribution by an order under section 22B of the Act.
The expression "energy" has been defined by clause (g) of section 2 of the Act as follows, "(g) "energy" means electrical energy (i) generated, transmitted or supplied for any purpose, or (ii) used for any purpose except the transmission of a message".
It is therefore a pervading definition, and there is no reason why energy generated and supplied under section 28 of the Act should not fall within its sweep.
We are mindful of the fact that while section 22B of the Act occurs in Part II, the aforesaid section 28 is in Part III, but that will not really take the supply of energy under section 28 out of the control of section 22B. Part II deals with "supply of energy" by licensee, while Part III deals with "supply, transmission and use of energy by non licensees".
But when it was thought necessary to vest the State Government with the power to give directions to licensees (under section 22A), and to control the distribution and consumption of energy (under section 22B), it became necessary to insert sections 22A and 22B by Act 32 of 1959.
The Legislature therefore inserted both the sections in Part II which occurred earlier than Part III, and under the broad fabric "Supply of Energy".
As is obvious, insertion of sections 22A and 22B would not have been appropriate in Part III, and the Legislature cannot be blamed if it preferred the inclusion of the two sections together in Part II rather than in the residuary Part IV.
Moreover it is by now well settled that the true meaning of a provision of law should be determined on the basis of what it provides by its clear language, and with due regard to the scheme of the law as a whole, and not merely by the place it finds in the formation of its Parts or Chapters.
An ancillary argument has been advanced that if sub section (1) of section 22B of the Act is read with due regard to sub section (2), it will appear that, like sub section (2), sub section (1) is also confined to a licensee and will not be applicable to the energy supplied by a sanction holder under section 28.
Our attention in this connection has been invited to the use of the article "the" in sub section (2) while stating that the order made under sub section (1) may direct 727 "the licensee ' not to comply with the matters stated in clauses (i) to (iii).
The argument is untenable for two reasons.
Firstly, subsection(1) of section 22B refers to the State Government 's power to control the distribution of energy as a whole and not merely the energy generated by a licensee, and there is no rule of construction by which the restricted scope of sub section (2), which deals only with the licensees should govern the scope of sub section (1) and confine it to licensees.
Secondly, the purpose of sub section (2) is to provide exceptions of the nature which are peculiar to licensees and are necessary to save them from the statutory obligations mentioned in the three clauses of the sub section.
It appears that the use of he article "the" in sub section (2) is not quite appropriate, but we have no doubt that there is no justification for the argument that section 22B is applicable only to licensees and not to a sanction holder under section 28.
What section 22B of the Act authorises the State Government to do, is to make an order providing for "regulating" the supply, distribution, consumption or use of energy, and it has been held by the High Court that the section does not confer the power to prohibit the supply of energy to any consumer.
The High Court has gone on to hold that Parliament did not confer on the State Governments the power to cut off supply to existing consumers.
Mr. Ray has supported the view of the High Court and has invited our attention to the decisions in Municipal Corporation of the City of Toronto vs Virgo,(1) Attorney General for Ontario vs Attorney General for the Dominion and the Distillers and Brewers ' Association of Ontario,(2) Birmingham and Midland Motor Omnibus Co. Ltd. vs Worcestershire County Council(3), Tarr vs Tarr(4), The Automobile Transport (Rajasthan) Ltd. vs The State of Rajasthan and others(5) and State of Mysore vs H. Sanjeeviah(6).
As against that the learned Solicitor General has placed reliance on the view taken in Fatechand Himmatlal and others vs State of Maharashtra etc.(7) that 'regulation ', if the situation is necessitous, may reach the limit of prohibition.
It appears that a distinction between 'regulation ' and 'restriction ' or 'prohibition ' has always been drawn, ever since Municipal Corpora 728 tion of the City of Toronto vs Virgo (supra). 'Regulation ' promotes the freedom or the facility which is required to be regulated in the interest of all concerned, whereas 'prohibition ' obstructs or shuts off, or denies it to those to whom it is applied.
The Oxford English Dictionary does not define "regulate" to include prohibition so that if it had been the intention to prohibit the supply, distribution, consumption or use of energy, the Legislature would not have contented itself with the use of the word "regulating" without using the word "prohibiting" or some such word, to bring out that effect.
But where the High Court went wrong was in thinking that the Order had the effect of prohibiting the supply of energy to the Company, which was an "existing consumer".
The proviso to clause 6(a) (i) of the Order to which exception has been taken, states as follows, "Provided that where any such industrial consumer has his [own source of generation of energy which alone enables him to obtain] 50 per cent or more of his total consumption, then a cut of 100 per cent in the energy supplied by the Uttar Pradesh State Electricity Board shall be exercised.
" What has therefore been ordered is no more than a cut of 50 per cent in the monthly consumption of electricity and not a total prohibition of consumption of energy.
That is a step in the direction of regulating the consumption of energy as far as it goes, and it is overridden with the further regulation contained in the proviso in the case of an industrial consumer having its own source of generation of energy "which alone" enabled him to obtain 50 per cent or more of his total consumption so as to ensure even to him a consumption of 50 per cent of energy and not a total prohibition.
The proviso therefore operates in a special or particular field and for a particular purpose where it is considered necessary for regulating the supply etc.
of the energy in the interest of the other consumers, for section 22B is meant to maintain the supply and secure the equitable distribution of energy to all concerned.
We are constrained to say that the High Court did not properly appreciate this aspect of the matter.
The High Court has gone on to hold that no power was vested in the State Government under section 22B of the Act to issue an order that certain preferences will be followed in supplying energy.
The High Court has found it established that after power supply was totally "disconnected" by the Board to the Company, "power supply connections were given to the agricultural sector and agro based industries.
" This appears to be the High Court 's finding in regard to the argument that the Order was bad as it was not permissible to adjust the priorities 729 by an order under section 22B. Learned counsel for the Company have argued that the only permissible preference was that under section 22A in favour of an establishment mentioned in it and that the preference shown to individual consumers was illegal.
Now so far as clause 6(a) (i) of the Order is concerned, it does not, by itself, provide for any preferences or priorities, beyond excluding "fertilizers" from the cut of 50 per cent on all large and heavy industrial power consumers receiving power at 33 k v and more.
Clause 7 of the Order deals with "exemptions", and "fertilizers manufacturing establishments" have been included there amongst the consumers to whom the cut referred to in clause 6 of the Order shall not be applicable.
It has not been argued before us that it was not permissible for the State Government to provide for exemptions in an order under section 22B, and we have not been referred to any such data or material on the basis of which it may be possible to examine whether the exemptions in question were in derogation of the concept of "maintaining and securing the equitable distribution of energy" under section 22B.
It may be that the State Government was of the opinion that supply of energy to the agricultural sector and agro based industries was more necessary and would benefit the state more substantially than the supply made to heavy industrial consumers, but merely because any such preference has been entertained by the State Government, it cannot be said that it necessarily runs counter to the concept of equitable distribution of energy stated in section 22B.
In fact counsel for the Company have repeatedly urged before us that the cut of 50 per cent referred to in clause 6(a) (i) was meant to deprive only a few consumers of energy, and that the cut of 100 per cent under the proviso operated exclusively against the Company.
And it has to be appreciated that clause 6(a) (i) deals only with large and heavy industrial power consumers receiving power at 33 kv and above, and it is hardly permissible for such a heavy consumer as the Company to complain of any preference that may have been shown to small consumers in the field of agriculture, or agro based or other small industries.
The fact remains that large and heavy industrial consumers of the category mentioned in clause 6(a) (i) are a class by themselves and it is hardly permissible for them to complain that the small preference shown to agriculturists in supplying energy for their water pumps or tube well, or in energising State tube wells supplying water to them, or the supply of energy to small scale industries has really created a privileged class of consumers or brought into existence any such concept of priorities as to run counter to or defeat the objective of bringing about the equitable distribution of energy by an order 730 under section 22B. No glaring instance of any preference has been brought to our notice so as to raise in us a desire to examine the question whether it was necessary or proper for the State Government to provide guidelines for the small preferences shown by it to the aforesaid consumers.
In fact it has been admitted in the written arguments which have been filed and received in Court that, in the present case, the company is "not sure as to what exactly has happened".
In such a situation, we are not persuaded that the High Court had any real justification for recording an adverse finding against the State on the question of the so called preferences or priorities.
Learned counsel for the Company were not able to refer us to any plea in the writ petition about illegal priorities or preferences.
Nor could they refer to a plea that any preference or priority shown by the State was the very antithesis of the concept of equitable distribution which, for the purpose of maintaining the supply of energy, was the very object of the Order.
If any such plea had been taken, it would have been permissible for the State to take any defence that may have been open to them.
But merely because the word preference or priority has been used by the State for the purpose of comparing the grantees of energy in preference to the Company, or as a matter of priority over the consumption of energy by a giant consumer like the Company, it will not be fair and reasonable for us to hold that the State has established a class of privileged consumers, and to set aside the grant of energy to them in their absence and without examining the facts and circumstances of their respective cases.
The purpose of the Order is to maintain the supply of energy and to secure its equitable distribution.
One such method was to conserve energy by virtue of the provisions of clause 6(a) (i).
If that has been done according to law; and if the resultant saving of energy is frittered away by showing unlawful preferences or creating unlawful priorities by other orders of an administrative nature, there is nothing to prevent the aggrieved party, including the Company, from challenging it according to the law, in an appropriate proceeding, if so advised.
But any such grievance cannot be examined in these proceedings for the Order has the avowed object of bringing about equitable distribution of the conserved energy in an honest and forthright manner and there is nothing on the record for us to hold otherwise.
It has next been argued that the validity of the Order, which is by way of a piece of subordinate legislation, is open to judicial scrutiny and that the subjective satisfaction of the State Government in making it is open to challenge in a court of law.
It will be enough for us to say that subordinate legislation is by now a well recognised form of legislation for practical reasons.
The modern 731 administrative machinery is quite complex and it is often found difficult to pass complicated legislative measures through the full parliamentary procedure and on a permanent or durable basis.
Even a carefully drafted Act may not work well in actual practice.
It may also be that the exact means of achieving the object of an Act may not be adequately comprehended all at once, and it may be useful to provide for some elasticity in the actual working of a law.
That can best be done by leaving some of the details to subordinate legislation.
That is why some legislative powers are delegated to executive authorities, subject of course to the purpose and the scheme of the parent Act, the constant vigil of the Parliament or the State Legislature, and the Judicial control.
These are reliable safeguards and with their easy availability, it is no surprise that subordinate legislation is now so voluminous that it may well be said to have dwarfed the parent.
The grounds of challenging the validity of subordinate legislation are well known.
The challenge may be on the ground that the power to make the law could not have been exercised in the circumstances which were prevailing at the time when it was made, or that a condition precedent to the making of the legislation did not exist, or that the authority which made the order was not competent to do so, or that the order was not made according to the procedure prescribed by law, or that its provisions were outside the scope of the enabling power in the parent Act or were otherwise violative of its provisions or of any other existing statute.
As it happens, none of these grounds or circumstances has been shown to exist in the present case.
The High Court has taken the view that the Company was unable to establish as a fact that there was no shortage in the generation of energy at the time when the order was made under section 22B.
It is no body 's case that the State Government was not competent to make the order, or that it did not comply with any procedural requirement of the Act in making the order, or that its provisions (or any of them) are outside the scope of the enabling power or are violative of the provisions of any other law.
We have examined some of the points of law on which the High Court has found some provisions of the order to be invalid, and we have given our reasons for taking a different view.
We have no doubt that the State Government formed its opinion about the necessity and expediency of making the order for the purposes of maintaining the supply and securing the equitable distribution of energy at a time when that was called for, and this Court cannot sit as a court of appeal to examine any and every argument in an attempt to show that the opinion of the State Government was vitiated for one fanciful reason or the other.
It has to be appreciated that the question whether the reasons which led to the 732 making of the order were sufficient, was essentially for the State Government to consider.
The validity of the order has been challenged on the ground that it suffers from the vice of malice in law.
But that is a point by itself and we shall examine it separately.
It will thus appear that the above arguments which have been advanced against the validity of clause 6(a) (i) of the order are not justified.
The whole of the clause reads as follows, "6(a) (i) In respect of electrical energy consumed by all large and heavy power industrial consumers receiving power at 33 kv and above, excepting fertilizers, from the U.P. State Electricity Board a cut of 50 per cent in their monthly consumption of electricity both in respect of energy and demand shall be exercised: Provided that where any such industrial consumer has his own source of generation of energy which alone enables him to obtain 50 per cent or more of his total consumption, then a cut of 100 per cent in the energy supplied by the Uttar Pradesh State electricity Board shall be exercised.
" It thus deals with the consumption of energy by all (excepting fertilizers) large and heavy industrial power consumers receiving power from the U.P.S.E.B. at 33 kv and above.
It imposes a cut of 50 per cent in their monthly consumption of energy.
Then it adds the provision that where such an industrial consumer has his own source for the generation of energy which by itself gives him 50 per cent or more of his total consumption of energy (provided for in the main clause), then it will not receive any energy from the U.P.S.E.B. as the cut in its supply will then be 100 per cent.
The clause therefore subserves the purpose of section 22B for, in a period of scarcity or insufficiency of the supply, it will have the effect of regulating the same and thereby securing the equitable distribution thereof.
It is true that although the order has been made on the ground that the State Government is of opinion that it is necessary and expedient for maintaining the supply and securing the equitable distribution of electrical energy, to provide for regulating the supply, distribution, consumption and use thereof, and has been called the Uttar Pradesh Electricity (Regulation of Supply, Distribution, Consumption and Use) order 1977, it does not deal with all those matters in details.
In fact it may well be said to be an order relating essentially to compulsory cut in the consumption of energy.
But that cannot detract from the basic fact 733 that the order has the sanction of section 22B of the Act and subserves the main purpose thereof, even though there may be justification for the criticism that it does not go far enough in its regulative enterprise in the expansive field set out for it in the preamble.
At any rate, it cannot be said to be beyond the scope and the ambit of that section, and its validity is not really open to challenge as a piece of subordinate legislation.
It has however been strenuously argued on behalf of the Company that the order should be struck down on the ground of malice in law on the part of the State Government.
That no doubt is another aspect of the doctrine of ultra vires, for an offending Act can be condemned simply for the reason that it is unauthorised.
Bad faith has often been treated as interchangeable with unreasonableness and taking a decision on extraneous considerations.
In that sense, it is not really a distinct ground of invalidity.
It is well settled that if a discretionary power has been exercised for an "unauthorised purpose", that is enough to invite the Court 's review, for as has been said quite widely but properly by Rand J. in Roncarelli vs Duplessis,(1) malice is "acting for a reason and purpose knowingly foreign to the administration.
" But the question is whether this has been Proved to be so in the present case.
Mr. Ray has argued on behalf of the Company that the order is malafide, and has been made in the colourable exercise of the power under section 22B of the Act simply to compel the Company to agree to the payment of a higher rate for the supply of energy to it.
He has tried to establish his argument on the basis of the statement of the Chief Secretary of the State Government dated July 8, 1977 and some statements of the Minister concerned.
We shall examine them separately.
What the Chief Secretary said in his press statement dated July 8, 1977, was that the State Government had reduced the supply of power to the Company from 85 m w to 10 m w and that it had been decided to almost double the rate for the supply of the power which was being given to the Company.
It will be remembered that by virtue of the amendment which was made to the U.P. Electricity (Regulation of distribution and consumption) order on June 2, 1977, the Company was required to reduce its consumption of the Board 's energy to zero, but it was, nonetheless, allowed to draw 30 m w for some time.
That led to further directions for the reduction of consumption, and ultimately an order was made on June 29, 1977 for disconnecting the supply.
A representative of the Company met the Minister concerned and explained the Com 734 pany 's difficulties.
He asked for permission to draw at least 10 m w to keep the pots warm.
The Minister agreed to that request, but only against the standby agreement for the demand of 60 m w. A letter to that effect was sent to the Company on June 30, 1977.
As under the standby agreement, energy was to be supplied at the rate of 24 paise per unit, instead of 11 paise, the Chief Secretary merely stated the factual position on July 8, 1977.
At any rate there is nothing to show that the plea of scarcity of energy was merely a ruse to charge a higher rate from the Company.
Mr. Ray has invited our attention to the statements of the Minister concerned dated July 18, 1977, July 28, 1977, September 14, 1977, August 29, 1978 and his reply to the Company dated October 18, 1978, to show that the State Government was not satisfied with the contractual rate for the supply of energy as it was below the cost of generation, and wanted to review and rescind the agreement altogether.
We have gone through the record of the proceedings of the Legislative Assembly and we find that what the Minister said there was essentially correct that 10 m w energy was being supplied to the Company under the standby agreement.
It was in that content that the Minister informed the Assembly that the charges for the said standby supply came to 26 28 paise per unit.
The learned Solicitor General has taken us through the relevant record to show that the Minister did not really want to harm the Company unnecessarily, and if he stated further that he was never approached personally by the Company, or in a proper manner, or that the relief to the Company would be considered depending on how it contacted him for that purpose, the Minister simply wanted to state the facts and to convey his resentment against the attempt to influence him politically, or through any Minister of the Central Government.
The State has in fact filed a chart with its supplementary counter affidavit about the supply of energy to the Company from February 1973 to April 7, 1977.
It shows that during the period February 1973 to August 7, 1975 the Company received energy from 27.50 m w to 1.25 m w.
It was only after the declaration of emergency on June 26, 1975 that the Company received some 55 m w of energy, and then a fresh agreement was made soon after on November 30, 1976 to supply 85 m w of energy.
But even before that date, for a sufficiently long period, the Company got far more energy than what it was entitled to.
We are therefore not satisfied that the Company has been able to establish malice in law merely because of what the Chief Secretary or the Minister stated here and there.
It may well be that the new State Government was dissatisfied with the new agreement which had been 735 entered into at the instance of the political party which was then in power, but it cannot be said that the new Minister 's desire to examine the validity or propriety of that agreement arose out of any extraneous or improper consideration so as to amount to malice in law.
Our attention has also been invited in this connection to certain statements on behalf of the State Government and the Board that energy was available in abundance, and it has been urged that even so the Company was denied its supply in spite of the agreements and the assurances of the State Government to the contrary.
That is a point relating to the contractual rights of the Company and we shall come to it in a while.
Then it has been argued that even though the State Government professed in its affidavit that the cut in the consumption of energy by the Company could not be restored because of the desire to provide more energy for agricultural purposes, that was not really so and that any such attempt was in the nature of an extraneous consideration which vitiated the implementation of the Order.
Reference in this connection has been made to the Company 's averments in the supplementary affidavit that the load on account of agriculture and irrigation had declined, and there was in fact no diversion of energy to agriculture.
In order to examine the point, we directed the State to prepare a statement for the entire period from January 1977 to December 1978.
The Order was made on September 19, 1977, and the statement shows that consumption of energy for agricultural and irrigation purposes increased appreciably thereafter, and there is no justification for the argument to the contrary.
Another "extraneous" factor which is said to have been taken into consideration by the State Government in making the Order is said to be its view that the major portion of the aluminium produced by the Company was being consumed outside the State.
A similar objection was raised before the High Court on the basis of an averment in the counter affidavit of the State.
The High Court has, however, recorded the finding that it would be "unsafe" to uphold that contention, and we see no reason to take a different view.
The other factors to which reference has been made as extraneous factors which vitiated the Order are said to be consideration of the facts that the Company had failed to expand its generating capacity, the financial loss suffered by the U.P.S.E.B. and the non payment of the coal surcharge by the Company.
But there is nothing on the record to show that these factors were taken into consideration at the time of making the Order.
It may be that those or somewhat similar facts were mentioned 736 at one time or the other in answer to the complaint of the Company, or in justification of what the State Government had done, by way of defence, but that cannot justify the argument that they formed the basis for the making of the Order.
It has also been argued that while making the Order the State Government failed to take into consideration the facts that the production of aluminium was of considerable importance to the national economy and that the Board was capable of generating more energy but was not doing so.
Reference has also been made to the new aluminium policy which the Central Government announced on July 15, 1975, and to the benefits which the U.P.S.E.B. was deriving from the aluminium products manufactured by the Company.
But the argument is untenable because there is nothing to show that these factors were not taken into consideration while making the Order, and an inference that they were ignored cannot be drawn against the State merely because the Company was not permitted to consume all the energy it wanted and there was a fall in the production of aluminium because of the restriction imposed by the Order.
It may be that the U.P.S.E.B. was capable of generating more energy, or that it was not running efficiently and had not succeeded in reaching its target of ideal generation.
But here again it will be enough to say that although the High Court arrived at the conclusion that the Company deserved the writ which it granted, it did not find it possible to hold that the U.P.S.E.B. had deliberately under utilised its generation capacity.
That is a finding of fact which does not call for interference by us.
There is thus no justification for the argument that there was malice in law on the part of the State Government in making the Order.
It may be that the State gave an impression, after the Order had been made, that it had some spectacular effect on the fortune of the Company, or that it had brought about such efficiency as to ensure supply of energy to new entrepreneurs.
It may also be that in doing so the State over stated its resources of energy in order to open up a State which had not been able to develop its industrial resources satisfactorily, but what has to be examined in such cases is the true and the dominant purpose behind the Order.
And as long as the dominant motive is proper and reasonable, and is not sullied by a mere pretext, the Order based on it will be valid when it is well within the true scope and policy of the Act and is an honest attempt to deal with the situation for which the power to make the Order had been granted by the Act.
It has however been further argued by Mr. Ray that the Order is invalid as it does not subserve the purpose of section 22B of the Act inasmuch as it does not secure the "equitable distribution" of energy.
737 Reference has been made to Jowitt 's Dictionary of English Law, where "equitable" has been stated to mean "that which is fair", and to Corpus Juris Secundum to show that equitable is that which is done "fairly, justly and impartially".
Our attention has been invited to the facts and circumstances which led to the establishment of the Company in the State of Uttar Pradesh and the agreement with and the assurances which were given to the Company.
Our attention has also been invited to the new connections which were given by the U.P.S.E.B. to the other consumers while denying the contractual supply of energy to the Company.
It cannot be doubted that only that distribution can be said to be "equitable" which is "just and right under all the circumstances of the particular case" (The Century Dictionary).
It will be remembered that the High Court has recorded a finding that there was shortage in the generation of energy when the Order was made.
A great deal of statistical data has been laid before us and Mr. Gupta has tried to make full use of it on behalf of the Company.
But the fact remains that the demand for energy was far in excess of the supply from all the sources available to the U.P.S.E.B.
It has also been well established that a situation had arisen when it became necessary to obtain an order from the State Government about the course of action to be adopted by the Board.
Self contained notes were therefore drawn up in March 1977, and on May 24, 1977, June 28, 1977 and August 26, 1977.
We have gone through the notes and they are quite detailed and objective.
We have made a mention of the developments which took place because of those notes, including the making of the Order.
We have no doubt that it was made because a situation had arisen when regulation of the supply, distribution, consumption and use of energy had become necessary, and the Order was a genuine attempt to secure equitable distribution of energy.
It is true that the Company was the worst sufferer under clause 6(a)(i) of the Order, but then it was also the greatest consumer.
The basis for the making of the Order was the necessity or expediency for maintaining the supply and securing the equitable distribution of energy by means of an order providing for the regulation of the supply, distribution, consumption and use of energy.
It has been argued by Mr. Ray that as power was supplied indiscriminately to new consumers after imposing a cut on the Company 's consumption of energy, the issue of the Order was really a colourable exercise of the State Government 's power under section 22B of the Act.
Our attention in this connection has been invited to the averments in the affidavits which have been filed on behalf of the Company and to a 738 list of new connections filed as Annexure to the supplementary rejoinder affidavit of Suresh Chandra, Special Officer of the Company.
Reference has also been made to a list of new connections filed in the High Court on March 6, 1978.
Learned Solicitor General has however pointed out that even if all the new connections were to become effective within a period of two years, their incidence would be no more than 4 per cent of the total connected load as the real impact on the system would merely be an additional load of only 18 m.w.
It has also been pointed out that while there was an increase of 9 per cent in the installed capacity of the U.P.S.E.B. for the generation of energy, the increase in the connected load was not more than 2 per cent.
We have been informed that the percentage increase in the connected load had declined from 10 in 1974 75 to 2 in 1977 78, which showed that great care was being taken in incurring extra liability.
The State has also filed a list of those applicants to whom new connections were sanctioned, but were not actually released, making a total of some 23 mw.
It has been urged on behalf of the Company that the Board had deliberately reduced its thermal generation.
It has been pointed out that while there was a substantial increase in hydro electrical generation, the performance in the thermal field was highly unsatisfactory.
The State has supplied the necessary information which shows that the fall in thermal generation was due to the initial troubles of new plants, the poor performance of the plants, and the breakdown at Harduaganj.
We have been informed that the performance of the U.P.S.E.B. was better than the Boards in the other States.
We have also been told that the proposition that there was deliberate under capacity operation of thermal machines is technically unsound because of the operating constraints in running the large thermal machines at loads lower than the rated capacity.
We have made a reference to the finding of the High Court against the Company in this respect.
Another aspect of the controversy before us relates to the contractual liability of the State to supply the energy which it had assured to the Company.
It has been pointed out that under the agreement dated October 29, 1959, the State was bound to supply 55 m w of energy upto 1987 and then an agreement was entered into on November 30, 1976, to supply additional 30 m w, making a total of 85 m w for a period of 5 years.
It has therefore been argued that instead of fulfilling its obligation under the agreements and the other assurances which were given by the State from time to time, the State took resort to the provisions of section 22B to get out of its obligation and the making of the impugned Order was really a colourable exercise of that statutory power.
739 We find from the counter affidavit of the State (October, 1977) that, as would appear from the Chief Secretary 's letter dated November 20, 1968, what the State Government had assured the Company was to meet the interim requirement of the Company for 2 or 3 years from the U.P.S.E.B. and to facilitate the parallel running of the Company 's new power station, in addition to the station which had been set up at Renusagar.
It is also not without significance that the State was not a party to the agreement dated November 30, 1976, for the supply of additional 30 m.w., because that agreement was made between the Company and the U.P.S.E.B.
It was in fact expressly stated in that agreement that it would be subject to the provisions of the Electricity Acts of 1910 and 1948 and the rules and regulations, including the amendments thereto.
Care was also taken to provide that the U.P.S.E.B. shall not be responsible for damages or diminutions in the supply of energy according to the orders issued by the State Government, A similar provision was made in the earlier agreement of 1959.
Reference was in fact specifically made in the Board 's letter to the Company dated September 2, 1972, to the State Government 's power to "control the distribution and consumption of energy under section 22B of the ".
We have made a reference to the manner and the stages in which the State Government took decisions for the restrictions to be imposed on the consumption of energy with due regard to the detailed factual notes which were submitted for its orders on account of the acute shortage of energy in the State.
Decisions in the matter were taken by the different State Governments, including the Governors ' Advisors, and it cannot be said that the cuts were imposed suddenly, or without due regard to the Company 's difficulties in reducing its consumption of energy in the manner directed by the Order.
We are therefore unable to take the view that the State wantonly disregarded its contractual obligations to the Company.
But even if the Company had some cause of grievance on that account, that may well be said to be unavoidable, in the situation which had arisen when the Order was made on September 19, 1977.
It has to be appreciated that subsection (2) of section 22B of the Act specifically provided that it was permissible for the State Government to direct by the Order that the U.P.S.E.B. shall not comply with the provision, inter alia, of any contract made by it.
A direction to that effect was expressly made in clause 11 of the Order, and it is not permissible for the Company to complain on that account.
It is not disputed that the consumers which were hit by the provisions of clause 6(a) (i) of the Order were the Company, the Kanoria 740 Chemicals and Industries Ltd., the Indian Railways, the Indian Explosives Ltd., and the Fertiliser Corporation of India.
The last three of these have been exempted from the rigour of the Order.
As regards the Kanoria Chemicals and Industries Ltd., the State has stated in its reply that it was manufacturing Benzena Chloride and BHC which are used for agricultural purposes and for purifying drinking water.
They were entitled to 50 per cent of their consumption, and the State allowed them exemption to the extent of 3 m w making it permissible for them to consume 12.5 m.w.
It cannot therefore be said that the continued supply of energy to Kanoria Chemicals was proof of any hostility on the part of the State in so far as the Company was concerned.
It may also be that, as has been argued on behalf of the Company, some other restrictions which were initially imposed on some other consumers under the Order were withdrawn, so that it is the Company which is the main sufferer under the Order.
Even so, it is not reasonable to take the view that the Order was not justified when it was made, and it cannot be held to be invalid merely because the Company is the main sufferer under it.
It is not its case that the Order was discriminatory and should be struck down under article 14 of the Constitution.
As has been stated the High Court has in fact found that the Company was "unable to establish as a fact that there was no shortage in the generation of electricity when the impugned Order was made under section 22B of the Act of 1910.
" The Order was therefore justified and was a valid Order when it was made on September 19, 1977.
The question is whether there is force in the argument that it has ceased to be in force and stood impliedly repealed because of the change in the circumstances which brought it into existence.
The High Court has recorded a finding in this connection in favour of the Company.
Craies on Statute Law, seventh edition, has mentioned six different classes of enactments at pages 357 8 which are considered as having ceased to be in force, "1.
Expired that is, enactments which having been originally limited to endure only for a specified period by a distinct provision, have not been either perpetuated or kept in force by continuance, or which have merely had for their object the continuance of previous temporary enactments for periods now gone by effluxion of time; 2.
Spent that is, enactments spent or exhausted in operation by the accomplishment of the purposes for which they were passed, either at the moment of their first 741 taking effect or on the happening of some event or on the doing of some act authorised or required; 3.
Repealed in general terms that is, repealed by the operation of an enactment expressed only in general terms as distinguished from an enactment specifying the Acts on which it is to operate; 4.
Virtually repealed where an earlier enactment is inconsistent with, or is rendered nugatory by, a later one; 5.
Superseded where a later enactment effects the same purposes as an earlier one by repetition of its terms or otherwise; 6.
Obsolete where the state of things contemplated by the enactment has ceased to exist, or the enactment is of such a nature as to be no longer capable of being put in force, regard being had to the alteration of political or social circumstances.
" These six have been mentioned as the enactments which are selected for inclusion in the Statute Law Revision Acts of England as having ceased to be in force otherwise than by express repeal, or having by lapse of time or otherwise become unnecessary.
It is quite an exhaustive list and the question is whether the Order could be said to have "spent" itself or become "obsolete", for the other four categories are inapplicable to the present case.
But whether a piece of legislation has spent itself or exhausted in operation by the accomplishment of the purpose for which it was passed, or whether the state of things contemplated by the enactment has ceased to exist, are essentially questions of fact for the Legislature to examine, and no vested right exists in a citizen to ask for a declaration that the law has been impliedly repealed on any such ground.
It has to be appreciated that the power to legislate is both positive in the sense of making a law, and negative in the sense of repealing a law or making it inoperative.
In either case, it is a power of the Legislature, and should lie where it belongs.
Any other view will be hazardous and may well be said to be an encroachment on the legislative field.
In an extreme and a clear case, no doubt, an antiquated law may be said to have become obsolete the more so if it is a penal law and has become incapable of user by a drastic change in the circumstances.
But the judge of the change should be the Legislature, and courts are not expected to undertake that duty unless that becomes unavoidable and the circumstances are so apparent 742 as to lead to one and only one conclusion.
This is equally so in regard to the delegated or subordinate legislation.
We have gone through the cases reported in Elwood Hamilton vs Kentucky Distilleries & Warehouse Co.,(1) Chastleton Corporation vs A. Leftwich Sinclair(2) and Nashville, Chattanooga & St. Louis Railway vs Herbert section Walters(3) on which reliance has been placed by Mr. Ray, but they are of no real help to the Company.
Thus in Elwood Hamilton(1) it has been held that it requires "a clear case" to justify a court in declaring that a Federal Statute adopted to increase war efficiency has ceased to be valid, on the theory that the war emergency has passed and the power of Congress no longer exists.
In Chastleton Corporation(2) it has been held that courts would pronounce on the continued operation of law upon facts which they "judicially know.
" We have also gone through Nashville(3) case where the view has been taken that a statute valid when enacted may become invalid by change in the conditions to which it is applied.
We have gone through The petition of the Earl of Antrim and Eleven other Irish Peers(4) also where a declaration was asked for by some Irish Peers that the peerage of Ireland had in accordance with the provisions of the Union with Ireland Act, 1800, the right to be represented by 28 Lords temporal of Ireland for life.
Their petition was rejected because the provisions of the Act of 1800 had ceased to be effective on the passing of the Irish Free State (Agreement) Act, 1922.
That was therefore quite a different case.
Mr. Ray has placed reliance on Pannalal Lahoti vs State of Hyderabad,(5) but what has been held there is that a temporary legislation cannot be allowed to outlast the war emergency which "brought it forth".
In The Union of India vs Ram Kanwar and others(6) it was held that as the building in question was being used for a purpose other than that for which it was originally requisitioned under the law, it was liable to be de requisitioned.
The question is whether any such situation has been found to be established in the present case ? Now what the High Court has found in this respect is as follows, "This Court finds that circumstances have materially changed since the impugned order was made.
The shortage in reservoir from which water is drawn for the generation of 743 Hydro electricity has ceased and further supplies of electrical energy are available from newly commissioned units.
The respondents admit that fresh power connections have been given.
In these circumstances, the continuance of the impugned order is no longer justified and consequently, the order must be held to have outlived the purpose for which it was made and, as such, it must be held to be no longer valid. ' It has thus found three facts: (i) the shortage in the reservoir(s) for generation of hydel energy had ceased, (ii) further supply of energy was available from newly commissioned units, and (iii) fresh power connections had been given by the U.P.S.E.B.
But what was lost sight of was the important fact that it was all along the case of the State that hydel energy was only one third of the total generation, and that generation of thermal energy which met two third of the total requirement had declined for reasons beyond the control of U.P.S.E.B.
The High Court did not therefore undertake a careful examination of the facts, and took some new connections into consideration without attempting to examine their magnitude and effect on the over all generation and availability of energy from all the sources.
The State has filed a detailed affidavit dated October 12, 1978, where it has been stated that the U.P.S.E.B. was at best capable of generating electrical energy to the "tune of 10,185 m u," whereas the total requirement of the State for 1978 79 was 13,866 m u so that there was a gap of 393 m u.
The High Court therefore erred in taking the view that the continuance of the order was no longer justified.
Even so, the High Court abstained from striking down the whole of the Order and merely declared that the provisions of the first proviso to clause 6(a) (i) was ultra vires, and quashed it.
We have given our reasons for taking the view that the whole of clause 6(a) (i) of the order, including the proviso, is valid, and the question remains whether we should restore the quashed proviso.
The answer to the question is simple.
The learned Solicitor General has made a statement at the Bar that at present, or in the near future, there is no difficulty in supplying 42.5 m w energy to the Company, and that the Company is getting that much energy already.
He has been frank enough to say that this will be so even if the proviso is restored by this Court.
He has stated that the State Government has been reviewing the position from time to time, and has given the 744 assurance that it will continue to do so in future.
He has also stated that although the application of the Company for grant of exemption under clause 10 of the Order had been rejected on December 9, 1977, there is nothing to prevent the Company from making a fresh application if it thinks that there is a real and substantial improvement in the generation of energy in the State.
The fact therefore remains that, as things stand at present, the proviso, which admittedly applies only to the Company, is of no practical use for the time being.
So even though it is valid and has wrongly been quashed by the High Court, we do not think it necessary to restore it, so that it shall not be deemed to form part of clause 6(a) (i) of the Order.
But if there is deterioration in the generation of energy again, or there are other sufficient reasons within the purview of section 22B of the Act to reinsert the proviso, in the present or modified form, it will be permissible for the State Government to do so according to the law.
In the result, while C.A. No. 921 of 1978 is allowed to the extent mentioned above, C.A. No. 425 of 1979 fails and is dismissed.
In the circumstances of the case, the parties shall pay and bear their own costs in both the appeals.
N.V.K. C.A. 921/78 allowed.
C.A. 425/79 dismissed.
| IN-Abs | At the time of granting licence to the company for the establishment of a new Aluminium factory the Government of India obtained the consent of the Government of U.P.
To make available to the company in bulk cheap electricity from the Rihand Hydro Electric Scheme.
An agreement was entered into between the Company and the State Government for the bulk supply of electricity on a firm, continuous and uninterrupted basis at 1.99 odd paise per unit for a period of 25 years.
The company set up and commissioned its aluminium plant at Renukoot in April, 1962.
It was granted a further licence for the expansion of its installed capacity.
As the State was unable to meet the extra requirement of energy, sanction under section 28 of the Electricity Act 1910 was granted to the Company, at its request, on November 12, 1964, to set up a generating station at Renusagar, near Renukoot.
It set up two generating units of 67.5 mw each.
The first unit started generating power in 1967 and the other in 1968.
In the meantime, permission was granted to increase the Company 's installed capacity from 40,000 metric tonnes to 60,000 metric tonnes.
The Company thought of setting up a plant for the production of 60,000 metric tonnes of aluminium in the State of Gujarat.
But the Government of U.P. entered into negotiations with the Company and in its letter dated November 20, 1968, it stated that there could be no difficulty in meeting the interim requirements of energy for 2 to 3 years from the U.P. State Electricity Board and also for arranging for parallel running of their new power stations.
The Company was granted sanction to expand the Renu Sagar Generation by 250 mw, and after negotiations with the State Government it was agreed that the U.P.S.E.B. would meet the additional energy under a phased programme.
The U.P.S.E.B. stated in its letter dated September 2, 1972, that the supply would be without prejudice to the power of the State Government to control the 710 distribution and consumption of energy under section 22B of the Act.
The additional energy was not made available to the Company during 1972 75 although the rate was substantially increased with retrospective effect.
An agreement was however entered into between the Company and the U.P.S.E.B. on November 30, 1976, in supersession of the earlier agreements, and it was stipulated that it would be read and construed in all respects in conformity with the provisions of the and its rules and the regulations and the amendments thereto.
The State Government took a decision in December 1976 to reconnect some agricultural pumping sets which had been disconnected and this placed an additional load on the grid system of the State.
On the note of the UPSEB that there was acute shortage of energy, and its suggestion for the imposition of some restrictions, the U.P. Electricity (Regulation of Distribution and Consumption) order 1977, was issued by the Government on April 7, 1977.
Under cl.
6(a)(i) of the Order, the Company could draw energy only to the extent of 50 per cent of its monthly consumption.
As the shortage of energy became more acute the Secretary of the Power Department sent a note to the Governor dated May 3, 1977 stating that there was a large gap between demand and availability of energy and that overriding public interest, particularly the need to maintain food supply, required that units which were heavy consumers of energy should be subjected to further cut in the consumption of energy.
It was particularly pointed out that as the Company was itself generating energy at Renusagar, it will have more than 50 per cent of energy even if the Board 's supply was completely withdrawn.
The Governor approved that proposal on June 1, 1977.
A proviso was inserted in cl. 6(a) (i) of the U.P. Electricity (Regulation of Distribution and Consumption) Order, 1977 in June 2, 1977 according to which an industrial consumer having its own source of generation of energy from which it obtained 50 per cent or more of its consumption would suffer a cut of 100 per cent in the energy supplied by the UPSEB.
The company was given time to bring about the total cut.
Fresh elections were held to the State Legislature Assembly, and the new Cabinet was sworn in on June 23, 1977.
It decided to reduce the supply of energy to the company to zero, in pursuance of the amendment dated June 2, 1977 and called for a fresh note on the position regarding the generation and distribution of energy.
The Chairman of the UPSEB prepared a note on August 26, 1977, in which he pointed out the shortage of energy, including substantial fall in the generation of thermal energy, and in the "import" of energy.
The State Government made an order on September 19, 1977 called the U.P. Electricity (Regulation of Supply Distribution, Consumption and Use) Order, 1977.
That order was made for maintaining the supply and securing equitable distribution of electrical energy, and to provide for regulating the supply, distribution, consumption and use thereof.
Clause 6 of the order which provided for compulsory cut in consumption of energy and demand, affected the company.
711 The clause provided as follows: "6(a)(i): In respect of electrical energy consumed by all large and heavy power industrial consumers receiving power at 33 kv.
and above excepting fertilizers, from the U.P.S.E.B. a cut of 50 per cent in their monthly consumption of electricity both in respect of energy and demand shall be exercised: Provided that where any such industrial consumer has his own source of generation of energy which alone enables him to obtain 50 per cent or more of his total consumption, then a cut of 100 per cent in the energy supplied by the UPSEB shall be exercised.
" Being aggrieved by the compulsory cut imposed by the Government the company filed its third writ petition against the order.
The company 's earlier writ petitions were dismissed as withdrawn.
The High Court took the view: (a) that it was the statutory obligation of the UPSEB to supply electrical energy to a consumer and held that the Pipri Bus Bar was a "distributing Main" under s.2(o) and was an electricity supply line as defined in s.2(f) of the Act; (b) section 22B of the Act did not confer power on the State Governments to cut off supply of energy to existing consumers or to issue an order that certain preferences will be followed in supplying energy, (c) though the company deserved the writ, it could not be said that UPSEB had deliberately under utilised its generation capacity, and held the first proviso to Clause 6(a)(i) of the order ultra vires, quashed it and directed the UPSEB to supply electrical energy to the company in accordance with law, without taking into consideration, the provisions of the said proviso.
Appeals were filed in this Court by the State and the Company, the State being aggrieved because the High Court had interfered with the U.P. Electricity (Regulation of Supply, Distribution, Consumption and Use) Order, 1977 dated September 19, 1977 made under section 22B of the Electricity Supply Act, 1910 and the Company felt aggrieved on the ground that the High Court had not granted all the reliefs which it had claimed in its petition under article 226 of the Constitution.
In the appeals it was contended: (a) Only the energy which was generated by the Board could be the subject matter of an order under section 22B of the Act and it was not permissible for the State to take into account the energy generated by the Company for its own use.
(b) Sub section
(1) of section 22B of the Act was confined to a licensee and would not be applicable to the energy supplied by a sanction holder under section 28.
(c) The only permissible preference was that under s.22A in favour of an establishment mentioned in it and the preference shown to individual consumers was illegal.
(d) The validity of the Order, which was by way of subordinate legislation, was open to judicial scrutiny; the subjective satisfaction of the State Government in making it was open to challenge in a court of law, the order suffered from the vice of malice in law; it had been made in the colourable exercise of 712 the power under section 22B of the Act simply to compel the company to agree to the payment of a higher rate for the supply of energy to it.
While making the order the State Government failed to take into consideration the facts that the production of aluminium was of considerable importance to the national economy and that the Board was capable of generating more energy but was not doing so.
The issue of the Order was really a colourable exercise of the State Government 's power under section 22B of the Act as power was supplied indiscriminately to new consumers after imposing a cut on the Company 's consumption of energy.
(e) The Board had deliberately reduced its thermal generation.
^ HELD: 1.
The High Court erred in taking the view that the Pipri Bus Bar, which was composed of a set of conductors which were made up of thick aluminium core steel reinforced cables, was a 'distributing main ' under section 2(e) of the Act and was an electric supply line as defined in section 2(f) and that cl.
VI of the Schedule to the Act would be fully applicable to the Board in so far as its obligation to the Company was concerned.
In view of the second proviso of section 26 of the Act of 1948, the provisions of cl.
VI of the Schedule to the Act could apply to the U.P.S.E.B. in respect of that area only where distribution mains had been laid by the Board and the supply of energy through any of them had commenced.
[724B F] The High Court, therefore, erred in taking the view that the Board was bound by the term of cl.
VI of the Schedule to the Act to supply energy to the Company within one month of the making of a requisition or within such longer period as the Electrical Inspector might allow.
But even if the Board was under an obligation to supply energy to every person, the fact nevertheless remained that the State Government had the over riding power to provide, by order made under section 22B of the Act, for regulating the supply, distribution, consumption or use thereof.
Sub section
(2) of that section categorically states that, without prejudice to the generality of the power under sub section
(1), the order may direct the Board not to comply with any contract, agreement or requisition for the supply of energy.
[725B D] 2.
Sub section
(1) of section 28 of the Act in terms refers to and deals with, engaging by a non licensee, in the business of supplying energy to the "public".
It was, therefore, futile to contend that what was generated by the Renusagar Power Company was not meant for supply to the public, but was the Company 's own energy.
It is true that generation became, in the circumstances, the "captive" generation for the use of the Company, but that was far from saying that, in the eye of law, it was not energy meant for supply to the public or that it was not amenable to control under section 22B.
It was therefore also liable to equitable distribution by an order under section 22B of the Act.
[725G 726A] 3.
The expression "energy" had been defined by cl.
(g) of section 2 of the Act to mean electrical energy, generated, transmitted or supplied for any purpose or used for any purpose except the transmission of a message.
It was therefore a pervading definition and there was no reason why energy generated and supplied under section 28 of the Act should not fall within its sweep.
[726B C] 4.
Though the use of the article "the" in sub section
(2) was not quite appropriate, there was no justification for the argument that section 22B was applicable only to licensees and not to a sanction holder under section 28.
[727C] 713 5.
What section 22B of the Act authorised the State Government to do, was to make an order providing for 'regulating" the supply, distribution, consumption or use of energy.
[727D] 6.
A distinction between 'regulation ' and 'restriction ' or 'prohibition ' had always been drawn. 'Regulation ' promotes the freedom or the facility which is required to be regulated in the interest of all concerned, whereas 'prohibition ' obstructs or shuts off, or denies it to those to whom it is applied.
The High Court went wrong in thinking that the order had the effect of prohibiting the supply of energy to the Company, which was an 'exciting consumer '.
[727G 728C] Municipal Corporation of the City of Toronto vs Virgo, ; Attorney General for Ontario vs Attorney General for the Dominion and the Distillers and Brewers ' Association of Ontario, ; Birmingham and Midland Motor Omnibus Co. Ltd. vs Worcestershire County Council, Tarr vs Tarr. ; The Automobile Transport (Rajasthan) Ltd. vs The State of Rajasthan & Ors., [1963] 1 SCR 491; State of Mysore vs H. Sanjeeviah, ; ; Fatehchand Himmatlal & Ors.
vs State of Maharashtra etc.
; at p. 851. 7.
What had been ordered was no more than a cut of 50 per cent in the monthly consumption of electricity and not a total prohibition of consumption of energy.
That was a step in the direction of regulating the consumption of energy, and not a total prohibition as envisaged in the proviso to cl. 6(a) (i) of the Order.
[728E] 8.
The proviso operates in a special or particular field and for a particular purpose where it was considered necessary for regulating the supply etc., of the energy in the interest of the other consumers, for section 22B was mean to maintain the supply and secure the equitable distribution of energy to all concerned.
The High Court did not properly appreciate that aspect of the matter.
[728F] 9.
Large and heavy industrial consumers of the category in cl.
6(a)(i) are a class by themselves and it is hardly permissible for them to complain that the small preference shown to agriculturists in supplying energy for their water pumps or tube wells, or in energising State tube wells, supplying water to them, or the supply of energy to small scale industries had really created a privileged class of consumers or brought into existence any such concept of priorities as to run counter to or defeat the objective of bringing about the equitable distribution of energy by an order under section 22B. The High Court had no real justification for recording an adverse finding against the State on the question of the so called preference or priorities.
[729G H, 730B] 10.
There was no doubt that the State Government formed its opinion about the necessity and expediency of making the Order for the purpose of maintaining the supply and securing the equitable distribution of energy at a time when that was called for and this Court cannot sit as a Court of appeal to examine any and every argument in an attempt to show that the opinion of the State Government was vitiated for one fanciful reason or the other.
[731 G H] 11.
Although the U.P. Electricity (Regulation of Supply, Distribution, Consumption and Use) Order, 1977, had been made on the ground that the State Government was of the opinion that it was necessary and expedient for main 714 taining the supply and securing the equitable distribution of electrical energy, to provide for regulating the supply, distribution, consumption and use thereof, it did not deal with all those matters in detail.
In fact it may well be said to be an order relating essentially to compulsory cut in the consumption of energy.
But that cannot detract from the basic fact that the order had the sanction of section 22B of the Act and subserved the main purpose thereof.
Therefore its validity was not open to challenge as a piece of subordinate legislation.
[732G 733B] 12.
Malice in law is another aspect of the doctrine of ultra vires.
An offending Act can be condemned simply, for the reason that it is unauthorised.
Bad faith has often been treated as interchangeable with unreasonableness and taking a decision on extraneous considerations.
In that sense, it is not really a distinct ground of invalidity.
It is well settled that if a discretionary power has been exercised for an 'unauthorised purpose ' that is enough to invite the Court 's review.
[733 D] Roncarelli vs Duplessis, p. 141 (Canada Law Reports); referred to.
In the instant case, the Company had not been able to establish malice in law, merely because of what the Chief Secretary said in his press statement dated July 8, 1977, or what the Minister informed the Assemble.
It may well be that the new State Government was dissatisfied with the new agreement which had been entered into at the instance of the political party which was then in power, but it could not be said that the new Minister 's desire to examining the validity or propriety of that agreement arose out of any extraneous or improper consideration so as to amount to malice in law.
[734H 735A] 13.
Although the High Court arrived at the conclusion that the company deserved the writ which it granted, it did not find it possible to hold that the UPSEB, had deliberately under utilised its generation capacity.
That was a finding of fact which did not call for interference.
[736E] 14.
As long as the dominant motive was proper and reasonable, and was not sullied by a mere pretext, the Order based on it would be valid when it was well within the due scope and policy of the Act and was an honest attempt to deal with the situation for which the power to make the order had been granted by the Act.
There was thus no justification for the argument that there was malice in law on the part of the State Government in making the order.
[736G, F] 15.
That distribution can be said to be "equitable" which is "just and right under all the circumstances of the particular case".
The High Court had recorded a finding that there was shortage in the generation of energy when the order was made.
The fact remains that the demand for energy was far in excess of the supply from all sources available to the UPSEB.
It had also been well established that a situation had arisen when it became necessary to obtain an order from the State Government about the course of action to be adopted by the Board.
Self contained notes were therefore drawn up in March, 1977 and on May 24, 1977.
June 28, 1977 and August 26, 1977, which were quite detailed and objective and led to the making of the Order.
The Order was a genuine attempt to secure equitable distribution of energy.
It was true that the Company was the worst sufferer under cl. 6 (a)(i) of the Order, but then it was also the greatest consumer.
[737C F] 715 16.
From the Chief Secretary 's letter dated November 20, 1968 it appeared that the State Government had assured the Company that it would meet the interim requirement of the Company for 2 or 3 years from the UPSEB and facilitate the parallel running of the Company 's new power station in addition to the station which had been set up at Renusagar.
But the State was not a party to the agreement dated November 30, 1976 for the supply of additional 30mw.
because the agreement was made between the Company and the UPSEB.
It was expressly stated in that agreement that it would be subject to the provisions of the Electricity Acts of 1910 and 1948 and the rules and regulations thereunder, including the amendments thereto.
Care was also taken to provide that the UPSEB shall not be responsible for damages or diminutions in the supply of energy according to the orders issued by the State Government.
A similar provision was made in the earlier agreement of 1959.
In the Board 's letter to the Company dated September 2, 1972 reference was specifically made to the State Government 's power to "control the distribution and consumption of energy under section 22B of the ." [739A D] 17.
Decisions in the matter of restrictions to be imposed on the consumption of energy on account of acute shortage of energy in the State, were taken by the different State Governments, including the Governor 's Advisors, and it cannot be said that the cuts were imposed suddenly, or without due regard to the company 's difficulties in reducing its consumption of energy in the manner directed by the order.
It cannot therefore, be said that the State wantonly disregarded its contractual obligation to the company.
[739E F] 18.
Sub section (2) of section 22B of the Act specifically provided that it was permissible for the State Government to direct by the order that the UPSEB shall not comply with the provisions inter alia of any contract made by it.
A direction to that effect was expressly made in cl. 11 of the Order, and so it is not permissible for the company to complain on that account.
[739G] 19.
Craics on Statute Law (7th Edn.) pages 357 58 has mentioned six different classes of enactments which are considered as having ceased to be in force.
These six have been mentioned as the enactments which are selected for inclusion in the Statute Law Revision Acts of England as having ceased to be in force otherwise than by express repeal, or having by lapse of time or otherwise become unnecessary.
[740G, 741D] The question is whether the order could be said to have "spent" itself or become "obsolete".
Whether a piece of legislation has spent itself or exhausted in operation by the accomplishment of the purpose for which it was passed, or whether the state of things contemplated by the enactment has ceased to exist are essentially questions of fact for the legislature to examine, and no vested right exists in a citizen to ask for a declaration that the law has been impliedly repealed on any such ground.
[741E F] 20.
The power to legislate is both positive in the sense of making a law, and negative in the sense of repealing a law or making it imperative.
In either case it is the power of the legislature, and should lie where it belongs.
In an extreme and a clear case, no doubt, an antiquated law may be said to have become obsolete the more so if it is a penal law and has become incapable of user by a drastic change in the circumstances.
But the judge of the change should be the legislature, and courts are not expected to undertake 716 that duty unless that becomes unavoidable and the circumstances are so apparent as to lead to one and only one conclusion.
This is equally so in regard to the delegated or subordinate legislation.
[741G 742A] Elwood Hamilton vs Kentucky Distilleries & Warehouse Co., ; ; Chastleton Corporation vs A. Leftwich Sinclair, ; ; Nashville, Chattanooga & St. Louis Railway vs Herbert section Walters, ; ; The Union of India vs Ram Kanwar & Ors., ; ; referred to.
The Petition of the Earl of Antrim & 11 Other Irish Peers, ; distinguished.
The High Court found three facts (i) the shortage in the reservoirs for generation of hydel energy had ceased, (ii) further supply of energy was available from newly commissioned units, and (iii) fresh power connection had been given by the UPSEB, but lost sight of the important fact that it was all along the case of the State that hydel energy was only one third of the total generation, and that generation of thermal energy which met two third of the total requirement had declined for reasons beyond the control of U.P.S.E.B.
The High court did not therefore undertake a careful examination of the facts, and took some new connections into consideration without attempting to examine their magnitude and effect on the overall generation and availability of energy from all the sources.
The High Court therefore erred in taking the view that the continuance of the Order was no longer justified.
Even so, the High Court abstained from striking down the whole of the Order and merely declared that the provision of the first proviso to cl. 6(a) (i) was ultra vires, and quashed it.
[743C F] 22.
Even though the proviso is valid and has wrongly been quashed by the High Court, it is not necessary to restore it in view of the statement of the Solicitor General, so that it shall not be deemed to form part of cl. 6(a)(i) of the Order.
But it there is deterioration in the generation of energy again, or there are other sufficient reasons, within the purview of section 22B of the Act to reinsert the proviso, in the present or modified form, it would be permissible for the State Government to do so accordingly to the law.
[743G H, 744C]
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